Homeowners associations are typically associated with suburbia, but they play critical roles in the city neighborhoods as well, as residents of a Nashville community found out in recent years.
While the role of an HOA is to keep land value up, it serves many other purposes. More people moving to Nashville necessitates road-widening projects, and homeowners may receive that fateful letter from the Tennessee Department of Transportation (TDOT) that changes are coming. In a neighborhood with HOA property, the TDOT deals directly with the HOA board.
But city and state officials are at a loss if the HOA is defunct, as Hunters Brand Road residents learned. The small neighborhood was established in the 1980s and residents had enjoyed an HOA-less existence for over 20 years.
Celeste LaReau, 58, had lived at Hunters Branch for several years when in 2018, she received news that the city had plans to widen Nolensville Road, which flanked the neighborhood. The busy state highway had only two lanes, but the addition of a greenway and a walking path was included in the expansion. Officials from TDOT were in the process of trying to find someone in the neighborhood to whom they could pay $50,000 for the property, but the HOA on file with the city no longer existed.
“Because our HOA was dissolved in 1993, there was no representation on behalf of our neighborhood approved to receive these funds from TDOT,” said LaReau.
It was the first LaReau had ever heard about the HOA. As the neighborhood evolved and people moved in and out, realtors selling the homes failed to mention the HOA, which technically still existed. Residents had been paying for the street lights and trash disposal, which is a task usually done by the HOA. The money offered by TDOT would take care of many needs for the neighborhood.
“Consequently, a notice or order of involuntary nonsuit had been filed by TDOT in circuit court to condemn our community property so the project could move forward,” she said.
LaReau had to move quickly since TDOT had already filed paperwork to condemn the property. She made the decision to become the neighborhood liaison since she had previous experience in dealing with TDOT. She consulted Ernie Gilkes, a civil litigation and compliance attorney, for advice while notifying her 150 neighbors about the potential $50,000.
“The question was, if the homeowners association had dissolved, who owned this land?” said Gilkes.
In a neighborhood meeting attended by a representative from the Metro Codes Department and most residents of Hunters Branch, LaReau explained that the neighborhood had until the court date to resurrect the HOA. $50,000 was at stake.
“Part of that money would go to pay for our street lights, and improvements within the property. You know, just to put the money in the bank,” she said.
To resurrect the HOA, residents needed to pay $5 a month, but the suggestion was met with disapproval. Some residents remarked that they “did not want to be told what to do,” said LaReau. Other older neighbors still remembered the defunct HOA.
Sometimes, people can't see the forest through the trees. rather than have $50,000 to improve the lighting or cut the grass, all they can see is 'I don't want to pay $10 a month. – Ernie Gilkes, attorney, on hesitance to establish an HOA.
“[The HOA] went defunct because there was no one administering it, and there was some controversy that maybe one of the parties had taken some money, and there was some distrust with the HOA because of it,” said LaReau.
She attempted a last ditch effort to get a nominating committee elected for the HOA, noting that the money would have paid to fix up the property and pay for the street lights, for which residents were already paying. But the notion had proven too unpopular for the residents.
“At that point I had put so much time and energy into trying to be able to receive the $50,000 because I’m a homeowner here. I thought it would be good for the neighborhood,” she said.
The problem is that TDOT still condemned the property.
“In these instances, TDOT will contact the president of the association and negotiate with them. If negotiations fail for whatever reason, TDOT will deposit the original offer into court and the (attorney general’s) office will take it from there through the condemnation process, said Kathryn Schulte, TDOT community relations officer. “During this process, the court will determine who will receive the payment for the land if there’s no clear title. It is unusual for a tract to go through the condemnation process without a clear title, but it does happen,”
Someone still needs to receive the $50,000, so the final decision falls to the attorney general, who may allocate the funds into another neighborhood, according to Gilkes.
“Sometimes, people can’t see the forest through the trees. Rather than have $50,000 to improve the lighting or cut the grass, all they could see is ‘I don’t want to pay $10 a month,’” said Gilkes.
Disappointed, LaReau considered selling her property since the neighborhood had only delayed their problem, which would inevitably come up again in future dealings with the city. She recently applied for a short-term rental permit, which she wouldn’t have been able to do without an HOA’s approval.
“I was really thinking about selling my house because the neighborhood doesn’t care, why should I care?” she said.
While construction hasn’t started yet, some of the residents whose property would be affected have yet to receive compensation, according to LaReau.
“An HOA would have had the power to negotiate the timeliness of the payment at least,” said LaReau.