Dear fellow Enclave owners,
The various issues surrounding rental units in The Enclave have gotten conflated and misunderstood, recently. The proposed Amendment 3 and the follow-up survey, regarding limitations on the number of rental units are both concerned with limiting the number of rental units and preserving The Enclave as the prominently owner-residential community we currently enjoy. However, the issue of the Rental Impact Administrative Fee is separate and completely disconnected from the others. The fee is not an attempt to punish owners of rental units or to dissuade owners from renting their units. The purpose of the fee is simply to provide financial fairness to resident owners, regarding monthly dues and the payment of our monthly bills. The following is an attempt to educate and inform the Association on the purpose of the Rental Impact Administrative Fee, so they can make an informed decision as to the future of the fee.
Our monthly dues are collected to pay our bills. They pay our utility bills, like water/sewer, trash, etc. They pay for maintenance costs and wear and tear on our elevators, the front gate, parking lots, pool/hot tub, TV/Wi-Fi, etc. They pay for our property management, landscaping, security, ground maintenance, etc. You get the picture. The total bill of all these services is divided proportionally and equally between each owner, based on their unit size. No matter what our individual usage is per unit, when we join the Association by buying a condo, we agree to share equally all those costs. So, a person who lives at The Enclave for 6 months per year is paying the same COA Fees as a resident owner who lives here full time, even though they are using half the amount of water, using the elevator/pool/hot tub/gym equipment half as much, going back and forth through the gate half as much and that is understood by all owners. But we accept this situation when we join the Association as owners. We agree to share equally all the bills with other owners, regardless of our usage of those utilities, facilities, and services. For your information, as of now, approximately 50% of the units in The Enclave are owned by part-time resident owners, roughly 61 of 123 units.
However, the part-time resident is paying twice as much, or more, as a full-time rental unit owner does. The part-time resident is basically subsidizing the full-time rental unit owner and his tenant. Renters are full-time residents at The Enclave. Therefore, they use disproportionate amounts of water, the elevators, the front gate, the pool, and all the facilities and services, as say a 6-month part-time resident owner. As a result, our total billing costs for utilities and maintenance are driven higher, due to renters residing here 24/7/365. Since the overall bill is split evenly, the monthly dues are higher for every owner. These are tangible, real expenses paid by every owner. The monthly dues of rental units are essentially partially subsidized by every owner. One could argue, but those landlords pay the same monthly dues on the rental unit as anyone else. That is absolutely true. But the landlord recovers those dues in the form of rent. Resident owners don’t recover those dues from anyone. They just pay the bill. As I stated before, we accept paying an equal share of the bills when we join the Association. The difference is renters are NOT part of the Association. No owner-member of the Association has agreed to partially subsidize renters’ utility and maintenance costs as a consequence of buying a condo at The Enclave.
The Rental Impact Administrative Fee is collected to offset the subsidy that resident owners pay for renters’ higher disproportionate usage of our water, utilities, maintenance, and wear and tear on The Enclave. It is meant to reduce the impact that full time renters have on our monthly dues, due to their higher usage rates as compared to full-time and part-time residents. All Rental Impact Administrative Fee monies are deposited into the general operation fund. These Rental Impact Administrative Fee deposits, along with owners’ monthly dues are used to pay our utilities and maintenance bills. Consequently, the Rental Impact Administrative fee deposits result in slightly lower monthly dues for all owners, and reducing the subsidy owners pay for the renters’ increased usage. So how much of a Rental Impact Administrative Fee, if any, is fair? The monthly dues on a two-bedroom unit are currently $526, or $6312 annually. The Rental Impact Administrative Fee is $750 annually, which represents just under 12% increase over the monthly dues. The question is, do full-time renters use water/sewer, the elevators, the gate, the pool/hot tub, and all other services, at a rate only 12% more than the average Enclave owner? Obviously, some services, such as water, elevators, the gate, TV/Wi-Fi, parking lot, possibly the pool/hot tub, are used at twice the rate of a 6-month part-time resident owner. That’s a usage rate 100% more than an owner who lives at The Enclave for 6 months. If you live at The Enclave less than 6 months per year, that difference goes even higher. Meaning you are subsidizing owners of full-time rental units at an even higher rate.
These are not the opinions of the Board of Directors. There is no secret agenda. These are simply the facts. As stated above, as of now, 50% of the units in The Enclave are owned by part-time resident owners. If you favor removing Rental Impact Administrative Fees, then you agree with subsidizing owners of full-time rental units by paying higher monthly COA fees from owner residents. The fact is, all resident owners are splitting the cost for the extra usage of full-time renters. The question is, do resident owners want to partially subsidize investors who rent their units for profit. If Rental Impact Administrative Fees are removed, money to make up the difference to pay our bills has to come from somewhere. That somewhere would be in the form of increased monthly dues.
The Board of Directors