Crook and Brown volunteer information to local newspapers casting the HOA as negligent and irresponsible and creating the myths cited in these articles (and HERE) turning public opinion against the well-intentioned homeowners who had nothing to do with creating these issues and made attempts to address them within their limited financial resources. Crook and Brown inform the public and City and County officials that Centennial has deferred maintenance all along. No details about what “maintenance” was deferred are provided since Centennial has a solid maintenance record; painting, staining, repairs, etc. What hasn’t been done is a roof replacement and complete redesign and reconstruction of the buildings to correct the inherent sources of the water intrusion. The question of what “maintenance” should have taken place, but did not has never been answered by those making the accusations. Yet, the public has been convinced that this is the case.
Centennial raises dues by 50% and begins repairs on other units at the request of the City to get a better idea of the extent of the damage and actual repair costs. Monthly HOA dues are now between $236 and $592 per month depending on unit size. Insurance premiums and deductibles have tripled because of the liability of the defective buildings, yet no insurance claim will cover damage from design flaws. Numerous options are explored from home equity loans to a special taxing district. All possibilities are non-starters mostly due to the limitations of Centennial being deed-restricted housing. The HOA’s insurance company eventually cancels their policy and a new policy is acquired for a lower premium contingent on the repair of the buildings. The savings from the lower rate is transferred to the Capital Reserve fund and dues are held at increased levels.
In 2012, APCHA contracts and pays 80% of costs for another Capital Reserve study. Even with a Capital Reserve fund of over $500,000, the study finds Centennial to be underfunded because it concludes that $3.3 M is needed for repairs. Capital reserves have been funded at recommended levels, adjusted when necessary, and steadily increasing for Centennial’s existence despite a consistent history of extensive repair work. Now instead of collecting $90,000 per year for Capital Reserves, the HOA needs $275,000 per year. The Capital Reserve fund is still needed to maintain the aging infrastructure, but now must be used to re-build the defective structure as well. Dues would now be between $825 and $1650 per month to maintain a basic standard of habitability, no extra amenities.
City staff reviews the APCHA-commissioned report and claims that the report is only a draft and its findings are overblown. Crook continues to advise City Council that no help is necessary since only $7,000 per unit maybe less is needed and that is more than affordable especially considering the years of neglect and financial irresponsibility. Centennial insists that much more is necessary and well beyond the means of the owners especially given that the deed-restricted unit values and appreciation cap prevent the ability to obtain loans of this size. Continued attempts are made to forge a cooperative partnership with local govt. seeing how govt. is omnipresent in the creation, regulation and sale of this housing. Plus, APCHA receives a 2% commission and assorted fees for every sale. Repeated requests are made to enter into good faith discussions to devise viable solutions and consider a program of sustainability for our current affordable housing inventory. It is reported that Pitkin County has built up $10 million in housing funds, yet without any proposed projects would like to spend the money to purchase rental housing in Basalt and buy down the sales price of unsold housing units. The City’s housing funds are healthy and continually replenished by the Real Estate Transfer Tax and a sales tax. The City’s own projections put the housing fund at $41M by 2022 even after $85M or more is spent on Burlingame.
