Management Articles
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Chairman Look for someone with good leadership skills, organization and ability to motivate members. The chairperson is responsible for preparing and presenting committee reports to the Board, delegating responsibilities, calling meetings and soliciting input from members.

Membership 4-9 members per committee is optimal. Be careful to include those members who can make a genuine contribution. Desirable characteristics include honesty, flexibility, dependability, and the ability to work well with others. Members should be placed into roles that best suit their talents.

Types of Committees

1. Standing Committees are created by the governing documents and function on a permanent basis. Examples are executive, rules and regulations, architectural review, finance/budget, landscape, newsletter and crime watch.
2. Ad Hoc Committees are appointed for a particular purpose and exist as long as needed to complete a specific task. Examples might include budget and nominating, etc.

Meeting Procedure The degree of formality depends on your committee. Meetings should be arranged so all members are visible to one another to encourage open discussion. Meeting dates should be established well in advance, so members can make necessary arrangements. Provide written agendas prior to each meeting and set time limit for a discussion of topics. Call on a different members for their opinion on each agenda item.

Recognition is a vital part of all volunteer work. It generates a sense of group involvement and is an important tool for motivation. Timing is important. Delayed recognition is much less effective. Make recognition sincere, honest and fair. If you reward volunteers who are not performing, it may serve to diminish the value of volunteers who are performing well. Understand your volunteers. What satisfies and motivates one person, may not motivate another. Determine what type of recognition would be most meaningful to each volunteer. Some may appreciate a public ceremony, while others will better appreciate a small private one.

Rewards are one way of recognizing volunteers. They are long-term motivators and include thanks and praise, giving more responsibility and reference letters.

Awards are another way of showing appreciation for a job well done. Consider Certificates of Appreciation, plaques, personalized t-shirts, mugs, etc., gifts and gift certificates.

Committees can be designed to fit individual talents like gardening, accounting and entertaining. It is also a great entree to a board position once comfort level increases. Do you have an unfilled need in your community? Form a committee and let it run! Thanks to Lauren A. Bush BACK

Framing the Organization
This is a overview of how a community association works in conjunction with state laws, the governing documents, management company and the Board of Directors.

I. The Governing Documents. Give the Board of Directors authority and direction to govern the association. They consist of:

1. Articles of Incorporation - The formal documents filed with the state that allow the association to act as a not for profit corporation.
2. By-Laws - Outline how the association is governed and deals with the association as a corporation, i.e. elections, assessment collections, terms of office and duties of officers.
3. CC&Rs - Covenants, Conditions & Restrictions define how the physical entities that comprise the association are to be used, that is, use restrictions, easements and annexation.
4. Rules & Regulations  - Combines those provided with the By-Laws with those adopted by the Board of Directors within the guidelines of the CC&Rs.
5. Resolutions - Formally deal with specific issues that require detailed procedures to accomplish, like the collection of money and architectural control.
6. State Statutes - State legislation that take precedence over all other legal documents.

II. Structure of a Homeowners Association Organizational hierarchy consists of:
Board of Directors - Establishes policies and procedures.
Management Company - Executes policies and procedures as established by the Board of Directors.
Committees - Research and make recommendations to the Board of Directors who then makes the final decision. Typical committees include Budget, Newsletter, Architectural Control, Rules and Grounds.
Contractors - Professionals hired to perform services for the association. The Management Company oversees the sub-contractors.
Auditors - Provide an impartial review of the association's finances. Depending on state or CC&R requirements, their services may be required annually or as requested by the Board.

III. Items of Special Interest
Budget - The budget consists of anticipated operating and reserve expenses for the year as well as future years’ reserve expenses. Operating expenses include utilities, maintenance of the common areas, administrative (management, accounting). The Reserve Fund is a type of savings account that covers major expenditures and replacements like roofs, painting, paving, pool equipment and replastering.
Common Area Interest - All homeowners own an undivided portion of the common area either through a deed or the corporation.
Rules Enforcement - Living in a community association imposes some special restrictions intended to maintain harmony and enhance property values.
Fines Imposed for violations of the CC&R's or Rules & Regulations are intended as a means to gain compliance as opposed to "punishment".
Collection Procedure - The Board of Directors is given the responsibility to collect homeowner assessments which are necessary to maintain, preserve and enhance the common area and the property values. A collection procedure details the time frame for payments and the penalties for non-payment from simple fines to property foreclosure.

IV. Insurance.  The association should be covered by a variety coverages which vary according to the property type and legal documents. The following examples are commonly used:

• Property Damage, Hazard or Fire
• General liability (common area injuries)
• Directors & Officers Liability (covers business judgments by the Board)
• Workers compensation (protects against financial liability caused by injury to employees, board members or volunteers)
• Fidelity Bond (protects against theft of association funds)
• Earthquake Insurance
• Building Ordinance or Law (pays the increased reconstruction costs due to code and zoning changes)

V. Property Management Services. Management companies provide a wide array of services to assist the Board and the association in managing the business affairs and common area. A general overview includes:

1. Management Expertise - The management company advises the board on management techniques that will provide both efficiency and economy to the association’s operations.
2. Financial Reports - Comprehensive monthly accounting of all financial activity of the association including all revenue, expenditures and delinquent accounts.
3. Budget Preparation - Assists the Board of Directors in annual budget preparation through detailed analysis of previous fiscal years' activities and anticipated cost increases and/or special projects.
4. Customer Service - The manager accepts owner requests and processes them according to their nature such as bookkeeping, general information, maintenance and rules complaint.
5. Emergency Service - Provides 24 hour after-hours response for maintenance emergencies that threaten life or property.
6. Correspondence to the Board is received through the Management Company and responded to according to urgency: emergencies are dealt with as soon as possible and non-emergencies are dealt with either by the property manager or at regular scheduled Board Meetings.  BACK

Board Orientation
There is often confusion about what roles and responsibilities Board members play. Here’s a handy guide:

OFFICERS' RESPONSIBILITIES
President

• Prepares meeting agenda
• Presides at all Board and Association meetings
• Appoints and supervises all Committees
• Supervises Manager
• Trains Directors for future leadership positions
• Sets positive example

Secretary

• Takes minutes at all meetings
• Maintains book of minutes and resolutions
• Post meeting and special meeting notices
• Attests to the authenticity of all corporate documents
• Certifies all meeting notices and election results
• Responsible for all official communications with members
• Timekeeper for all meetings

Treasurer

• Responsible for collection and expenditure of assessments
• Reviews and summarizes financial statements, especially the status of reserve funds, unusual amount of receivable and payables and, variances of actual vs budget for month and year to date
• Approves/signs all reserve checks
• Approves/monitors investment policy
• Monitors delinquencies and advises the Board

All Board Members

• Come to meetings prepared and informed
• Maintain a professional demeanor
• Support the President as leader
• Put personal issues aside
• Encourage participation
• Be open and fair
• Maintain confidentiality when appropriate.

Board Meetings. are designed to transact association business by the Board only; homeowners are welcome to attend and observe. Provide a Homeowner Open Forum just prior to the beginning of the meeting for owner comments or questions. Limited each owner to 5 minutes. Open Forum is not the proper venue to report maintenance requests.

Board Meeting.  Conduct Business matters are considered when a motion is made, and seconded. Each motion has a discussion period before a vote is taken. Discussion is takes place only between the Directors and management although owner attendees may be invited to comment. Votes, when taken, involve Board members only. Owner agenda items that expect action should be made at least a month before the meeting to allow the proper research and consideration.

Preparation of Agenda.  Associations using Parliamentary Procedure (recommended) usually follow a fixed Agenda like:

I. Call to Order - The President says, "The meeting will please come to order."
II. Minutes - The secretary reads the Minutes of the last meeting.
III. Officer's Reports - Usually limited to a report from Treasurer, but others may report at this time.
IV. Committee Reports - First come reports from "standing" or permanent committees; then from "ad hoc," or special committees.
V. Special Orders - Important business previously designated for consideration at this meeting.
VI. Unfinished Business - Business left over from previous meetings.
VII. New Business - Introduction of new topics.
VIII. Announcements - Informing the assembly of other subjects and events.
IX. Adjournment - The meeting ends by a vote or by general consent.

Summary of Board Responsibility

• Read the agenda and related material prior to the meeting.
• Be prepared to ask questions
• Advise in advance if unable to attend a meeting.
• Maintain confidentiality regarding sensitive issues like delinquent owners, owners in violations, pending litigation. personnel matters

BACK

Closing the Organizational Gaps
There are many organizational "gaps" that can occur in community associations. Organizational gaps are flaws that continue to plague the well being of the community year after year until they are accepted as inevitable. Gaps can be filled and repaired but you first need to find them. Here a few common ones:

Gap in the Board – Do the same people serve on your Board year after year? Some continue to serve because they think no one else will. Interestingly enough, if there is never a void, there will never be a need to fill it. Fresh blood (the creative kind) is needed to keep the Board vibrant. Remember, every owner is qualified to serve. Consider term limitation as a way of forcing the issue.

Gap in the Budget – Does your community have inordinately large delinquencies? Money is the lifeblood of the organization and without it, the assets wither and deteriorate. Inability to collect money is a common symptom of communities doing in house bookkeeping. Let’s face it, collecting debts from neighbors is hard and many board treasurers tend to avoid confrontation and defer the problem until it grows out of control. If this condition exists at your community, consider enacting a Collection Policy that has teeth and hire either a professional management company or outside bookkeeping service. This is simply too important an issue to hope it will resolve itself. Plug this gap today!

Another Gap in the Budget - Does your Board routinely overspend? There could be several reasons:

1. Failure to adhere to the approved budget. There is always more needs than money to fund them. There is a tendency by some Boards to yield to the squeaky wheels in the community and rob the cash from reserves. Bad Board! Bad! Reserves are designed for specific future maintenance and repair items. To use reserves for nonemergency and unbudgeted expenses is plain wrong. One of the Board’s most important jobs, when it comes to overspending, is to "just say NO".

2. The Board is systematically under budgeting (Trying to squeeze blood out of a...well, you know.) Under budgeting is often the result of the Board yielding to the pressure to minimize the assessments in spite of growing costs. Since the utilities and other services must be paid and there is no Tooth Fairy, budgets need to be reality, not wish based. Use actual prior year expenses to craft the next year’s budget adjusting for inflation and known increases (like contracts, utility rates, etc.) to close this gap.

Gap in the Community – Is the "community" missing from your community association? Aside from the economic benefits of pooling costs and sharing the work, associations afford an opportunity to develop a "village" in the neighbor sense. Have you considered facilitating social events that bring your neighbors together? To get started, you don’t even have to make up an event: The annual homeowner meeting can be turned into a potluck with prize drawings. Add contests for Best Christmas Lights, Patio Garden or Community Volunteer Award. Recognize your members in any way you can to encourage involvement.

Gap in the Management – Is the Board under utilizing the property manager? Managers have a wealth of experience that the association is paying for whether they use it or not. Why not ask for an opinion on significant matters? The manager also has a broader perspective on issues than the Board. As an outside observer, it is much easier to see what’s really going on in board meetings (hidden agendas, conflicts of interest and personality conflicts) that interfere with productive results. Encourage your manager to make constructive observations to help keep the Board on track.

Gap in the Governing Documents – Archaic governing documents, rules and regulations can be an ongoing aggravation. Certain provisions that made sense 20 years ago have outlived there usefulness. In some cases, because of the Fair Housing Act, they are downright illegal. Contact your attorney for a review and plug these gaps.

Gap in the Maintenance – Is the association paying for maintenance and insurance claims that are not the association’s responsibility? Just because a washer overflows flooding the neighbor’s unit doesn’t mean that the association should necessarily come to the rescue. All condo owners are supposed to carry appropriate insurance to protect against damage to their unit interior and personal property. Unless the damage originated from the association maintained common area, the owner and owner’s insurance is responsible for the repairs. To clarify, develop an Areas of Responsibility List using the governing documents as a guideline.

Closing the gaps in your community association is a top priority. Each seemingly minor gap can add up to a royal pain in the rear. By that’s another gap and another article.  BACK

Follow the Leader
Strong leadership is an essential component of every successful community association. According to the book Leaders, "a manager does things the right way and a leader does the right thing." A leader is someone who not only recognizes the "right thing," but who can also motivate others to help him get the right thing done. How do you recognize who has this special combination of insight and inspiration? Strong leaders should have skills, knowledge, and experience plus the abilities to motivate and command.

A person's suitability should include understanding how the association works and familiarity with significant historical events. Newcomers frequently make superb volunteers. However, there are some situations which call for someone possessing a historical perspective. For example, if the association is in the midst of sensitive litigation or a new management contract, a newcomer might detract by insisting on covering old ground again.

How much interest has the candidate shown in the association and its undertakings? Has there been regular meeting attendance, response to volunteer requests and participation in activities? If not, investigate the sudden interest. Be particularly careful about "one-issue" candidates who run because they dislike a certain contractor or are opposed to a recent assessment increase.

Consider communications skills: Some association volunteers are not particularly articulate, yet are valuable and productive. Leaders should be able to express ideas clearly and persuasively.

A candidate should not have conflicting personal and professional commitments. For example, a candidate may have out of town travel commitments that means spotty participation.

There are personal characteristics that point to strong leadership style. Look for people who display these particular abilities:

Vision - A strong leader understands and promotes the association's best interests. Leaders set goals, communicate what’s needed to achieve them and then move toward them.

An Open Mind - A leader must be able to approach a problem creatively. Perspective is an invaluable leadership tool. A board afraid of change will stagnate.

Enthusiasm - Enthusiasm is contagious. With it, goals are achieved quickly. Without it, the same goals may be entirely out of sight.

Sound Judgment - Has the ability to identify and prioritize issues. A good leader then weighs alternatives carefully before making decisions.

Decisiveness - Taking a stand involves making mistakes. A good leader takes a stand and if an error is made, acknowledges it and makes a course correction. Avoid those that "play it safe". It usually means stagnation.

Sensitivity - A genuinely caring leader inspires confidence in others. Confidence leads to results. Leaders delegate, give and seek constructive feedback. A leader knows how and when to give praise. Praise is the simplest and often the most valued form of reward. A leader knows how to criticize constructively: pointing out what is wrong without attacking personalities. A good leader seeks opinions and ideas from others.

Ability to Take Criticism - No one in a position of power will escape criticism. Leaders have the ability to discern when criticism is valid and when it’s not.

Leadership Styles The effective leader has some identifiable styles:

• Leads by Example - Arrives on time, never shirks responsibilities and demonstrates good work habits.
• Solves Problems - Uses knowledge and experience to help get the job done.
• Fosters Cooperation - Instills cooperation among volunteers, making it easy for them to pitch in together.
• Communicate - Explains, persuades and praises.
• Promotes Teamwork - Pitches in along side others.
• Practices the Golden Rule - Treats others as equals
• Takes Responsibility - Never blames others for problems.
• Listens to Others - Uses other’s ideas and gives credit when credit’s due.

A leader can make or break a community spirit. By considering the strength and qualities it takes to succeed, selecting your President can in a very real way, lead to a more productive and happy community. Choose well, and prosper. Excerpts from article by Community Associations Institute   BACK

Self-Assessment Checklist
Every organization has strong and weak points and a homeowner association is no exception. Below is a list of 46 items that will help evaluate yours. Each item should be marked: 1 = Yes or 0 = No

How did you score?
39-46: EXCELLENT Still room for improvement?
31-38: VERY GOOD You're close, but roll up your sleeves and close the gap.
23-30: GOOD  But you've got serious work to do.
22 or less: DANGER Your association is probably suffering from deferred maintenance, sliding property values, excessive delinquencies and internal conflict. If so, competent management and legal advisors are urgently needed before the patient bleeds to death.

The Board is responsible for the largest asset most people own...all together usually millions of dollars in assets. This reality demands serious reflection and planning to properly manage. The first step is to focus on your weak points and enact a plan of attack.  Thanks to Lauren Bush for the article concept.     BACK

Managing Expectations
The property manager wears many hats while handling association business but the manager’s role at board and homeowner meetings and follow up is pivotal to overall effectiveness. Here are some of the key traits of a competent manager.

As Coach. The manager coaches the board of directors in its duties and helps organize and conduct meetings so they will be an effective forum for policy making. The effective manager helps the President stay focused on business for maximum efficiency. When board actions deviate from the governing documents the manager should point it out and get them back on track.

As Organizer. Since the manager is usually the holder of the records, he plays an active role in the preparation and organization of meetings by assisting the President to prepare the agenda. The manager should present a concise and understandable report focused on the agenda. If the manager anticipates and provides answers to the board's questions in the report, they will be able to make decisions more quickly.

As Tactician. The manager must understand the dynamics of the board of directors in order to anticipate their questions. The manager must get to know and understand each board member's personality, background and experience. Constructive suggestions must be delivered tactfully recognizing varying levels of sensitivity.

As Communicator. Board decisions should be communicated to the members quickly usually by newsletter. The manager can work with a newsletter committee to develop the format and content. The newsletter should not only provide the pertinent board meeting information, but promote pride and teamwork in the community. It should be presented in an way that will encourage readership. Make it fun! Mention names and events! Use graphics or clip art! Add jokes and quips!

As Diplomat.  Phone calls fielded by managers deal with financial, maintenance and general information questions. Sometimes callers are upset and angry. By attentiveness and asking questions, the manager can demonstrate the incredibly effective communication tool of caring. Once the caller feels understood, the manager can move on to problem solving. As the saying goes, "They don’t care how much you know until they know how much you care."

Meeting expectations is the manager’s greatest challenge. By preparing for meetings thoroughly, expectations are more likely to be met. Meeting halfway won’t do it.  BACK

Community Checkup
Any community can become depressed, listless and out of sorts. Good health is often only a prescription away. Here are some that can improve the overall health and happiness of your community.

Communication Prescriptions

• Publish and distribute a newsletter at least four times a year.
• Include resident events (births, graduations, etc.) in the newsletter
• Develop an Internet web site and include budgets, governing documents, names, phone numbers and other need-to-know items. Link your web site to other community association web sites and resources.
• Distribute questionnaires to residents and publish the results.
• Publish a community calendar well in advance of the events.
• Introduce new residents at board meetings and profile them in the newsletter
• Use signs discreetly within your community
• Fashion rules and signage in a positive manner

Community Prescriptions

• Develop an active committee structure to support the Board of Directors
• Develop a mission statement for your community
• Send your newsletter to local political leaders
• Encourage local business to advertise in your newsletter
• Encourage voter registration by residents of the community
• Establish a forum for local political leaders to meet with residents of your community
• Take an active position on local community issues
• Hold an annual community garage sale
• Establish a community library with donated books
• Assist residents in locating babysitters from within the community
• Sponsor a neighborhood cleanup day
• Sponsor a community aerobics class

Management Prescriptions

• Limit board meetings to 2 hours and make real decisions.
• Distribute meeting agendas in advance
• Provide for a Homeowner Forum before each board meeting
• Track director and owner attendance at meetings
• Enact only rules and regulations that are practical, clear and enforceable
• Limit the number of consecutive directors terms allowable
• Budget for board education (seminars, books, magazines, videos)
• Revise governing documents using plain language
• Make board meetings minutes easily and quickly available to unit owners

Financial Prescriptions

• Commission a reserve study and update it annually
• Adequately fund reserves to avoid special assessments
• Encourage owner participation on the budget committee
• Have periodic outside audits of your finances
• Invest reserve funds wisely to maximize yield through insured investments
• Encourage purchase of homeowner insurance from the association insurance company to reduce gaps in coverage
• Distribute timely financial information to owners
• Adequately budget to maintain services
• Develop volume discount programs that benefit residents; For example, cable TV services can be purchased in "bulk rate agreements" with 40-50% discount.

Asset Appreciation Prescriptions

• Ask area real estate agents to assess the strong and weak market points of the association
• Encourage upgrading of homes.

Now, aren't you feeling better already?   Well, you surely LOOK better and the good feelings are sure to follow.  Take two a day and call me another time. The Doctor.  BACK

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