Homeowners Associations: Management and Board Responsibilities


 

Residents who purchase units in condominiums, townhomes and co-ops, don’t always understand the roles and responsibilities of the Board of Directors and the Property Management Firm. This checklist provides some insights.


TYPICAL DUTIES OF THE PROPERTY MANAGER


COMMUNICATION

  • Maintain communication with the board, association members/owners, and vendors
  • Respond to letters and log calls from owners
  • Send notices of annual meetings

FISCAL MANAGEMENT

  • Collect assessments
  • Ensure bills are paid
  • Produce financial statements
  • Establish a draft budget for the board and implement budget policy
  • Ensure tax forms are completed and taxes are paid, as appropriate

ADVICE AND CONSULTATION

  • Advise the board on governing documents
  • Refer the board to other professional advisors (e.g. attorneys, CPAs, engineers)
  • Research insurance coverage and process claims

RECORD KEEPING

  • Maintain files for each member of the association/owner
  • Maintain records for the association
  • Process initial Architectural Control Committee (ACC) applications

PROPERTY MANAGEMENT & MAINTENANCE

  • Interview, hire, supervise and terminate association employees, when necessary
  • Negotiate contracts – with board approval
  • Monitor contract vendors such as landscapers and custodial services
  • Inspect and maintain comment elements
  • Handle emergency situations

TYPICAL RESPONSIBILITIES OF THE BOARD OF DIRECTORS


PRESIDENT

  • Prepare meeting agenda
  • Preside over meetings
  • Appoint committees
  • Execute contracts
  • Perform day-to-day administration
  • Act as spokesperson for the association

SECRETARY

  • Maintain membership lists
  • Give notice of mailings
  • Keep meeting minutes
  • Maintain association correspondence
  • Preserve association history

TREASURER

  • Understand financial accounting
  • Review financial statements
  • Prepare budgets (works with the management firm)
  • Develop investment strategies
  • Oversee tax filings and annual audits (works with CPA)
  • Report on the financial condition of the association

 

 

MISCONCEPTIONS ABOUT THE
PROPERTY MANAGER’S DUTIES


Here are some things a property manager typically is not contracted to do.

A property manager does NOT:

  • Negotiate disputes between owners
    Managers may handle communications in the case of governing document violations.
  • Advise on legal matters
    Managers may recommend legal advice be solicited. Attorneys should be consulted.
  • Have to be available 24/7
    Managers should have procedures to handle emergencies and timely communication.
  • Have to be on-site whenever contractors are on the property
    Managers should do spot checks and a final inspection with a board representative.
  • Report to individual owners
    Managers contract with the board. Owners should address concerns directly to board members not the property management firm.

 

 

 

FIDUCIARY RESPONSIBILITY

The Board of Directors has a fiduciary relationship with its members and is responsible for making good decisions for the association.

Directors are responsible for:

  • Preserving property values
  • Maintaining the property
  • Establishing house rules and regulations
  • Overseeing the organization’s finances (including collecting assessments)
  • Maintaining appropriate insurance coverage for common area liability and property damage
  • Keeping members informed.

 

More Information on Homeowners Association

Management

Community Associations: A Guide to Successful Management
by Stephen R. Barber, CPM and Vickie Gaskill, CPM, ARM, MPM

IREM Course: CID201 -Common Interest Developments: Managing Condominium Association Properties

Forms and Tools for Homeowners Associations

Download a copy of this Checklist for Homeowners Associations