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Resolution - Assessment Collection Procedures
ASSESSMENT COLLECTION PROCEDURES
Supersedes Resolution 18-07
WHEREAS, the Aquia Harbour Property Owners Association, Inc. (the “Association”) is an incorporated, non-stock corporation organized and operating in accordance with the Virginia Nonstock Corporation Act (“Nonstock Act”), the Articles of Incorporation of Aquia Harbour Property Owners Association, Inc. (the “Articles of Incorporation”), the Subdivided Land Sales Act of 1978, Va Code §55-344 (the “Subdivided Act”), the Aquia Harbour Property Owners Association, Inc. Restrictions and Covenants (the “Restrictions and Covenants”); the Declaration of Restrictions of Aquia Harbour Property Owners Association, Inc.(“Declaration”) and pursuant to the Bylaws of Aquia Harbour Property Owners Association, Inc.;
WHEREAS, Section 13.1-853 of the Nonstock Act provides that the Association’s Board of Directors (the “Board”) shall have all the powers necessary to conduct the business and affairs of the Association;
WHEREAS, Article B(1) of the Articles of Incorporation state that the purpose of the Association is in part to “…provide rules and requirements for such membership and to provide rules and regulations for the maintenance, upkeep and enhancement of each owner’s property”;
WHEREAS, Article VI, Section 1 of the Bylaws authorizes the Board of Directors to manage the affairs of the Association as authorized by the Nonstock Act or Subdivided Act including operating, maintaining and improving the Amenities, Common Area and security force of the Association;
WHEREAS, Article XVI, Section 1 of the Bylaws states that every person who owns or is purchasing a lot or lots within the Subdivision [Aquia Harbour], or who occupies, under a lease agreement, a lot or lots within the Subdivision, is, by virtue of such ownership, purchase or occupancy, a Member of the Association;
WHEREAS, Article 7 of the Restrictions and Covenants and Article XX, of the Bylaws specifies the charges that are to be paid by the beneficial or record owner of each Lot in the Association;
WHEREAS, Article XX, Section 7 of the Bylaws provides the Associations remedies for the nonpayment of assessments, including placing of a lien of record against the Lot and to collect the costs incurred by the Association in the enforcement of the lien; and
WHEREAS, the Board has determined that there is a need to establish policies and procedures for the collection of assessments;
NOW, THEREFORE, BE IT RESOLVED THAT the Board hereby adopts the following assessment collection policies and procedures as part of the Association’s Book of Regulations:
I. Routine Collections
A. Due Dates. Each fiscal year’s annual assessment shall be due and payable, in monthly installments, on or before the first (1st) day of each month. Unless otherwise determined by the Board, all special assessments shall be due and payable at least Forty-five (45) Calendar Days after the Lot Owner is mailed notice of the special assessment.
B. Owners’ Mailing Addresses. All documents, correspondence and notices from the Association relating to assessments or charges shall be mailed, emailed or delivered to the Lot Owner’s address of record that appears on the books of the Association, which is the Lot address unless the Association is otherwise notified in writing by the Lot Owner to change his/her address of record to a different mailing address. Lot Owners have the responsibility of promptly informing the Association, in writing, of changes to their address or email address of record.
C. Invoices and Other Notices. Non‑receipt of an invoice, payment coupon or other notice shall in no way relieve the Lot Owner of the obligation to pay the amount due by the due date. If a Lot Owner does not receive a notice within the expected or required time period, it is that Owner’s responsibility to contact the Business Office immediately to obtain a copy of the notice and to confirm the Owner’s correct mailing or email address.
II. Remedies For Nonpayment Of Assessment
A. Late Fees/Interest. If payment of the assessment (or assessment installment) is not received by the Association within ten (10) days after the applicable due date (e.g., by January 10th for the January 1st monthly installment), then a late fee of the greater of Twenty Five Dollars ($25.00) shall automatically be added to the amount due and shall be a part of the lien for unpaid assessments against the Owner’s Lot and shall be the Lot Owner’s personal obligation to pay. Interest at the rate of 12% shall be charged on all outstanding debt in addition to the late fee.
B. Returned Checks. If a check (or electronic debit, if applicable) is returned or rejected, the Lot Owner’s account shall be assessed a returned check/debit processing charge of not more than Fifty Dollars ($50.00), plus the bad check/debit return fee, if any, charged to the Association by the bank. If the Association receives from any Owner, in any fiscal year, two or more returned checks or rejected electronic debits, the Association may require all future payments for the remainder of that fiscal year to be made by certified check, cashier’s check, or money order.
C. Late Notice. A “Late Notice” or other delinquency notice may be sent by the Association to Lot Owners who have not paid assessments or charges in full within 10 days after the applicable due date. Non-receipt of such notice does not relieve the Lot Owner of his or her obligation to pay the assessment or the resulting late fees, costs, attorneys’ fees or other applicable charges. Additional late notices or reminder notices may be sent to a delinquent Lot Owner, at the Board’s discretion, prior to referral of an account to legal counsel. However, once an account is referred to legal counsel for collection, no further late notices or other delinquency notices will be sent by the Association until the account is closed with legal counsel’s office.
D. Collection Costs/Attorneys Fees. All costs of collection, including attorneys fees, incurred by the Association as a result of the failure of a Lot Owner to timely pay assessments or other charges shall be assessed against that Lot Owner as they are incurred or as collection action is taken, without the need for a case-by-case vote by the Board. These expenses may include, for example, the cost of filing a lien and/or civil suit and other court costs, and any other collection-related costs. These collection costs shall be added to the Lot Owner’s assessment account and become part of the lien against the Owner’s Lot and the personal obligation of the Lot Owner.
E. Acceleration. If a Lot Owner fails to pay a delinquent assessment installment within 15 days after written notice is sent to the Lot Owner, then the remaining balance of the applicable annual or special assessment is automatically accelerated for the entire fiscal year, making that entire remaining balance immediately due and payable in full without the need for specific case-by-case vote from the Board, the Association’s legal counsel is thereafter authorized to demand and collect the accelerated amounts. The 15-day notice referenced above shall be sent by the Association and/or the Association’s legal counsel (by first-class and certified mail, return-receipt requested) to the Lot Owner’s address of record (if different than the Lot address) and to the Lot address (if the Owner is known to reside or receive mail there).
F. Referral of Account for Collection. If a Lot Owner’s account remains delinquent for more than 8 months, then the Association is authorized to forward the Lot Owner’s delinquent account to the Association’s legal counsel for collection, subject to any Board guidance regarding the minimum account balance to forward.
G. Lien. As provided under the Bylaws, when an annual or special assessment or other charge is levied (or assessed) against a Lot, that assessment or other charge is deemed to be lien against the Owner’s Lot, and the Association may at any time thereafter record a Memorandum of Lien in the county’s land records, with or without further warning or notice to the Lot Owner. In order to meet any statutory deadlines, the Association’s legal counsel may proceed directly with filing a Memorandum of Lien against the Owner’s Lot prior to sending a demand letter to the delinquent Lot Owner. Accelerated installments, late fees, attorney’s fees, other charges (as applicable), and the costs associated with filing and releasing the Memorandum of Lien shall be included as part of the lien and added to the Lot Owner’s assessment account.
H. Further Legal Action. If an account remains delinquent after the initiation of legal action (for example, after filing of a lien or civil suit), the Association’s legal counsel is authorized to take other appropriate legal action to collect the amounts due, except as provided in Paragraph I below or unless directed otherwise by the Board. Once a judgment is entered against a Lot Owner, further legal actions may include, without limitation, garnishment of wages, rent and/or bank accounts, and the attachment of vehicles or other assets.
I. Waivers. The Board may, in its sole discretion, grant a waiver of any provision herein (except filing of Memoranda of Lien beyond the statutory deadline) upon written request by a Lot Owner alleging a significant personal hardship or as otherwise determined to be in the best interests of the Association. Any such relief granted to a Lot Owner shall be appropriately documented in the Association’s files with the conditions of the relief, if any. The Board may designate the Association’s General Manager, the President or other officer or the Association’s legal counsel as having the authority to grant waivers or payment plans on behalf of the Association between Board meetings, subject to any Board-established guidelines. If a payment plan request is granted for delinquent amounts, a condition of the payment plan may require, among other things, that the delinquent amounts be secured by a recorded Memorandum of Lien and/or by a Promissory Note and, if applicable, that current dues, as they become due, are paid via the AHPOA administered automatic debit (ACH) system.
J. Waiver. The Association is authorized to waive the imposition of late fees if the delinquent Lot Owner had owned the Lot for three or fewer months at the time of the delinquency and, in the judgment of the Association, the delinquency was the result of a misunderstanding of the correct procedures for paying the assessment. This type of waiver may be granted only once to any Lot Owner.
K. Application of payments. Payments received from a Lot Owner shall be credited in the following order:
1. Collection costs for delinquent accounts, including, for example, certified mailing costs, lien filing/releasing costs, returned check charges, court costs and attorney’s fees;
2. Late fees;
3. Other assessments against the Lot Owner’s account (e.g., annual assessments), applied to the oldest outstanding amount first.
The remedies stated herein shall not constitute an election of remedies and all remedies shall be deemed cumulative.
Adopted by the Aquia Harbour Board of Directors at a regular meeting on April 24, 2019.