Secrets, Secrets Are No Fun

Association members are welcome to read official association documents. There’s nothing secret about the business of the association. In fact, you should already have copies of key documents like the bylaws or rules. Other common documents that are open for members to review include:

• Board meeting minutes
• Insurance policies
• Financial statements and annual audits
• Declaration and bylaws
• Rules and regulations
• Current contracts
• Leases and agreements
• Ballots and proxies

Here is typically how homeowners are able gain access to these documents (procedures may vary depending on your exact community):

• Send the board a request in writing specifying exactly what records you wish to review, the date of those records and the purpose of your request.

• The board will respond to your request within 30 days. During that time the board or manager will locate the correct documents and get them ready for you.

• The records you requested will be available for your review during regular business hours at the manager’s office for 30 days after your request is processed.

• The association will make copies of records for a reasonable fee.

Please do not request documents that infringe on the privacy of an individual like medical or personnel records. These are not public records, and the association will not make them available. Salary information is available in the aggregate, but not for individuals. Some requests might also be denied if they involve ongoing legal or contractual obligations that might expose the association board or manager to liability.

Homeowner Rights & Responsibilities

As a homeowner in our association, you have certain rights—and certain responsibilities. And its just as important to know both!

You have the right to . . .

• A responsive and competent community association
• Honest, fair, and respectful treatment by community leaders and managers.
• Attend meetings, serve on committees, and run for election.
• Access appropriate association records.
• Prudent financial management of fees and other assessments.
• Live in a community where the property is maintained according to established standards.
• Fair treatment regarding financial and other association obligations, including the opportunity to discuss payment plans and options before the association takes any legal action, and the right to appeal decisions
• Receive all rules and regulations governing the community association—if not prior to purchase and settlement, then upon joining the community.

You also have the responsibility to . . .

• Maintain your property according to established standards.
• Treat association leaders with honesty and respect.
• Read and comply with rules and regulations of the community and ensure that your tenants and guest do too.
• Vote in community elections and on other issues.
• Pay association assessments and charges on time.
• Contact association leaders or managers, if necessary, to discuss financial obligations and alternative payment arrangements.
• Request reconsideration of material decisions that personally affect you.
• Provide your current contact information to the association so you receive all information from the community.

How the Budget Committee Works

The budget committee comprises members of our community association, which enables residents to have a say in how their money is spent. How does the budget committee work and who serves on it? 

The Treasurer’s and Accountant’s Roles

It makes sense for the board treasurer to chair the budget committee. As chair, it’s the treasurer’s job to keep everyone on track as the budget is prepared. The treasurer also presents the budget for approval to the board and members. If the association works with an accountant, he or she may offer consulting, but the accountant really has no significant role in the process of devising the budget.

Who Should Be on the Committee?

The owners who serve on the budget committee should represent a cross-section of the community. Of course, if there are members willing to serve who have expertise in areas such as insurance, that’s even better. When it comes to size, a good general guideline is that the committee shouldn’t be so large that it becomes unwieldy.

What the Committee Does

The treasurer will make sure that all committee members understand the three basic components of the budget:

1. Funds needed for daily operation of the community, such as common electricity and water, grounds maintenance, management, insurance, and general maintenance. These expenses are either contractual or can be reasonably estimated based on experience. An important consideration when looking at items in the operating budget is the expectations of the community—for example, do members want a landscaper who is a “blow, mow, and go” type, or do they want a landscaper who provides a higher level of service? Obviously, the latter requires more of an investment.

2. Funds needed to maintain our reserves at sufficient levels. Reserve funds provide money for the repair and replacement of the community’s assets—such as the pool, roofs, pavement, etc.

3. Funds for additions or enhancements to the existing property. This is a function of what members of the community want and are willing to pay for. The community should provide input and approval for this component.

Armed with this knowledge, the committee will estimate total expenses for the coming year and compare that sum to the association’s potential revenue (assessments, interest on investments, concession income, and so on). If expenses are greater than revenue, the committee will look for ways to lower expenses without compromising service. If that doesn’t balance the budget, the committee may have to make a tough decision—whether to increase assessments or levy a one-time special assessment.

Its not always an easy job - but its absolutely essential to the health and longevity of your association. Homeowners always want to know where their money (or dues) are being spent. Serving on the budget committee can be a very eye opening experience!

Sounds Like A Good Idea

Noise is a concern for every resident and because you live in a community, it’s important to understand that some degree of noise is to be expected. At the same time, residents need to consider the consequences of their noisy behavior. To keep everyone happy and maintain civility among neighbors, the following are a few steps that you can take to reduce or eliminate annoying noise (and if everyone follows these guidelines, your community will be a much happier (and more peaceful) place!):

            Be kind and respectful. A little common courtesy makes a big difference. Keep your music and television at reasonable levels, do your vacuuming before bedtime, and before remodeling, check with the manager about acceptable hours and days of the week that work can be done. If you put in hardwood or tile flooring, use a sound-reducing underlayment. Move your noisy appliance away from walls and put sound-absorbing material underneath before your neighbors complain.

            Keep a log. If you’re disturbed by a noise problem, note the times and the nature of the noise. Ask the manager to listen and verify the noise as well. There may be a pattern in the noise that can be adjusted.

            Visit your neighbor. If your neighbor is the source of the noise, try a friendly chat. Sometimes people just don’t realize how noise is affecting others. People are usually considerate once they realize they’re disturbing others. And, if your neighbor knocks on your door, listen politely and be willing to made changes to reduce your own noise.

            Contact the manager. If a polite request doesn’t change your neighbor’s noisiness, it may be time to ask the manager for help.  Have your noise log ready, including attempts to solve the problem yourself.

Reducing noise sounds like a good idea. A quiet, peaceful community, relatively speaking, is a happy community.

Community Association 101

Even though so many people live in an association, you might be surprised by how many of those neighbors—owners and renters alike—don’t really understand the fundamental nature of common-interest communities. And we know that many others, including the media and government officials, lack a true understanding of the community association (or condominium) concept.

Community Associations Institute (CAI), a national membership organization that represents the best interests of common-interest communities, developed 10 basic principles that answer three essential questions: What is the basic function of a community association? What are the essential obligations and expectations of homeowners? What are the core principles that should guide association leaders?

 

Lets take a look:

1. Associations ensure that the collective rights and interests of homeowners are respected and preserved.

2. Associations are the most local form of representative democracy, with leaders elected by their neighbors to govern in the best interest of all residents.

3. Associations provide services and amenities to residents, protect property values and meet the established expectations of homeowners.

4. Associations succeed when they cultivate a true sense of community, active homeowner involvement and a culture of building consensus.

5. Association homeowners have the right to elect their community leaders and to use the democratic process to determine the policies that will protect their investments.

6. Association homeowners choose where to live and accept a contractual responsibility to abide by established policies and meet their financial obligations to the association.

7. Association leaders protect the community’s financial health by using established management practices and sound business principles.

8. Association leaders have a legal and ethical obligation to adhere to the association’s governing documents and abide by all applicable laws.

9. Association leaders seek an effective balance between the preferences of individual residents and the collective rights of homeowners.

10. Association leaders and residents should be reasonable, flexible and open to the possibility—and benefits—of compromise.

Fundamentals can be downloaded at www.caionline.org/governance/fundamentals.pdf. For more information about Community Associations Institute, go to www.caionline.org.

Money Down the Drain

Most condominium or townhome communities share a similar structure when it comes to water.  Each unit either has its own meter, is sub metered, or the water is included in the assessments for the community.  Owners with meters feel a sense of responsibility for the water usage and try to help conserve.  But responsibility for water consumption is not all that is needed; owners need to also take the proactive approach to ensure that plumbing fixtures are in good working order.  Alas, not all owners are this responsible. 

We’ve had an incredible success story recently with one of our clients, and their board of directors is truly proud of the results.  We noticed a trend by carefully reviewing the financial reports.  It is so important that you pay attention when you look at your financials!  The water bill at this condominium community was skyrocketing.  Operating funds were depleting.  We knew we had to act fast. 

Two approaches were researched and implemented.  We contacted the city utility department and got approval to participate in a toilet rebate program:  All owners installing a low flow flush toilet would get a rebate from the city.  The city credited the association’s utility bill and in return the association issued funds to the owner.  We also had the community's attorney review the governing documents to ensure that we would have the right to do unit inspections searching for any plumbing leaks.

The water bill received immediately after the process began was already showing improvement, success!   After all the reports of completed repairs by the owners were in and many new, low flush toilets had been installed - the next water bill had been cut in half as compared to the same date the year before.  It was so important to the board of directors to be able to show this to their owners that not only do they have a responsibility to ensure their community is being run well, but they also are proactive in finding ways to keep spending down as well as find ways to save costs. 

While of course we had a “fun time” dealing with disgruntled owners that didn’t want us to enter their units or didn’t believe us when reported leaks needing repairs, it was well worth it in the end to be able to thank them for their cooperation!

Point of Contact

It’s always a good idea to have a single point of contact between various groups and businesses.  Having too many hands in the cookie jar can lead to confusion and misunderstanding.  Important issues and resolutions are almost always missed. 

This is especially true with committees, boards and vendors.  Committees are frequently made up of three or more homeowners - and when there are a lot of volunteers, there tends to also be a lot of opinions.  So it is important to designate a committee chairperson who reports the wants and needs of the entire committee to the board and/or management. 

Having a member of the board acting as a liaison for each committee is equally important.  That way each committee chairperson can report to one member of the board instead of all five or more members.  Around budget season each committee should have met and discussed their proposed budget amongst themselves for the upcoming year.  They then send this proposed budget to the Treasurer for review and to be included in the Association’s budget.  If you had three or more committee members trying to convey their budget needs to each board member, something inevitably will get marginalized. 

The same system applies to management and board members.  The board should assign each board member a specific committee to oversee (i.e. landscaping, pool, finance, etc.).  For example, the landscape committee discovers that a major irrigation leak has occurred and, after receiving three bids, they determine they would like XYZ Irrigation Company hired to conduct repairs.  The landscape chairperson reports the findings to management.  The manager then adds this to the manager’s report and notifies the board liaison for landscaping.  The liaison reports his findings to the rest of the board so they can quickly decide as a group on the request.  This also helps everyone to be more organized and efficient during the month and more productive at the board meetings. 

Along those same lines, it is always a good idea to have one point of contact with your contractors/ vendors -both to deal with on a regular basis and to report issues to.  With more than one point of contact you waste time navigating through the vendor’s organization to report specific issues, and may not have successfully followed through afterward.  Also, you risk the vendor misunderstanding the specific needs and conditions of the community, if he/she does not regularly interact with a particular person. 

A single point of contact creates accountability, pinpointing errors and decreasing communication snafus and lost time in working through your community’s challenges.