Property Management Transition
Happy New Year!
We are a 70 unit HOA in Tucson with nearly 25% rentals. As in a lot of HOA’s it seems, it is next to impossible to find interested homeowners to serve as board members.
While some board members have been on the board for decades, most of the board members simply do not have the time or interest to do anything more than attending the monthly board meeting which is facilitated by the one person property management company.
Unfortunately, you could consider the board to be inactive, excluding bring up problems and attending board meetings. The property management company keeps the legal requirements and financials, however, the president has been the only person who has facilitated 100% of the onsite various responsibilities. This person is exhausted after nearly 10 years of doing most everything has now resigned from the board at the conclusion of December 2019.
With this resignation, the property management company also has given notice. This comes as a mixed relief as the board felt that the individual was not doing enough for the board. Basically the board does not want to be involved in the day to day oversight and responsibilities.
I am a board member who lives on the East Coast and wants to help guide and facilitate the transition of the property management company. I anticipate there to be little to no help from board members in identifying, conducting interviews, site visits to the property.
The current management company is a bit antiquated and I anticipate that this person will simply drop everything in a box, and deliver to the new company with little or no explanation, once hired.
Questions:
I would like to craft a communication to the current property manager as to what the transition should look like and include? Is there a list of basic responsibilities the outgoing property manager should give to the new property management company?
2) The board is accustom to the President (resigned) and the property management company (resigning) to do everything. Is there a basic list of duties the board should be doing?
Any help and guidance would be greatly appreciated.
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Tom;
This is one of the most important and difficult task that any HOA can undertake.
First and foremost is the transition of the associations money. You must locate all association financial accounts and transition signature authority and access for those accounts. You then need to secure all bank statement records from the past management company or financial institutions and particularly for the last couple of months and scrutinize all the financial transactions in that time period to determine if they were all appropriate. Along with the financial access and records comes the assessment payment status and history records of all homeowners. You should ask for a current financial status from the management company including accounts receivable as well as accounts payable. If your association has a long term maintenance plan or reserve study you need to get a copy of that plan.
Then you must obtain all association records starting with the original and all changes to the governing documents for the association (CC&R’s, Articles of Incorporation , bylaws, and rules and policies) then all other records of the association such as meeting minutes, board resolutions, violation notices. Also include any committee records such as architectural review committee records of approved or rejected change request and minutes.
You must obtain copies of all current association contracts with any vendor.
You must obtain any records of legal action taken by the association and against the association.
You must obtain the address of record and contact information for all current home owners.
From what it sounds the community manager probably has all of this in several boxes of paper, use this list to find and organize the essential records and separate them from the chaff. Any new management company should scan these paper records and organize them for easy access and retrievability.
As for the board duties and responsibilities for that I’ll need to go to Tucson and meet with your remaining board and members of your community to get to understand your specific community and encourage members to participate an take interest in their community. Contact me with the site email and we can coordinate such a meeting if you desire.
Dennis
My sincere apologies for the delay in responding. Thank you for your broad and detailed overview. This information will greatly assist me in the initial conversations with our board. I greatly appreciate you offering to come for a visit. I will reach back if the board feels this is something they would like to do.
Again – Thank you!