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Maine Alliance for Road Associations

Required to be a non-profit? Seeking guidance

  • 10 Nov 2025 5:01 PM
    Message # 13561670

    Hello all, 

    I purchased a home that includes a private road. In all of our deeds, it refers to the 'Alexander Way Homeowner's Association, a non-profit corporation'. No incorporation was ever filed by the previous owner, which was an affordable housing trust that developed 7 homes on the road. There was one existing home prior to their development, but her deed also makes her a member of this association. We do have covenants filed for each home as well, set by the association and running with the property, recorded in the registry of deeds for all 8 lots. There are no by-laws filed, and the Housing Trust told us all that it was up to us to manage the HOA now that all homes on the road sold. We have had one initial meeting with every lot owner and selected officers (President, Secretary, and 2 treasurers - of which I am one - re: co-treasurers, long story). I understand this forum doesn't provide legal advice, but I could still use some guidance. Based on a lot of reading, it seems that if our deeds mentioned a member organization (i.e. HOA), that even thought the HOA exists primarily to ensure road maintenance/dues, we may not be able to use the statute route for legal structure. I cannot find any language in Maine titles/chapters that says explicitly that we have to be a non-profit corporation, but it seems like we may have to be? Also, it specifies we are that structure in our deeds? I'd really welcome any advice; when I mentioned at the first meeting that we could become a non-profit corporation there was a lot of pushback from other members that it was "too complicated". We've identified someone for snow clearing, but I'm getting anxious as other officers are dragging their feet about getting things done and we don't have banking, insurance, or due collections set up. I am worried we won't have the funds liquid to pay our plow contractor, and he was the only person we found in the area willing to take us on. Please, if you have any advice or resources, please let me know!

    Thanks!

  • 11 Nov 2025 12:47 AM
    Reply # 13561776 on 13561670
    Anonymous member (Administrator)

    I am not an attorney, but I can tell you what we did, and it's been working since 2012.  We started out a lot like you.  There was a subdivision, (actually, there were four, all on connected roads,) and all the deeds said the grantees would be members of the XXXXXX  XXXXXX Road Association.  But there wasn't one.  Then one of the developers hired an attorney who set up the XXXXXXX  XXXXXX Owners' Association as  non-profit.  (Note the difference in the name.)  It started off with 25 of the 35 Owners meeting together and paying their dues.  But within a few years there were only a dozen people paying.  Most of the officers quit, and there was not enough in the treasury to pay the plow contractor. 

    Then the new person who had had the office of President thrust on them discovered that we were supposed to have paid a fee to the State every year, and it had not been paid since the first year.  We had no funds to pay the back dues plus penalties.  So we scrapped the non-profit and re-formed as Statutory, naming it what it said in the deeds, and being careful to follow all the initial requirements - having a Notary call the first meeting, notifying the owners of every benefited property, having the agenda and proposed budget go out with the Notice, etc.  Thirteen years later, after further subdivision, we now have 55 members and almost all of them pay.

    So my recommendation would be to go ahead and form a Statutory association, being careful to fulfill all the requirements.  You can always also form as a non-profit later if you find you need to, but at least you will be able to get started and pay your plow contractor.

  • 12 Nov 2025 1:51 AM
    Reply # 13562214 on 13561670

    Thank you for your reply, I appreciate it! I do want to reiterate, we are listed in our deeds as a homeowners association non-profit, not a road association. It is my understanding that statutory is only for a road association? We do have covenants that do have restrictions/guidance beyond just the need to maintain the road, including that all lots must equally pay for the road and that the HOA is allowed as much as legal to get fees from every lot (as well as we cannot rent our homes, some aesetics stuff etc). Given that our covenants also place resale requiremts in place for affordability to future buyers, I'm not sure we could dissolve them even if we wanted to. Does that change your perspective or answer at all? It also snowed today, making finding a solution feel increasingly dire, but I'm having a hard time getter other officers to move forward with anything. I want us to be able to at least start collecting dues, but I'm unsure of the best route. Can we be an HOA/non-profit as well statutory road association? Thank you

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