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As a volunteer serving on an HOA board it is you who will make a difference in your community. Get started here to learn more about how this series of videos will help you understand your role and responsibilities.
No two associations are the same. However, the role of the board is always the same. Here is an overview of the 10 topics that are essential to successfully serving on your board.
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As a director of a private nonprofit corporation it is critical to understand your fiduciary duty. Know your individual responsibilities as well as the board’s authority. Learn what protection you have against personal liability; and know what actions can expose the board and association to liability.
The “Chain of Governing Documents” is discussed in this segment as well as the significance of maintaining current information with the Corporations Division of your Secretary of State. Learn the distinctions between covenant provisions and provisions in the bylaws. Every association will sooner or later need the services of an attorney. Learn why and know how to be sure to select the right attorney or law firm.
What are the board’s financial responsibilities with a focus on the budget preparation and approval process?
Collection of assessment is critical to the financial health of the association; however, the process of collections can be complicated. The board should have a written policy (Adopted Resolution) for collections, liens, and foreclosures. Many associations outsource their delinquent accounts to attorneys and law firms experienced with HOA collections. Some associations will take responsibility for placing liens themselves and filing claims with the small claims court.
Covenant enforcement is one of the most difficult aspects of governing a homeowner association. Once again the board should have a written policy (Adopted Resolution) for covenant enforcement. Boards should use practical approaches to help avoid legal solutions. However, the board should carefully weigh the risks and rewards of enforcement. State laws vary and some provide for alternative dispute resolution. Here are the steps for covenant enforcement.
What types of insurance is the association required to have? What are non-monetary claims? What happens when a claim or judgement is not covered by insurance.
Many associations have limited maintenance responsibilities consisting of only entrance signage. However, many associations have extensive infrastructure in the form of pools, clubhouses and tennis courts. The board has a responsibility to maintain the common areas. This is done with an inventory of assets, maintenance controls, a reserve study and an adequately funded reserve fund.
Contracting with a professional management company or self-managing? The pros and cons.
Meetings represent the democratic process of governing a homeowner association. It is where directors are elected, budgets are approved, issues are debated and rules or resolutions adopted. State laws and governing documents vary widely. It is important that the board understand the types of meetings, required notices and agendas, quorums, proxies, and voting procedures. Parliamentary procedure is essential as well as maintaining accurate minutes of the meetings.
It is no secret that most residents are apathetic when it comes to affairs of the homeowner association. That is… until they are personally affected by a covenant/rule violation letter or receive notice of an increase in assessments or worse, a special assessment. Therefore the burden of communication rests with the board to educate and inform residents of their responsibilities and the importance of their participation.