Re: Trying to get set up
From: Nancy Baumeister (
Date: Tue, 11 May 2010 08:36:01 -0700 (PDT)
Hi Nicole,

Disclaimer- I am not the expert here, and I was not the central figure in the following activities/decisions that we did during development but here's my take from CoHo Corvallis. .

Nicole Lorsong wrote:
-Zoning - How did zoning / these goverment type issues work for your community? Did you buy land in an area already 'properly zoned' for the number/density of houses you wanted, or did you need to rezone? For anyone that did rezoning - was it expensive? Difficult? I know this is largely area based, but I'm just looking for a vague idea to take back to my group.
We did rezone- we made part of the property higher density and the rest of it is zoned open space. we also had to get annexed into the city to do the higher density.. It was pretty easy- we had good community support. We did do a lot of outreach. In other words, it was easy but it was also a lot of work.
-Liability - The lawyer I spoke with was concerned about issues of shared liability. Fo r example, in cases where Household A has a guest that is injured on the property and the guest decides to sue- what keeps households B through J safe from litigation? Is homeowners insurance and a properly designed legal structure enough?
I think so.
-People leaving the community - Obviously at some point someone will probably move out, and statistically someone will probably get divorced. When a member separates themselves from the community, are there difficulities here? I think the lawyer was especially concerned with shared items. Ex: If we share a tractor, and Household A gets divorced, can Ms Household A include the tractor as part of her assets to be split from Mr Household A, and affect the rest of the community negatively?
I think the HOA owns the tractor. Household A owns the condo and that is what gets split.
-Members that don't pay dues - I guess I'm a little confused on this point in the first place. So if the community's legal entity buys the land on which the houses are located, that land can be mortgaged, right? And the community dues essentially = an equal part of the mortgage + any extra community fees? If this is the case, then if one family doesn't or can't pay for a month (or more), then does everyone else pick up the slack or loose thier land/house, too?
We did a pretty standard model- we pooled our down payments (5 to 10%) to form an LLC. The LLC borrowed the rest of the money to build CoHO, We bought our condos from the LLC. When I pay my mortgage I pay the bank that loaned me the money to buy it from the LLC. If I get in trouble I am in trouble with my bank. Of course if it came down to a foreclosure then the community is affected and there have been lots of discusssions here about community support for members in financial trouble.
I don't know if I'm making sense, here. I guess I just don't really understand the finer details of the legal and money aspects. In my mind it's simple - we buy some stuff and we share it. :P But I guess in the 'real world' it's a little more complex. :) Lastly, if any one of the Maryland groups can recommend a good lawyer or any other good local contacts who might be able to help with basic set up, I'd appreciate it!
A good lawyer and lots of reading here will help you enormously. Good luck. It's a lot of work but you only have to do the development once. It's worth it.

CoHo ecovillage, Corvallis Oregon
Thanks in advance!
"Freedonia Commons' - A [very] new group in central Maryland

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