There has been a nasty rumor hanging around for years that homeowner associations (HOAs) are inherently flawed. The premise is that both volunteer and hired management are incompetent, invasive and tyrannical. Picture the Board trooping through the property with clipboard and citations ready to swat any owners that step out of line. Not a pretty picture for those that want "care free" living.

There are valid complaints about how some HOAs are being run and, in some cases, the board or manager may be autocratic or power mad. But don’t confuse the power and purpose of a HOA Board with a corporate board like General Motors. In GM's case, the board is composed of highly paid and trained professionals. They consciously can and do make risk management decisions based on whether profits will exceed the cost of defense litigation. They don't live next to the people impacted by their decisions. They rarely have to personally pay out of their own pockets for either bad or good decisions they make. And while GM execs may lose their jobs for bad decisions, they stand to profit enormously from good ones. None of this is true with HOA boards.

100% of all HOA boards are unpaid volunteers that, while competent in their chosen professions, are largely unschooled, unprepared and inexperienced in government and property management. Unfortunately, this can often be said of professional HOA managers who all too often have no professional training or license (real estate broker's or property manager's) to engage in highly complex people and real estate management. There is a widespread lack of information, training and experience.

Homeowner association management is by far the most complex of all forms of property management because the lines between management (Board) and tenant (Homeowner) are not rigid or definable by contract. There is an annoying "humanity" factor in homeowner associations that keeps getting in the way of business decisions. Residents are, after all, neighbors and not associates or clients. A whole new paradigm emerges: Not only do homeowner association professional and volunteer managers need to be consummate business people, they need to be as compassionate as Mother Theresa. They are expected to intuitively "know" when the "business deal" is off and "humanity" is on. It is a tightrope that even the most experienced managers fall from. With inexperienced managers, the falls are bound to be frequent.

Inexperience produces lack of planning because if you don't know what's coming next, how are you to plan for it? Lack of planning results in crisis management and crisis makes homeowners rightfully nervous and irritable. A case in point: Failure to have a long range Reserve Plan will produce deteriorating assets and unwelcome special assessments. Wasn't this all supposed to be "care free" like the brochure said?

Ever hear an HOA Board grumble about the lack of volunteers? Many complaining owners fall into the description of "never served on the Board, never will and mad because of what the Board is doing". Owners that choose passivity position themselves to be reactionary. What else can they do since they're not involved? ALL owners owe their HOA some degree of volunteerism. Those that don't will always have a hard time understanding the homeowner association concept. Stand up and be counted. If after serving, you still feel a gross injustice is being perpetrated, you're probably right. Work to throw the bums out.

All's not lost. While it's sometimes easy to assume a defensive posture in HOAs, defense rarely produces a successful outcome. Owner versus Board confrontation usually ends in a power struggle that technically one side wins but in reality both parties lose. Because, at the end of the day, both sides are neighbors. And being in conflict with a neighbor strikes way too close to home.

While the homeowner association system has its pitfalls, it also has tremendous advantages: Economies of scale that allow wholesale buying of products and services and access to amenities that few homeowners could afford on their own. Many haven't quite grasped what a gold mine they live in. It’s our goal to point out just what great possibilities there are. First, by sharing planning tools that work and secondly by seeking out products and services that will make homeowner association life a pleasure and not a pain. If Boards and managers take advantage of these nuggets, they will soon gain well deserved respect as they improve the livability of the HOA.

This is the "silver lining" that is waiting for homeowner associations to discover. It’s there and it’s real. Bring your picks and shovels and get to work! For more on this subject, see www.regenesis.net