The Role of the Board

An association board is a group of owner volunteers elected by all owners. Its scope of responsibility and authority depends on state statute and the association’s governing documents. Some documents invest a board with broad authority. Others are more limited and precisely defined.

In general, most boards have the responsibility and the authority to set goals, standards and policies for the association that involve:

  • Finances—setting budgets, collecting assessments, purchasing insur-ance, funding reserves and generally ensuring the association’s financial viability.
  • Contracts—for building and landscape maintenance, reserve studies, security, snow plowing and other services.
  • Management—maintaining and repairing the property, supervising staff and committees and providing service to residents. Most associations hire a professional management to execute board policies.
  • Legal responsibilities—drafting and enforcing rules, regulations and governing documents; conducting meetings and elections.

Owners elect board members, but generally boards appoint officers among themselves. Most boards have four officers: president, vice president, secretary and treasurer. Sometimes one board member holds two positions—secretary and treasurer, for example.

Each officer has a role with certain responsibilities. Boards of associations that have professional management may assign a task to the manager, but the responsibility remains with the officer.

Sample Board Duties

  • Enforce the documents
  • Establish sound fiscal policies and maintain accurate records
  • Develop a workable budget, keeping in mind the needs, requirements, and expectations of the community
  • Establish reserve funds
  • Act on budget items and determine assessment rates
  • Collect assessments
  • Establish, publicize and enforce rules and penalties
  • Authorize legal action against owners who do not comply with the rules
  • Review local laws before passing rules or sending bylaws to membership for approval
  • Appoint committees and delegate authority to them
  • Either establish the necessary guidelines for volunteer self-management and implement them, or employ a manager
  • Determine management duties
  • Select an auditor, attorney, insurance agent and other professionals for the association
  • Provide adequate insurance coverage, as required by the bylaws and state and local government
  • Inform board members of all business items that require their vote
  • Inform members of important board decisions and transactions
  • See that the association is protected for the acts of all parties with fiscal responsibilities
  • Attend and participate in meetings

Note: Consult association documents and state statutes to determine your board’s powers and duties.

The President

As a community leader, the association president directs the activities of the association, chairs board and general membership meetings and balances the needs and interests of the residents. Some association presidents have the authority to appoint committee members or to serve as a committee member. The president may be asked to help negotiate contracts, sign contracts and other documents and oversee their execution. A wise president will motivate other board members to participate and also rely on other board members for guidance and advice.

Setting Goals

New association presidents often know what they would like to accomplish before their first day on the job. Working closely with the whole board and the manager, a new president can define these goals.

  • Be proactive—identify the association’s most urgent needs. For example, many associations view common area improvements as the most pressing community need.
  • Set realistic goals. A president that sets unobtainable goals may frustrate other board members and defeat his or her own purposes.
  • Sequence goals. Even dedicated volunteers with unlimited resources need time to accomplish their goals. Do not plan to achieve all the association’s goals overnight. Continuity is better than drastic change—unless the association requires immediate change to continue functioning. Phase in new programs over time and refine procedures as you go.
  • Clarify association goals with the manager. Managers often help new board presidents use existing programs to achieve their goals. Though enthusiastic new presidents often want to make their mark on the community, they should never waste resources by ignoring existing programs or the expertise of association professionals.
  • Give appropriate credit to contributing members. Always thank members who help out. This helps to maintain volunteer interest and will
    draw new members into association activities.
  • Work as a team. Board and committee members and management staff are all part of a team that runs the community. As team captain, the association president should not overlook the value of the other members’ contributions. Compliment members when they make valued suggestions and ask for advice when needed. By expressing confidence in volunteers, the president helps to build a strong team.

Dealing with People

New board presidents should view their tenure as a lesson in human nature.

Many presidents learn about thoughtfulness, hospitality, kindness and dedication. But others learn about the disruptiveness of petty neighborhood politics and personal agendas, or face criticism from neighbors. To maintain harmony within the community and to facilitate association operations, the president may have to negotiate sensitive issues.

To succeed, the president must work constructively with members. Presidents must learn to listen to members and be patient with their concerns. Board presidents who start out with a positive intent to improve community living may find that their attitude changes after a few months in office. They may become annoyed with member concerns and overburdened by the demands of the job. The reverse is also true. The demands of the job may be educational, and helping members address their concerns may be satisfying.

Working with Professional Management

The board president is responsible for spearheading the association’s search for good management. Several management options are available to most associations:

  • Self-management
  • Off-site management
  • On-site management
  • Management company
  • Combination method

Each of these methods has its own strengths and weaknesses. For instance, self-management may cut costs, but volunteers don’t always have the expertise needed to manage a community. Off-site managers and management companies are qualified for the job, but may not be as readily available to administer the day-to-day operations of the association as those who work on-site. On-site managers are easily accessible, but will be more expensive.

After the board has chosen an appropriate form of management, it needs to monitor the manager’s performance and provide feedback. An annual review is a common way to evaluate management, while still giving the manager the room he or she needs to operate efficiently.

This feedback will strengthen the partnership between the manager and the board and make it easier for the manager to provide the board with the support it needs to run the association. Here are some specific ways the manager can help the board president.

  • Recommend improved procedures
  • Point out potential pitfalls and their legal ramifications
  • Translate the board’s ideas into words and actions for the members
  • (e.g., publishing a newsletter, or summarizing meetings)
  • Recommend individuals for committee service
  • Contact and monitor service providers

Presidents can learn a lot about association operations by working closely with the community association manager and other association employees.

Preparing for Board Meetings

Well-organized meetings set the tone for all future board work. Board members come away from the meeting knowing they have performed their duties, and they’re confident about how to proceed on future projects. Here are a few tips to help the association president conduct an effective board meeting.

  1. Set an annual schedule for board meetings (e.g., second Tuesday of every month) so board members can plan their schedules accordingly, and there is no excuse for forgetting or missing a meeting. The time for the meeting should also be consistent. Evening meetings work well for many associations. However, some board members and managers claim they accomplish more at early morning meetings. Management companies are increasingly getting away from evening meetings because they place an undue burden on managers’ time.
  2. If possible, conduct all meetings in the same place. Select a business environment—a local community center or library meeting room—rather than meeting in a board member’s home. This eliminates distractions and gets attendees in a business frame of mind without placing hospitality obligations on anyone.
  3. Advertise the meeting in advance. The board secretary or manager should send an initial announcement to board members. Notify association members through the newsletter on the website or announcements posted in common areas.
  4. Send information packages to each board member at least one day before the meeting. Include the agenda, financials, committee reports, contracts for review and background information on issues to be discussed. This gives directors time to review and consider pertinent material and make informed decisions at the meeting. It also helps keep the meet- ing to a reasonable time.
  5. Use a timed agenda. The agenda is the core of an effective board meeting. It sets boundaries on time, focuses the discussion and promotes decision making and problem solving. Though agendas vary depending on the association’s size and needs, certain items should be included for each meeting—a homeowner forum, approving minutes, unfinished and new business and financial, committee and manager reports. Post the agenda on bulletin boards or other common-element areas where members are likely to read it. Understanding association issues encourages members to attend board meetings.

Avoid surprises. Surprises at a board meeting can be embarrassing and disheartening to both the directors and the members. Association business is never enhanced by a president who, for instance, announces an unbudgeted association debt for the first time at a meeting. And volunteers may lose their enthusiasm if they are not informed in advance about a project cancellation.

Avoid unpleasant surprises by contacting key members before the meeting. For instance, if the president gets the key elements of a committee’s report, he or she will have enough time to prepare for potential problems or start the resolution process. The call will also remind members of their responsibilities and help prepare them for the meeting. Reports should be in writing and given to board members a few days prior to the meeting.

The Vice President

The board vice president plays an important role in association affairs. The vice president substitutes for the president in his or her absence. This person also presides over board meetings when the president is unavailable or steps aside due to a conflict of interest. Vice presidents commonly serve as the board’s liaison to key committees and may be assigned special projects. For example, the vice president may research and report on sensitive issues or unresolved committee issues. The vice president should always be briefed on association operations so that he or she is prepared if an emergency occurs.

The Treaurer

The treasurer works with the manager and finance committee to prepare a draft budget for review and approval by the association board or members. The budget is a formal financial plan that determines the annual assessment. This is a central part of the association’s duty to oversee the association’s banking and its investment accounts.

To start the process, the treasurer reviews past years’ financial statements. These statements can be useful in determining how much to allocate to each expense. The treasurer then evaluates committee and member input on the association’s needs and priorities. At this point, the treasurer projects future expenses and adds them to the budget. The treasurer can contact vendors, utility companies, attorneys and insurance agents to get a more accurate projection. Of particular importance, the treasurer ensures that reserve accounts are adequately funded.

This can be accomplished by working closely with a Reserve Planning Specialist who can project an appropriate amount to include in the annual budget. The treasurer is responsible for association financial reports, even if their preparation has been delegated to an accountant. The treasurer usually presents an overview of the association’s finances, budget and invest ments at the annual meeting.

Though association bylaws describe the treasurer’s duties in detail, a few of the treasurer’s main responsibilities include:

  • Monitoring association financial activities
  • Overseeing the association budget and insurance policies
  • Investing association assets
  • Maintaining adequate reserves
  • Coordinating year-end audit or review
  • Serving as liaison to the finance committee, accountant or financial staff
  • Often, the association management company can assist the treasurer with these duties.

The Secretary

Though members may view the association secretary as an individual who quietly records board meeting minutes, the secretary’s job is actually quite complex. In addition to formatting, recording and distributing meeting minutes, the association secretary must maintain correspondence and store and retrieve association documents. Some organizations have a recording secretary and a corresponding secretary. This relieves the pressure of one person doing both jobs.

The secretary is responsible for maintaining all records of the association and usually signs financial and other official association documents. The secretary often delegates the task of maintaining records to a professional manager, but the responsibility for the documents’ integrity remains with the secretary.

Secretarial duties often include setting up and maintaining a filing system. If the developer sets up the association’s initial filing system, the homeowner board must update the system so that it meets the community’s current needs. New secretaries may want to examine different systems to find the one that works best for the association.

Secretaries should select the best place to store association files. For paper records, a good storage area is safe from fire and flood. Digital records must be protected not only from physical harm but from numerous cyber threats like hackers, power interruptions and failure to back up data.

Consider storing duplicate files off-site and off line in case of an emergency. Establish a file retention schedule and purge files accordingly. A professional manager or management company can assist the secretary with many of these duties.

Each board member plays an important role in the success of the community. The president supervises association activities, the vice president provides the president with backup support, the treasurer oversees the finances and the secretary records it all. By working together, these individuals can build a solid foundation for association operations. Association leaders can then delegate duties to committee members to implement its programs.