Becoming a board member of an HOA or community association is an exciting move. But with a newfound position comes potentially unfamiliar responsibilities. Let’s explore the essential things you need to know to be a successful first-time board member!
What Do HOA Board Members Do?
Your primary role as a board member is to preserve, protect, and enhance the community’s value. Generally, you’re tasked with maintaining each owner’s investment. Why would people want to belong to a community where the property is not in good shape, and capital repairs aren’t regularly made to maintain and increase home values?
Coordinating board training with your management team will help to set goals and expectations for conducting community business, as well as create a mutually beneficial relationship between board members and management. If there is not one in place, develop a strategic plan for the board to follow.
Being a community leader means listening to those you serve. By supporting residents and listening to their concerns, you can build purposeful relationships that remain transparent at all times. Because most violations stem from a lack of knowledge or understanding, there should be a solid balance in governance that stands firm yet encourages community input.
Because you have no authority separate from that of the board, you must become acquainted with the parliamentary procedures specific to your association. Keeping clear lines of communication with other board members is crucial, but it remains important not to govern in secrecy. You must become acquainted with the Board’s insurance agent, as knowing you are covered is not enough – you must know the ins and outs of directors’ and officers’ insurance. Similarly, you must familiarize yourself with the bylaws, code of conduct, management agreement, and capital plans, which may include a reserve study.
How Do Reserve Studies Help Board Members?
If the board does not have a capital plan or reserve study, it is imperative that you obtain one. Reserve studies act as a proactive capital planning tool for boards, providing an equitable and reliable financial plan for the future.
A reserve study is a non-invasive inspection of all association-maintained assets. The reserve study report will take into account the current amount in reserves and outline a 30-year financial plan to support capital project funding when the time comes.
This information is paramount in fulfilling your fiduciary duty of care and acting in good faith. After all, a board can not say it fulfilled its fiduciary obligations if it was aware of issues and did not take action. An inspection and capital planning tool, reserve studies generally make a board member’s life easier and help fulfill their fiduciary obligations to the community.
As a first-time or tenured board member, it’s extremely important to make informed decisions, avoid conflicts of interest, and act within the breadth of your jurisdiction. If you’re unsure about any rules, regulations, vendors, or documents, become informed before acting. Become and remain loyal to the community you serve, as you have a fiduciary obligation to do so.
Becoming a first-time board member is a big step, but it can be an extremely rewarding experience. By following the rules of conduct, maintaining all legal and association documents, fulfilling your fiduciary responsibilities, and caring for your community, your hard work is bound to pay off.