Jarrell neighborhood frustrated after they say their annual fees quadrupled

A community in Jarrell is frustrated that its neighborhood fees will quadruple this year.

Community speaks out

What they're saying:

"Being sprung a bill like this is not fun for anybody," said Brian Clark, a resident at Sonterra in Jarrell. He closed on his home here in 2023.

"We were told the HOA fees were a one-time-up front payment at closing," said Clark. "I kind of had suspicions about that just based on what I knew about HOA’s coming in. I thought that was a little bit strange, but I wasn't going to complain."

The whole time, Clark was also paying a $5 monthly fee to the Sonterra Municipal Utility District, which the MUD was transferring to the HOA.

According to Sonterra MUD, those $5 comes from an agreement in 2011 where it agreed to pay the HOA until July 2024 "at which time the MUD would make its final payment and the HOA would convey ownership of the Sonterra clubhouse and pool property to the MUD."

"I don't think most homeowners knew that that agreement had been in place," said Clark.

That agreement ended in August and residents said they learned the annual HOA fees would return, which cost four times more than what they were paying to the MUD.

They also said it’s due at the end of January.

"$60 a year versus $240 a year is quite a jump," said Clark.

More than 1,200 people have already signed a petition to abolish the dues, citing the fee "constitutes a significant financial burden on households."

One resident who asked to remain anonymous agrees.

"I understand a lot of people in the Jarrell area are not as financially stable. They’re not just able to fork out $240. They must budget that."

"My take is the HOA always knew that agreement was going to end, and they should have had a plan," said Clark. "They act like they were caught completely off guard by the fact that the mud paid their bill and paid the loan off and ended the contract and I think some foresight on their part would have saved this situation from blowing up into what it is now."

In response, the Sonterra MUD also said in part that it ended the agreement because "additional payments, which would be in exchange for no valid consideration, would be unlawful."

Sonterra HOA added "The HOA is very willing to go back to the previous process.  It would be better and less expensive for the homeowners. The MUD just needs to talk to the HOA for a solution that works for both of them."

It also said it has "always offered payment plans. The homeowners only need to ask."

That is something both residents mentioned in their interviews.

"I think people could come up with $60 within three months, much easier than a lump sum of $240," said the anonymous resident.

"In order to keep people from going delinquent, there would be a payment option," said Clark. "I mean, $240 in the grand scheme of things isn’t a ton of money but a lump sum payment by a lot of the people who live here. It’s going to break them for that month."

Statements from Sonterra MUD and HOA

What they're saying:

Below is the full statement from Sonterra MUD:

"The HOA and Sonterra MUD entered into a Lease/Purchase Agreement in 2011. Under the Lease/Purchase Agreement, the MUD agreed to pay the HOA monthly lease payments until July 2024, at which time the MUD would make its final payment and the HOA would convey ownership of the Sonterra clubhouse and pool property to the MUD. As further consideration for the property, the MUD agreed to pay the HOA up to $5.00 per month per home for use by the HOA to conduct deed restriction enforcement. The Lease/Purchase Agreement expired when the final payment was made to the HOA and the HOA deeded the clubhouse and pool property to the MUD, per the terms of the agreement. This resulted in cessation of the $5 per month payments to the HOA, which payments constituted a portion of the consideration in exchange for the clubhouse and pool property. The agreement was not renewed since the property purchase was complete. Additional payments, which would be in exchange for no valid consideration, would be unlawful. Consequently, the HOA now assesses and collects fees like a typical HOA."

Below is the full statement from Sonterra HOA:

The Sonterra HOA also provided it’s 2025 budget to FOX 7 and answered follow-up questions:

LAUREN: From residents, we have heard that the $240 payment may be difficult to pay this month. Is a payment plan an option?

HOA: Yes, we have always offered payment plans.  The homeowners only need to ask. 

LAUREN: Also, do you have any plans to release a 2025 budget or show how you might use the additional money? 

HOA: The 2025 Budget has been released and is on the website.  We are the management company the Declarant sets the budget.  There are several factors (including inflation) contributing to the new budget. There are projects the MUD cannot pay for but will be required to be completed as part of finishing the buildout of the community.  Those expenses have been and are controlled by the Declarant, and we are not privy to their plans.   

LAUREN: One of the residents who reached out also explained that their new annual fee is $240. They are a little confused at how they went from paying $5 a month (or $60 a year) to now $240 a year. Could you explain that too?

HOA: The $5 was used to enforce the CCRs, some community maintenance, events, etc. Very efficient (no billing, no payment plans needed, no collections, no attorneys, minimal accounting staff, etc., etc. Now that the HOA must bill the homeowners directly, the delinquency rate will be significantly higher, resulting in the need to perform billing, additional postage, manage payment plans, more administration, manage collections, involving attorneys, more accounting, court costs, etc.

We had a 0% delinquency rate prior to the MUD changing direction. This is unheard of with HOAs. Meaning every homeowner paid $5 to fund the HOA without having to be sent an invoice.  Very efficient.  This is just like the MUD’s agreement with ACDI. The MUD contracted with ACDI for the community’s trash service and makes one payment to ACDI.  ACDI in turn collects the trash for the whole community. Very efficient. If ACDI had to bill and collect funds from each homeowner, the cost to the homeowner would be significantly more. 

Additionally, ACDI can take their cans back if you don’t pay. The only option the HOA has is to sue for collections.

By comparison:

  • The Home Place HOA (in Jarrell, small community, no new projects, no amenities) - $10 per month.
  • Calumet HOA (Jarrell) - $30 per month
  • Stonebridge Crossing HOA (Jarrell)- $41.67 per month.

As stated before, we are more than happy to sit down with the MUD to discuss a long-term legal agreement which would result in a reduced cost to the homeowners."

The Source: Information from interviews conducted by FOX 7 Austin's Lauren Rangel

Jarrell