General Information
What are our governing documents?
- The Whitewater Creek Community Association is created as a Georgia nonprofit corporation, governed by O.C.G.A Title 14 Chapter 3 “Nonprofit Corporations”. Articles of Incorporation were filed with the Georgia Secretary of State outlining our purpose and basic rules.
- The original developer of our subdivision created a Declaration of Covenants, Conditions and Restrictions that are recorded by the Fayette County Superior Court in 1985. These “Declarations” were modified in 1987, 1988, 2003, and 2020 and create the rules we are most familiar with regarding common area use, design restrictions, amendments, fines, dues and the like.
- The Board of Directors, elected by the membership, created Bylaws that generally stipulate the duties and responsibilities of the Board, voting requirements, meeting requirements, and membership rights.
- The various committees authorized by the Board do the day-to-day work of managing the neighborhood and may promulgate various rules, such as architectural and appearance standards subject to Board approval.
Who is the association “membership”?
- The membership is made up of individual lot owners. A member has one vote per lot owned. For example, Invited Clubs owns two lots, and as such has two votes.
- A member must be “in good standing” to vote (i.e.: Dues current).
Where can I find the latest versions of our governing documents?
- You can request to review and copy the latest version of our governing documents by informing the vendor contracted to manage the association (Lee Mason and Community Association Management, CAM).
- The Plat and Declarations are recorded at the Fayette County Superior Court along with deeds, liens and other recordable documents.
- The Articles of Incorporation are recorded with the Georgia Secretary of State.
- The FRONTSTEPS© application normally maintains an electronic version of the documents; however, there may be errors from time to time.
Budgets, Dues and Assessments
What is a neighborhood budget, and how is it determined?
- The Board is required to produce budgets for the coming year, and create annual assessments (commonly referred to as “dues”, not to be confused with “special assessments” such as for road improvements above and beyond your annual dues).
- If a budget is not determined before the end of a year, then the budget and “dues” from the prior year remain in effect until an adjusted budget is approved. [Declarations, Section 9(d)]
- There are two budgets: (1) an operating budget for revenue and expenses that are expected to occur in the budgeted year, and (2) a capital budget for revenue and expenses that will occur over a longer timespan (e.g.: amenity center construction, road paving).
How are dues determined and how are they increased?
- The Board will calculate the annual assessment, “dues”, based on the approved budgets divided among the membership evenly.
- Dues can be increased by up to 10% year over year without membership approval. The higher your current dues are, the faster they can increase without your specific approval.
- Any increase in the annual assessment (“dues”) by over 10% requires a 2/3 majority vote of the membership either in attendance at the annual meeting or represented by a proxy. (NOTE: There is a current theory that would allow a majority vote by splitting the operational budget and dues thereby calculated, and a “capital contribution” generated from the capital budget as a separate obligation not subject to membership approval. This has NOT been tested by the courts and is not a theory that the editor supports.)
What is a “special assessment”?
- A “special assessment” is a charge against the membership for a determined period, generally to cover a one-time or multi-year expense.
- Unlike an annual assessment (“Dues”) increase, the special assessment cannot be increased without membership approval. Dues tend to be sticky; a special assessment goes away once it expires. When was the last time you noted a decrease in your “dues”?
- A special assessment over $200 in any one year requires approval of 2/3 of the membership attending a meeting either in person or represented by a proxy.
Voting
How does the membership vote for or against proposed changes?
- One lot owner equals one vote. If a lot has multiple owners, then they must decide how to cast the joint vote. An attempt to vote twice for any one lot will invalidate both votes.
- The membership can vote either by attending an annual meeting, or a special meeting in person or by signing a proxy for another person to vote in their absence.
- In some cases, ballots may be generated by the Board, and votes can be tabulated from them.
What happens if very few members attend a meeting; does that mean that only a few can decide on big issues?
- It depends. Whereas membership apathy is risky and can result in undesired outcomes, our governing documents take this into consideration and require a quorum to exist for any business to be conducted at an annual, regular or special meeting as well as actions taken without a meeting.
What is a quorum?
- A quorum is the minimum percentage members that must be present or be represented by a proxy, a written consent before any approval or disapproval action is taken at a meeting.
- If an action is taken without a meeting, then the number of ballots or written consents received determine the quorum.
- If a quorum is not available for a meeting, then the meeting becomes an informational “town hall” and no business may be decided thereby.
- Generally, a quorum in our community consists of at least 1/3 of the total number of voting members in the community. There are exceptions for some special procedures such as calling a Special Meeting.
- REMEMBER: in almost every case, if a quorum is not available, no business may be transacted.
If a quorum exists at a meeting, does that mean that everyone must stay until the end?
- No. In 2020 the community voted in an Amendment to our Declarations to come under the control of the Georgia Property Owners’ Association Act (O.C.G.A. Title 44, Chapter 3, Article 6 “Property Owners’ Associations,” referred to as the POAA). The POAA provides that if a quorum exists at the beginning of a meeting it is deemed to exist until adjournment, no matter how many members depart.
- You can imagine that if you do not stay until adjournment, the possibility exists that just a few can decide things that the whole group would never have approved.
How is a proxy different from a ballot?
- A ballot is the actual vote for or against a proposition, and it cannot be revoked after it is delivered to the Board.
- A proxy is an authorization for another individual to vote for the member granting the proxy and can be revoked at any time.
- If the grantor of a proxy records their attendance at the meeting where the voting will take place, the proxy is automatically revoked.
- A proxy must be delivered to the Board Secretary prior to the opening of a meeting, and a ballot executed at a meeting must be delivered prior to the adjournment of a meeting.
- If a designated proxy grantee is not named, then the Board Secretary is deemed to be the grantee and may vote for the member. This may or may not be the member’s intention.
Amendments
If the membership wishes to change how the community is governed, how can it do it?
- The instrument changing the governing documents is called an Amendment. • An Amendment requires a 2/3 majority of all members either present or represented by a proxy or a written consent at a meeting called for that purpose.
I noticed that the Bylaws and the Declarations require a different vote total for an amendment. Which one governs?
- Typically, there is an order of precedence between governing authorities: (1) Federal and State Law, (2) Articles of Incorporation, (3) The plat, (4) the Declaration, (5) The Bylaws, (6) Board rules and procedures.
- The Declaration of Restrictive Covenants would apply over the Bylaws. Electing and Removing Board Members
How can the membership remove Directors on the Board of Directors?
- Generally, a Director can be removed without cause by a majority vote of the members present or represented by a proxy at any Special Meeting or Regular Meeting.
- The membership would typically call for a Special Meeting, provide the required notice of at least 10 days to the Director(s) they seek to remove. • The successor to the removed Director may be chosen at the same meeting by a majority of those present or represented by proxy (remember a quorum is still required).
Who can run for a Director position?
- Our Bylaws state that: “Nomination for election to the Board shall be made from the floor at the meeting.” [Bylaws, Article III, Section 6]
- Nominations may also be made by a nominating committee. Whitewater Creek does not currently have a nominating committee.
- The Director must be a member in good standing.
Duties and Responsibilities of the Board of Directors
What are the main duties of the Board?
- Generally, the board is responsible to take any and all actions that are not the exclusive authority of the membership (e.g.: authorizing budgets, assessments, amendments, electing Directors, etc.)
What is the main responsibility of the Board of Directors?
- The Board is responsible to execute their duties with “Care” and “Loyalty”. • “Care” is best explained by the “reasonable” application of a reasonable “best business decision” made by an individual of ordinary ability similarly situated.
- “Loyalty” is best explained as placing the interests of the community above one’s own interests.
What happens if there is a conflict of interest between a Director and a vendor?
- Georgia law provides that a Director seek Board approval if a likely conflict of interest occurs. A conflict typically concerns either a familial relationship or a financial interest.
- The conflict of interest must be disclosed, and the Board may decide if the Director must recuse or not from any decision-making authority.
If the Board makes a mistake, can they suffer personal legal liability?
- Yes. That is why the Board must act with caution, making use of experts when necessary, and consider all reasonable outcomes.
- Directors are shielded, however, from most liability by insurance maintained by the association against most acts except those specifically excluded from the policy (eg.: theft of funds).
Meetings
What is done at an annual meeting?
- The Annual Meeting is a special meeting where the membership decides on actions that are solely within their authority.
- The Annual Meeting is NOT just another Board Meeting. The President will fairly administer the meeting, but the membership reserves the right to make motions, deliberate, and vote on any actions authorized.
Can any member call a Special meeting?
- Yes. Special Meetings can be called by the membership by petition, submitted to the Secretary, of at least 25% of the total lot owners. [Bylaws, Article II, Section 2]
What can be accomplished at a Special Meeting?
- Almost anything, if adequate notice is provided, a quorum exists and the purpose of the meeting is stated in the notice (e.g.: Directors can be removed or replaced, Amendments can be voted upon, the entire Board could be removed, Assessments can be implemented or removed, prior Board decisions can be overturned, etc.)
How are meetings run?
- Board meetings are run by the Board of Directors, but members may attend. It is up to the Board’s discretion whether members will be allowed to comment.
- Annual meetings are administered by the Board, but the members must be allowed to make motions, votes and deliberations if they decide. [O.C.G.A. 14-3-701(d)(2)]
- Meetings are run according to the parliamentary procedures in latest edition of Roberts Rules of Order.
Can an action be taken without a meeting?
- Yes. “In the Board’s discretion, any action that may be taken by the Association members at any annual, regular, or special meeting may be taken without a meeting if the Board delivers a written consent form or written ballot to every member entitled to vote on the matter.” [Bylaws, Article II, Section 8]
Community Association Manager
Who is Community Association Management, Inc.: “CAM”?
- CAM is a Georgia firm licensed by the State of Georgia to perform services as a Community Association Manager.
- The operations of the homeowners’ association are managed by CAM. The reality is that a large community is too much for a nine-member Board of Directors and various ad hoc committees of neighbors to manage effectively.
- CAM manages communications, voting, billing, contracting, consulting, fines, liens, and many other day-to-day tasks.
- CAM serves at the pleasure of the Board of Directors and is accountable to them.
What is the cost of community association management?
- The 2024 budget for professional community management runs nearly $100 per lot owner per year.
Disclaimer:
The contents of this document are a summary based on current readings of our governing documents and relevant Georgia statutes for the purpose of neighborhood awareness and general knowledge. It does not constitute legal advice and any use of the contents for such purposes should not be undertaken without first obtaining competent legal representation.
This FAQ is intended only for the membership of the Whitewater Creek Community Association, Inc., and any other distribution is prohibited.
