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Not always necessary for HOA to obtain three bids

Q: Is there ever a time when it isn’t necessary to get sealed bids for the cost of a service from vendors? In other words, if the cost of the service is below a certain amount, can the bids be presented to the board unsealed?

A: Per Nevada Revised Statutes 116.31086, an association would not be required to obtain three bids if the cost of the project or service was less than 3 percent of the association’s annual budget for communities under 1,000 homes or less than 1 percent of the annual budget for communities more than 1,000 units. Association projects are defined by the law without limitation that involves the maintenance, repair, replacement or restoration of the common elements, or which involves the provision of professional service to the association, such as accounting or legal.

If you already have a service contract with a landscape or pool company, as an example, you would not necessarily have to obtain three bids but only the estimate from the vendor per their service contract.

Q: There seems to be enough ambiguity concerning this simple issue to make its potential outcome very disturbing.

If a homeowners association bylaws state that its board of directors may remove a board member for missing three consecutive unexcused board meetings, does the board have the authority to remove that member from the board entirely or only as an officer? How does NRS 116 support or refute such an action?

Thank you for aiding me in clearing it up.

A: NRS 116.31036 pertains to the removal of a member of the executive board. Only homeowners can remove a director from the board. The board can only vote to remove a director as an officer and select another director to serve in that position.

Q: Is a board allowed to create a rule for covenants within the bylaws or covenants, conditions and restrictions that do not directly state that the board is authorized to define by a rule? Or lacking that stated authority is the language within the bylaws to be followed as written, and if needed for clarification to be done by amendment voted on by the members?

A: Generally speaking, the CC&Rs allow the board to generate rules and regulations on a variety of subjects.

Rules and regulations must be consistent with the CC&Rs. For example, if your association wanted to pass a no pet rule but your covenants allow pets, the association would not legally be able to create a no-pet regulation.

You would need to review your CC&Rs as some covenants provide a broad range or rule making while others are more restrictive.

Barbara Holland is a Certified Property Manager (CPM) and holds the supervisory community manager certificate with the state of Nevada. She is an author and educator on real estate management. Questions may be sent to holland744o@gmail.com.

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Matthew Hoyt of CommCap Advisors has been named a recipient of the National NAIOP 2019 Developing Leaders Award, honoring rising industry professionals throughout the nation. The selection was competitive. NAIOP selected five young professionals nationally to receive this prestigious award.

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