Question: Our HOA has been in existence for a couple of years. The main entrance is very unattractive and needs lighting and a sprinkler system. The cost of these improvements would be $5000 and we only have $1000 in reserves. What would be the best way to handle this matter?

Answer: The governing documents generally provide the authority the board needs to raise money to care for the common elements by special assessment if necessary. But have you done an Operating Budget that includes insurance, utilities, landscape care and other expenses related to this project? Have you performed a reserve study to deal with the long range cost of the addition? Before moving forward with this, consider the whole expense picture.

Question: Our HOA has a entry gate with access control that uses smart cards which cost less than $5 each. The HOA charges the residents $50 for each smart card. The board's justification for the high charge is to discourage multiple card use per resident.

Answer: It does make sense from a security point of view that only residents should have smart cards. If extras were easily and cheaply available, they would likely be handed out to friends and relatives. Since security and access are very important to gated communities, the number of smart cards and who carries them should be strictly controlled. $50 does sounds high for a $5 device, but regulating and dispensing them does take someone's time. If someone is being paid to do this and that is their charge for doing it, it's justifiable. If done by volunteers, the price should be the HOA's at or close to the actual cost.

Question: Our board received a complaint about a resident running a business out of their home. They apparently ship a lot of items and the neighbor wants us to do something about it. Should we ban home businesses?

Answer: Banning home businesses is a bad idea since many people do it in a way that has no impact on the neighbors whatsoever. However, controlling how home offices impact the neighbors and the common area is a good idea. The HOA should have guidelines for home offices as they relate to parking, traffic, noise, odors and signs. In other words, control those things that impact the quiet enjoyment of the neighbors or residential character.

For more Ask the HOA Expert, go to Regenesis.net.

Published: April 25, 2007

Use of this article without permission is a violation of federal copyright laws.

Richard Thompson owns Regenesis, a management consulting company that specializes in condominium and homeowner associations. He is a nationally recognized expert on HOA management issues. Regenesis publishes The Regenesis Report, a monthly newsletter for HOA boards, developers and managers. To subscribe, go to Regenesis.net. He can be contacted by email at .