April 1, 2005 | By Maxine Saitta; from the Ocean County Observer
Here are the facts the about common-interest bill
We have been reading individuals' opinions on the content of bill S-2016. Here are the facts:
The fee shall not exceed $6 per year, which is 50 cents per month per homeowner. The increase cannot exceed 5 percent per year.
An increase in association maintenance dues cannot exceed consumer price index plus 3 percent per year.
No individual officer shall have the sole power to act for or to bind the association.
Board members who violate the rules will be fined and cannot use the services of the association attorney.
Entrance fees cannot exceed two months' worth of maintenance dues, which makes more sense than charging new homeowners $500, which is outrageous. The fee would be earmarked for capital improvements.
The Berkeley Township Council passed a resolution dated Feb. 22 saying S-2016 "would abolish Homeowners' Associations." Council President Peter J. Mustardo signed it. I called Mustardo and asked him on what page that information was printed. He said he didn't remember. I called several other council members and asked them the same question. They didn't know. It appears that the people who govern us have not read the bill. They all replied that the township attorney had drawn up the resolution.
The bill states that the requirement to form a homeowners' association shall not apply to any common interest community in which the common elements consist only of open space, including walking trails, and sewerage and drainage basins, at the option of the developer and the municipality. For such communities, the developer shall establish a trust fund for the use of the municipality to cover the expenses of the maintenance of these . . . common elements. That means that the bill only could eliminate the requirement to form a homeowners' association when there is no clubhouse or any other structure. It does not abolish any association.
A residents' petition in opposition to S-2016 that has been circulating throughout the Holiday City and Silver Ridge communities. The petition calls the measure "ill-conceived" and a "cash cow for the New Jersey State Department of Community Affairs" and says "We hereby oppose this measure, S-2016, as it is written."
Does anyone know what the bill means? Have they read it? How can anyone sign a petition about something they know nothing about?
The bill states that within 90 days of the effective date of and annually on the same date thereafter, all homeowners associations shall register with the commissioner of Community Affairs and pay an annual registration fee, which shall not exceed $6 for each unit within the common-interest community. The fee may be adjusted annually, but the adjustment may not exceed 5 percent of the fee charged in the prior year. A fee shall not be charged on a unit that is reserved for occupancy by low- or moderate-income households in accordance with the Fair Housing Act.
A common interest community containing low- and moderate-income and market-rate units may be totally or partially exempted from the registration fee.
The breakdown of the $6 is: 10 percent for the Center for Government Services, Rutgers University, for providing educational training or materials for board members; 10 percent For the Center for Negotiation and Conflict Resolution, Rutgers University for providing conflict resolution training for board members, property managers and owners; 25 percent for the Department of Treasury, Office of the Public Defender, Office of Dispute Settlement for providing arbitration services and training of volunteer mediators; 25 percent to the Council on Affordable Housing for making grants to associations comprised, in part or in whole, of low- and moderate-income households for assistance to those households in the payment of the common maintenance expenses; and the rest to be used by the DCA to defray administrative costs. The 25 percent that everyone is upset about is actually 12.5 cents a month.
We, at Holiday City West, had our monthly open board meeting on March 3 and our president spoke at length against S-2016. He proclaimed, "Our community, as we know it and live it will virtually be history." He then added "All the common grounds in the community would come under the control of the Township and could be taxable . . . this is a terrible bill." He requested that everyone sign the petition.
We have an open forum at the end of our meetings, where shareholders are now only allowed two minutes to address the board. I asked the president if he read the bill. He had not, but he said the secretary did. I never did get to the part that focuses on residents' rights because they shut off the microphone and closed the meeting. The only response was that the board secretary declared that he needed the 50 cents a month to pay for his own health insurance.
After the meeting people lined up to sign the petition. We actually had two petitions in our lobby. I wonder if the people knew which one they were signing. The other petition was about a traffic light located on Route 37 and Bimini Drive. The petition, written by a resident involved in an accident, implied the traffic light was at fault, not the driver. The board allotted her more time at the microphone than they allotted me.
So who is really behind all the propaganda against the bill? Boards of trustees and their attorneys. Currently boards of trustees of adult communities or directors do not report to anyone. They don't want to. Trustees do not want their authority questioned.
Who are these people? They're retired men and women who have absolutely no training or experience in executing the job they have volunteered to do. I'm sure there are some who try to be model administrators but, for the most part, they rely on their attorneys for leadership and direction. Association attorneys will lose part of their income due to a decrease in the need for their expert and costly opinions and a sharp decrease in lawsuits between shareholders and trustees for actions that violate the existing bylaws, thus violating the rights of shareholders.
Read the bill. Do not allow anyone to persuade you to sign a petition that you know nothing about. Tell your trustees that you want a copy of the bill in the library. Have an open and honest debate over what's good and bad about the bill.
I am happy to pay $6 a year for some type of legislation that will get me more than two minutes of free speech per month at my open board meetings.