The POAA and You

The Virginia legislature passed the Property Owners' Association Act (POAA) to protect the homeowner. At first, the idea was to protect the homeowner from moving into a place with a mandatory association (such as Leewood) and being unaware of it. Then, in response to abuses of Associations a "Homeowner's Bill of Rights" was enacted and has generally increased in scope yearly. The Act does give the Association a few additional capabilities -- like imposing charges for un-followed rules (usually Architectural standards, but can be other things) and non-judicial foreclosure. On the Association "hate" sites you see a lot about non-judicial foreclosure. Leewood has never even come close to pursuing foreclosure as an option, and have been advised if we ever do, not to do non-judicially. In other words, this provision, that there is all the screaming about probably will never affect a Leewood homeowner. The Fairfax Manual for Associations lists the following as the core aspects of the Act:

• associations must conduct open meetings, keep detailed books and records, and with very few exceptions, make them available to members;
• enforcement of the Declaration of Covenants, Conditions and Restrictions via due process procedure, and the levy of financial penalties (if necessary) against the property for violations;
• associations are given authority to levy special assessments when necessary or in appropriate circumstances;
• authority to create liens and other enforcement remedies is clarified; in a suit to enforce provisions of the declaration, the prevailing party may collect reasonable attorney fees.

The main part of the Act, from the prospective of a Homeowner living in an association is Section 510. It provides for, amongst other things:

1. Access to records. Personnel records may be withheld, but Leewood doesn't have any of those -- no personnel you know! Attorneys argue about the "right" to see the specifics of the homeowner account records or ARC records (i.e.by individual homeowners). Most records of interest are available through the POAA and our own governing documents. You might have to pay for copying to obtain them.


2. Announcement of an annual meeting (and there must be one yearly) by regular mail with 14 days notice.


3. All board meetings must be open to members of record. Particularly interesting, as it was added after "workarounds" by the Associations was the wording that: "The board of directors shall not use work sessions or other informal gatherings of the board of directors to circumvent the open meeting requirements of this section."


4. Notice of board of directors meetings and committee meetings must be given.


• If the meeting is an emergency or special meeting, the notice should be given to the homeowners at the same time as it is given to the board.
• Homeowners may request to be notified of upcoming meetings by email (or in case of board meetings by regular mail). Note this is quite a burden on the board, and if meetings are announced properly there would be little need for it.
• The agenda meeting packet must be made available to the homeowners at the same time it is made available to the board. (The act is a little behind the times here as so much now is done via email and there are not necessarily the meeting packets that we generated say 10 years ago. This was always an awkward provision for associations without a central office -- perhaps the packet could be posted on the old oak tree).
  
5. Voting by secret or written ballot except in electing the officers of the association is prohibited.


6. Executive sessions may be held to consider violations of individual homeowners, discuss and consider contracts, discuss personnel matters, and consult with legal counsel. The list is inclusive in the POAA and very limited.


• Before going to executive session a motion must be made with the exact reason for the executive session being called. No other matters can be considered in executive session.
• "No contract, motion or other action adopted, passed or agreed to in executive session shall become effective unless the board of directors ..., following the executive session, reconvenes in open meeting and takes a vote on such contract, motion or other action which shall have its substance reasonably identified in the open meeting.
• The rules about executive sessions applies also to committees.
  
7. A time for homeowners to speak will be part of the agenda.
   
8. The association shall be provide for a free method of communication between homeowners. (There was a great growth industry in email lists and message boards after this provision was included. It is unclear what is wrong with the telephone).

For new and selling members of the association, a POAA packet is required, the seller must request it from the association and the contract for the house must state that the house is part of a mandatory association. The packet contains financial information, our governing documents, some other required statements, and notice of whether there are any assessments or charges owed on the house and whether there are any ARC violations. The buyer may break the contract within three days of the receipt of this packet. If he chooses to buy, then he is liable for the violations and charges noted in the packet. He is responsible for asking for an update of the packet if it is out of date. If the association fails to mention an ARC violation in the packet, they cannot pursue it with the new owner. Note this really applies to true architectural violations as maintenance violations just keep getting worse with time.

The board may adopt and promulgate rules and regulations at regular board meetings. However, the members can convene a homeowners meeting in accordance with the association bylaws can amend or repeal any rules. Rules and regulations must be distributed to the homeowners.

The board may enforce these rules through injunctive relief, loss of use of the facilities, and by assessing charges for the breaking of rules. Due process must be followed for the latter.

The POAA changes yearly and it is recommended that everyone should read it often. If something strikes you as unfair -- quite often you will find that it is not only unfair, but against the Act or our documents. However, remember that everyone can make errors. Life used to be so simple! All a board member had to do was read the association documents, and hopefully they did not change often. The POAA changes so often that even attorneys must look up the latest provisions, or the latest rework of the provisions. When it was first passed everyone in the industry had it nearly memorized -- now the memory is too cluttered with the insertions and deletions they have made for anyone to carry it all in his head. Remember, also, one cannot rely on past experience with corporate boards, trade boards, etc. to know what rules must be followed as far as announcing meetings, meeting in executive sessions, etc.

Before you cry "wolf" analyze each provision and see whether you actually need it. If you place too much administrative burden on the association it will cost both the association and you money. In other words, be aware of the Act, but also be reasonable! The Act has already increased the workload of the association significantly -- just from the handling of the requests, and producing the packet.

See our contact page to find our POAA representative if you need a packet (at a charge of course!).

Click here to read the entire Act in all its glory.

Judith B. Currier
August 2006