Why Do Community Association’s Exist?
For some Homeowners moving into a Community Association, this answer is clear. Others, are surprised to learn that there are a Declaration, Bylaws, and Rules and Regulations that govern the way a Community Association is administered.
What’s the purpose of a Community Association?
Community Associations were formed to serve a common purpose: to a create harmonious living amongst neighbors, while protecting and enhancing property values.
If all neighbors moved into a Community and agreed on:
- The Rules as to how the Community is Governed…
- The Architectural Guidelines of the Association…
Then all Homeowners would maintain their homes, protect and enhance property values, and abide by the same rules. In reality, a form of “utopia” would exist.
Where do problems occur?
1. Not everyone knows they are moving into a Community Association.
I am still not sure how this is possible, as every sale is required to have a resale certificate at the time of purchase. The resale in Pennsylvania would be a 5407 for a Townhouse or a 3407 for a Condominium. This certificate answers several questions in accordance with state law and is required by every title company for a real estate sale to close. Otherwise, the title cannot be transferred between buyers.
However, on occasion, it happens.
Sometimes, a Homeowner isn’t aware that a home is in a Community because there isn’t a sign to a Community Association at the entrance.
Sometimes, a relator doesn’t indicate that the home is a part of a Community Association.
Sometimes, a seller doesn’t disclose that they are a part of a Community Association.
It’s all happened, and it becomes a surprise to the new buyer when they are contacted by management or the Board of Directors to welcome them to the Community Association, and to collect Association fees.
2. A prospective Homeowner does not read, the Declaration, Bylaws, and Rules and Regulations (Governing Documents) prior to moving into a Community Association.
Let’s be honest. If you have purchased a home, can you admit to reading every word, of every document, at the settlement table? If prospective Homeowners are not provided the Declaration, Bylaws, and Rules and Regulations (with any other Administrative Policies, Resolutions, and Amendments) prior to the settlement table, there is an excellent chance that they are not being read.
3. A prospective Homeowner may not understand the Governing Documents of the Association.
The Declaration and Bylaws of an Association are often written by an Attorney. Many are not easy to read, or understand. Experienced Community Management Professionals and Attorneys often have to read the documents several times over, comparing different sections to one another, and referring back to State Laws. If a Homeowner is not experienced in this field, or has not had an opportunity to consult an Attorney who is experienced in this field, they may not understand what they are reviewing.
4. The seller and/or realtor may provide misleading information, accidentally.
I do not believe this is intentional by any means, but rather, refer to the explanation in #3 as listed above. The Governing Documents are not written in easy-to-read language. There can be misinterpretations of what is stated. In addition, a lot of what is listed or restated in the listing of a realtor or from a homeowner selling their home without an agent is what they have heard or learned from management or on-site staff. Sometimes, this information is not accurate. I have seen where a person believed they were assigned two parking spaces, when they only received one, or they thought the pool was free and there was actually a fee for it. Sadly, the true answer lies in the confusing documents. But when in doubt, a prospective Homeowner can always ask Management to place any verbal statements in writing on Association Letterhead and include the written document in the Resale agreement.
5. Rules are not consistently enforced by Managers, Management Companies, and/or the Board.
In an ideal world, the Community Association would have a Rule Enforcement Policy that would have been distributed to all Homeowners. It should be included in the Resale Package and in the Welcome Package. It should be included on the Association’s Web Portal and available to all Homeowners and Renters upon request.
In this ideal world, the Board would direct management to follow the Rule Enforcement Policy. Management would conduct inspections and issue violations according to the Policy. The violations would indicate what the infraction was, provide a chance for appeal, indicate the due process for each homeowner, and advise each homeowner of potential penalty if the infraction was not corrected.
Re-inspections would occur closing out those violations that were cured and escalating those that were not.
But, with the change of Managers, Management Companies, and Board Members, something seems to get lost along the way. Either inspections are not performed, violations are not issued, or rules are merely no longer enforced.
When a new Board or manager comes on and tries to enforce rules, problems occur when rules have not been enforced for some time. Homeowners who expect rule enforcement become disgruntled because it is not occurring, demanding action. Meanwhile, those who were used to rule enforcement not occurring, become upset when it does occur. It creates a rift in the community that takes a lot of time and effort to try to overcome and heal.
Inconsistent Rule enforcement also opens an Association to potential discrimination claims of selective enforcement. If any violations are issued, who is choosing who they are issued to and why?
6. Rule violations are creating harm to neighbors.
Sixteen years ago, a manager pulled me aside and told me before I issued a violation letter, I should pick up the phone and call a Homeowner to advise them that a letter was coming. I told the manager, Chris Matthews, I just didn’t have time to do that. I was a new manager, it was my job to issue violation letters. At the time, I thought the thicker my management report was, with all the violation letters issued, meant that I was doing my job.
She said, “Make the time”.
I had hundreds of violation letters to issue. There was no way I could possibly make that many phone calls, I told her.
“That’s the point.” She said.
To this day, I never forgot that conversation, and I reach out to Homeowners in advance of issuing those letters.
Rules aren’t about a manager sitting in the office and issuing violation letters.
Rules aren’t about a Board or a Manager “being in control” or “doing their job”. Violation
letters are not a popularity contest or, about “telling someone what to do”.
Rules are in place for a reason.
So what is that reason?
Let’s look at weeding, as an example. Why should we weed our flower beds?
- Curb appeal is attractive and makes a difference for real estate values. Even if our home is not for sale, our neighbor’s may be.
- The higher our weeds are, the more unwanted visitors can gain access to our homes. (Spiders, ants, and the likes increase when weeds are not kept under control)
- If your home is attached to another home, the pests you are inviting into your home, are now being invited into your neighbor’s home.
Here’s another example. Why should trash go into a trash can?
- Trash bags tear open and leak.
- Leaking trash bags stain concrete and asphalt.
- Leaking trash attracts bugs, rodents, mice, rats, and other unwanted creatures.
- Trash bags can be torn open by possums, foxes, and other creatures, tracking trash throughout the community.
- Your personal information in your trash bag can be spread throughout the community, creating a personal safety risk to you.
- If your community doesn’t have a groundskeeper or maintenance person, the clean up of this trash is an unbudgeted expense.
- The trash company will not clean up loose trash that is not placed into a trash can. On many occasions, they also will not pick up trash bags next to a trash can, either.
When we break down the rules, they all of a sudden start making sense. It seems that many Rules in Community Associations are intended to:
- Help keep residents safe (prevent insects and other pests like mice, rats, possums, foxes, etc.)
- Help keep the community clean (free of trash and debris)
- Protect property value (make sure the community stays well maintained)
- Enhance property value where able
7. Rules cannot be changed.
While the old adage says Rules are meant to be broken, I would rather think that rules are meant to be discussed. Some Rules may be outdated and need to be re-written or removed. Others, may need to be added.
Management, works for all of the Residents of the Association. If the Residents come to Bricck with a plea for change, Bricck will present their case to the Board and ask for change.
Rules and Regulations can be changed by a Board vote. (Declaration and Bylaws take more work for amendments to occur, each vary according to Association requirements).
At Bricck, as we onboard clients, we always recommend to new Boards that we re-issue the Rules and Regulations of the Association. We perform initial inspections and observations of the community to observe initial infractions of the Rules and Regulations….but we never assume that Residents know what the Rules are, or that consistent and fair Rule Enforcement has occurred in the past.
Moreover, we also do not want to assume that every Homeowner, Resident, and Tenant have received copies of the Rules and Regulations. So, we suggest providing them by mail and email, and giving everyone thirty (30) days to re-review.
We suggest that everyone take the time to go through and make note of any rule that they do not understand, or do not agree with, too.
Then, we ask the Homeowners, Residents, and Tenants to open a dialogue with us at Bricck about these questions and concerns. We want to know what they are.
Maybe, there is a rule that is so old it needs to be updated.
Maybe, there is a rule that is so outdated, that it needs to be changed.
Maybe, the residents are so up in arms about a topic, that the item needs to be addressed immediately.
Or maybe, there aren’t any questions, at all. But, everyone had the chance and opportunity to receive the Rules, have the chance to voice their opinion, and be heard. And, maybe, that’s all they wanted, after all.
8. Fees will never increase.
It is unrealistic to think that Maintenance or Condominium fees for an Association will never increase. Even the Association’s with the most simple services will still have price increases as labor wages increase and material costs increase. Cost of living is not decreasing, either. If your annual budget is not increasing by at least the cost of living, there is a better chance at a larger special assessment in the future than not, to make up for lost time.
Every Community Association has a different pallet as to their choice for funding. Many prefer smaller stepped increases than no increase and a large, unplanned jump. Others appreciate special assessments for snow or large one-time projects (like roof, siding, etc.) so that yearly fees do not have to increase. These are all questions that the Management Company learns about your Community Association as they are helping to develop your Association’s budget with your Board.
9. The Board holds the Power in a Community Association.
This statement is false. The power in any Community Association always lies with the Homeowners. The Homeowners elect the Board of Directors to vote on their behalf on the day-to-day issues and management of the Community Association. However, the Homeowners have voting power at Elections, for any item that requires a vote of the membership of the Association, and they have the ability to remove the Board, if they are not satisfied with the Board.
Removal of the Board is cumbersome and difficult, and it is often easier to have new candidates run at upcoming elections versus attempt a complete overturn.
10. Management works for the Board.
This statement is also false. Management is hired by the Board to work for the Association. The Association is comprised of all Homeowners. Therefore, Management works for every Homeowner, not the Board.
Management takes direction from the Board, because the Homeowners have elected the Board to make the day-to-day decisions of the Association --- including, hiring a Management Company. The Homeowners have elected the Board to be the authority and decision makers in the Community, so they are who provides direction to Management.
Management, however, is bound by moral and ethical responsibilities and principles. We have to act with integrity at all times. We will never take direction from a Board that is not legal, ethical, or moral. If we receive direction in this manner, we will advise the Board of such and tell them that we refuse to act in this manner. We will document the action accordingly and make a recommendation to the Board as to a different way that they can handle the situation that both a legal and moral way to proceed moving forward. If necessary, we will refer the Board to the Association’s legal counsel for further guidance and recuse ourselves from the situation.
Bricck will always act in the best interest of every Homeowner.
Living in a Community Association is a benefit to Homeowners. Common Area expenses would not only be a single-family homeowner’s expense, but also their responsibility for finding contractors, performing maintenance, and repairs, while burdening all repairs costs themselves. Although Community Association living has many benefits, there are many misconceptions that occur when living in a Community Association. Many of these misconceptions occur with the hierarchy of the Residents, Management, and the Board and reporting authority. In addition, more education and support alike are needed by Community Management Professionals to both Homeowners and Board Members to ensure that everyone in the Community is aware of State Laws, Governing Documents, and Rules and Regulations. This education should not be focused purely on Rule Enforcement but rather a general understanding of the Community to gain consensus and understanding of the Community as a whole and work toward a common purpose of obtaining harmonious living while protecting and enhancing real estate values.
Bricck Property Management is a boutique property management firm with corporate offices located in King of Prussia, Pennsylvania. Bricck provides best-in-class property management services to condominiums, homeowner’s associations (HOA’s), co-ops, active adult communities, lifestyle communities, and commercial buildings. Contact Bricck today for a free, cost-effective, high customer service level proposal: Phone: 610-596-8500. Email: email@example.com. Website: www.bricck.com