Gardening Resource

The National Gardening Association offers numerous free online newsletters to homeowners covering urban and small-space gardening, vegetable and fruit gardening, craft and cooking projects and specific gardening information by geographical region. Newsletters include feature articles, tips and resources. To sign up go to www.garden.org/subscriptions.

Starting Strong, Moving from the Developer

The Virginia Real Estate Board posts the following information on Taking Those First Steps- A newly elected homeowner board should take several steps when transitioning from the developer's management to identify and preserve potential claims. These steps include:

Select Independent Legal Counsel

Select Independent Management

Collect All Relevant Documents

Determine the Physical Condition of the Property

Determine the Financial Condition (check that developer has paid all required capital contributions and all regular and special assessments that it owes, including any accrued interest and/or penalties.)

Evaluate additional Transition Areas (in particular any contracts entered into by the Developers)

Assert Claims stemming from Audits and Inspections

Determine Potential Defendants with any Issues Relating to the Developer

Parking Policy- Questions to think about!

When sculpting a parking policy, here are a few questions from different perspectives that it will be important to think about:

The Association's Perspective
*Is the parking policy working?
*Why don't residents appreciate the value of compliance?
*Do all residents know about the parking rules?
*Has the need to provide handicapped parking places further limited the number of available spaces?

The Owners' and Residents' Perspective
*Why don't we have reserved parking?
*Why can't I park my service van in front of my own home?
*Where are my guests supposed to park?

Keep these considerations in mind as the association embarks on either drafting new rules from scratch or revising outdated rules. Understand that the association may be saddled with built-in parking problems--it seemed like a good idea at the time to the developer or a former board--but, the current situation isn't meeting the association's needs.

Consider the various perspectives and needs of those involved--the association, the owners, the residents, and their guests. With these things in mind, the association is now ready to solve its parking problems.

Accounting: Accrual versus Cash

Accural Accounting is a method that records revenues and expenses when they are incurred, regardless of when cash is exchanged. The term "accrual" refers to any individual entry recording revenue or expense in the absence of a cash transaction.

Cash Basis Accounting is an accounting system that doesn't record accruals but instead recognizes income (or revenue) only when payment is received and expenses only when payment is made. There's no match of revenue against expenses in a fixed accounting period, so comparisons of previous periods aren't possible.

Beyond Lawn Care

Wooded areas, meadows, streams, and ponds are features that add value to communities. These features enhance property values, increase aesthetic appeal, improve environmental quality, eliminate noise and wind, and reduce energy bills.

The responsibility to maintain the natural areas goes beyond the capabilities of the lawn care provider, so it’s up to us to properly maintain all our common ground—-landscaped and natural.

That’s why the association pays attention to water resources and quality, wildlife habitats,
and species diversity. Proper maintenance and management will benefit the local ecosystems and save the association money.

Important to remember:
* Use a licensed contractor with references
* Make sure your contactors has insurance
*Have a detailed contract signed with your contractor
* If you have homeowners that want to help out, make sure you have worker's compensation insurance and a waiver approved by your legal counsel.

Why Do We Need Reserves?

Equipment and major components (like the roofs) must be replaced from time to time, regardless of whether we plan for the expense. We prefer to plan and set the funds aside now. Reserve funds aren’t an extra expense—they just spread out expenses more evenly. There are other important reasons we put association monies into reserves every month:

1. Reserve funds meet legal, fiduciary, and professional requirements. A replacement fund may be required by:
*Any secondary mortgage market in which the association participates (e.g., Fannie Mae, Freddie Mac, FHA, VA).
* State statutes, regulations, or court decisions.
*The community’s governing documents.

2. Reserve funds provide for major repairs and replacements that we know will be necessary at some point in time. Although a roof may be replaced when it is 25 years old, every owner who lives under or around it should share its replacement costs.

3. Reserve funds minimize the need for special assessments or borrowing. For most association members, this is the most important reason.

4. Reserve funds enhance resale values. Lenders and real estate agents are aware of the ramifications for new buyers if the reserves are inadequate. Many states require associations to disclose the amounts in their reserve funds to prospective purchasers.

5. The American Institute of Certified Public Accountants (AICPA) requires the community association to disclose its reserve funds in its financial statements.

Why Scoop the Poop?

Besides being a nuisance, uncollected dog waste is a serious problem for our association. Next time you’re tempted to leave your dog’s droppings on the lawn, please remember these facts:
1. The Environmental Protection Agency is becoming aggressive about enforcing the Clean Water Act. Our association could be fined if dog waste goes uncollected.
2. Uncollected dog waste may lead to a special assessment. If fined by the EPA, the association could face a potential special assessment that would be levied against all members—not just dog owners.
3. The appearance and quality of the common areas are known to affect home sales—not just whether and for how much they sell, but how quickly.
4. The more residents complain about dog waste, the more time the manager must spend on enforcement rather than serving the association.
5. Uncollected dog waste spreads disease and attracts rodents who feed on pet waste.

Ten Reasons to Volunteer for the Association

Here are 10 great reasons to give your community when you make the volunteer pitch:

1. Protect your self-interests. Protect your property values and maintain the quality of life in your community.
2. Correct a problem. Has your car been towed, or do you think maybe maintenance has been neglected?
3. Be sociable. Meet your neighbors, make friends, and exchange opinions.
4. Give back. Repay a little of what’s been done for you.
5. Advance your career. Build your personal resume by including your community volunteer service.
6. Have some fun. Association work isn’t drudgery. It’s fun accomplishing good things with your neighbors.
7. Get educated. Learn how it’s done—we’ll train you.
8. Express yourself. Help with creative projects like community beautification.
9. Earn recognition. If you would like a little attention or validation, your contributions will be recognized and celebrated.
10. Try some altruism. Improve society by helping others.

Here’s What HOA Residents Have to Say

Americans who live in community associations are overwhelmingly pleased with their communities, expressing strong satisfaction with the board members who govern their associations and the community managers who provide professional support.

More than seven in 10 community association residents expressed satisfaction with their community experience, according to a survey conducted by Zogby International, a leading public opinion research firm. Almost 40 percent of community association residents say they are "very pleased," with only 10 percent expressing some level of dissatisfaction. Almost 20 percent express neither point of view.

An estimated 54 million Americans live in some 274,000 homeowner associations, condominium communities, cooperatives and other planned developments.

Here’s what community association residents say:

88 percent believe their governing boards strive to serve the best interests of the community.
90 percent say they are on friendly terms with their association board members, with just 4 percent indicating a negative relationship.
86 percent say they get along well with their immediate neighbors, with just 5 percent reporting a negative relationship. Of those who reported issues with neighbors, the most common problems were pets, general lifestyle, noise, and parking.
78 percent believe community association rules "protect and enhance" property values, while only one in 100 say rules harm property values. About 20 percent see no difference.
88 percent of residents who have interacted with professional community managers say the experience has been positive.

The research was sponsored by the Foundation for Community Association Research, a non-profit organization created in 1975 by Community Associations Institute (CAI). Based on telephone interviews conducted in August 2005, the survey has a margin of error of +/- 3.5 percentage points.

Order of Power: Governing Documents

When a community is governed by a master association policy and the community association policy, the question of which association policy supersedes the other is bound to come up. The basic rule of thumb is the higher document, being that of the master policy, overrides the lower document, the community policy. The exception is if the lower document is more restrictive than the higher document.

For example, if the master policy says that dogs are allowed in the community, but the community policy says that dogs 30 pounds and less are allowed in the community, then the lower document, the community document, trumps the master document.

As always, the association’s attorney can shed light on specific issues beyond this general rule of thumb and its exception.

Votes During Executive Session

Can votes be taken in an executive session?

Yes, votes can be taken in executive session. Proceedings in an executive session are secret, but are not restricted in any other way.

Spectrum of Motions that Stall or Stop

Withdraw/Modify Motion: Applies only after question is stated; mover can accept an amendment without obtaining the floor.

Commit /Refer/Recommit to Committee: State the committee to receive the question or resolution; if no committee exists include size of committee desired and method of selecting the members (election or appointment).

Lay on the Table: Temporarily suspends further consideration/action on pending question; may be made after motion to close debate has carried or is pending

Take from the Table: Resumes consideration of item previously "laid on the table" - state the motion to take from the table

Postpone Indefinitely: Kills the question/resolution for this session - exception: the motion to reconsider can be made this session

With Springtime Comes Flags

Spring time means that flags are going up across communities.

If your community fals with the Property Owners Act (POA): § 55-513.1. Flag display; necessary supporting structures; affirmative defense.

A. Unless specifically prohibited by the association's rules and regulations or architectural guidelines provided in the disclosure packet required pursuant to § 55-512, the association shall not prohibit any lot owner from displaying the flag of (i) the United States, (ii) the Commonwealth, (iii) any active branch of the armed forces of the United States, or (iv) any military valor or service award of the United States.

B. In any action brought by the association under § 55-513, the lot owner shall be entitled to assert as an affirmative defense that the required disclosure of any limitations pertaining to the display of flags or any flagpole or similar structure necessary to display such flags was not contained in the disclosure packet required pursuant to § 55-512.


If you are subject to the Condo Act:

Dog Expelled by Condominium

The Commonwealth of Virginia has an interesting article regarding a dog that was removed from a property adn reinstated damages to the owners.

Check it out here.

Balance Sheet Components

Balance Sheet Components

A balance sheet provides detailed information about a company’s assets, liabilities and members’ equity.

Assets are things that a community owns that have value. This typically means they can either be sold or used by the community to provide services that can be sold. Assets include physical property, such as plants, trucks, equipment and inventory. It also includes things that can’t be touched but nevertheless exist and have value, such as trademarks and patents. And cash itself is an asset. So are investments a community makes.

Liabilities are amounts of money that a community owes to others. This can include all kinds of obligations, like money borrowed from a bank, vehicle leases, money owed to suppliers for materials, payroll, environmental cleanup costs, or taxes owed to the government.

Members’ equity is sometimes called capital or net worth. It’s the money that would be left if a community sold all of its assets and paid off all of its liabilities. This leftover money belongs to the members, or the owners, of the community.

The following formula summarizes what a balance sheet shows:

ASSETS = LIABILITIES + MEMBERS' EQUITY

A community's assets have to equal, or "balance," the sum of its liabilities and members' equity.

Treasurer Duties

Healthy finances are critical to the sound operation of a community association. The association treasurer is responsible for maintaining the finances and ensuring financial growth. The community’s governing documents outline the specific duties of the position within the structure of the Board.

To highlight a few key responsibilities of a community treasurer:
•The treasurer is the financial voice of the board and the community.
•The treasurer is the board's liaison to the association's auditor. He or she should monitor the progress of the annual audit. Make sure that appropriate tax returns are filed on time.
•The treasurer should implement a reserve program based on an engineering study and make sure it has adequate funding.
•The treasurer should ensure the implementation of an annual operating budget.
•The treasurer should implement safeguards to protect association assets.
•The treasurer may oversee issues such as: insurance, financial records, investment of funds

The treasurer should rely on the management office’s accounting department and controller to provide accurate reports and summaries. The accounting department and controller should also be available for training sessions. Reading the details within a monthly financial statement and understanding the cash flow and balance sheets will help the treasurer have a firm handle on the communities financial well being.

Resale Package 101

With recent reports of a slight increase in pending home sales and mortgage applications in the Washington Metro area, communities can expect to see a corresponding slight increase in resale packages orders. While buyers are required to receive resale packages prior to settlement, few understand the importance of reading all of the material and gaining a strong understanding of the financial reports, audits and governing documents.

Simply put, the resale package is a document prepared by the management company that dictates the financial health of a community and the rules a resident must live by.

The resale package (both certificate for resale and association disclosure packet) must contain the following information:

*The name of the association and the name and address of its registered agent in Virginia, if the association is incorporated.
*Information pertaining to expenditure of funds which requires an assessment in addition to the regular assessment during the current or next fiscal year.
*The amount of assessments and other mandatory charges imposed by the association for the property being purchased, and the status of the seller’s account.
*Information regarding any other entity of facility to which the owner may be liable for fees or other charges once he or she purchases the lot.
*Association financial information, including the current budget, most recent financial statement, and status of reserve funds.
*A description of pending suits or unpaid judgments of a material nature.
*Insurance information, both association and individual owner coverage requirements.
*Information concerning compliance by the seller with the governing documents, including copies of any notices provided to the seller.
*A copy of the current governing documents, and any rules and regulations or architectural guidelines adoptee by the association. Failure to receive copies of these documents does not relieve the purchaser of the obligation to comply with their provisions.
*Certification that the association has registered with the Virginia Real Estate Board.

The certificate for resale for a unit in a condominium association must contain all of the above information, plus:

*Whether the documents create a right of first refusal.
*Whether the condominium is located within a development subject to the Property Owners’ Association Act.
*Information concerning any limitation on the number of persons who may occupy a unit.
*The association disclosure packet to a townhome or home in a property owners’ association must also contain:
*A copy of the cover sheet developed by the Virginia Real Estate Board.

*Information concerning use restrictions, specially related to “for sale” signs and flag display.

Important Questions and Answers

Are the seller’s financial obligations current?
Taking title to a unit with unpaid assessments, fines or other charges may subject the purchaser to liability for paying those outstanding amounts. The purchaser will want to be aware of any fees prior to settlement for payment purposes.

Are the Capital Reserve accounts fully funded?
Reserve funds are collected to replace capital assets (i.e. streets, sidewalks, roofs, etc.) when they reach the end of their useful life. Every five years a reserve study is conducted and measures the life span and anticipated cost of these repairs. The funding for the repairs is acquired by regular payments into a capital reserve account. Inadequate funding can result in special assessments- charges that must be paid in addition to the regular assessment.

What does the Association’s master insurance policy cover?
Who pays the deductible, the unit owner or the Association? Is your personal property, (i.e. furniture, wardrobe, etc.) covered? Have there been many claims in the past? How high is the association’s deductible- meaning what will you have to cover before the insurance kicks in. Ask your insurance agent to evaluate the insurance section of the condominium instruments to determine what coverage you need in addition to that covered by the master policy.

Indemnification defined

What does “indemnification” mean?

Indemnification is the act of making another party "whole" by paying any loss another might suffer.

This is usually seen as a clause in a contract where a party agrees to pay for any losses which arise or have arisen already. In many community association documents, the association “indemnifies” the board members and committees, protecting them, to a degree, from any personal loss as a result of a lawsuit. If you have a management contract, you will probably see a similar clause there.

Open Forum at Board Meetings

What does that really mean?

The Open Forum is that time set aside at a Board of Directors meeting or committee meeting for the owners to make comments, offer suggestions, and ask questions.

Virginia law ensures that, subject to reasonable rules, the Board or executive organ provides a designated period of time during a meeting to allow owners an opportunity to comment on any matter relating to the owners association. During a meeting at which the agenda is limited to specific topics, the comments may be limited to topics on the meeting agenda.

It is important to understand that a 'designated period of time' means the open forum has a beginning and an end. Whether the 'open forum' occurs before or after the business portion of the meeting, it is a discrete period of time.

With the exception of very specific items which may be discussed in executive session, the business portion of the meeting is conducted openly. But the 'open forum' does not extend to the business portion of the meeting. This means the audience should not, on its own initiative, interact, ask questions, offer suggestions, make comments, deride, interrupt, etc. during the business portion.

Both boards and owners should take advantage of the open forum. Many achievements and successful projects of communities have started as just a comment from one interested or irritated owner.

Value of Rules

The National Homeowner Survey found that most community governed properties believed that rules protected and enhanced their communities.

Value of Rules

Do the rules in your community protect and enhance property values, harm them or make no difference?

74% Protect and enhance
3% Harm
22% No difference
2% Not sure

The interesting number was the near quarter of community homeowners who saw no difference in the enhancement of the property, whether rules were enforced or not. Several possible causes could be effecting this, including: rules that are not well written and do not serve a purpose, rules that are not evenly and fairly applied, rules that do not focus on the betterment of the community and communities that waiver in their enforcement.

The heart of the matter comes down to if the purpose and intent of rules are being followed and if there is an enforcement policy. If these two areas are not determined, homeowners will not see benefit in the community governing documents.

Board Member Pearls of Wisdoms

BE A GOOD LEADER
Provide community leadership.
Establish and articulate goals.
Define clear expectations.
Don’t put things off.
Set high standards.
Make thoughtful and timely decisions.
Do what is right, not necessarily what is popular.
Ask others for help and input.
Plan and save for the future.
Build consensus.
Be an advocate.
Encourage strategic planning.
Execute with excellence.

Implementation of the Verizon FIOS Network in Alexandria & Arlington: Frequently Asked Questions

Many residents have contacted City Council members and staff concerning the deployment of the Verizon FiOS network in Alexandria and Arlington. Below are the most frequently asked questions.

Q: What is “FiOS?”
A: FiOS stands for fiber optic services over FTTP (fiber to the premises), an advanced fiber-optic technology that uses strands of glass fiber and laser-generated pulses of light to transmit voice, data, and video signals.

Q: When will FiOS be available to Alexandria and Arlington residents?
A: FiOS should be available in Alexandria and Arlington in late 2009 or 2010. The FiOS network will allow Verizon to provide voice, Internet and cable services. Verizon will need to negotiate a new telephone franchise addressing issues related to the construction of the FiOS network, such as the placement of boxes or poles in the street. They will begin constructing the fiber optic network after the telephone franchise is approved.

Q: Will FiOS be available to all residents?
A: The service area will be determined during the franchise negotiations. Neither Alexandria nor Arlington has the legal authority to require Verizon to provide FiOS services everywhere.

Q: Who should be contacted at Verizon to express our concerns or obtain updates about their plans?
A: Inquiries should be addressed to:

Catherine Hogan Lewis, External Affairs/Government Relations
E-mail: catherine.hogan.lewis@verizon.com
Phone: 703.886.3033

Q: Does Comcast have an exclusive franchise?
A: Comcast does not have an exclusive contract to provide cable and Internet service.