HOA budgets landscaping costs to meet SNWA requirements
Q: As with many other communities, we are now required by the Southern Nevada Water Authority to review and revise some of our common areas that have lawn/grasses for removal of some or all of the grass to meet future water standards by 2026.
Our homeowners association is planning these revisions sooner than later, but current reserves may not cover the costs as we would like to get ahead of future additional requirements and remove more than the minimum required by SNWAs outline.
My question is in regards to homeowners associaiton assessments: Will an equally applied, per household, assessment be appropriate for this type of mandated/regulated requirement in order to cover the additional expenses the HOA must incur?
I believe Nevada Revised Statutes 116.3115 addresses assessments.
A: In preparing your budget for the year, you will need to first determine your standard recurring operating expenses with your recommended reserve contribution. Check your governing documents to determine how much of an increase can be passed to the homeowners.
Reserve specialists are supporting the use of the reserve funds allocated for landscaping to help address the changes to the landscape as mandated by the Southern Nevada Water Authority. In order to establish adequate reserves, NRS 116.3115 (2a) does allow a board to establish or carry out a funding plan without seeking or obtaining approval of the homeowners. The additional assessments must be based on the reserve study.
You will need to address this issue with your reserve specialist and your attorney, as you may want to allocate reserve funds differently in order to afford the landscape changes (taking into consideration any rebates that you may receive from SNWA). You would then need the funds to be replenished to accommodate the funding of those capital expenditures that were adjusted for the landscape.
Q: I am a new president of our HOA. In an effort to increase participation and enhance communication I am trying to get an email blast out once a month. However, our manager insists that we must have a signed release from our homeowners. I have looked through an old version of NRS 116 and cannot find any reference to this requirement. Could you cite the section?
We already have a lot of the emails because of issues and interactions and could provide more information to the homeowners with a monthly blast.
A: As a president, you are just one of the board of directors. Any official e-blast on behalf of the association should be approved by the board. An agenda item can be placed at your next board meeting for the approval of the president to produce the e-blasts on behalf of the association. Your directors may modify the motion with some conditions.
Barbara Holland, CPM is an author, educator and expert witness on real estate issues pertaining to management and brokerage. Questions may be sent to holland744o@gmail.com.