Directors

Roles and Responsibilities of HOA Board of Directors

A board of directors is a requirement for a homeowners association to function properly. These elected volunteer officials are responsible for all operations of the association and ensuring the community governing documents are followed and enforced. Without a capable board, a community’s quality can quickly decline. The bylaws of an association give all the information regarding a board of directors. Election procedures, the number of members, officer positions, and terms will all vary from association to association.

The board is elected from and by the homeowners of the community at the annual meeting. The bylaws will list how the election should be conducted: if it is held by ballot or proxy or both, if a nominations committee is required, and how many homeowners must vote to reach quorum.

The number of board members usually varies from three to seven and even then, some bylaws may state a board should consist of no fewer than three members and no more than five. Terms most often range from two to three years with a staggered election cycle, preventing the entire board from changing at the same time and allowing some consistency in decisions and knowledge.

Once a board is elected by their peers, the board members will convene to elect the officers, usually during the first board meeting following the annual meeting. associations are required to have a president, secretary, and treasurer and all officers’ terms are limited to one year. Meaning, if a board member was elected to a two-year term, they could be elected to secretary for the first year, and following the next annual meeting be elected to president for the second year of their term. Some bylaws and statutes allow the positions of secretary and treasurer to be held by the same person. In cases where there are fewer officer positions than board members, it is possible to be an elected board member but not hold an officer position. Each officer will have their own responsibilities in managing the association.

The position of President requires outstanding leadership and management skills. This does not mean he or she should make all of the decisions, but rather preside over meetings and make sure all members of the board have the opportunity to give their opinions and the decision that is made is done so only after appropriate discussion and with the best interests of the community in mind. He or she is also responsible for preparing meeting agendas and ensuring all important business is taken care of. As many associations are incorporated as non-for-profit corporations, the president is essentially the CEO and will sign all contracts and other legal documents pertaining to the association and cosign all checks.

The Vice President will act as a substitute for the president if he or she is unavailable as well as carry out any other duties that may be assigned to him or her. In many associations, the vice president is given the role of acting as a chairman or liaison of one or more committees.

The Secretary is more than just the person who gives proper notice of meetings and takes the minutes during them. He or she works closely with the president to develop meeting agendas and is responsible for all association records such as homeowner information and maintenance history. These records must be stored properly and be available for inspection by any homeowner upon request so a good organizational system is a must. Most secretaries also write and send the neighborhood newsletter to keep the company up to date on happenings and general association information.

The Treasurer handle all monies of the association, whether they are incoming or leaving. He or she must collect dues and issue payments to vendors as needed and approved by the board. At the end of the fiscal year, he or she should schedule and assist with an audit of the association books with a CPA as well as preparing the annual budget and income and expenditure report for the rest of the board.

Miscellaneous responsibilities of the board of directors like creating a homeowner handbook or architectural guidelines should be taken upon by the board as a whole, allowing each member to weigh in before voting on a final product.

Any board member may resign if they so wish as long as they give written notice to the rest of the board. The board can also remove any member with or without cause at any time. In these instances of a vacancy, the board can appoint a replacement with a majority vote. Should the resigning member’s resignation not take effect until a later date, they may participate in the selection of a replacement as they still hold all powers of their position.

Anyone looking to run for a position on their community’s board of directors should keep in mind the job is often a thankless one and if elected they should make all decisions with the interest of the community at heart. The greatest reward will be the satisfaction of a job well done when the community prospers.