Poor association management can be detrimental to any community. But, how do board members even begin to understand what good community association management looks like?
What Is Community Association Management?
A community association is an association made up of members of a community. This can be in the form of a village, a condominium, a neighborhood, or any group of homeowners. Community association management simply refers to the management of the community association’s affairs. It involves a variety of tasks, including but not limited to accounting, financial management, dues collection, maintenance, vendor coordination, homeowner communication, and dispute resolution.
At the helm of every community association, there sits a set of board members responsible for community management. These board members perform association duties, such as those listed above, to keep the association operating smoothly. In some cases, community associations may employ the services of a third-party manager.
What is a community association manager? Simply put, a community association manager is the point person or the person responsible for managing a community association. These managers are well-versed in the various aspects of community management and have undergone training specifically for this purpose.
There are some managers that work independently, offering their community association management services individually. And then there are others who work under a community association management company.
Managing a Community the Right Way
Although community associations operate similarly to a government, they are by no means purely democratic. Instead of relying on a majority vote from the entire membership for every decision, the association’s board makes the decisions for the community. After all, these board members were elected into their positions to act as representatives of the membership.
But, as a member of your board, how do you even begin to govern your association in an effective and upright way?
Put the Law First
A good board member understands the laws that apply to their association. Thus, before making any decision, it is imperative to refer to your federal, state, and local laws. On a federal level, these are laws like the Fair Housing Act and the Americans with Disabilities Act. On a state or local level, though, it really depends on where you live.
For instance, in North Carolina, community associations must adhere to the Planned Community Act, the Condominium Act, and the Unit Ownership Act. When it comes to corporate governance and procedure, community associations in North Carolina must follow the North Carolina Nonprofit Corporation Act. It is important to note that the law takes precedence over your association’s governing documents.
Do What Is Best for the Community
When making decisions, you must always think about what is best for your community. This means you have to consider all the factors and elements, analyze them from every angle, and come to a decision that is within the community’s best interests. It means doing your due diligence to arrive at a research-backed decision.
Board members often feel pressured when it comes to decision-making, especially when the topic is particularly controversial or will result in conflict. But, taking the easy way out is never a good approach to doing anything if it means the community will suffer for it. Some board members may also be tempted to make a decision that serves their personal agendas or the interests of their friends. And it does not take a genius to know that this type of practice is unethical and downright wrong.
As a board member, you must not be afraid of upsetting a few members if it means your decision is the best for the community. You must also acknowledge that what is best for the community is not always the same as what is best for its members.
For example, it is clearly within your community’s best interests to purchase insurance as it protects your association from liability. But, this also means members will need to pay for the insurance through their monthly dues, and that may not sit well with some people. In this case, you must muster up the courage to vote for the insurance even if it is not necessarily the popular decision.
Remember that board members have certain fiduciary duties to uphold, including the duty to act in the interest of the association. A breach of fiduciary duty can lead to consequences for both the community and your board.
Make Decisions Based on Research
Board members must employ an effective decision-making process, but what does this entail exactly? When faced with a decision to make, you must first learn all the facts concerning the issue. Do your research and read up on the topic. You must also approach the issue with an open mind and welcome different perspectives. Armed with this information, you must then ask what is best for the community and make a decision based on the answer to this question.
The Ins and Outs of Listening to Homeowner Input
Sometimes, board members may feel inclined to make their decisions based on the opinions of others. After all, it is hard to ignore the voices of outspoken residents, especially when they use modern methods of expression such as social media. Nowadays, it is hard to halt the spread of information, even if that information is not necessarily true. And the opinion of one particularly vocal resident might rapidly gain momentum and supporters along the way.
Even when faced with such a situation, though, you must stand your ground. Go back to what is best for your community and cast your vote based on that. Recall that board members are not just figureheads — you are not expected to make a decision based on the opinions of the association’s residents. Rather, you were elected as a board member because you are expected to make decisions based on research, feedback, and your own judgment.
Of course, that is not to say that you should not listen to resident feedback at all. If residents, even a minority of them, have something significant and new to add to the discussion, take their opinions into consideration. It is important to remember, though, that these more vocal residents do not necessarily represent the majority of the membership. Sometimes, most of the community’s residents remain silent because they agree with the decision. As such, be careful not to be swayed just because of a few loud opinions.
What Does Bad Community Association Management Look Like?
While bad community association management can take many forms, it usually manifests itself in two common ways. The first is governance that simply goes with the flow. This is when you act on issues that are not really consequential to the entire community. For instance, you may have heard a few friends complaining about an issue or have seen a certain problem gaining traction online. Perhaps someone has submitted a written complaint to your board.
Although this type of community association management may seem like good practice, it is not always in the interest of the community. It only usually involves complaints from a few vocal residents and, thus, does not reflect the opinions of the majority. Additionally, it creates a culture of simply responding to every seemingly urgent issue among the board instead of focusing on what is really best for the community.
The second type of bad community association management is one that is self-serving. This is when you make decisions based on your personal agenda or to serve your own interests. Some residents only even run for a board position so that they can resolve an issue that is important to them in a way that serves them the best.
What Can Homeowners Do?
If state laws and governing documents allow it, homeowners can remove ineffective or self-serving board members from their positions. Typically, homeowners can accomplish this with a vote from the membership. The exact specifications and requirements, though, will depend on the laws in your state and the provisions in your governing documents.
Of course, homeowners who feel that they can make a significant difference can also choose to run for the board. If a resident believes they have the community’s best interests in mind, running for a position on the board may very well be the ideal recourse.
It Starts With the Board
Effective community association management begins with the board. As a board member, you must always work in the interest of your association. In doing so, you can create a thriving community where residents feel satisfied and property values remain protected.
Everyone needs a little help once in a while, though. Your community can benefit from the help of an established community association management company like Cedar Management Group. Call us today at (877) 252-3327 or contact us online for more information.
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