Collect a tap fee in an HOA
<p>I am in an HOA.  We have a shared water system.  It is considered common property of HOA and there is a water assessment that is assigned by the board for the cost of operating the well.  There is a separate accrual account for capital projects.</p>

<p>I served on the board and saw at least 10 purchase agreements and a tap fee was not mentioned.</p>

<p>Initially there was no water system.  After the initial build out it was discovered permitting individual wells was going to be difficult.  By the time you honored size / spacing on septic and the well there was not much room for a house. </p>

<p>The builder put in a well and ran a water line. Again it is common property of the HOA. Some lots were already sold so he could not just add to the selling price. Builder imposed a tap fee of $1000 paid to him personally. I have been through the CCR and bylaws and there is nothing about a tap fee. I have seen no document that mentions a tap fee.</p>

<p>Can the builder legally enforce this tap fee paid directly to him?</p>

<p>It is not worth fighting over $1000 fee but I was curious.  What if he changed that number to be $10,000.  He has first ROR.  He could exercise it then waive the tap fee on himself. </p>

<p>The plot thickens.  The title company is enforcing a tap fee must be collected at closing.  I asked where is a tap fee documented.  They said we have an email from this individual.</p>

<p>Now the HOA is saying we are not enforcing the tap fee only collecting.  I told that is money laundering.</p>

<p>You won't see it in the CCRs, Bylaws, etc.. since it wasn't implemented and part of the original plans of the association. The builder is just a homeowner now right? If so then they have no extra rights than other homeowners (unless Bylaws say different?)</p>

<p>Anyways, you definitely should question it; homeowner (builder) should have been treated as a vendor, but also any capital expenditures or new assets of the association might need a vote of the HOA members.</p>

<p>Unless the builder/homeowner had a vendor contract with the association on that fee then most likely no they cannot enforce it; it seems what you do suggest is they are asking for a voluntary donation towards the expense of putting one in.</p>

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