Roads Are Easements Not Planned Communities Or HOAs

[Patricia]

Julie, in answer:

First, I would like to say Thank You for answering my question.

I understand what you have said, but have some additional questions to ask. Perhaps maybe you could answer them as you have my original question.

The voluntary club should use Restricted Road Maintenance Fees, which they collect from OWNERS for Roads- period.

The voluntary club should collect MEMBERSHIP dues from WILLING MEMBERS to pay for non-road, association activities. (This is totally separate from Owners and Roads.)

Any "compensation" the voluntary club feels it is due should be fairly assessed. Renting out the clubhouse, for road related meetings does not cost the voluntary club in excess of $170,000/year. (Which is what they have been skimming from road fees).

Who then pays for the Board of Directors? Costs associated with meetings?

Where in any of the HPPOA financial statements does it state that the road related meetings are costing $170,000.00 a year? Further, isn’t there numerous – for an easier term for all to understand – other “shared expenses” between the road maintenance and voluntary club operations? Such as mailings, which under various circumstances is required. At .73 cents per letter, one mailing a year to all lot owners would cost $5,840.00. Don’t elections require ballots to be mailed? And what about the numerous "recall elections" HPP has endured over the years? More ballot mailings. Isn’t there also a requirement to have one annual mailing of whatever? Isn’t there also shared office expenses? And also, when a lawsuit is filed against HPPOA and its officers and directors, where is the money supposed to come from in order to defend and untimely settle or dispose of these lawsuits?

Any governmental activities (such as, establishing mail service) that are not road related or club related should involve owners and their governmental representatives (county, state). HPPOA should not be acting on any owner's behalf, without their consent. HPPOA is not a quasi-governmental agency.

I don’t really see HPPOA with dirty hands here, but I can agree, that for the USPS, this is a half measure at fixing their original screw up with respect to HPP mail delivery. The arrangement, as I understand it, was the USPS donated the mailboxes and HPPOA sought out and collected voluntary funds from people who desired to have mailboxes convenient to them.

So, if anything, I see HPPOA seizing an opportunity offered by the USPS that does nothing but good for the residents of HPP, nor can I see that any road monies have been or are being spent on this sole issue.

The above would make a lot of owners happy.

I'm sure your answers would make some happy. I just don’t think it's as big as a number as you seem to think it is.

Again, thank you for your answers and I look forward to you possibly answering my follow-up questions.

Hello, Julie.

A LOT of road money has been diverted and spent on the mailboxes- among other things. 

But again this is complicated (the courts and HPPOA made it so). And as an "outsider" I would imagine it is even more difficult to understand. Still, I will try to break it down using HPPOA's own budget outline from 2024/2025:

The following is EVERYTHING PAID FOR WITH ROAD FEE MONEY:

1) Road Maintenance (materials, hauling, contract work, dust mitigation, signage, road striping/marking, speed hump maintenance)

2) Road Improvements Through Bond (debt service, professional fees, and expenses)

3) Shoulder Maintenance 

4) Equipment and Vehicles (maintenance and repairs, equipment rental, equipment hauling, fuel, hydronic oil and grease, vehicle registration/inspection, equipment insurance)

5) Shop (tools and small equipment, shop supplies, shop furniture and equipment, shop utilities)

5) Office (newsletter, outsourced printing ALL postage, rental storage unit for HPPOA's records, rental of postage machine, furniture and small equipment,  office supplies, contract services,  bank charges and fees, annual fees and registration, collection expenses, liens, directors and officers liability insurance, board expenses, crime insurance, meeting expenses merchant service fees, office utilities- telephone and fax, electric)

6) Property (general liability insurance, umbrella policy, property insurance, office repairs,shop repairs, ANNUAL GENERAL FUND COMPENSATION)

7) Professional Fees (audit and accounting, recording secretary, ALL legal, document server, elections, technical, website)

8) Personnel (salaries and wages, payroll taxes and unemployment, employee benefits, temporary disability insurance, workers comp insurance, temporary hires, training, employee relations, payroll service, employee retention/hiring, employee drug screening)

The following are non-road expenses, which are supposed to be paid for with non-road money:

1) Activity Center- what I call "clubhouse" (AC electricity, AC water,  AC propane, AC Janitorial, AC supplies, AC maintenance and repairs, AC grounds, AC fixtures, furniture and equipment, AC events and festivals, AC property tax, property insurance non-roads, professional fees non-roads)

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The Annual General Fund Payment is the $170,000 plus that HPPOA skims from road maintenance fees for "compensation."

As you can see, everything except for the clubhouse is budgeted and paid for with road fee money. Aside from using the HPPOA clubhouse, there is no "compensation" that HPPOA is owed.

A fair compensation for using the clubhouse would be as follows:

12 Board Meetings per year at approx. 3 hours/meeting and $30/hr. (the rental rate) is:
$1,080

3 General Meetings per year at approx. 3 hours/meeting and $30/hr. (the rental rate is:
$270

Approx 72 Committee Meetings per year at approx. 2 hours/meeting each and $15/hour (the rental rate) is:
$2,160

The TOTAL in clubhouse rental fees for a year is:
$3,510

However, given the 2024/2025 Budget:

Non-road income for that year was determined to be:
$60,925

Non-road expenses for that year were determined to be:
$51,000

Without "compensating" themselves $170,000 plus, HPPOA's non-road "nest egg" would have been:
$9,925 PLUS the $3,510 clubhouse rental for a total of:
$13,435

As you can see, HPPOA trying to save a "nest egg," in excess of $700,000 in non-road fees, would have taken HPPOA quite a long time if they'd conducted business as they should. But without suing them, who is going to make them? HPPOA will take what they want. Use it where they want. And justify it however way they want.

Apologize for the length. But I warned you that it is complex and messy.

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Instead of saving, approx. $13,000 in non-road money each year, for the past 5 years (which is what HPPOA is actually left with and would have totaled maybe $65,000). HPPOA has been skimming 5% of the road fees each year, calling it "compensation," and making themselves a nice "nest egg" (approx. $700,000).

A corporation skimming approx. $635,000 from a restricted fund is not something that should be ignored or excused- no matter what HPPOA's "good intentions" may be.