HOAleader.com - Tip of the Week - January 8, 2010
Published: Fri, 01/08/10
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Is Your HOA Management Company Double Dipping?
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This week's tip deals with saving money by digging into your
management company's relationships with the vendors it
recommends for association projects.
"A lot of our competitors own plumbing, electrical, or insurance
companies or landscapers, or painters--all types of ancillary
vendors that provide services and products to associations,"
explains Robert White, managing director of KW Property
Management & Consulting in Miami, which oversees about 125
associations totaling 30,000-35,000 units.
"They'll do the management and see that the building needs new
paint and just get their vendors in there. Or they'll get bids
from other vendors and then tailor their bid around the other
bids. That creates a major conflict of interest. Some companies
even reward managers for getting those vendors into those
associations to begin with."
That doesn't mean your association will always get the short end
of the stick. "In some cases, having an affiliated company do
work for your community is not only perfectly appropriate, but
you have an even higher likelihood of achieving satisfaction
because the manager is working with you in another way and wants
to preserve that relationship," says Lisa A. Magill, a
shareholder and association attorney at Becker & Poliakoff PA in
Fort Lauderdale, Fla.
"However, if the owners of the companies are affiliated, you may
not have the same level of comfort that bids reflect arms-length
transaction pricing."
One way to determine whether you're getting fair and independent
advice from your management company when it comes to outside
vendors is to include a question in your request or bids asking
bidders to identify all the owners of the company and all the
ownership interests those people have in any other companies the
association does business with.
For more examples of how you might be losing money if your
management company has failed to disclose a conflict of interest,
and to learn more about protecting your association, see our new
article: http://www.hoaleader.com/members/376.cfm
Best regards,
Matt Humphrey
President
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Recent articles posted at HOAleader.com:
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HOA Management Companies: Does Your Management Company Have
Conflicts of Interest?
Your property management company may be taking additional money
out of your pocket each month, and you may not have any idea it's
happening. Here's how to protect your association.
Click here to read full article:
< http://www.hoaleader.com/members/376.cfm >
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HOA Architectural Review: How to be Fair and Reasonable With
Requests for Variances
It's inevitable that at least one of your homeowners will
approach your board and ask for a variance from the association's
architectural review standards. Can your HOA grant a variance? If
so, should it? Here are some answers.
Click here to read full article:
< http://www.hoaleader.com/members/374.cfm >
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HOA Construction Defects: Don't Shoot Yourself in the Foot
You face a dilemma when your owners encounter problems that might
be the tip of a construction defect iceberg. How can you complete
necessary repairs quickly while still preserving any claims you
may have against your developer? This week's tip explores that
difficult problem.
Click here to read full article:
< http://www.hoaleader.com/public/373.cfm >
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What Your HOA Must Know About Construction Defects
If your condo, townhome, or homeowners association has uncovered
repair problems that may indicate there are construction defects
in your community, you need to know the basics of pursuing a
claim against your developer. Here's a summary.
Click here to read full article:
< http://www.hoaleader.com/members/372.cfm >
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What Financial Information Must Your Association Disclose to
Prospective Homeowners?
One of your members has put her unit up for sale. She gets an
offer and accepts it. You then get a request for all kinds of
home owners association records from the buyer. What's your
response? What must your association provide when prospective
homeowners ask for your association's governing documents? What
about your financial documents and minutes? What if the buyer
asks the number of delinquent owners and the amount of the
delinquencies? The answer to those questions depends on your
state's law and your internal practices. Some states have rules
requiring associations to provide extensive detail to potential
buyers. Others are silent on the issue. Here's an overview.
Click here to read full article:
< http://www.hoaleader.com/members/370.cfm >
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