Does your association have an important vote coming up? Are you considering conducting that vote by mail? Voting by mail can be a very effective way to encourage owner participation and to increase the chance of having enough voter response to get the business of the association accomplished. However, whether it is the election of directors or an owner vote to approve a declaration amendment, there are a few important details to consider and a few tricky requirements to be aware of. You wouldn’t want to go through the process of voting by mail only to find out that the results are ultimately invalid. Here are five tips and tricks:
- Nominations. If your association is planning on conducting your director elections by mail, the way you handle the nomination process is important. You want to be sure to give ample opportunity for interested owners to throw their hat into the ring. First check your governing documents (usually the bylaws) for any provisions regarding the nomination of potential directors and make sure you comply with same. If there are no provisions regarding nomination, you will want to provide a written solicitation for nominations with plenty of advance notice to the owners. Include the date of the upcoming election, a nomination form, the number of open director positions, the deadline for submissions, and other clear instructions on how to make a proper nomination. Once the deadline for nominations has passed, you will want to assemble the list of valid candidates and prepare to send to it to the owners for consideration.
- Secret Voting. Do you have more candidates than open director positions? If so, Colorado law requires the director election voting to be conducted by secret ballot, as it is considered “contested.” The secret balloting requirement can be tricky to comply with. Owners will need to be provided with the complete candidate list, and candidate statements or enough information to make an informed choice. They should have a secret mail-in ballot form that contains no request or prompts for placing any identifying marks on the ballot. There should be a separate owner signature page where the owner writes his/her identifying information and places the signature. Owners will then place their completed secret ballot into a secret envelope or “privacy” envelope. The privacy envelope should then be placed inside another self-addressed envelope along with the owner signature page. If you make sure the self-addressed envelope is already pre-stamped, you will greatly increase the chances of it being returned.
- Counting the Ballots. Don’t forget that the same Colorado law that requires secret balloting for contested elections also has very specific requirements for how the ballots are to be counted. Those who are assigned to count the ballots must be neutral third parties, unrelated to the candidates. They must not be board members, and to avoid any appearance of impropriety, we recommend counters not be managing agents or attorneys of the association. The vote counters are generally chosen from volunteers at the upcoming annual meeting. The results of the director election are then announced at such annual meeting.
- Voting on Amendments. If your association is attempting to obtain approval of one or more amendments to its declaration of covenants, the use of a mail-in ballot can be effective. However, it is not necessarily the most effective means of obtaining owner approval, if you have a choice. You should carefully read your existing declaration provisions on amendment to see exactly what type of approval is required. If a “vote” or a “meeting” is not required, and the existing declaration requires only the “approval” or “consent” of a certain percentage of owners, you may be able to use what is called a consent form. The main benefit of the consent form over a mail-in ballot is that a consent form has no deadline for its return. The association’s directors can keep gathering consent forms indefinitely, until such time as they have gathered enough consents to exceed the required owner approval percentage. The only caveat is this: in the event an owner sells his/her unit in the community after giving the consent, but before the amendments are recorded, the association can no longer count that owner’s consent toward the required approval requirement.
- Mail-In Ballot Requirements. If it is determined that a mail-in ballot for approval of a proposed amendment is necessary, the board should be careful that it fulfills all of the specific requirements of the Colorado Revised Nonprofit Corporation Act regarding mail-in ballots. The ballot must: a) state each proposed action and be accompanied by sufficient written information for the owner to make an informed choice; b) state the number of ballots that must be returned to reach a quorum; c) state the number of yes votes needed to approve the proposed amendment; d) give the owner an opportunity to vote to approve OR to reject the proposed amendment; and e) must state a date and time as the deadline for the return of the ballot. A failure to fulfill these requirements can lead to the ballot, and the results achieved, being declared invalid.
As you can see, conducting a vote by mail-in ballot can be an effective tool, but one that is tricky to utilize correctly. If you have any specific questions about the use of mail-in ballots for an upcoming vote, please contact your association’s helpful legal counsel at Altitude Community Law P.C.