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HOA Target, Process & Objective

Written by on Tuesday, 08 November 2016 2:58 pm
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The lack of communication is often one of the biggest complaints that many boards receive. Yet, good communication is a fundamental imperative of every homeowner association. If the board is to succeed with its objectives, it needs cooperation from the members. So how is this cooperation best obtained?

The board needs to identify priority targets to aim for. Hitting each target requires a process to achieve a positive objective that will improve the HOA. Here are some examples of priorities:

A. Target: Long Range Planning. Reserve studies provide a multi-year projection of common element repairs and replacements like roofing, painting, fencing and decks. The components all have varying life cycles and costs. Some have long lives, like roofs, and others have shorter lives, like paint. The reserve identifies all of the common element components, predicts useful lives and current cost of repair or replacement. With this information, a schedule and funding forecast can be generated to assist the board in planning.

Process: Hire a professional reserve study consultant and follow the recommendations.

Objective: To maintain the property in best condition to maximize values.

B. Target: Stewardship. The board is entrusted with two things that mean a lot to HOA members: their money and their homes. Stewardship is a form of fiduciary responsibility. Good stewards handle the property of others with extreme care, making sure it is protected from forces that will do it harm or diminish its capacity. This requires careful handling of money and property.

Process:

1. Review and revise the HOA budget each year several months before the beginning of the new fiscal year.

2. Increase HOA fees a minimum of the inflation rate and more if expenses indicate.

3. Keep funds segregated according to whether they are for operating (normal annual expenses) or reserves (cyclical repairs or replacements).

4. Get three qualified bids on large contracts and projects.

5. Perform regular preventive maintenance.

6. Focus on value, not price.

Objective: When it comes to money, the board should not penny pinch by keeping HOA fees the lowest around. Lack of money diminishes services that reduce HOA member property values. Spending money prudently will maintain highest property values and member satisfaction..

C. Target: Fostering Harmony. It's a dog eat dog world out there. It shouldn't be like that in the HOA.

Process:

1. Only enact rules that are necessary and eliminate those that aren't.

2. Provide for an appeal process.

3. Offer a mediation alternative.

4. Promote social events that introduce neighbors to neighbors.

5. Promote charitable events that showcase the HOA's kinder side.

6. Promote team events like park cleanups

Objective: There is no "I" in TEAM. Find ways for HOA members to resolve conflict and promote friendships.

D. Target: Accountability. Hold members responsible.

Process:

1. Have a clear and enforceable collection policy.

2. Have reasonable and enforceable rules.

Objective: Encourage individual responsibility through clear guidelines.

Identifying your HOA's priority Targets, Processes and Objectives will help the board focus on what's most important. Go TPO!

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  About the author, Richard Thompson

Individual news stories are based upon the opinions of the writer and does not reflect the opinion of Realty Times.