HOAleader.com - Tip of the Week - January 15, 2016
Published: Fri, 01/15/16
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Self-Managed HOAs: Do These Things, or Face the Consequences
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In this week’s tip, we give some friendly advice to self-managed associations.
But first, we give a caveat: At least one of our experts advises against going alone. “I don’t prefer self managed properties,” says Bob Kmiecik, a partner at Kaman & Cusimano LLC, which represents associations throughout Ohio. “You don’t want to be liable for your business decisions, and one way to ensure that is to hire the person with the necessary expertise.
“I don’t care if you have a lawyer or accountant on the board,” adds Kmiecik. “I wouldn’t rely on what they say. I’d go outside and ask what others say.”
That said, the choice to be self-managed is still yours. But if you go that route, there are things you should do to protect yourself and your association. Here are the first two.
1. Keep meticulous financial records.
“I don’t like when I have collections files, and I see it’s a self-managed community,” admits Hal Kyles, a partner at Denver’s Orten Cavanagh & Holmes LLC, which represents more than 600 associations in Colorado. “More often than not, it’ll be more of a challenge to work with that community, and the biggest issue I have is their financial recordkeeping.
“Frequently, they’ll hire an accounting firm that’s not acting as a community manager to maintain their financial books,” says Kyles. “But even then, I find the folks they hire aren’t experts at dealing with HOA issues. So often their record keeping and the documents I get that allow me to do collections are sloppy or downright wrong. I have to go back and explain, ‘I can’t do this collection matter because your financial records are simply not accurate.’”
2. Hire a team of professionals to advise you.
“Certainly, you need to have your team of professionals,” asserts Phaedra J. Howard, a partner at Hellmuth & Johnson PLLC in Eden Prairie, Minn., who advises associations. “You need to have a lawyer—either a law firm or several depending on what your issues are—to whom you can refer questions. You also need your accountants and all your other professionals. At least in Minnesota, the common interest ownership act requires an annual review—not an audit—by a CPA of the association’s financials. So you need to have your CPA on retainer to deal with that once a year.”
Read our new article for Howard’s real-life examples of how self-managed associations have committed serious mistakes, and to find out the three other things self-managed associations should know:
http://www.hoaleader.com/members/1310.cfm
Best regards,
Matt Humphrey
President
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Improve Your HOA Meetings:
What You Need to Know about Robert's Rules and Other Parliamentary Procedures
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With Practical Tips for Condo and HOA Boards
Thursday, January 21, 2016
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Learn more or register now:
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Recent articles posted at HOAleader.com:
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5 Must-Dos for the Self-Managed HOA
HOAs can certainly opt to forego the services of a management company.
At least one of our experts advises against it. "I don't prefer self managed properties," says Bob Kmiecik, a partner at Kaman & Cusimano LLC, which represents associations throughout Ohio. "You don't want to be liable for your business decisions, and one way to ensure that is to hire the person with the necessary expertise.
Click here to read full article:
http://www.hoaleader.com/members/5-MustDos-for-Self-Managed-HOA.cfm
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In the Thick of a Lawsuit with an HOA Owner, Think Twice Before Doing This
In this week's tip, we offer a suggestion to avoid torpedoing yourself in litigation.
The issue stems from a question from a reader who's embroiled in litigation with the HOA over a drain pipe. In a new twist, the HOA is now alleging violations of pet rules, though the reader contends the board hasn't consistently enforced pet rules in the past.
Click here to read full article:
http://www.hoaleader.com/public/In-Thick-Lawsuit-with-HOA-Owner-Think-Twice-Before-Doing-This.cfm
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If You're in a Lawsuit Against an HOA Owner, Is This a Good or Bad Idea?
An HOAleader.com reader asks: "I live in [Los Angeles], and I'm in the middle of a lawsuit with my HOA. (The suit is over a common area, shared, drain pipe.)
"I've been a condo owner in this building for 10 years. Recently the board sent me a letter stating I have to get rid of one of my dogs. I own two and have had them both since I purchased my unit. The three previous boards used to state, 'Our pet policy runs in accordance with the city,' which is three. The CC&Rs state, 'Only one dog or cat.' Other owners have two pets but haven't been sent this letter.
Click here to read full article:
http://www.hoaleader.com/members/Youre-in-Lawsuit-Against-HOA-Owner-This-Good-or-Bad-Idea.cfm
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Improve Your HOA Meetings: What You Need to Know about Robert's Rules and Other Parliamentary Procedures
Join us for an in-depth webinar on January 21 led by two community association professionals experienced in advising boards on improving their operations. You'll get a road map to help you decide what parliamentary procedures you should follow, and how to use them to improve relationships among board members and between board members and owners.
Click here to read full article:
http://www.hoaleader.com/products/improve-your-hoa-meetings-webinar-a.cfm
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Before Bidding Adieu to the Recession, Take These HOA Lessons
In this week's tip, we aim to start the new year by looking back.
The recession that began around 2008 hammered HOAs for years. Thankfully, the worst seems to be over, and each day looks brighter and brighter for today's HOAs.
Click here to read full article:
http://www.hoaleader.com/public/Before-Bidding-Adieu-Recession-Take-These-HOA-Lessons.cfm
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