Homeowner Association Board Members Roles Explained

Community associations are unique entities, and the Boards that lead community associations fill unique roles.

Does Your Community Association Board Have What It Takes To Succeed?

Successful Community Associations

  • have boards that consist of officials elected to represent and protect the best interests of their constituents.
  • are corporate entities whose board members must maintain the value of jointly owned assets.
  • are social entities that are expected to preserve or improve the quality of common ground living in their neighborhoods.

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Association Websites by Neighborhood Notices

Qualities of a Good Board Member

A Strong Board Member Exhibits:

  • Good character
  • Strong integrity
  • Calm judgment
  • Willingness to serve
  • Committed to the best interests of the community as a whole
  • Relevant experience or background
  • Previous volunteer service
  • Strong “people skills”

 

Warning Signs of Weak Board Members

  • A Dictator who is unable to put the welfare of the community first
  • Works behind the board to run things his or her way
  • Impulsive or quick tempered
  • Has a personal or hidden agenda
  • Puts individual interests first
  • Little or no experience in management, leadership, or service and is unable to work with others for the common good.

Sadly, weak board members are all too common. Our list is just a quick overview of the topic of the less than ideal Board Member. For more, read our article about what to do if you have a dictator for a Board President.

How To Succeed as a Community Association Board Member

You might be wondering with all of this responsibility, how you can possibly succeed with such a challenging assignment?

Personal Preference – You can start by putting your personal preferences and circumstances aside. When you make decisions as a board member, you have an obligation to work in the best interest of the entire community, regardless of how they affect you personally. Don’t allow personality differences to interfere with the work of the board. Be cooperative, positive, and make every effort to stay focused on the needs of the community.

Education – Educating yourself should be a high priority. Part of learning how to be a good board member will come from trial and error; but, you can reduce the errors and the time it takes you to get up to speed by attending seminars, reading books, networking with community association board members, asking questions of your manager, accountant, or attorney, downloading free materials from the web, and much more.

Process – Knowing, understanding and applying the differences between the roles of the board members and the managers is imperative. Boards set policy and make policy decisions. Managers implement the board’s directives and take care of operations.

Stand United – Once the board makes a decision, stand behind it and make every effort to see it succeed—even if you voted against it.

Be Reasonable – Although boards have a big responsibility, they needn’t be overzealous or inflexible to fulfill it. Avoid snap decisions, act rather than react, and deal with real problems, not nuisance situations.

Boards vary in size, but most are comprised of five to seven elected homeowners from the community. Among themselves, they appoint officers. There are typically three primary positions on the Board… President, Secretary, and Treasurer. Decisions are made by the board as a group, not by individuals or by just the officers.

Next, we’ll discuss each of the officer roles of President, Secretary, and Treasurer in a little more detail.

Association Board Member Roles


THE PRESIDENT

Different situations will determine which role the association President assumes. Sometimes the President must set aside other roles, such as neighbor or friend, to accomplish a task or make a decision, community association presidents are required to fulfill many roles, but the primary roles are leadership.

Association Presidents gain their authority to lead a community association from state law — generally called the Common Interest Ownership Act.

The President should have a basic understanding of the law pertaining to community associations, as well as the association’s governing documents — the Declaration (also called Covenants, Conditions, and Restrictions—CC&Rs), Bylaws (which address the association’s structure, the board, the officers, definition of a quorum, ability to enter into contracts, etc.), and the Rules and Regulations (the operational and behavioral laws that apply to association residents).

Therefore, Board Presidents must perceive the association as both a community and a business, as well as operate on the democratic principles of government.

[bctt tweet=”Board Presidents must perceive the association as both a community and a business, as well as operate on the democratic principles of government.” username=”acrirealty”]

The President’s Role and Their Responsibility

1. Oversee Operations

Association presidents must adhere to budgets, formulate and enforce rules and policies, conduct meetings, prepare agendas, and work with committees.

2. Speak for the Board and the Association

The president is the official spokesperson for the board—to association members, the community manager (or management company), vendors, the press, and the greater community.

3. Seek Knowledge

Learning how to be president of a community association generally comes from on-the-job training. However, educational resources for association volunteers are available in books, seminars, periodicals, and networking offered by groups that serve common-interest communities, such as Community Associations Institute and its chapters.

4. Work with Volunteers

The president is the leader of the board, a body that typically includes:

  • The Vice President—who substitutes for the president in his or her absence
  • The Secretary—the official recorder of the association’s activities
  • The Treasurer—the chief financial officer of the association

It’s in the president’s best interest to encourage the officers’ participation in association affairs and to develop their skills as team members. The president should also attempt to identify and train potential association leaders, encourage them to join the board, and orient them to their new responsibilities.

5. Work with Professionals

Many associations employ either a community management company or a professional manager who directs association operations based on policy set by the board. The president is the liaison between the manager and the association.

Seeking the services of an attorney, architect, or insurance professional is in the best interests of the association. Experts provide information and expertise that board members don’t normally have. For example:

  • Reviewing legal contracts requires advice from an attorney.
  • Managing reserve funds requires guidance from an accountant or investment advisor.

The position of association President is not for everyone. Fortunately, every President has a Board from which he or she can draw support. As long as the members recognize the importance of the community that unifies them, the role of President can be very satisfying. The Board President has a fiduciary obligation to protect the community association.

Board members (and, in particular, the President, and Treasurer) have a fiduciary obligation to protect the community association by:

  • Adequately funding reserve accounts and educating homeowners about the value and purpose of having capital assets.
  • Collecting fees from homeowners.
  • Seeking the advice of a certified insurance specialist and protecting the association with appropriate levels of insurance coverage.


THE  SECRETARY

The Secretary is responsible for preserving the association’s history, maintaining its records, and protecting it from liability.

The secretary should be efficient, well organized, and have a commitment to the future of the association. Associations with a professional manager can ask the manager to perform some of the secretarial tasks.

The Secretary’s Role and Their Responsibility

1. Record Minutes for Association Meetings

There are many types of meetings held by an association for which minutes must be recorded.

  • Board meetings
  • Special meetings
  • Annual meetings
  • Committee meetings

2. Guidelines for Recording Minutes

  • Record the association’s actions and record why they were made.
  • Preserve board members’ voting.
  • State the authority by which directors take a certain action and cite the documents granting that process.
  • Record all matters brought before the board, whether adopted, dismissed without discussion or vote, rejected, deferred, tabled, or simply presented as information.

Remember that the association’s minutes are official records and admissible as evidence in a court of law.

3. Standardize Language Used for Recurring Functions 

Certain functions occur frequently in all meetings. Recording these will be easier if the secretary develops standardized language to cover functions that occur during every meeting.

Recurring language could be used for the

  • Call to order by the presiding officer
  • Proof of meeting notice or waiver of meeting notice
  • Presence, or lack, of a quorum
  • Reading and approval of the previous meeting minutes
  • Reading and acceptance of various reports
  • Unfinished business
  • New business Adjournment

4. Announce Meetings and Prepare Meeting Agenda

Notifying Board and association members of meetings are required by law.

How and when notice is given is typically stated in the association’s governing documents. Agendas are essential to the success not only of the meeting but of the association as well.

5. Maintain Association Records

  • Store and retrieve association documents as required by declarations.
  • Devise an effective filing system, and keep files safe and accessible.
  • Identify and categorize all current and stored documents.
  • Prepare and maintain a retention schedule for document disposal.

6. Witness and Verify Signatures

Many associations have policies to safeguard assets that require two signatures on checks or have a witness to verify signatures. Generally, this responsibility falls to the secretary.

7. Maintain Lists

The secretary is responsible for maintaining lists of all association board and committee members, officers, and members. The list must include their current mailing address and voting percentages.

8. Verify Proxies

The Secretary accepts and verifies proxies for annual or special membership meetings. They are also responsible to ensure that proxies and ballots are kept in the association’s records.

9. File Forms with State Agencies

The secretary is responsible for filing specific forms with state agencies. These might include employment forms, incorporation documents, and other official records of the association.

10. Manage Correspondence

Any agreement or coordination that occurs with the association should be directed through the Secretary.

While the President is the voice of the board, the Secretary acts as the heart of the Association Board

The position of association Secretary is not for everyone. Thankfully, every Secretary has a Board from which he or she can draw support.


THE TREASURER

The association treasurer is responsible for maintaining the finances and ensuring the financial stability of the association. He or she is the financial voice of the Board and liaison to auditors, CPAs, brokers, agents, and bankers. This includes a number of duties and responsibilities.

The Treasurer’s Role and Their Responsibility

1. Prepare the Budget

The most important responsibility the treasurer has is preparing the annual operating budget.

2. Maintain Association Accounts

The association’s documents and bylaws specify a number of financial responsibilities that the treasurer must oversee.

  • Route correspondence to appropriate association representatives—manager, office, board member, committee chair, etc.
  • Ensure that tone, form, and spelling of all association correspondence reflect positively on the association.
  • Maintaining adequate insurance coverage.
  • Keeping financial records.
  • Investing association funds.
  • Collecting assessments and delinquencies.
  • Reserving funds for future needs.
  • Filing income tax returns.

3. Understand Basic Financial Statements

The treasurer must understand the basic components and definitions of the financial statement:

  • Assets
  • Liabilities
  • Members’ equity: reserves and operating fund balance
  1. In addition, it would be advantageous to the association if the treasurer also had an understanding of the other components of the financial statement such as:
  • Initial working capital
  • Special project funds
  • Income statement
  • Statement of cash flow

4. Report to the Board 

The treasurer should report at regular board meetings on the state of the association’s finances. Reports should be based upon factual information compiled from statements and receipts.  This information may also be maintained and provided by the property manager or finance committee.

  • Balance sheet
  • Statement of income
  • Cash receipts and cash disbursements activity
  • Unit owner balances
  • General ledger activity and journal entries
  • Schedule of accounts payable
  • Bank statements and bank reconciliations

5. Implement a Reserve Program 

Reserves are a primary responsibility of the treasurer and the board of directors. The treasurer must:

  • Conduct reserve studies.
  • Update the reserve study yearly.
  • Develop and implement a reserve funding schedule.
  • Fund the reserve accounts accordingly to meet goals.

6. Select a CPA and conduct an Audit

Ensuring that the association is working with a qualified certified public accountant (CPA) is one of the treasurer’s important duties.

CPAs with community association experience are better equipped to provide the expertise you need. The treasurer should work with the CPA to perform an annual audit. An annual audit is a very important document for a community association, the management company, and the board. Even if your association uses the services of a CPA, or if your treasurer is a CPA, all board members—especially in self-managed associations—should have a basic understanding of community association finances.

7. Bookkeeping

In smaller, self-managed communities, the treasurer’s duties may include bookkeeping.

8. Financial Liason

The treasurer is the liaison between the association board and finance committee, its subcommittees, and between the board and the members on financial matters. In addition, the treasurer is the liaison to reserve study engineers, bankers, CPAs, insurance agents, investment brokers, and auditors.

9. Maintain Records

The treasurer should make sure that important financial records are safely maintained in the proper location and for the appropriate length of time.

The image below outlines some of the industry standards for maintaining the Association’s financial records.

Maintaining the Association’s Financial Records

Just like the President, the Board Treasurer has a fiduciary obligation to protect the community association.

The position of association Treasurer is not for everyone. Luckily, even the Treasurer has the Board to lean on for support.

Whereas the President is the voice, and the Secretary is the heart, the Board’s Treasurer is the blood flow for the entire Association.


Many associations employ either a community management company or a professional community manager to direct association operations.

How To Ensure Your HOA Gets The Best Return On Their Investment

Acri Realty Building Strong Management-Bridges since 1993

It’s essential that you find a qualified manager with whom you can work productively. A professional association manager will help the board preserve assets, maintain property values, establish continuity, and provide assistance with operational and financial matters.

Professional Managers – Right Hand of the Board

The board sets policy and establishes a direction for the association, and the manager sees that the policies are implemented. Professional managers can be more than just an employee.

The right management company will work with you and build a strong business relationship that functions more like a great partnership.

Professional managers can assist boards with:

  • Managing human resources: compliance with Equal Employment Opportunity Commission (EEOC) guidelines, payroll, reviews.
  • Coordinating and supervising maintenance activities: landscaping, repairs and snow removal.
  • Alerting the board when legal assistance is needed.
  • Advising the board of regulatory issues and compliance requirements: fair housing procedures, fair debt collection practices.
  • Coordinating member/board communication: preparing a newsletter, posting notice of meetings.
  • Managing office operations: accounts payable and receivable, bookkeeping,
  • Managing association finances: budgeting, collecting assessments, analyzing reserves, pursuing delinquencies.
  • Working with accountants and auditors to maintain the association’s financial records.
  • Working with insurance companies to file or settle claims.
  • Working with state and regulatory agencies as an advocate for the community.
  • Carrying out delegated officer duties.
  • Preparing proposals and screening contractors.

How to Select and Find a Qualified Manager

The association’s size, amenities, facilities, and budget determine the type of management your association needs. Whether you select an on-site manager or work with a management company, it’s essential that you select a qualified community association management professional. You can identify qualified managers by the credentials that indicate their level of professionalism.

Networking

Not all experienced and capable community association managers will be listed in the directories. However, you can get recommendations on qualified managers by talking to industry professionals at local and national meetings of CAI (Community Associations Institute).

Invite Managers to Apply

Once you’ve identified several potential managers or management companies, invite them to submit a proposal.

Is a less expensive per door cost always better? That depends. Sure, you can save a few pennies and appear like you are saving money, but when you look closely, you may be in serious trouble.

Ignorance isn’t bliss for your community — or your neighbors — when it comes to Homeowner Association or Condominium Property Management Service Companies. Don’t be impressed by empty promises, websites or pretty PowerPoint presentations.

Be sure to find the answers to some key questions before signing a contract. The best way to to get the answers you need is by actually visiting and interviewing potential professional management companies at their business location.

Ask the Tough Questions (and Get Them Answered)

Acri Realty has compiled a list of the questions you and your association need to ask and get answered before committing to and signing a contract with a professional property management company. Print it out and use it as a guide so that you are sure to get the answers you really need.


Acri Association Managment Service Provider-ListDownload the Tough Questions ⇐ Print it out and use it as a guide the next time you need to interview a property management company. Be sure to get difficult questions answered.


Hiring a Condo or HOA Property Management Service Company that is “less expensive” is not what is going to protect your property values. Oftentimes discount providers cut services or charge excessively for add ons. Without the appropriate software, experienced staff and certified contractors to protect your HOA services efficiently, you risk a much higher cost in the long run and end with devalued properties. It is all too common that the less expensive property management companies are not collecting enough per door money to effectively manage your assets.

The first step in proactively preserving your HOA values is employing a sound and experienced professional management company who really know the intricacies of an HOA operation. Your return on the investment you make with your professional property management company will be the increase in your property value. Call and schedule an interview with Acri Realty for the best in association property management services.

Once your association selects a manager or management company, both the board and the manager will want a contract that specifies the terms of the agreement. For legal advice and contract recommendations, we recommend that you consult with an attorney. Here are some of the elements that you can expect to be included in your management contract.

The Management Contract

  • The parties involved in the agreement
  • Documents that govern the use of management services
  • Amenities serviced by the management company
  • Association management duties
  • Manager’s communications responsibilities
  • Compensation and Terms of the agreement
  • Various definitions and guidelines for dealing with potential conflicts

The Critical Board Meetings

An association is a business that must conduct meetings of its “shareholders”— the owners or their elected representatives.

Community associations conduct several types of meetings, each addressing a particular need and fulfilling a purpose. Board meetings must be productive, orderly, free of disruptions, and open to members and residents unless an executive session is convened.

The Purpose of Board Meetings

  • Set Agenda
  • Review Plans
  • Resolve Issues
  • Listen to Homeowner Concerns
  • Plan for the Future
  • Vote on business discussed in executive session

Executive sessions may occur, however, the board should only convene in executive sessions to discuss pending litigation, personnel issues, or contract negotiations.

The Purpose of Annual Membership Meetings

  • Elect officers
  • Deliver committee reports to chairman
  • Build community by bringing in neighbors feedback and show transparency

The Purpose of Special Meetings / Town Meetings

  • Focus on one particular item of concerns
  • Present sensitive or controversial matters to the homeowners
  • Garner support for large projects or clarify unpopular rules and /or assessments
  • Provide a structured venue in which residents can explore issues and express feedback
  • Get resident feedback before the board takes place
  • Reach consensus or resolve an ongoing issueGain valuable insights into the character and values of the homeowners

Board Meeting Processes

Board officials use tools and processes to assist in the organization of their meetings and to ensure they’re satisfying any meeting requirements.

The parliamentary procedure is the body of rules, ethics, and customs governing board meetings. The use of the parliamentary procedure can be as formal or basic as the association wishes, as long as it provides sufficient structure to keep a meeting orderly, fair, and productive.

The Purpose of the Parliamentary Procedure

  • Staying on the agenda plan
  • Discussing one subject at a time
  • Giving each participant a chance to speak
  • Speaking only on the issue being presented
  • Speaking only when recognized by the chairman
  • Addressing questions and comments to the chairman
  • Deciding issues through motions, seconds, and votes

Associations must also meet several important criteria before any business can be conducted at a meeting. In particular, the notification of members, meeting a quorum, and recording of actions taken – the minutes.

Notifying Members – The law requires community associations to notify members of meetings—especially annual meetings. Keep notices brief, focused, and simple; issue them at the appropriate time in the proper manner.

Achieve a quorum – Each association’s governing documents or state law specifies how many members constitute a quorum. Quorum size can vary from one association to the next. Board officials must sure that a quorum is present before calling any meeting to order.

Record Meeting Results / Minutes – Minutes are the official record of decisions made at an association board or committee meeting.

Good meeting minutes will include:

  • Type of meeting: board, committee, regular, special
  • Association name time, date, and place
  • Attendees’ names
  • Approval or correction of the previous minutes
  • Officer and committee reports
  • Motions and their outcomes—approved, denied, or tabled
  • Adjournment time

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Rinaldo Acri-CEO Acri Commercial Realty“Our mission is to help your community not only succeed but to achieve success with a minimum amount of anxiety and angst. Hopefully, we can even help you enjoy the benefits of community life. That’s why we’re providing you this overview of what you need to know about Governing Documents. Just like our federal laws, the governing documents are the foundation from which you build your community. This article can help you understand your community and if you are a board member, provide some background information to help guide you as well.  If you can’t find what you need, call us and we’ll be happy to help you.”

 

 

Ultimately, the role of the board is to protect and increase property value. This is accomplished by operating the association, maintaining the common property, and enforcing the governing documents.

 

Disclaimer: This content including advice provides generic information only. It is in no way a substitute for qualified legal opinion. Always consult a specialist or your own attorney for more information. Acri Community Realty does not claim responsibility for this information.
Acri Community RealtyAbout Acri Community Realty: Acri Community Realty, located in the Greater Pittsburgh Area, specializes in custom HOA and Condo property management solutions, scaled to fit your needs.

Acri is known for the great care and pride in the work done to protect and enhance the value of your investment. They have the privilege of managing a diverse portfolio of properties while caring for each and every home like it is their own.

If you’ve had any issues with your HOA or Condo that you’d like Acri to try and delve into, and possibly write about later contact us via our website at ⇒ Acri Community Realty. We are interested to hear about your experiences and how an association has helped or hurt.


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