If you have never owned a home that has a governing homeowners association (HOA), it can be difficult to sort out who does what. While collaboration among everyone involved is what helps to drive a community forward, it’s helpful to clarify responsibilities and align goals.
This article will explain the rules and expectations for each group to give you a clearer understanding of the relationship between residents, HOAs, and management companies. It will also provide examples of how everyone can work together to preserve property values and make the community a great place to live.
What’s the difference between the HOA board and the management company?
The HOA board and the HOA management company are two separate entities. The homeowners association board is comprised of elected volunteers who own property in the community and usually live there. The HOA management company is an outside vendor contracted by the homeowners association.
The Role of the HOA Board
The homeowners association board has two main duties:
- Acts as a fiduciary for the non-profit homeowners association corporation
This means they’re entrusted with making the decisions that affect the values of the properties in the community. One of the board’s primary responsibilities is to protect, preserve, and enhance the value of the physical property governed by the community association.
- Facilitates the enjoyment of the community
This involves setting the rules and regulations for residential conduct, including the usage of common spaces, landscaping standards, and anything else that affects the overall residential environment of a community.
Read More: HOA Management 101: The Role of the Board.
The Role of the HOA Management Company
As mentioned above, the management company is a vendor, hired by the HOA board. They act as agents of the HOA corporation. The management company is a fiduciary and has two core duties:
- Provides helpful business advice
As experts regarding the laws that affect property values in a particular area, HOA management companiesoffer unbiased direction and recommendations to help homeowners associations make the most prudent and effective decisions to preserve and enhance the value of the property.
- Implements the direction of the HOA board and facilitates day-to-day operations in the community
While the HOA board establishes the rules for the community, the management company implements the rules. This can range from issuing notices to homeowners for minor infractions to acquiring independent bids for service providers that affect the community.
The management company does not have the final say in how rules are written; they simply ensure that residents follow the HOA regulations and HOAs follow legal regulations.
What can a homeowner expect from their HOA board?
Members of the board are elected volunteers who should act in the best interest of the homeowners association, no matter their private opinions or personal biases. In addition, board members are expected to:
- Act in a fair and consistent manner
- Refrain from voting on issues or making decisions that present a conflict of interest
- Maintain confidentiality
- Treat homeowners and other board members with respect during discussions and throughout any dispute resolution
What can the board expect from the HOA management company?
The HOA management company does not establish any rules or regulations for a community. Their role is to implement the guidelines set by the HOA. They will simply act upon the rules that the HOA sets. The services provided by an unbiased management company ensure the HOA is working in accordance with the state and national laws that protect homeowners.
How do management companies help the board?
The management company is the board’s closest and most trusted business relationship. They always have the best interest of the HOA top of mind and are always working to protect and increase property values in the community. They do this by implementing HOA management resources such as:
- Making sure the community common area looks great
- Making sure the corporation’s liability exposure is low
- Ensuring the community manager working with the board is the right fit to provide outstanding service to the community
- Helping to build a sense of community
- Providing ongoing training and support for their community manager
Working together to protect property value
Maintaining and improving property value over time is one of the shared goals of all homeowners, and a HOA board is tasked with ensuring this is achieved. This requires a lot of behind-the-scenes efforts to make the front-facing appearance and enjoyment of the property is intact. Here are a few of the key functions a HOA board of directors carries out:
Common area maintenance
Every property has a different layout and amenities for homeowners to enjoy. But it’s up to the board of directions to ensure rules are followed and everything remains well-maintained. This includes everything from pool areas to gym facilities and landscaping to clubhouse. While collectively, as a community, it’s best to work together to keep common areas looking great, the responsibility and financial upkeep falls to the board of directors’ decision-making.
How a HOA management team can help: To work within the set budget outlined by the community, an association manager can work with HOA boards to ensure they have enough funds to carry out any requests. Additionally, they can help prioritize projects and get quotes from vendors to find the right fit for the job.
Enforcement of CC&Rs
A HOA’s CC&Rs are what guides the community and keeps everyone aligned with the rules and regulations necessary to maintain the space. The guidelines are written (and revamped, as necessary) by the board of directors and must be reviewed periodically for accuracy. CC&Rs address issues such as homeowner parking and trash collection, as well as architectural improvements and interior paint and structural guidelines as well.
How a HOA management team can help: An association manager can review CC&Rs for legal language and assist a HOA board of directors with voter approval and homeowner communication. There are specific requirements when adjusting new rules and regulations for a community, which must be followed to ensure approval.
Promote community engagement
A board of directors also leads community engagement among homeowners to socialize and participate in conversations regarding the betterment of the community. The more people are involved, the more likely they will be invested in preserving the property’s value. The board of directors handle budgets for community activities such as holiday parties, BBQs, educational events, and more.
How a HOA management team can help: A HOA manager can poll homeowners for events they are most interested in and help coordinate activities. They can also provide guidance on how to encourage the creation of sub-committees to boost participation among the community.
Facilitating the right fit between HOA and management company
Though most HOA relationships are positive and productive, one of the most common reasons that friction arises between a homeowners association and the management company is because the community manager(the management company employee who acts as a liaison to the HOA board) is simply not a right fit for the community.
This can happen for a number of reasons, from personal to professional, but the most efficient way to handle this is to work with the management company to resolve the issue. HOA boards should ask the management company to address the issue or assign a new manager who is a better fit for the needs of the community.
It’s helpful when a community manager can maintain a presence onsite. This helps them become more familiar with the property, homeowners, and the board of directors. It also allows them to anticipate potential HOA concerns and propose solutions before they turn into bigger problems.
Homeowners’ association boards and management companies have two completely different roles in managing a community. By better understanding who does what, residents can address their concerns with the appropriate party and avoid any confusion about how each party supports the other.
If you have any additional questions about the role of an HOA board member or community manager, please contact Keystone Pacific. We’ll be glad to answer your questions.