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HSV board split over assessment system

by Jeff Smith | August 7, 2014 at 4:00 a.m.

HOT SPRINGS VILLAGE -- The seven members of the Hot Springs Village Property Owners' Association Board of Directors had divided opinions Wednesday on the proposed two-tier assessment system.

The board will vote Aug. 20 whether to formerly hold an assessment campaign. If approved, the ad hoc Assessment Committee would spend the remainder of August and September conducting an information campaign on the proposal, which would raise dues on lots with homes from $36.68 a month to $65 a month. The assessment on unimproved lots would not change.

Ballots would be mailed to members in good standing in early October and due back before the Thanksgiving holiday.

Directors Frank Leeming and Jeff Atkins opposed the two-tier system on Wednesday, saying it would divide the Village.

Leeming read a two-page prepared statement, saying the two-tier proposal is, in effect, a "one-time roll of the dice. To win approval of the money we need, we're betting our future on those who have the least invested in our community, knowing that it may be years -- if ever -- before a majority would approve another assessment increase. It's a gamble I don't think we can afford to take. Our goal should be to win the support of all property owners."

Leeming stressed that before asking for an assessment increase, the members need to be presented with a specific plan of how the money will be spent and where, not just saying it's to make up an annual $3.2 million deficit to take care of capital plans that have been deferred.

Leeming proposed waiting another year to get a detailed plan put together to present to the membership.

Vice President Harv Shelton, who chaired the Future Financial Task Force that came up with the two-tier proposal, said the Assessment Committee has prepared a lengthy document with a list of eight high-priority items that need funding.

"It would justify the need for the additional $3 million a year, and they can show this to the public once they get their marching orders from us on Aug. 20," he said.

President Keith Keck agreed with many of the points in Leeming's statement, but said, "How much longer can we wait? How much longer can we kick the can?"

"Money is always an issue, but if we want to keep this community pristine, especially our infrastructure, we have to have the funding. We need to pave 30 miles of road a year to keep up with the cycle, and one year recently we didn't even pave 10 miles. Last year we paved 29 miles of road for $1.8 million, and this year we cut the road budget to $1.3 million. We have to keep up the roads," Director Mike Medica said.

Director Bobbie Bateman said she had no problem with the two-tier system.

"The residents are the ones who are getting the greatest advantage by being here using these amenities, so I feel we should shoulder more of the financial burden. In the long-term plans, we can't ask builders and investors from across the nation to come in and invest in our community if we don't invest in it first," Bateman said.

Director Mary Neilson said she has had a lot of communications from nonresident property owners.

"The general consensus I hear is 'We are tired of paying the bill for those who are living there.'" With that input, going to a two-tier system makes sense at this stage," she said.

There are approximately 8,500 residences in Hot Springs Village, which has a population of slightly less than 14,000. There are 15,000 nonresident members in good standing. The number of lots in arrears on assessment payments is now 9,200, or 27 percent of the total lots in the community.

Atkins had asked about the possibility of converting the assessment system on a value scale, much like a millage. Keck said that had been investigated, along with a water meter fee, but it was not feasible because of regulations in the Declaration and the fact that the POA was successfully sued a few years ago by commercial entities over dedicated commercial fees. Keck also said he felt that going to an assessed value system would further divide the Village.

"We are one Village. It should be one property, one vote," Keck said.

"I don't think we have the answers to these questions to go to our members and ask for an assessment increase of this magnitude, or for a two-tier plan we'll never be able to reel back in. I think we should push the idea back for 12 months," Leeming said.

Keck discussed the difficulties its sister community, Bella Vista, went through when it went to a tw0-tier system. It eventually had to incorporate. He said he felt the community finally went into the right direction, but it was too late.

"We don't want to get into the situation where we are at the point of no return," Keck said.

Keck, Atkins, Shelton and Leeming made a public thank you to the members who submitted hundreds of emails with suggestions, questions and concerns about the proposal.

"We will vote on this in two weeks, and if the majority of the board approves the proposal, the Assessment Committee will move forward with the campaign," Keck said.

If a campaign is launched and is successful, the increase would go into effect Jan. 1, 2015.

Local on 08/07/2014

Print Headline: HSV board split over assessment system


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