Even if your community doesn’t appreciate all that you do, we understand how much work goes into serving on a condo or HOA board. But with an endless to-do list, it’s easy to lose sight of what motivated you to serve on the board in the first place.
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We invite you to check out this article to see if you’re already doing these 10 things that help board members succeed. Whether you’re a seasoned treasurer or new president, these guiding principles can help you thrive in your role while avoiding burnout.
What does the board do?
Governed communities require a board of directors to manage operations, facilitate a cohesive community, and maintain property values. While many boards hire a management company to look after day-to-day items, it’s ultimately up to the board to ensure the community is operating according to the governing documents, and that the association is in good financial health.
Fiduciary obligation
There is a great deal of responsibility placed on condo and HOA board members considering that they are volunteers. Not only are they expected to put their interests aside and prioritize the best interests of the entity they are serving, but they have a fiduciary obligation to do so under state corporate law.
A board member’s fiduciary duties are comprised of three components:
- the duty of care
- the duty of loyalty, and
- the duty to act within the scope of its authority
To meet the duty of care, directors must make informed decisions, and act in a prudent and reasonable manner.
The duty of loyalty requires board members to act fairly, in good faith, and for the benefit of the HOA as a whole, as opposed to making decisions based on personal interest or gain.
To stay within the scope of its authority, board members must not make decisions or act on matters if they don’t have the ability to do so. For example, a board member couldn’t issue a fine to a member who put outdoor chairs on their front lawn if there is no rule stating that they cannot do this.
Roles
Most condos and HOAs will have a board consisting of 5 or 7 directors, but a small community may only require 3 people. Bylaws usually outline how many members must serve on the board and how long terms last.
At the very least, a condo or HOA will have a president, secretary, and treasurer.
| President | *presides over board and membership meetings *acts as the primary liaison between the board members and other vendors such as the association manager, attorney, etc. *may co-sign checks with treasurer *ensures projects and operations are meeting expectations |
| Vice President | *essentially takes on the same responsibilities as the president *assumes the role of president when president is unable to fulfill their duties *common for president to delegate some tasks to the vice president |
| Secretary | *handles all of the documentation and record-keeping within the association, including meeting minutes, membership list and reports *provides notice to members about upcoming meetings *files documents with the Secretary of State *may co-sign checks with either the president or treasurer |
| Treasurer | *oversees the association’s operating account, reserve account, deposits, and investments *prepares and updates financial documents *pays bills *creates annual budget *files taxes *co-signs checks with the president or secretary |
| General Member | *may be referred to as a “director at large” *has the powers and rights of other directors *tasks may be delegated to this member |
10 things every board member should know
1. The president isn’t the boss
While the president probably spends the most time trying to solve issues, it is the board that legally controls the HOA. Don’t think of the president as the boss, rather treat them as the chairperson. Remember, the president’s vote doesn’t matter any more than the votes of the other directors. Associations generally do better when the entire board works collaboratively.
2. Prioritize service over control
Associations that are constantly dealing with conflicts are generally not very productive. It’s hard to accomplish goals when the board is always caught in an argument with a member.
Of course it is impossible to make everyone happy all of the time, but if directors are being flooded with complaints from different owners, it might be time for the board to adjust their leadership style.
An attitude of service is less stressful and more beneficial than an attitude of control. Directors are more likely to apply feedback or criticism to make the community better instead of using resources to prove their way is the right way.
3. Good financial stewardship can be challenging, but it’s worth the work
Financial responsibilities can be the most challenging part of serving on the board. However, if an association’s financial health plummets, you can be certain that the entire community will be negatively impacted.
Managing a multimillion-dollar budget requires planning and budgeting for actual costs. Be certain about the money coming in and the money leaving the association. Ignorance is not bliss when it comes to financial management. The real numbers might be ugly, and owners will probably be asked to pay higher monthly fees. But making a few tough budgeting choices this year is far less painful than having to levy a big special assessment two years from now.
If the board is overwhelmed, don’t hesitate to hire help. An accountant or bookkeeper who specializes in condo or HOA finances can help your team make sense of the numbers.
4. Owners seldom complain about receiving too much information
It is almost impossible to communicate too much with the members who are not on the board. While they are paying the same fees as board members, and have the same vested interests, members don’t get to see all of the information that the board has access to.
Communication is a key issue or challenge for countless condos and HOAs. While board members may think they are sharing enough information, owners still feel like they’re being kept in the dark.
Automating communications through property management software can drastically improve the dialogue between owners and the board. Sharing a new announcement or posting updated CC&Rs takes seconds. Budgets, letters and documents don’t have to be mailed out to individual owners. Instead, these materials can be created digitally or uploaded to a file library, and members can access them whenever it’s most convenient for them.
Most software platforms are accessible via a mobile app, giving owners the ability to stay connected no matter where they are.
5. You’re not expected to respond to an email at 2 am
Serving on the board comes with some serious responsibilities. But that doesn’t mean you have to be performing that role 24/7.
It can be tough to keep board work from creeping into your personal life, but try to set limits on how much time you spend performing tasks for the association. By setting limits, you minimize your risk of burning out.
Many condos and HOAs decide to hire a property manager to help them with day-to-day responsibilities. Having a professional to help with the endless tasks makes a huge difference.
6. Just because you can do something doesn’t always mean you should
Sometimes boards grapple with whether they have the authority to do something. But the bigger question is how will this benefit or help the association. If the answer is “it won’t,” then the board may want to reconsider moving forward with its plan.
7. Managing an association is hard. It probably could be easier
It never hurts to take a step back and ask if there’s another way to complete tasks or achieve goals. Most of us are guilty of maintaining routines just because that’s how they’ve always been done. But if you haven’t reviewed your processes in a while, chances are high that they could benefit from an update.
For example, are online payments being made available to owners? Can your board approve architectural change requests online? Would your community prefer hybrid or virtual meetings? Small changes can lighten the workload for your board in a big way.
8. Be as transparent as possible
This ties in with item #4. General meetings, board minutes and financial reports matter to association members. Always strive to keep owners informed and up to date on projects, funds, and anything that impacts them as association members.
9. Collecting dues is unpleasant but necessary
It may seem unfair to continue asking for dues from members going through hard times, failing to follow the collection process is unfair to the other members.
More significantly, ignoring late payments violates the board’s duties and can put the association in a compromising position. Every owner must contribute what they owe, otherwise, the condo or HOA will find itself in a financial deficit.
10. Every process serves a purpose
Formal processes laid out in the governing documents can seem unnecessarily tedious, but following these processes is the best way for board members to avoid complications, legal or otherwise.
For example, your governing documents may require the association to send one warning and two formal violation notices before an owner can be fined for an offense. That means it could be weeks before a stubborn owner takes the violation seriously. But, if the board didn’t follow the community’s violation process, and issued a fine right away, not only would the owner not be obliged to pay it, but if the issue ever went to court, a judge would question why the association didn’t follow proper procedure. This would certainly weaken the board’s case.
Conclusion
We know you’re doing a great job as a condo or HOA board member. Keep these guiding principles in mind as you carry out your term, and don’t underestimate the importance of your service to your association.