Contributions to Reserve Fund

Contributions to the association reserve fund are funds derived from the current years income or dues only.  Money transfered into the reserves that came from closed accounts or mature CDs are not contributions and thus cannot be counted as such.  Money transfered from funds left over from previous years are not contributions either they are repayments of money not contributed or are just transfers into the fund.

Every person who holds title to a condo needs to be aware of this.  If your annual financials do not show contributions as an expense you will need to calculate it.  Take the reserve balance from the previous years balance sheet and subtract it from the most current balance sheet reserve balance.  The difference is the net contribution after reserve expenses.  Take that number and the most current balance sheet and subtract it from the amount of surplus shown under owners equity.  This will tell you how much the checking account has increased.  To verify this take the most current balance sheet and subtract the checking balance from the checking balance on the previous years balance sheet.  The two should match.  Here is an example.

                                            2009                      2008                      Difference
Checking balance of         47,761.14                22,308.08               30,111.77
Reserve Balance             144,834.16              107,107.19              33,068.28
2009 Surplus on Balance Sheet                                                     $63,180.03

The reason for the surplus to be so large is that the contributions on the income statement does not include contributions deriving from the 2009 dues collected.  Therefore, the surplus shown on the balance sheet includes both the contributions and the amount of dues that were not used to pay expenses. 

Because the $30,111.77 there is not any large sums of money owed the association from a suit or any accounts this far past due and only a compilation audit is completed which will not reveal any vendor over-payments or charges.  This money is unspent dues period. 

Arizona state law 33-1254 says that any surplus money left from the current year dues is to be refunded to the owners or credited to their accounts to offset dues.  This means anyone who owned a home in the community for any length of time in 2009 is owed a partial or full refund of the over paid dues. 
Condos are personal property and cannot legally be held for investment purposes.  Any surplus money not spent is a profit causing an investment to be created into the HOA.

This means that every person who held title to a home in Indian Bend Village Inc. a non-profit aka Suntree is owed $14.42 per month for part year owners or $173.05 for full year owners.  If this money is not refunded not only does it violate state law but it also violates the declaration. 

Surplus money cannot be used for whatever the board wants to spend it on.     Spending money on the common area other than the common area in front of the homes has no benefits.  The amount of money spent on major redesign projects will be so insignificant that it isn't worth mentioning.  If landscaping returns 15% then a 173.05 per owner project would could only get a return of 25.00.  Spending 173.05 to get 25.00 makes no financial sense at all!


Every owner of a condo in Ariozna should be aware how to determine the surplus dues and that it is legally required to be refunded.

Audits Are Not A Witch Hunt

I'm amazed at the number of HOA boards that are scared to have a full audit.  Full audits are not a witch hunt nor are they intended to cause finger pointing within the community or management.  The intent behind them is to find errors. 
 

Increasing Interest and Desire

I recently read that mature trees can increase home values up to 7% on average.  It really kinda upsets me to read or hear people say this because it isn't completely accurate.  Here's why.

HOA Relents, Gives Disabled Vet New Handicapped Parking Space - Denver News Story - KMGH Denver

Who advised this board? I think it may be time to fire the management company and their attorney.

HOA Relents, Gives Disabled Vet New Handicapped Parking Space - Denver News Story - KMGH Denver

Disabled Vet Battles HOA Over Handicap Parking Space - Denver News Story - KMGH Denver

It really just doesn't get much worse than this. I think this board may be the lowest common denominator. Learn from others.


Disabled Vet Battles HOA Over Handicap Parking Space - Denver News Story - KMGH Denver

Maintenance Schedule

I tried to post this as a form that could be edited but was unable.  But, I was able to do it as a picture.  If you know how to convert it to a document it should convert perfectly as a .doc, .pdf, or open office document.  Edit this form anyway needed to fit your needs.    

Getting the Most Bang for Your Buck

My experience has been that board members approve bids based on price only.  Making decisions in this manner shows how little respect they have for the other owners. Value has yet to be considered in the discussion process when determining how board members vote.  Questions usually asked to determine value like; the company's reputation, designations earned, experience, warranty, maintenance requirements, or even cost of maintenance are never asked!  It's really very shocking to say the least.

  It's just basically reading the bids aloud then a vote.  Do they manage their own money this way or just the association funds?  Determining if something is a good value can be different for everyone and situation.  Some may think that versatility to ease of changing with the trends cheaply is more valuable than something elaborate that costs less.  Versatility equals lower maintenance costs, and thus costs less in the long run.  Where as something elaborate may cost less upon install will cost more over the long run, but both items should be build to last regardless of which is chosen.  For the HOA value has to include; versatility, total costs over the life of the item, warranty, company's reputation, quality, etc.  All of these characteristics at the very least must be considered to determine value, but more often than not are not considered.     

Marketing - Whose Responsible For Doing It?

To answer the question you first have to ask yourself this question.

1.  Does our HOA Association own a golf course, retail space, offer any kind of club facilities that require membership, who can be a member of it, or other means of generating revenue from the public?

Landscape Conversions Are they Worth It?

It's hard to not get angry at board members for doing landscape conversion because it doesn't make any sense.  Landscapers make out like a bandit and the community is left holding the bag.  I know, I've been told by landscape companies that we should convert some of the common area to desert landscape.  The never tell you why it should be done. 

Can Anyone Answer This Question?

More and more I'm seeing shrubs shaped like mushrooms.  It's not like it's a young shrub that is being trained into a tree that is just in transition.  These are old shrubs and very very large evergreen shrubs being shaped like mushrooms.

Are they trying to send a message that they want to nuke their yard out of frustration?  Are they supporting nuclear war?  Is it representing psychedelic mushrooms or what?

The first thing you see when you drive into a community or anywhere for that matter is the landscaping.  The shape of the plants and trees direct your eyes to look at whatever the focal point is.  If the any of the plants are shaped like a mushroom my eyes stay focused on that and that only.  Which means I'm looking down at the ground or looking straight up and nothing else exists from then on.  All I will remember is, that place with the mushroom shaped plants. 

Why do you think they shape them like mushrooms?  It's an odd way to be remembered.

Something Funny I Have to Share

I read the funniest thing in an article written by Sami Becker.  She has an article called Sami's Smackdown.  In this one she explains how she loves to sit and read her e-mails while enjoying her first cup of Joe every morning.  So, this month she shared some of them with us and I had to share them too.

These are the best typos I've seen in a long long time.  Hope you enjoy them as much as I did. 

Rules to Live By

Rules every community board member and officer should live by.

1.  Keep it simple.  It's easy to complicate things.  It's the genius that keeps things simple.

2.  Use forms to make decision making easy.

Lighting

Something most community board members don't think about is lighting.  Something as simple as landscape lighting can make a seemingly drab unexciting or simple landscape just pop.  Adding lighting is one of the easiest ways to create interest without costing a huge amount of money. 

Payment Options

We hear it in commercials how using electronic transactions is easier than paying with checks.  How you can save time by having your account drafted every month.  And how you can use Bill Pay via your bank and send payments for monthly bills.  All of these methods are said to make our lives easier somehow.  It isn't our lives they are trying to make easier, it is their own!

People don't seem to understand how all this electronic banking works.  There are positives and negatives to all of it.  But, here's the skinny of it all.

Why Gypsum Should Not Be Used on Soil

 

GYPSUMIn its monoclinic form

If you have clay soil, you've noticed that it's hard and doesn't accept water easily.  The reason for this is because clay can contain lime and gypsum.  But, what is gypsum?  Mined gypsum in it monoclinic state is crystallized.  When gypsum is manufactured into a massive or foliated form is green, yellow, or black based on impurities. Manufactured gypsum is a product of the action of sulfuric acid on calcium containing minerals.  It exists in clay as a result of the action of sulfuric acid on limestone. 

Artificial gypsum is a result manufacturing phosphoric acid once the phosphoric rock which contains tri-calcium phosphate is treated with sulfuric acid.  It's compacted into blocks and wall board or gypsum board and used to construct non-supporting walls.  New homes contain up to 7 metric tons of gypsum.  When gypsum is heated to 242 degrees it losses it's water and becomes Plaster of Paris.  When water is added to Plaster of Paris it dries into a hard solid piece of gypsum.  This form of plaster is desired because of it's ability to swell and seal joints.

Uncalcined (unheated) gypsum is used to fertilize arid, alkaline soil is also used to retard Portland Cement.   This kind of gypsum is uncalcined gypsum is called "Land Plaster".

If irrigating the soil is proving to be difficult it could be because your soil falls into one or both of theses classifications.  Aridsols soils occur in dry regions and are low in organic material, leaching will be insufficient to remove soluble materials such as lime, gypsum, and salt.  The World Reference Base for Soil Resources, "Gypsisols are characterized by a subsurface layer of gypsum (a hydrated calcium sulfate) accumulated by the precipitation of calcium and sulfate from downward percolating waters in the soil profile."   Encyclopedia Britannica   This type of soil requires intensive irrigation management.    

To see a photograph of what Gypsisols look like in the US use the link below.
 http://www.britannica.com/EBchecked/media/19555/Gypsisol-soil-profile-from-the-United-States-showing-a-white

Using gypsum will only make everything worse not better.  So, why would we add gypsum or sulfur to the hard clay soil in an Arid region when the goal is to remove it from the root zone?  Where we have been listening to our landscapers they have been telling us to use something that will ultimately cause our soil to become as hard as plaster!  Why would they do this?

First determine if you have a large gypsum deposit in the soil's subgrade.  If so, cash in on it if you can otherwise it's time to amend your soil.  If the problem is large amounts of gypsum you need to dig to the bottom of the deposit and amend the soil.  This could mean digging several feet down before adding amendments so the soil will drain and can be leeched later. 
For clay soil you need to add the organic matter back to the soil, NOT SAND OR TOP SOIL.  To do this mix into the soil either by hand or with a tiller going about 2 foot below the surface then add 3 inches or more of hummus; Peat moss or Pro-Mix.  Pro-Mix contains the good bacteria and fungi that exist in fertile soil.  The decomposed material and incomplete decomposed material return the gasses and organic matter back into the soil that is usable.  It will also prevent water from bonding to the minerals on the surface of the soil and allow it to be absorbed and utilized by plants.  You may also notice that the soil will be cooler and easier to dig in. 

Anywhere that man has touched the land the balance of organic matter has been lost.