March 25, 2019
Update on Charter/Spectrum Offer
Several weeks ago, we made the community aware of a possible offer from Charter/Spectrum to offer residents:
- Internet speeds up to 200Mbps, including modem and wireless router.
- HD Digital TV including 3 receivers and Platinum level television channel availability.
- Ability to stream included.
The offer for the items listed started out at $48/month with annual increases not to exceed 4% annually and a contract term of 7 years. This is a program offered to condos/apartments and the abbreviation is an (MDU) which stands for Multiple Dwelling Unit.
Our Board met several days ago and went through the documents and the offer. There were a few items that gave us concern.
- Monthly billing for bulk services is directly to the HOA. We requested that each home be invoiced individually by Charter so each homeowner could pay on their own. Charter was not willing to change this and for that reason, we believe it would not be wise to put the HOA at risk financially.
- As many of you know, we are a volunteer organization and give of our time to the community. We do not feel we have the appetite to invoice each homeowner monthly (or quarterly) and then collect those fees. We felt it would be difficult to change our by-laws to require each homeowner to subscribe to these services for 7 years. If there were changes in the by-laws, this would provide the tool to collect on past due fees, but without that we were concerned that while the bulk cable/internet billing coming into the HOA would be $4800/monthly (100 homes @ $48), a few residents may not want service from Charter and then find a provider elsewhere. If 10 homes opt out, we would then be collecting $4320/month, thus leaving the HOA responsible for the balance. This could quickly add up and put the HOA in financial peril.
- We confirmed the pricing offered was $48/monthly for these services and they are. The extras were sales taxes and government-imposed fees that are seemingly on all providers. First year, we were looking at $54 all in plus any premium channels (HBO or Showtime) as an example.
- We did not feel it would be the prudent thing to do to sign this agreement and then pass it along to a new board for them over the responsibility of billing, collecting and managing this contract.
From a comparison point of view, we polled a couple of residents who are paying $180-$200 for TV and Internet. Using $180/month, this is $2,160/year and $15,120 over 7 years. The same homeowner, with 4% annual increases would pay $576/year one and a total of $4,546 over 7 years, representing a savings of $10,574. If a resident is paying closer to $200/month as many are, the savings are more dramatic.
For those only paying for Internet, the current rate appears to be $75.00/month with a leased modem. Their offer of $48 would save approximately $27/monthly, $288 annually and $2,016 over 7 years.
If there was 100% buy in from every homeowner to go down this road, then perhaps the board would revisit with proposed changes to our by-laws. Many of you have seen or responded to past Facebook posts that they would be supportive, but again, the only way it works is with mandatory 100% participation.
In closing, we knew the offer represented incredible savings to the community. On one hand who wouldn’t like to save or redirect $1,500 annually to something other than their cable and internet bill? On the other hand, the terms of the offer require bulk invoicing of all homes (less premium services) to the HOA without a boilerplate manner in which to mandate homeowner participation.
Feel free to contact us with thoughts/comments.