Water meter issue allows Buckhead condo to avoid paying for 15 years

ATLANTA — A Channel 2 Action News Investigation has discovered a high-rise condominium in Buckhead filled with expensive units paid nearly nothing for water and sewer for nearly 15 years.

Investigative Reporter Richard Belcher found the Homeowners' Association knew it wasn't being billed for at least 12 years.

"It's shocking to me. If everyone knew this story, it would cause outrage to everyone," Phoenix on Peachtree condo owner Jack Richardson told Belcher.

Richardson moved into the building in 2001, just as it opened.

Asking prices at the Phoenix on Peachtree today range from $400,000 to more than $1 million. %

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For years there was an unwritten amenity: The city wasn't charging for water and sewer.

Richardson became aware of the billing problem from a Homeowners' Association audit that stated: "As of December 31, 2003, the association had not received a bill for a meter that services common areas...This has been a problem from the beginning."

Richardson says he was told the Homeowners' Association would pay it.

"We believed what the board told us," Richardson said.

Richardson says he became even more concerned when he had trouble getting HOA financial records in later years.

Eventually, he became convinced the bills were not being paid. Richardson says every resident pays for common area water and sewer usage as part of their HOA fees.

"They've actively sought to cover this up from the residents of the building. And they got caught," Richardson said.

"They've actively sought to cover this up from the residents of the building. And they got caught."

In early 2015, 11 years after that audit revealed the billing problem, other residents began to ask questions.

One email to fellow residents stated: "it's very unfortunate that the board...made the extremely questionable decision more than a decade ago not to discover why the association was being grossly under-billed."

Another emailed: "Surely the directors did not believe the 'free' services would last forever."

Another resident reported that board member and resident Erroll Davis -- the former Atlanta Public Schools superintendent -- had said "the board did not feel that there was an ethical or legal obligation to attempt to pay ... unless the city sent a bill."

"I believe over 15 years we owe approximately $1 million without penalties and interest, just on the pure bill alone," said Richardson, who is a financial adviser.

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"It's a significant amount of money," Atlanta Watershed Management spokeswoman Lillian Govus told Belcher. The city provided billing records dating back to 2001.

Govus says since then the Phoenix on Peachtree condominium paid only a few water bills and has not paid any sewer bills. She says the water bills they did pay were about 95 percent too low.

After members from the HOA board approached the city last fall, the city found meter and billing problems at the condo location that stretched back perhaps as far as 2001.

As of October 2015, the HOA started paying both sewer and water bills.

“Right now, the city has no intent to back-bill this property, because part of it was our responsibility," Govus told Belcher.

"I can't believe the lengths that the board went to to hide this for so long."

"I can't believe the lengths that the board went to to hide this for so long," Richardson said.

"This should have been resolved 15 years ago and could have, had the board, you know, just made a five-minute call to the city water and sewer department."

Davis told Belcher the billing issue was the result of turnover on the HOA board.

Watch Richard Belcher confront the HOA President a few days after our original report:

Cox Media Group