HOA Management Versus Rental Property Management
Since there is no legally elected Board of Directors, and hence, no legally hired General Manager at Deer Ridge Mountain Resort, I have begun the quest for a competent HOA management company.
This is not to be confused with a rental property management company such as RML that worries about rentals of the units. Instead, a HOA management company does many, if not all, of the usual general manager duties plus the bookkeeping duties for the HOA. They also take care of all of the maintenance and administration without the HOA having to worry about hiring full time people, paying employee overhead, worker’s comp insurance, vacation days, etc.
In other words, a company that specializes in HOA management does Joe Thomas’ job for GGRC for a whole lot less money – and does a whole lot more for the HOA than Joe does – even with the lower cost.
These kinds of companies exist because there are so many condo associations just like Deer Ridge – where the property is too small to be able to cost justify a full time staff and, frankly, doesn’t need the full time staff to take care of the needs of such a small complex. Deer Ridge Mountain Resort, with only 84 units, is such a small complex that it doesn’t need, and cannot afford, to pay for the full time people that are inappropriately charged to GGRC.
In my opinion, Joe Thomas and the “board” intentionally try to “muddy the waters” in an attempt to hide what are the real cost requirements for operating our Home Owners Association, GGRC – and the real costs of running RML and staying in the motel business. The real needs of GGRC – and the real costs – to operate our property as the residential community that is defined in our Master Deed and Bylaws are low. The real costs for operating RML are very high. Very, very high.
In my opinion, this is just part of the major lies and deception by Joe Thomas, Larry Ohm and the rest of the “board” that will be detailed on an upcoming post about the “RML Lie Exposed: RML Actually Has Negative Cash Flow Of $152,000 Per Year“
Actual Deer Ridge Bid – From HOA Management Group
However, back to solving the GGRC management cost issue.
We’ve received a detailed bid from a local HOA management company called HOA Management Group.
Their bid was based on my providing them with detailed financial statements and audits of GGRC and RML – with the clear understanding that I was just an owner at Deer Ridge and not personally empowered to make a decision. Their company:
- Has been providing HOA services in the area for over a dozen years.
- Has managed over $800 million in HOA property at over 50 different locations throughout East Tennessee.
- Has their own accounting and maintenance people along with their own lawn care experts.
- Prepares the annual budget for the HOA.
- Collects HOA fees and assessments.
- Includes all the bookkeeping in their charges.
- Generates management reports that include monthly management summaries, balance sheet, income and expense statements, budget performance, collection report and bank reconciliation.
- They maintain the state-required HOA “Administrator’s Book” that seems to be so difficult to produce with the current management team led by “full time” General Manager Joe Thomas.
Here are the pages from their brochure:
Their Bid
Their bid had the following cover letter:
RE: Deer Ridge Home Owners Association
Dear Mr. Goodman:
We have reviewed the budget which you sent us from your property. We agree that a Home Owners Association funding and operating a for profit Overnight Rental Company in which not all of the owners do not participate in, could greatly
complicate things for your Home Owners Association. However, for a complete opinion we suggest you seek legal counsel.
As far as your Home Owners Association, we feel we could operate it in an efficient and unbiased manner and save you thousands of dollars.
All of the salaries, accounting and clerical work pertaining to the operation of your HOA would be removed from your budget.
We would most likely be able to save you a considerable amount on your insurance and pool maintenance and supplies.
If the decision makers on Your HOA Board would like to meet with us, we would be happy to conduct a complete analysis of your budget and operating finances.
The following page is a preliminary proposal based on the information we received without an in depth understanding of the scope of work required in operating your HOA and property in its entirety.
Thank you,
Cody Farmer
The summary of their bid includes:
- A one time set up fee of $1,680 to audit the books and records
- A monthly management fee of $1,680 per month plus any and all late fees they collect
- Maintenance done at $25 per hour for individual homeowners’ repairs.
- Maintenance for common areas at $40 per hour without a maintenance contract and at $20 an hour with a maintenance contract.
- All monthly bookkeeping included, which would also save GGRC thousands of dollars per year.
- All personnel would be their people – not ours – so there would be no cost to us for all personnel related costs. This also means that they provide the back up folks for vacation, illness and resignations and firings.
You can see their full bid by clicking Bid and view their brochure by clicking Brochure.
Bear in mind, that all of these activities are strictly GGRC related and have nothing to do with the illegitimate RML and its’ activities.
An upcoming post here on this blog will show the details of how RML is costing GGRC over $152,000 EVERY year – and how Joe Thomas and Larry Ohm and the rest of the “board” have, in my opinion, been grossly misrepresenting this fact for YEARS.
This Is Just One Sample HOA Management Company
This one bid already shows that GGRC could save tens of thousands of dollars each year if we didn’t have to worry about the “Joe Thomas Continued Employment Act of 2010.”
From a cursory due diligence of Cody Farmer’s bid, his company certainly seems like a major improvement over Joe Thomas and a major savings to our home owners’ association. But there may be even better, even more cost-effective solutions available to Deer Ridge once we start really comparing competing companies.
Either way, there IS a better way than using Joe Thomas to manage GGRC.
A whole lot better way – in my opinion.
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