New rule for fines and an assessment collection policy
In the Board’s last newsletter, we shared one of the documents given to the Board by J&M Management Company – the Rule on Fines. The HOA’s attorney brought to our attention that the Rule is very weak and inadequate. For example, the procedure for implementing fines is cumbersome and requires at least monthly follow-up and further letters from the Board if fines continue due to continuing non-compliance. The Board is considering a new Rule on Fines, which is much clearer and easier to use. In addition, we are looking at a new Assessment Collection Policy.
Section 2.6 of our CCRs states the Board has the power to adopt, modify and amend rules and regulations so long as they are consistent with the CCRs. Regarding an Assessment Collection Policy, section 3.9 of the CCRs says the HOA can charge a 12% annual interest rate on delinquent assessments. The CCRs are silent regarding late charges, which means we can charge them at a reasonable rate. Our attorney recommends a serious monthly late charge, with the intent to provide an incentive for paying the fees.
So, you know what to expect, the process for adopting and implementing new rules follows:
The Board determines the Rule and/or Policy it wishes to adopt.
The Board adopts at an official Board meeting and it is dated and signed by all Board members.
Copies of the adopted Rule and/or Policy are mailed to ALL owners with a Board cover letter explaining what is being sent to owners and the date the Rule or Policy will go into effect.
