Vacant Lots and Unfinished Roads

Communication Community Associations Developers Owning a home in an association

Due to the recent plunge in the housing market, many associations are finding themselves with multiple vacant lots and unfinished roads. The homeowners within the association may begin to complain to the management company and/or Board of Directors about the over grown lots and unfinished roads. As the manager and/or Board of Directors, you must research the lots to determine who owns the lots and if the roads have been turned over to the city or county. Once you have determined who owns what, now what can you do?
If the issue at hand is a vacant lot that needs to be addressed and you have found the owner, try speaking with them about the issue. In most cases the problem can be resolved, if not you still have options. With proper notification, most Covenants allow the Association the right of abatement, also known as Self-Help. This would allow the Association to complete the task at hand at the appropriate time that the Covenants allow. The downside to this option is that the Association will need the funds up front to pay a contractor to complete the tasks. This expense can later be recouped by assessing the charges to the owner. The Association runs the risk of the owner not paying the abatement fee however; at that point most Covenants allow the Association to treat the nonpayment as an Assessment. As always, consult your attorney to determine if the covenants allow abatement fees to be enforceable as an assessment. An alternative option would be to fine the owner. This will hopefully motivate the owner to comply. Another option would be to have the local code enforcement contact the Lot owner to address the issue. If code enforcement is able to handle the situation it would save the association the upfront costs of abatement.
The issue of the unfinished roads can become slightly more complicated. Some communities have privately owned roads while others have roads owned by the City or County. For Associations with privately owned roads, the Association will need to outlay the expense for bringing the roads up to a standard suitable for the members. Depending on the condition the road was left in, this can be very costly. If the roads are supposed to be dedicated to the City or County, the roads must meet certain development standards. The Community Manager or Board of Directors must research what the standards are. Often you will find that one of the development standards is that the road must be top coated. Many times this is the main development standard that is not met for Associations. This has become a common occurrence due to developers not being able to finish the project.
After receiving bids for top coating the roads, you may realize the Association does not have the funds in their Reserves to pay for this expense. Do not worry you still have options available. A construction bond is required prior to the Developer starting the development. Until the development is 100% complete, the bond will remain in place. The bond is there to make sure the development is built to the specification of the original approved design plans. If the roads are not completed and the Developer/Declarant is no longer in control, the Association can go to the local development department to make sure the bond is still in place. This will help the Association to complete the roads and have them turned over to the local road department. If the bond is no longer active, it is the development departments’ responsibility to make sure the bond remains in place until the requirements of the approved plans have been satisfied.
This article is provided by Tolley Community Management

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