New Mark’s financial situation got a large reprieve this week when the insurance company that handles business for the Homes Association agreed to cover the mandated refund to townhome owners for stormwater management fees.

John Daroff, the new Board of Directors President, announced the good news at the monthly board meeting on April 6. He said that the USLI Insurance company had agreed that very day to pay out up to $219 per townhome for each of 198 townhome owners, which could amount to a maximum of $43,362.

“Thank you to the insurance company for plugging a giant hole in our budget!” John exclaimed to a round of applause from the board and about a dozen residents who attended community forum.

John also thanked board member Alex Manolatos for suggesting that the board make an insurance claim for the judgment. The decision came after New Mark appealed an earlier denial from the company.

The Montgomery County Commission on Common Ownership Communities (CCOC) ruled against the Association in February in a case brought by resident Richard Berman that challenged the legality of New Mark’s addition of the city’s stormwater management fees as a separate fee on resident dues for the past five years.

Townhomes ended up paying more in those extra fees than detached homes because their parking lots and sidewalks are regarded as common community property, and the city could not directly bill them for the so-called rain tax.

Detached homes paid smaller fees through New Mark to cover other commonly held property such as the playground, swimming pool, clubhouse, etc. They also paid additional fees directly through their city property tax bill to cover their own driveways and sidewalks.

The CCOC ruled that New Mark has to include all such fees for common property in its normal operating budget and repay some of those tacked-on fees to townhome owners, and set the amount at $219 for each of the 198 townhomes.

The USLI insurance company agreed to pay the refund for “entitled” townhome owners, subject to appropriate prorating, according to an email from the company that was shared by John with the Board.

New Mark has 90 days from the CCOC decision date to pay the judgment.