Deputy Joan Burton has welcomed the NCA’s brand new guide to property management companies, but said that the Government must see through its promise to bring forward the relevant legislation before the Dáil’s summer recess. The Law Reform Commission just published its final report and legislative guidelines , on property management companies, leaving the Government no excuse but to bring forward legislation without delay.

Commenting on Fingal County Council’s replies to her questions on the taking in charge of Dublin 15 housing estates (below), Deputy Burton said “I know that many residents are concerned about their estate being taken in charge. They want to be sure that the roads and public spaces will be handed over to the Council in their proper state and then maintained adequately by the County Council.”

“Living in an attractive and well maintained estate is the least that people deserve. In many cases, this is unfortunately not the case due to shortcomings on the part of the management company and their agents. For many, the most appropriate solution is for these estates to be taken in charge by the County Council. This process can take many years, as residents around Dublin 15 have found out the hard way. While the Council claims that it is not possible to give precise timescales for this process, we must surely move towards a situation where we are talking about months and not years.”

“Many people have undergone serious anguish in dealing with their management company and their agents. It’s understandable that in many cases, they are only too happy to have the county council take over responsibility of their estates as has traditionally been the case for housing estates around the country. It is therefore important that the Council has clear procedure set out to ensure a smooth transition.”

Statements of the County Manager to Joan Burton:

1. To ask the Manager the procedure and timeline for the process of taking in charge estates, or parts thereof, of estates run by management companies.

Reply:
The following are details of the process for declaring roads to be public roads and taking them in charge by the Council:

When an application is received from a Developer to take an Estate in Charge the Developer is requested to submit as constructed drawings of the Estate including the layout of services together with a certificate from his Architects/Engineers confirming that the development has been carried out in accordance with the Planning Permission granted.

The Building Control Section then “snags” the Estate for outstanding works and pursues with the Developer the carrying out and completion of any works deemed necessary to bring the Estate up to taking in charge standard.

The Water Services Department, the Parks Department and the Public Lighting Division also inspects the Estate to establish that services and facilities which are the responsibility of these Departments are in accordance with Council standards.

Subject to the satisfactory resolution of any outstanding issues, arrangements are then put in place to have the formal ‘as constructed’ taking in charge drawings prepared to enable the Statutory Procedures to be initiated. This involves the giving of Public Notice in the Public Press and the making available for inspection of the taking in charge drawings for a period of one month. A further period of 2 weeks is allowed for the making of submissions in relation to the taking in charge of the Estate and the declaration of the roads to be public roads.

When this process has been completed a report on the matter is submitted to the next appropriate meeting of the County Council.

The time frame for the taking in charge of individual Estates can vary considerably and is dependent on the manner in which the development has been carried out and the co-operation of the Developer in completing outstanding works following the inspections by the Building Control Engineer and the other Departments of the Council.

In general, all developers are responsible for roads, public lighting, open spaces, sewers and watermains until these amenities and public utilities are completed to a satisfactory standard for taking in charge. Developers responsible for these public utilities and amenities completed to a satisfactory standard may request the Local Authority to take them in charge. Alternatively a developer may set up a Management Company controlled by the residents of the development to maintain amenities and public utilities completed satisfactorily but not taken in charge by the Local authority.

In 2007 a total of 21 housing estates were taken in charge in the administrative area of Fingal. In 2008 up to the end of April, 2008, 9 housing estates were taken in charge. A further 3 housing estates will be considered by the County Council for taking in charge at its meeting on 12th May, 2008.
.

2. To ask the Manager for a comprehensive list of all estates in Dublin 15 which have not yet been taken in charge; for a comprehensive list of all estates for which applications have been made for those estates, or parts thereof, to be taken in charge; to outline in each instance the status and projected timescale for completion of the process.

Reply:
At present, the County Council is processing applications to take the following estates in the Dublin 15 area in charge: –

ESTATE NAME CURRENT STATUS
Dunsoghly Estate Drawings ready. Manager’s Order signed. Public display
is about to commence. Will go to the July County Council Meeting.
Mount Symon, Clonsilla Road Drawings ready. Manager’s Order signed. Public display
is about commence. Will go to the July County
Council Meeting.
Portersfield, Clonsilla Planning permission required to retain the closure of the pedestrian access in advance of taking in charge
Summerfield Blanchardstown €20,000 has been sequestered for outstanding works.
Manager’s Order being prepared for public display. Will
go to the July County Council Meeting.
Windemere, Clonsilla No “As Constructed” Drawings received. Taking in
Charge Drawings being prepared.Money to be sequestered
to finish hammerhead.
Ongar Stud, Dublin 15 -Ongar Park, Ongar Chase, Ongar Village, Ongar Lodge, Will be taken in charge in phases. No “As Constructed”
Drawings received. 80% surveyed. Small amount of
outstanding works required.
Tyrellstown, Dublin 15 Curragh Hall and Bealing have been taken in charge.
Remainder of estate to be taken in charge in phases. “As Constructed” Drawings being verified.
Castlefield, Clonsilla Road Will be taken in charge in 3 phases. Drawings being
prepared. Planning permission required in relation
to the entrance prior to taking it in charge
Allendale, Dublin 15 Small amount of outstanding works required. Taking
in charge drawings to be prepared.
Beechfield Estate, Clonee, Dublin 15 Small amount of outstanding works required. Taking
in charge drawings to be prepared.
Redwood Estate, Hollystown Application to take estate in charge received. Requested
to submit documentation
Charlestown, Meakstown Drawings received. Have to be verified.

On completion of outstanding works/preparation of necessary taking in charge drawings, public notice is given of the Council’s intention to declare the roads in the estate to be public roads. This process alone takes 6 weeks to complete. On completion of public display process, a report recommending the declaration of the roads / taking in charge of the estates is submitted to the next appropriate meeting of the County Council to enable the estate to be taken in charge.

Due to the many variables associated with the taking in charge process, it is not possible to give precise timescales in all cases for the taking in charge of each of the estates listed above.

Speaking in the Dáil today, Deputy Joan Burton called on the new Government to urgently address the management company issue.

“We have seen an exponential growth in the number of so-called property management companies in recent years. At the same time there has been a gross political failure in terms of regulating this sector. While I accept that the issues at hand are complex, requiring several pieces of legislation, there is no reason why this should be years in the pipeline.”

While the Government prevaricates, many young people continue to be charged management fees of up to €2,500 in return for often very poor standards of service. People often cannot receive proper invoices, which not only makes it difficult for people to claim the tax relief to which they are entitled but raises concerns about the transparency of these charges. This is a case of gross exploitation by some management company directors, developers and property service agents.

We have even seen homeowners having to resort to legal action to hold their management agents to account. Indeed, in Tyrellstown in Dublin 15 homeowners have been fighting a running battle with their management agent over the last two years. These court cases are ongoing.

I recently put several questions to the Minister for Justice on management companies. Over the past year, we have received a succession of assurances that legislation is just around the corner, but that corner seems to be pushed further and further into the distance.

We are now assured that everything will become clearer once the Law Reform Commission publishes its final report on multi-unit developments. Publication of this document is expected at the end of May. We have waited long enough, and it looks like this process still has another while to run yet. I hope that the new Minister, Dermot Ahern, is more amenable to introducing interim measures to address the problems that homeowners are having with their management companies on a day to day basis.

It’s all change around the Cabinet table this week. I hope we’ll also see the Government stepping up a gear to deal with property management companies as a matter of priority. Indeed I would call on them to support today’s private members’ motion to indicate their newfound urgency in dealing with the issue – but I won’t hold my breath.

Are you sick of seeing your management fee on the increase for a sub-standard service?

Are you tired of being given the run-around by a property services company that’s out of touch?

Do you want to know more?

You can download a copy of my guide to management companies (page 1 & page 2). I also recommend the National Consumer Agency’s guide.

The fundamental problem is that there is no legislation in place which specifically governs the operation of management companies and their agents. We currently have a scandalous situation whereby homeowners are members of their management companies, yet they are often prevented from exercising control of it by property developers who retain enough properties and structure the company in such a way that they have majority control.

Over the past year, I have continually raised the issue of management companies in the Dáil and recently called on the Taoiseach to deliver the long promised legislation before he leaves office. He refused to give a concrete indication on when this legislation would be brought forward. We are now assured that everything will become clearer once the Law Reform Commission publishes its final report on multi-unit developments. Publication of this document is expected at the end of May.

What Should the Government do?

The Labour Party has put the following demands to the Minister for inclusion in the legislation:

? Facilitate the transfer in newly completed housing estates of responsibility for
essential public services such as water, sewage, roads, lighting and common open
spaces, to the control of the Local Authority;

? Appoint a Regulator of Management Companies to:
• regulate all management companies
• oblige vendors to provide clear information about fee levels, any changes in fee
levels and the duration of the management company contract
• compel service providers to give detailed invoices for services supplied;

? Restrict the use of management companies in traditional housing estates.

? Where management companies are a necessity, ie in an apartment building, Labour
proposes that these should be set up as not-for-profit companies, owned by the
residents.

Having received submissions from myself and other consumers, the National Consumer Agency is due to publish its proposals for addressing management company issues in the coming weeks. I will continue campaigning on your behalf to make sure the Government fulfils their promise to bring forward much needed legislation and put an end to this scandal.

In the mean time, if you have a problem with your management company, don’t hesitate to get in touch: joan@joanburton.ams2-c6-1.anuhosting.net or 618 4006.

You can also bring your concerns to the attention of the Office of the Director of Corporate Enforcement, the National Consumer Agency and the National Property Services Regulatory Authority

I recently put several questions to the Minister for Justice in the Dáil on management companies. Over the past year, I have received a succession of assurances that legislation is just around the corner, but that corner seems to be pushed further and further into the distance.

We are now assured that everything will become clearer once the Law Reform Commission publishes its final report on multi-unit developments. Publication of this document is expected at the end of May. We have waited long enough, and it looks like this process still has another while to run yet. Unfortunately, the Minister is not prepared to introduce any interim measures to address the problems that homeowners are having with their management companies on a day to day basis.

QUESTION NOS: 408 & 409

DÁIL QUESTIONS addressed to the Minister for Justice, Equality and Law Reform (Mr. Lenihan)
by Deputy Joan Burton
for WRITTEN on Tuesday, 29th April, 2008.

* 408. To ask the Minister for Justice, Equality and Law Reform his views as an interim measure, pending the report of the high level inter-Departmental Committee on Multi Unit Developments, on imposing a requirement on management companies and management agents to provide clear and immediate information on their operations to the occupants, both collectively and individually, of multi unit developments for which they have undertaken management responsibilities; and if he will make a statement on the matter.

– Joan Burton

* 409. To ask the Minister for Justice, Equality and Law Reform the number of occasions on which the inter-Departmental Committee on Multi Unit Developments, which is chaired by his Department, has met to date; the date it last met; and when the committee is scheduled to issue its final report.

– Joan Burton

REPLY:

The position is that the Law Reform Commission has indicated that it will publish, as soon as possible, its Report on Multi-Unit Developments which, following an extensive consultation process, will contain definitive reform proposals concerning the regulation and governance of property management companies.

The high-level interdepartmental committee, under the chairmanship of my Department and comprising representatives of relevant Departments and Offices, met on eight occasions during 2007 to review the issues raised in the Law Reform Commission’s Consultation Paper. The committee is now awaiting publication of the Commission’s Report and will then proceed to examine its definitive recommendations for reform. The key task of the committee will be to identify the legislative and other actions to be taken in response to the Commission’s reform recommendations and to determine a timescale for their implementation. This committee is reporting to a Cabinet Committee whose membership comprises the Ministers for Justice, Equality and Law Reform; Environment, Heritage and Local Government; Enterprise, Trade and Employment and the Attorney General.

Pending publication of the Commission’s Report it would not be feasible to enact legislation to give effect to interim measures. The Government has already directed that early action be taken by the relevant Departments to address the Commission’s recommendations; the types of action to be taken will, of course, be dependent on the form that the recommendations take.

Are you sick of seeing your management fee on the increase for a sub-standard service?

Are you tired of being given the run-around by a property services company that’s out of touch?

Do you want to know more?

The fundamental problem is that there is no legislation in place which specifically governs the operation of management companies and their agents. We currently have a scandalous situation whereby homeowners are members of their management companies, yet they are often prevented from exercising control of it by property developers who retain enough properties and structure the company in such a way that they have majority control.

Over the past year, I have continually raised the issue of management companies in the Dáil and recently called on the Taoiseach to deliver the long promised legislation before he leaves office. He refused to give a concrete indication on when this legislation would be brought forward. We are now assured that everything will become clearer once the Law Reform Commission publishes its final report on multi-unit developments. Publication of this document is expected at the end of May.

What Should the Government do?

The Labour Party has put the following demands to the Minister for inclusion in the legislation:

? Facilitate the transfer in newly completed housing estates of responsibility for
essential public services such as water, sewage, roads, lighting and common open
spaces, to the control of the Local Authority;

? Appoint a Regulator of Management Companies to:
• regulate all management companies
• oblige vendors to provide clear information about fee levels, any changes in fee
levels and the duration of the management company contract
• compel service providers to give detailed invoices for services supplied;

? Restrict the use of management companies in traditional housing estates.

? Where management companies are a necessity, ie in an apartment building, Labour
proposes that these should be set up as not-for-profit companies, owned by the
residents.

Having received submissions from myself and other consumers, the National Consumer Agency is due to publish its proposals for addressing management company issues in the coming weeks. I will continue campaigning on your behalf to make sure the Government fulfils their promise to bring forward much needed legislation and put an end to this scandal.

In the mean time, if you have a problem with your management company, don’t hesitate to get in touch: joan@joanburton.ams2-c6-1.anuhosting.net or 618 4006.

You can also bring your concerns to the attention of the Office of the Director of Corporate Enforcement, the National Consumer Agency and the National Property Services Regulatory Authority

I would also recommend downloading the National Consumer Agency’s guide.

Deputy Joan Burton has issued a reminder that PAYE workers are entitled to get tax relief at the standard 20% rate of tax on bin tags, service charges and these elements of fees paid to management companies.

More details, and the revenue application form, are available in the Revenue’s Explanatory Leaflet. For further information, you can get in touch with the Dublin Region Revenue Office on 1890 333 425.

With respect to management company fees, that part of the fees payable by residents to a management company in respect of such ‘service charges’ may, subject to the conditions outlined in the leaflet above, qualify for tax relief up to the €400 limit.

Unfortunately, the remaining elements of the management fees, such as payments towards the upkeep and maintenance of the property and payments towards a sinking fund do not qualify for tax relief.

Burton commented: “This will come as small relief to the many people who often pay extortionate management fees for little in return, however. Whether your management company is delinquent or whether it is fit for purpose, this measure at least gives some respite.”

“One obstacle that may prevent people from claiming this tax relief, unfortunately, is that some management companies do not provide a breakdown of charges indicating those elements on which workers are entitled to tax relief. This is just one of the issues on management companies which in need of urgent legislation. Only today, I brought this to the attention of the Minister for Finance in the Dáil; it’s all very well bringing in tax relief, but this is of little use if the management companies themselves are not legally obliged to provide people with the information they need to claim it.”

In the Dáil this week, Deputy Joan Burton again demanded that promises on legislation to deal with management companies be fulfilled. She outlined the ongoing problems arising from this legislative lacuna, “where many young people are charged management fees of €1,800 to €2,500 and cannot receive proper invoices, a case of gross exploitation by some management company directors, developers and property service agents.”

“We have all heard how little legislation is before the Dáil but nothing has been heard in this Dáil concerning a law dealing with management companies or the introduction of legislation on the regulation of property management agents. Many apartment blocks will soon be ten years old and issues such as damage to roofs and repainting exteriors arise. Most of the money collected has gone with the managing agents and there is nothing left in sinking funds to provide for essential major repairs. People in apartments may be faced with bills in excess of €10,000 for major repairs.”

Reacting to the Taoiseach’s response (below), Burton commented “we’ve had endless committee meetings and buck-passing – it’s high time that this important and long-promised legislation was brought before the Dáil. The complexity of the issue is no excuse for inaction.”

An Taoiseach had responded as follows: “In late 2006 and early 2007 the Law Reform Commission published a consultation paper on the multi-unit developments. It drew attention to the broad range of issues of governance and operation of the developments. It is complex because it involves more than one area. The Minister for Justice, Equality and Law Reform chairs a Cabinet committee, which includes the Departments of the Environment, Heritage and Local Government; Justice, Equality and Law Reform; the company law sections of the Department of Enterprise, Trade and Employment; and the Attorney General to deal with these cross-cutting issues. I thought it could be addressed with one Bill by the Department of the Environment, Heritage and Local Government but it involves company law, consumer protection and the development of regulatory structures. We are trying to make progress on all fronts but it could require three legislative measures from three Departments to get this correct. They are working on it, using the Law Reform Commission’s document as the base to do this. We are pushing it because it should be done. I do not disagree with the argument Deputy Burton makes.”

Deputy Burton has been advised that the National Consumer Agency is currently preparing a report outlining the conclusions of a stakeholder forum, established to deal with the issue of property management companies.

“Property Management Companies are a buring issue in many of the newer developments in the Dublin 15 area. It is only with proper legislation and oversight that we are going to see an improvement in the situation. With this is mind, I would encourage anyone aversely affected by their property management company to make a submission to the National Consumer Agency as soon as possible.”

Submissions should be marked ‘For the attention of the CEO’ and can be submitted to john_maher@nca.ie. Postal submissions can be made to the following address:

The Multi Unit Development Stakeholders Forum
Ann Fitzgerald
National Consumer Agency,
4 Harcourt Road,
Dublin 2.
Telephone 01 402550
Fax 01 4025501

You may also copy Deputy Burton on any correspondence should you wish to do so.

“Complaints against property management firms have soared by 146% for 2007 according to the annual report from the Office of the Director for Corporate Enforcement (ODCE). The litany of complaints set out by the ODCE includes a failure to hold meetings and a failure to disclose to members the companies’ latest financial accounts. These complaints bear out my own experience as a TD for Dublin West where I hear on an almost daily basis of more dissatisfied homeowners who get little, if anything, from their management company despite paying hefty and compulsory fees – sometimes in excess of €2000 a year.

“This problem is particularly acute in newer developments of houses and apartments such as Ongar, Tyrrelstown and College Gate where people are being held to ransom by these companies with no come-back and no government support whatsoever. Despite successive promises, there has been no regulator or legislation brought forward by the government and homeowners are on their own where a management company or agent provides a bad service.”

“The fact that these companies are currently in a legal no-man’s-land is causing endless trouble for affected residents across Dublin West. For several years, the government has talked about the need for legislation in this area, but we are continually fobbed off with policy reviews and committee meetings. Indeed, the Minister for Justice announced another one of these reviews shortly before Christmas. We need to see a little less conversation from this government, and a lot more action.”

The ODCE Interim Review 2007 is available here.