What is property owners association (POA)
The existing AOC (apartment owners cooperatives) will be replaced by POA (property owners associations) or copartnerships.
They will operate under the following scheme: one house – one governance body (POA or copartnership) – two bank accounts (current and savings one).
This is an alternative to AOC under which the owners manage their property themselves. The existing AOC (apartment owners cooperatives) should be reorganized until July 1, 2022.
In the material, we will describe what property owners association (POA) is, what are the expenses and responsibilities.
How to register POA
During the first meeting, owners of apartments and non-residential premises should approve:
- members of a house council, who will represent the interests of owners of apartments and non-residential premises on the issues related to managing and maintaining the common property of the condominium object;
- form of management for a condominium object or delegate the authority to select a form of management to the house council.
Owners of apartments and non-residential premises should select one of the forms of management:
- Property Owners Association (hereinafter: POA) is a legal entity formed by the owners of apartments and non-residential premises;
- Copartnership which is a direct joint management performed by all the owners of apartments and non-residential premises without legal entity formation.
At the same time, both forms of condominium object management will operate under the “one house - one association or copartnership - one account” principle, which implies that each property owners association or copartnership will have to open its own current and savings bank accounts.
Then, the following members are elected:
- chairperson of POA;
- inspection committee (inspector).
The chairperson of POA is elected among the owners of apartments/non-residential premises and performs management functions, concludes contracts for the provision of services with service activity entities.
S/he is selected among property owners for one year. A chairperson performs the following functions:
- Performs registration in justice agencies;
- Makes a list of residents and owners of apartments/non-residential premises and concludes contracts with subcontractors;
- Executes decisions made by residents;
- Places information on the decisions made during meetings and by a house council in public areas;
- Opens current and savings accounts in second-tier banks;
- Monitors execution of liabilities by residents and subcontractors;
- Provides residents with monthly and annual reports on the meetings;
- Executes other functions related to condominium object management and maintenance.
The chairperson of POA has a right to represent an association in all the courts, government agencies and organizations without power of attorney.
Salary of a chairperson of POA is approved on a meeting by all the property owners.
Who has a right to initiate a meeting on transfer from AOC to POA
A meeting of the owners of apartments/non-residential premises on transfer from AOC to POA or on other issues is convened at the initiative of a house council, trustee of copartnership, or at the request of inspection committee, or at the request of at least 10 percent of the owners of apartments/non-residential premises, or at the request of the housing inspectorate.
There is no need to contact a local akimat in order to establish POA as it is sufficient to hold a meeting of the owners of apartments/non-residential premises.
If the owners of apartments/non-residential premises won`t establish POA or copartnership within one year from the date of entry into force of the adopted Law as of December 26, 2019, then local executive bodies have to ensure that a meeting of owners of apartments/non-residential premises is held to elect house council and select the management form for a condominium object.
Nonetheless, apartment owners cooperatives (AOC) will not be abolished automatically but should be reorganized by July 1, 2022 into management or service companies. In a new status, they will proceed with their activities on the maintenance of houses. The established POA or copartnerships will decide whether to conclude an agreement with them or not.
If earlier AOC simultaneously acted as a customer and a contractor of services for the maintenance of the common property of an apartment building, POA will act only as customers. There won't be many employees.
It means that residents will engage management or service companies, conclude contracts with contractors and utility services and control the volume and types of work performed as well as payment for the works performed in a condominium.
How to execute documents for POA registration
When preparing documents, it is necessary to use standard forms of the minutes of the meeting and survey sheets pursuant to the Rules approved by the order of the MIID of RK No. 163 as of March 30, 2020. Voting sheets should be numbered and stitched together with a minutes.
The POA charter should be submitted to a registering authority in two languages: the state language (2 copies) and Russian (2 copies). When developing the charter, it is better to use the Model Charter of the Property Owners Association as a basis as it was developed to make life easier for property owners.
If property owners decide to develop the POA charter independently, it is necessary to include the basic norms of the Law of the Republic of Kazakhstan "On housing relations".
Pursuant to the Civil Code of the Republic of Kazakhstan, the name of a legal entity should not completely or significantly duplicate the name of other legal entities that have already been registered.
If you find it difficult to select a POA name, it is better to take a name of the residential complex or the address of an apartment building.
For the location of a legal entity, you can specify the actual address of POA office or home address of POA chairperson.
The POA chairperson should be fully capable, not have an outstanding and unexpunged conviction for crimes, premeditated bankruptcy, as well as debts for enforcement documents.
Opening POA bank accounts
Within 15 working days from the date of election, the POA chairperson should open two accounts in a second-tier bank:
- current (money for expenses on the current management of condominium object and its maintenance);
- savings (to save money for complete repairs of communal property).
Once cannot refuse to open the accounts.
There is a liability available for violation of the terms of opening current and savings accounts for a condominium facility in second-tier banks.
The sanction entails a warning first.
If a violation is not eliminated within a year, a fine will be imposed.
- in the amount of 10 MCI for individuals (for copartnership trustee);
in the amount of 20 MCI for legal entities (for POA chairperson).
Approval of cost estimates for POA
After POA is established, residents need to hold a meeting and approve the cost estimates.
Money can be used from an account intended for complete repairs to repair the roof, façade, and other expensive parts of the common property of condominium.
Funds from the "For housing maintenance" account are divided as follows: no more than 30 percent goes to management, no more than 70 percent goes to the maintenance of common property.
The following expenses are included into condominium object maintenance:
- payment for accounting services, statistical and tax reporting;
- payment to executive body for managing a condominium object (the amount is approved at a meeting or by a house council);
- obligatory payments to the budget (taxes, deductions and others);
- bank services;
- payment for cash management services;
- expenses for office maintenance (rent, communication, stationery, office equipment and its maintenance).
The following expenses are included into maintenance of common condominium object property:
- deratization, disinfestation, disinfection of basements, parking lots and other public areas of a condominium object;
- technical maintenance, localization of communal utility systems accidents (heating, hot and cold-water supply, water disposal, power supply, gas supply, ventilation);
- preparation of communal utility systems and equipment to autumn-winter period;
- ensuring the sanitary condition of public areas of a condominium object;
- ensuring the sanitary condition of a land plot located on a territory adjacent to a condominium object. This includes landscaping (planting, maintenance, pruning of green spaces and lawns), sanitary cleaning of garbage chutes, cleaning of cesspools, cleaning and whitewashing of yard latrines, cleaning leaves, snow and ice, including that on a roof;
- acquisition, installation service maintenance and testing of communal metering devices;
- ensuring the safe operation of hazardous technical devices, routine repair and localization of emergencies (elevator maintenance) pursuant to a decision made on a meeting of property owners;
- fire protection measures, including maintenance of fire-fighting equipment, purchase and charging of fire extinguishers, application of special inscriptions, signs, execution of evacuation plans and schemes, with the exception to acquisition and installation of fire alarm and fire extinguishing systems;
- current repairs of common property of a condominium object (based on a defects certificate);
- payment for utility services related to maintenance of common property of a condominium object pursuant to a decision made on a meeting of property owners;
- installation of intercom system;
- technical maintenance of intercom system;
- household expenses (purchase of stocks, equipment, etc.).
One cannot withdraw from contributions for complete repairs of a house.
In accordance with the law, property owners are obliged to take measures to maintain the common property of a condominium object and ensure its safe operation, including current and complete repairs of common property of a condominium object.
Debtors can be sued by the governing bodies and money can be collected from them.
For the purpose of money saving for complete repairs of common property of a condominium object, a property owner is obliged to transfer money to the savings account in the amount of at least 0.005 times the MCI per 1 sq. meter of usable area of an apartment/non-residential premise.
As to savings accounts, a second-tier bank will keep an automated accounting of funds with a breakdown for each apartment/non-residential premise.
Each property owner, who contributes money for complete repairs of common property of a condominium object has the right to receive information on the money accumulated for his/her apartment/non-residential premise.
The chairperson of property owners association is obliged to provide information on the money accumulated for complete repairs of common property of a condominium object at a request by a property owner.
Last update: 01.10.2021