Transition from developer to owner control in a community association is one of the most critical phases in a community’s growth. If conducted properly, it will give the association the independence it needs to mature into a capable governing body. These practical tips will help newly elected board members deal with their “new” association.
- The job of being a board member of an association that has just transitioned to owner control is both stressful and time consuming for the first year. Don’t volunteer if you don’t have the time to devote to your duties and responsibilities.
- If you are a person who needs lots of compliments and strokes, consider passing on the job. If you don’t like to hear criticism, likewise pass on the job.
- While not necessarily brain surgery or rocket science, the job is difficult with complex issues involving contracts, insurance, finances, law, construction, and management. Additionally, your people skills will be constantly tested. Don’t expect everything to be simple.
- Being on the board of an association is like running both a business (e.g., finances, contracts) and government (e.g., collecting assessments, enforcing covenants and rules) at the same time while trying to build a sense of community. Different skills and approaches are needed for each.
- Set up advisory committees to assist the board with its duties and responsibilities. However, advisory committees are just that – they offer assistance and advice, they don’t make the decisions. The committees will also be a good place to find and build future association leaders.
- Resist the urge to micro-manage your manager. That is not the board’s job. Boards set policy and establish procedures, managers execute and carry out the policy. Let your manager manage. There is a reason the board is not called the “Board of Managers.”
- Sit down with your manager immediately following the transition meeting and find out what she/he really does, what the contract calls for, and what limits and discretion the manager has. You may find that the manager you thought was non-responsive really just had her/his hands tied as a result of restrictions imposed by the developer. The first order of business of a new board should never be to fire the manager.
- Listen to your experts. There is a reason they’re called experts. You pay them a lot for their advice – at least seriously consider it. If not, fire them and save the association some money.
- Become thoroughly familiar with the association’s financial operations before spending money, entering into contracts, replacing items, etc. Has the developer completed an audit? What is the monthly income? Expenses? What are you required to spend? How much is owed in delinquent assessments? Most importantly, be sure you know how to read and understand the association’s financial statements.
- Become thoroughly familiar with the physical condition of the property. What’s working, what’s not? What needs repairing versus replacing? Is there a maintenance schedule? Is there an up-to-date reserve study? When was it last updated?
- Educate yourself about the operation, management, community association concept, your legal and financial responsibilities, the law, and what your governing documents say. Go to our website (altitude.law) and read the many articles and attend our free workshops for board members.
- Obey and follow your governing documents – it’s the law.