ALLOCATION OF ASSESSMENTS

ANSWER: There is nothing illegal about disproportionate assessments. The allocation is set by the developer when the governing documents are created. CC&Rs will generally allocate assessments in one of three ways:

Pro Rata. Pro rata (Latin, "according to the rate") refers to dividing monthly assessments by a percentage assigned to each unit or lot. This is usually by square footage. Even though payment of assessments are disproportionate, the courts have found that such payment schedules are not unreasonable and do not violate public policy. Cebular v. Cooper Arms Homeowners Association

Uniform Rate. Members pay the same amount regardless of the size of their units/lots.

Blended Rate. Assessments are assigned using a uniform rate for some budget items and a percentage rate for others. This method tries to allocate expenses by usage so that large units pay more for services that provide greater benefits to larger units.

Changing Assessment Allocations. Changing an association's assessment structure requires an amendment to the CC&Rs. Our firm has helped associations navigate the process but there is no guarantee the amendment will pass. Changing the structure means increasing assessments on some units and lowering it for others. Owners with increased assessments generally vote against the change.

For assistance, contact us.

Updated 6/22/2008