What is the increase in ($ and %) KCA homeowners dues?

-- Bill Edens (bedens@dcofficespace.net), December 15, 2000

Answers

According to Dick Arkin's article in the most recent "Town Crier," the increase is 8%, to $79 and change. An interesting spin attempt in Dick's article put the "average since the last increase" at about 2.7%. I'm not sure how relevant the issue of an average increase is, given no increases in recent previous years.

-- David Fetzer (dfetzer@ex-pressnet.com), December 17, 2000.

I think the average IS relevant. At first glance, the increase may seem large; however, if you consider we've had basically no increases in recent years, this year's increase is not all that much. I even remember a 50 cent decrease one year. How lucky we've been! Considering what we get here in the Kentlands, I, for one, am happy to pay my HOA.

-- Lauren Paiva (lkp9@aol.com), December 17, 2000.

I've always wondered how the increase in the number of Kentlands households vs. the same basic services and infrastructure from year to year (no offense intended) gets reconciled. While Kentlands is still in a growth phase, I would have expected HOA dues to decrease yearly. Then, after Kentlands is fully built out, I would expect HOA dues to increase yearly...

I understand that cost of services increases yearly, but I would think that would be more than offset by the increase in paying customers each year. But what do I know... I am just a BBS lurker...

-- Dave Fishback (fishback@fsd.com), December 18, 2000.

In the past any increases were occasional and quite small. The increased expenses in the past were mostly due to the increase in the number of people living in the Kentlands, and as the expenses increased so did the number of dues paying citizens.

However, a sudden jump of 8% is unusual in the Kentlands which has been fiscally conservative in the past. Also, until this year there was a surplus (which would be called retained earnings in a for-profit corporation). This surplus was over $100,000 thereby providing a cushion.

This $100,000-plus cushion is, or shortly will be, gone. It will no longer be available to offset small increases in expenditures in future years. Until spending and revenue come back into balance and produce a surplus of some type, every time we have per unit spending rises, we will have a dues increase to pay for it. The value of such a cushion cannot be overstated.

Why have the dues suddenly increased by 8%? Can we expect another increase next year? Important questions, considering that there are a number of Kentlands residents who live on fixed incomes. Unplanned increases hurt them worst of all.

-- Harvey Kaye (hkay@his.com), December 18, 2000.

Here's why I think the idea of stating the particular average increase stated in the article is irrelevant FOR THE CURRENT SITUATION: Had there been a need for an increase two years ago, there would have been one. There was not. Had there been a need for an increase one year ago, there would have been one. Again, there was not. But there is a need for one this year, and so there is one, and it is 8%. Why not go back five, six, or seven years?

If one wanted to calculate a pure average for purposes of comparison (and therefore let readers decide for themselves what "meaningful" is), then go back to the beginning of KCA dues-paying history and report that overall average increase. Or report the average increase only in those years in which there were increases.

-- David Fetzer (dfetzer@ex-pressnet.com), December 19, 2000.

I think all of the comments made so far relative to the increase have merit. While 8% is not huge, and while we have done very well over the long haul, this is a marked change that will effect some people and worthy of discussion. The experience and history of other communities, however, dictates that we should be careful to make sure that discussion does not simply become a numbers game. If we just talk about increases, dollars and averages, we will miss the real issues at hand.

We need to first address, as a collective, what the purpose of the HOA ought to be. What types of services should the community provide? What level of quality should those service be at? What types of services are inappropriate and should not be paid for by the HOA? These type of questions will ultimately lead to some form of agreement about exactly which goods and services the HOA management team needs to buy and how much they should be spending for those services relative to the range of available options (the cheapest, the middle, the best, etc.). Once we provide the management team with a specific charter in this way, we can let them do their job and then simply hold them accountable if they don't deliver. But if we all go down the path of arguing about the bottom-line and percentages, we will just fall into the same political rut that much larger (and less effective) organizations have fallen into before us. So my challenge is this: Instead of talking about increases and averages, let's talk about what types of services we think the HOA should be providing, whether those services should always be "top shelf" or could sometimes be "bare minimum", and how each of those services (or lack thereof), might or might not affect the type of community we think we want to be. While this is a much more difficult conversation to have (because it requires particpants to do some research in order to be able to deal in specifics), it is ultimately a much more productive discussion.

Joe Paiva

-- Joe Paiva (joepaiva@aol.com), December 23, 2000.

Joe you’re right, I have done some homework. Did the community need to spend?

*Pool Deck Expansion:

Architect’s approved fee for Design Development, Construction Document, Bid/Negotiation, Construction Administration and Building Permit:

..................................................................  $ 29,447.00

Construction Amount ................................... 322,376.00

Construction Contingency .............................. 32,237.00

                                                            ------------------

                                                       Total     $384,060.00

*Source CMC Manager

And will this money spent serve a few or benefit many?

-- Bill Edens (bedens@dcofficespace.net), December 24, 2000.

I heard that the "Pool Deck Expansion Project" has run into a significant problem--something about pieces of the original deck shifting. Can anyone provide any details on this? Also, how will this impact the projected cost of the project? We have already dipped pretty liberally into our reserves, and we still had that 8% increase in homeowner's fees this year.

-- Mary N. Macdonald (mnmacd@his.com), February 02, 2001.

I've been thinking about Bill Eden's question: did the community need to spend $384,060 on the "Pool Deck Expansion" project. I have no idea. That really bothers me because, as an equity holder in this community, I should be able to answer that question quickly and unequivocally. The problem is, I don't know how need was determined for the project. Does anyone?

-- Mary N. Macdonald (mnmacd@his.com), February 20, 2001.