Q: I live in a Reno community with a homeowners association. I would like clarification on how homeowners are to receive notices from the management company. Are certain notices supposed to be via postal mail and not email? Our new management company has indicated all notices are emailed, yet in the past some homeowners were not receiving important notices. Example: notices concerning board vacancies; ballots and information on candidates; proposals for adding an off-leash dog park (for) $50,000; a youth sports field for $250,000; and a recreational vehicle, camper, boat storage park in the amount of $75,000. These additions were going to be added under the power lines where the builder left open per mandates of city plans and NV Energy.
My second concern: The homeowners received a notice on Dec. 20 from a new management company. This was a big surprise. I had already mailed in my January dues to our previous management company. The mention of getting a new management company was never brought up at any of our HOA meetings or on any agenda for discussion. No bids were opened nor request for proposals discussed at any of our meetings. I am only aware of our previous management company receiving a verbal complaint at a board meeting from a homeowner, who is on the landscape committee concerning the lack of returning her calls.
This homeowners’ husband recently got a position on the board and our current management company is fired. Is this ethical according to Nevada Revised Statutes to not include all 200 homeowners in this process when it isn’t an emergency? All my correspondence with the previous management company was promptly acknowledged.
The third concern: Our current landscape company has been replaced without any bids being opened at an HOA board meeting, nor an RFP discussed. Again the same homeowner who was complaining about the management company, complained about the landscape company. Is it customary for one homeowner, just because her husband is a board member, to dictate these changes without the input from the other 200 residences? My understanding is that all bids and changes are to be opened and discussed at board meetings. As homeowners we do not know the monthly fee or what their job entails. Is there an NRS statue that I can refer to when addressing this issue since it was not a last-minute emergency?
Fourth concern: On Nov. 23, our HOA received an email that our last HOA meeting for the year, a scheduled board of directors meeting, was canceled on Dec. 6 and instead a budget ratification meeting was scheduled for Dec. 13. At our previous Oct. 18 board meeting, there was no mention of a $15 dues increase or of a budget ratification meeting instead of our scheduled Dec. 6 board meeting. Is there a NRS statue that I can refer to that states how much notice a homeowner is supposed to have and if homeowners have the right to discuss these changes?
Finally, this year the homeowners were given the option of attending in person or using the virtual meeting link for all board meetings. At the budget ratification meeting one board member attended in person, two board members called in and two did not call nor attend in person. Several homeowners wanted to call in instead of attending because it was raining hard that evening but were told they would only be able to attend in person. I was the only homeowner who attended in person with the one board member and the management company. There was no discussion as to why our dues were going to be increased by $15 per month, neither at any of our previous meetings nor at the ratification meeting. Is it considered ethical for only board members to be able to attend virtually for a meeting and to not have to attend in person but homeowners must attend in person? Should there have been a discussion as to why our dues increased? Please refer me to an NRS statue. Is it ethical to have a notice of an HOA meeting date change and an increase in the homeowner dues given only 13 days in advance?
A: I will address each of your questions in order.
■ First, prior to the passing of Senate Bill 186, certain actions required notification by mail. For example, the election and or removal of a director must be sent by mail. As to budgets, the law states that the association is to distribute to each owner a copy of the budget. It does not state that the budget must be mailed to each owner. The violation process requires notification by mail. If an association adopts a policy imposing fines, the policy is to be sent to the owners by mail. Prior to the passage of SB 186, under NRS 116.31068 (1c), the association could deliver notices by electronic means if the owner had given the association an electronic mail address.
In 2021, the Legislature passed SB 186, which would require associations to send notices both electronically and by mail, amending NRS 116.31068. Now, the new law does state that unless a unit owner opts out of receiving electronic communication or has not designated an electronic mail address, the association shall deliver any notice required to be given by the association and any other communication to the homeowner by mail and by electronic mail. The law also allows for communication by hand delivery to the owner or any other method reasonably calculated to provide notice to the owner.
This section of the law raised many issues to the point where the Nevada Real Estate Division has placed the section requiring both mail and electronic mail on hold so that the division can issue clarification. For example, digital communication may be best of conveying to homeowners that the water will be turned off today from 9 a.m. to noon because of an emergency. Technically, a letter and an email must be sent to the owners. By the time any owner receives the mail, the problem would most likely be over. Once the division provides direction, there will be an article in my column.
■ As to your second question, the removal and or the selection of a management company should have been on a board’s agenda. According to NRS 116.31086, the association must, when reasonably possible, solicit three bids if the project is expected to cost 3 percent or more for associations that consist of less than 1,000 units or 1 percent for associations with 1,000 units or more. The bids must be opened and read aloud during the board meeting. Association project includes, without limitation, a project that involves maintenance, repair, replacement, restoration of any part of the common elements or which involves the selection of professional services.
■ Concerning the third issue, the bidding process is outlined by the law. The removal or the selection of a vendor is under the board’s jurisdiction. Homeowners can express their opinions but ultimately it is a decision by the board.
■ As for the fourth question, under NRS 116.31151 (3), within 60 days after the adoption of any proposed budget, the board shall provide a summary of the budget to each owner and shall set a date for a meeting of the owners to consider ratification not less than 14 days or more than 30 days after the mailing of the summaries. Unless at that meeting, a majority of all owners or any larger vote specification in the declaration, reject the proposed budget, the proposed budget is ratified, whether or not a quorum is present. You can certainly discuss the changes but as you can see there are requirements to reject the budget.
■ Finally, under NRS 116.31151 (3), if the meeting date had to be changed, the notice should have been 14 days in advance.
You may want to consider running for the board. Many of your concerns are legitimate ones as to the communications to the owners.
Barbara Holland is an author and educator on real estate management. Questions may be sent to firstname.lastname@example.org.