"An absolute MUST HAVE for anyone owning or planning to purchase a condominium." -Jerome Jahn, Attorney and Real Estate Broker, Pasadena, CA
"A valuable guide to all aspects of community living." -Stephen C. Sawicki, Attorney, Orlando, FL
Move into a community with a homeowners association and you not only buy a home, you choose a way of life. Homeowners Association and You is the ultimate guide to choosing and creating a harmonious community...
"An absolute MUST HAVE for anyone owning or planning to purchase a condominium."
-Jerome Jahn, Attorney and Real Estate Broker, Pasadena, CA
"A valuable guide to all aspects of community living."
-Stephen C. Sawicki, Attorney, Orlando, FL
Move into a community with a homeowners association and you not only buy a home, you choose a way of life. Homeowners Association and You is the ultimate guide to choosing and creating a harmonious community of good neighbors and peaceful living.
With questionnaires and checklists to help you work together as a group, sample letters and legal forms to run your association smoothly and a sample orientation manual to get your association off to a good start and stay on track, Homeowners Association and You has everything you need. With it, you will be able to:
- Create a positive community atmosphere
- Resolve common problems regarding people, pets and parking
- Deal with a disruptive homeowner
- Keep your home and your association financially secure
- Discover how you can be a community leader
A truly essential tool for anyone who lives in a gated community, condominium or other homeowners association.
Ideal for everyone involved with Homeowners Associations
Residents, Managers, Board Members, Real Estate Agents, Bankers and Title Companies
Dr. Marlene M. Coleman has lived in a condominium community in Los Angeles for the past twenty-five years. She has held positions as a Committee and Board member, as well as served two terms as President of the Board of her Community Association-having turned it around from near disaster. She is also actively involved in both state and national Community Association organizations. Dr. Coleman is Associate Clinical Professor of Family Medicine at the University of Southern California Medical School, an Attending Physician in College Health at the California Institute of Technology in Pasadena, California, and a pediatrician in private practice in Newport Beach, California.
Judge William Huss is a full-time mediator and arbitrator, overseeing individual, institutional, and corporate cases. He was named one of the Master Mediators by Verdict Magazine. Judge Huss was on the Los Angeles Superior Court, presiding over both civil and criminal trials. He also served on the Los Angeles Superior Court Executive Committee and was the Chair of the Education Subcommittee.
He was a cofounder of an Alternative Dispute Resolution company and served as its president from 1996 2001. He has successfully conducted over 2,800 mediations on the subjects of construction, business, employment, personal injury, eminent domain, malpractice, real estate, homeowners association, and many others.
Before becoming a judge, he founded a law firm in downtown Los Angeles, and he is now Of Counsel to the firm. Having been an associate and partner in small, medium, and large firms, as well as founding one himself, Judge Huss is well-qualified to share insights and experiences that will benefit lawyers who want to start a law firm themselves.
The Five Basic Rules to Running and Maintaining a Successful Homeowner's Association
Adapted from Homeowners Association and You by Dr. Marlene M. Coleman and Judge William Huss
Community Associations can only succeed if they are managed well-not just well-managed. This means that as you look at your Community and its needs, you need to observe how it is managed-not just by whom. What are the methods to track and monitor projects? How is information disseminated? Are there any current risks to the Community? Are those risks legal? Financial? Structural?
Throughout your research, you must ask yourself, How do I know how my Community is doing? The questions of how much you know and from where the information comes lie at the heart of making sure your Community and its Association are safe. Only then can you be sure that your investment and your home are safe.
What must you do to find out whether your Association is well managed?
It starts with ground rules.
Ground rules are the guidelines by which those who oversee the Community and its needs must operate to succeed. The ground rules are not the same as the CC&Rs or any other governing documents. They are the active commitments that each member of the managing bodies (i.e., the Board, Committees, and management) make to one another to ensure the success of the greater Community.
Organizations that succeed do so because they are consistent and predictable. Those people who are overseeing the organization and its activities not only know the ground rules, but they ensure that those rules are set and followed. That way, everybody knows what is expected of them and everybody else. It also ensures that anyone who is working against the rules-and, as such, the good of the Community-can be easily identified and appropriate action can be taken.
The Community's ground rules must be actively followed by the Board, Committees, and management. These rules act as much to provide role modeling as they do to create consistency throughout the Community. It does not matter whether you have an outside manager overseeing your Association's activities or if that responsibility is performed by a resident manager-the ground rules apply to everyone involved in the management of the Community.
THE GROUND RULES
There are five basic ground rules that you and everyone involved in your Community's management and oversight must follow. Only by doing so can you ensure that the Association is managed well and well-managed. The five ground rules are:
1. Be consistent.
2. Be vigilant.
3. Enforce all the rules.
4. Review documents regularly.
5. Ask when you do not know.
Depending upon your Association and its needs, you may decide to add some ground rules to the list. Some communities add ground rules such as be honest; be respectful of others; or, ask, do not attack. These and others should be added if they will help your Board, Committee members, and management do their jobs well.
The ground rules should be posted at every meeting. They should also be reviewed periodically to ensure that everyone understands them and how they apply to your Community. This is particularly important if you have new Board or Committee members, or a new manager joining the group. In that case, special time should be set aside to discuss the ground rules in detail, ask questions, and make sure that everybody understands them and recommits themselves to their enforcement.
The following sections detail each ground rule and how it applies to the Community and its Association. As you read the descriptions, think about how your Community operates right now. Look for opportunities for improvement. Think about how you might introduce your thoughts to your fellow Community members-whether Board or Committee members, management, or just your friends within the Community who also want to become involved in the betterment of their home, Community, and Association.
Consistency creates a sense of safety and comfort for all of those around us. Everybody knows what to expect, no matter what the circumstances. Decisions are the same-no matter who makes them. Consistency and a sense of safety are synonymous.
It is not just the CC&Rs or governing documents with which you must be consistent-although that is absolutely necessary. It is also the way that you deal with problems within the Community
that makes consistency so important.
One of the more popular tricks that residents play is to pit one Board, Committee, or management member against the others. It is the idea that "if Mom says no, go ask Dad." That can only work if "Mom" and "Dad" are not consistent in the way that they make decisions. Rather than allowing residents to believe that they can ask one person and get the answer they want-knowing that they would not get the same answer from another person-it is the responsibility of all those in management to make sure that they are consistent with the rules and with each other.
Realistically, that is a very big task. It is hard enough for any individual to be consistent from situation to situation. Try to bring that consistency to a group and the difficulties in the early stages seem momentous. The best way to overcome those difficulties is to commit to working toward being consistent, and then, at each meeting, discuss decisions in the larger context. Were they consistent with other decisions being made? Are certain residents trying to play one person off another? What should be done to make sure that everyone is consistent from situation to situation?
Being consistent requires an objective look at how you are behaving from situation to situation-and adjusting your behaviors so there is no discernable difference from one set of circumstances to the next. Even though it seems as if every problem is separate and apart from all the others, that is not actually the case.
EXAMPLE: In one Community, one of the Board members was constantly complaining about residents who made any changes to the outside of their homes that might be seen by others. She bothered the manager, the other Board members, even the residents themselves-sometimes even insulting them for their lack of consideration for their neighbors and the overall value of the property.
Somehow, though, it never occurred to that same Board member that she had made changes to the outside of her residence that were breaking the same rules she was complaining about. For months she ignored the manager and other Board members as they mentioned, asked, and demanded that she bring her residence into compliance.
She truly did not see that it was the same thing. She was guilty of violating the same rules for which she was pointing a finger at others, yet she thought that, somehow, her situation was different, not because she was a Board member, but because she did not find her violation offensive-to her or to the value of the property. It was only everyone else's infractions that created a problem.
Once it was brought to her attention, she realized her mistake. Until that time, she did not see her inconsistency. Once she did, appropriate action was taken-by her and others-and the problems were solved.
The best way to build upon consistency and ensure that ground rules are being observed is to be vigilant. It is so easy for the rules of the Association to be overlooked. There is a tendency to want to believe that this time was different, that the residents know better
and will take it upon themselves to correct their behavior.
Perhaps the Board, Committee, or management members are just tired. They know that something is wrong and they even know that they must do something about it. But how many times must they take the same actions, for the same-or different-people, until everybody understands their responsibility to their Community and their Association?
They have every right to be tired. At the best of times, being vigilant is not easy. Add the responsibility of knowing that your decisions can make or break your Community and your own home, and it often seems the weight of the world is resting on your shoulders.
That being said, being vigilant-in combination with being consistent-lessens the weight of the world. Ultimately, it allows those who are overseeing the good of the Community to set and demonstrate standards for how the Community is going to work.
Vigilance in the management of the Community and its Association makes all of its operations more predictable. Most importantly, it becomes predictable that the Community is operating as it should and must for the best interests of all the residents.
EXAMPLE: In a townhome community there was a couple whose children invariably threw their candy and ice cream wrappers in the driveway and garage areas. Everybody knew the perpetrators. A number of residents spoke to the managing members of the Community, complaining about the mess and the fact that the parents disregarded the requests of the neighbors to teach their children to throw their garbage into the appropriate receptacles.
Because no action was being taken, other residents began breaking other rules. Their feeling-justified in their eyes-was that they and their children should not be held to a higher standard if no one was going to ensure that others were not held responsible. That part of the Community quickly began to look like a slum-with property values adjusting appropriately downward.
Finally, the Board members realized that they could not be nice about the rules of the Community. They had to be vigilant. What had started out as a single instance-something to be treated only as a minor problem-had escalated to a very real problem for the whole of the Community.
Action was taken. A meeting was held with the residents of that part of the Community. Cleanup teams were established to bring the common areas back to their previously pristine appearance. It was even decided by the residents of that area that a neighborhood watch program would be established, where residents would not only be on the lookout for potential criminals, but would also report on those children who violated the common
area cleanliness rules. The problem never recurred.
The easiest way to bring vigilance to the management of the Association is for the Board, Committee, and management members to review the requirements of the Community. They must look at the need and rule requirements, and discuss which are most important,
which are most frequently broken or ignored, and which have been most often passed over or excused-no matter what the reason.
Whether the requirements are aesthetic or operational (such as ensuring that ongoing preventive maintenance is performed), by going through this identification and discussion process, the managing members of the Community are able to identify where they need to put their attention and are then able to do so. Then, if necessary and appropriate, they can work with residents, management, or vendors who must address these problems to solve them and avoid recurrences. By being both vigilant and consistent-from requirement to requirement and person to person-the Community will operate in
a much more predictable manner.
Enforce All the Rules
The logical outgrowth of consistency and vigilance is that all rules of the Community and its Association are enforced. By committing to this action, the Board, Committees, and management are demonstrating their respect for the Association and all of its members-the residents of the Community. There can be no cherry-picking in rule enforcement. If the rule is not worth enforcing, then it should not be a rule. It is that simple.
No one likes to follow rules unless the rules are acceptable to them, no matter what the reason. If you allow Community members to follow the rules they like and ignore the rest, then you might as well have no rules at all.
Management is management. Whether it is the Board, Committees, a manager, or a management company, the responsibility of management is to ensure the health and well-being of the organization they oversee. It is a duty and responsibility that cannot be shirked.
No, it is not pleasant. Yes, it very often pits you against your neighbors. However, your responsibility is not to the individuals, but to the greater good of the Community. When you are dealing with problems in the Community, you are not dealing with individuals. It
may be an individual perpetrator, but it is not an individual problem. The problem is one that affects the community as a whole.
If a rule does not make sense-and that often happens-change it. Go through the proper procedures and channels to have the rule reviewed, and altered or deleted. However, until that rule no longer exists or has been changed to reflect the new needs of the Community, it must be enforced as it is written.
One of the most common rule enforcement problems has to do with pets. Sometimes a Community is established that does not allow pets because the original residents had no interest in them. Over time, that may well have changed.
Of course, those who bought into the Community knew that pets were not allowed. However, maybe they were given a gift, or they were lonely and wanted an animal companion in their home. No matter the reason, the pet is now there and it opens the door for other homeowners to demand the same.
EXAMPLE: In one Community, a resident had a near terror of cats. Upon finding out that one of her neighbors had a cat in her condominium, she was convinced that there were wild animals wandering the halls. A simple house cat-neither large nor dangerous-suddenly took on the size and threat of a puma on the prowl. The resident loudly ensured that the Board and manager knew that the no-pet rule was being broken.
Ultimately, it was found out that a number of residents had cats, small dogs, and fish in their condominiums. The decision was made to review the no-pet rule. Eventually, it was overturned and pets were allowed. The vocal resident-while not pleased-adjusted to the new situation. Pets were to be kept in the condominiums and not allowed to wander the halls.
At least, she felt, there would be no more surprises. There were pets in the building, and either she would have to get used to them or move to another location. She is still happily living in her original condominium.
Review Documents Regularly
All of this leads to the need to regularly review the governing and other documents of the Community. These documents are not cast in concrete. They are living, breathing means of supporting the needs of the Community. As the needs of the Community change, so should its documents. The only way to know whether that must be done is to regularly review those documents for their applicability.
Sometimes you review the documents to make sure that everybody understands the same rules the same way. Very often one person believes that he or she knows what a particular rule says and he or she operates in keeping with that understanding. Invariably, that same person has taken the time and effort to explain the rule to all and sundry to ensure they understand why the rule is being enforced in a particular way. More often than not, that person's understanding of that rule is incorrect.
It is not that this person is intentionally biasing the rule in a particular direction. He or she may have no vested interest one way or the other. It is simply his or her understanding or misunderstanding of what the rule says.
The interpretation of the rules and regulations of the Community often come from people who are no longer on the Board or Committees, or in management. They may not even live in the Community any more. But once, long ago, one person told someone else about a particular rule and how it works, and over the course of time that is exactly what everybody learned to believe about the rule.
This is where owner manuals become crucial. By laying down the general rules of the Community for everyone to know and see, it is much easier for everybody to have a shared understanding and knowledge about the way the Community works. Beyond that, the Board, Committees, and management should plan an annual review of the various rules and regulations of the Community to ensure that they are understood the same way, are still timely, and are being enforced.
Ask When You Do Not Know
One ground rule that makes all the others easy to follow is ask when you do not know. Whether the question is about the rules and regulations of the Community, how those rules and regulations are being enforced, the financials, the operations, or anything else, do not assume you know and understand everything. Do not assume everybody else understands everything either-they do not.
Every person throughout the Community has unique gifts of understanding. This is particularly true and important among those involved in the management and oversight of the Community and its Association. A good blend of varied expertise provides the greatest benefit to the Community.
People tend to focus in areas in which they are most comfortable. For example, you may find the following is the case in your Community.
The President will be the most strategic member of the managing entities.
The Vice President will be most comfortable as liaison between Board members.
?The Secretary will be the most detail-oriented person for nonfinancial operations.
?The Treasurer will be the person most comfortable with balance sheets and the financials of the Association.
The manager will be the most comfortable and conversant with the operational needs of the Association and the Community.
Granted, this is an oversimplification, but it gives you the basic idea. Each person brings his or her own expertise to the management of the Association. As such, each person is a resource to the others and can provide information on an as-needed basis.
Vendors, whether attorneys and accountants or HVAC technicians and gardeners, are also available knowledge resources. If you need to know something, ask. Do not be embarrassed and do not think your question is stupid. Chances are, if you want to know,
there is at least one other person in the group who would also like to know, but is afraid to ask. Not asking the question is a much greater risk to the Community than taking the time of others to get the knowledge that you all need to best manage your Community.
Remember, Communities must not only be well-managed, but managed well. By following the ground rules, you will find that you and your associates involved in the management and oversight of your Community and its Association will have a much easier time of it-now and in the future.
Chapter 1: Community Living -
Becoming a Part of the Community
Being Active in Your Community
Chapter 2: Understanding the Structure of the Association -
Understanding the Association
Chapter 3: Knowing the Players of the Association -
The Board of Directors
Managers and Management Companies
Part 2: Managing Legal Issues
Chapter 4: The Legal Structure of the Association -
The Association's Legal Needs
The Importance of Legal Counsel
Avoiding Legal Problems within the Association
Preventing Legal Problems
Covenants, Conditions, and Restrictions (CC&Rs)
Articles of Incorporation
Conflicts of Interest
Chapter 5: Resolving Conflicts -
Negotiating within the Community Association
Dispute Resolution Diagram
Sample Notices, Letters, and Forms
Letter One: Letter from Owner to Owner
Letter Two: Letter from Owner to Owner with a Copy to Management
Letter Three: Delinquency Letter
Letter Two: Violation of Rules
Letter Three: Parking Violation
Letter Four: Foreclosure Letter
Notice One: Annual Membership Meeting
Notice Two: Regular Board of Directors Meeting
Notice Three: Special Board of Directors Meeting
Notice Four: Executive Session Board Meeting
Form One: General Request and Review Form
Form Two: Architectural Request and Review Form
Form Three: Emergency Contact List
Form Four: Manager's Log of Owners' Requests
Form Five: Architectural Violation Log
Part 3: Managing the Community
Chapter 6: Ground Rules for Success -
The Ground Rules
The Disruptive Homeowner
The Three Ps
Chapter 7: Proactive and Preventive Financial Management -
Keeping a Forward View
Taking a Team Approach
Basic Considerations in Financial Management
Chapter 8: Planning and Monitoring -
Preventive Maintenance Systems
Preferred Supplier Systems
Community Association Annual Overview Form
Community Association Action Item Form
Community Association Management Action Tracking Form
Committee Recommendation Form
Chapter 9: Communication and Meetings -
Board and Committee Meetings
The Annual Meeting
The Purpose of Minutes
Checklist for Conducting Meetings
Template for Meeting Minutes
A Note on Proxies
Sample General Proxy
Welcome Packets and Homeowner Manuals
Checklist for New Resident Welcome Packet
Welcome Letter for New Resident
Suggestion and Response Systems
Community Association Suggestion and Response Form
Being Part of the Larger Community
Committee Interest Form
Chapter 10: A Final Note: You and Your Association -
Appendix A: Key Questions and Evaluations of Your Association -
Appendix B: Board Member Orientation Manual -
Appendix C: Recommended Readings and Resources -
About the Authors