> Homeowner Association News
Ask The HOA Expert - February 11, 2004
by Richard Thompson
Question: Since volunteers are hard to find, we've been considering paying our directors. Is that okay? Answer: Most governing documents prohibit compensating directors. But even if yours are silent, it's best not to walk that road. There is a clear conflict of interest and it could lead to lifetime appointments. Question: Our Board allows members to designate the manager as proxy at Annual Meetings. While he's a good guy and all, this doesn't seem right to me. Answer: Having an employee or contractor as proxy would be a huge conflict of interest since he could easily vote in friends who write his checks. This is a bad idea from start to finish. Question: Our HOA is 20 years old and our landscaping is looking pretty tired. We have a Grounds Committee but it seems it's not making much progress in beautifying the grounds. Thoughts? Answer: What you need is a master landscape plan provided by a landscape design professional that will take into account your irrigation system, tree cover, maintenance costs, curb appeal and, of course, cost of installation. This plan can be competitively bid by landscape construction contractors since it will show all the details of plant and bush species and placement. Landscaping is a big part of home value and this issue should not be neglected. Investing in landscape renewal will pay dividends in reduced maintenance costs, water bills, increased curb appeal and member pride. Pay a little and reap big rewards. Question: Our professional manager charges a five percent oversight fee for renovation and insurance repair projects that the association enters into. Is this common? Answer: The manager should not be expected to work for nothing. Extra work like this justifies extra pay. It's common for an HOA manager to charge either a percentage of the project cost or an hourly rate for project oversight. However, it's important to have someone that is knowledgeable about the particular work being done. Oversight of straight-forward projects like painting could be done by the managers but complex structural or roof work, for example, demand a higher degree of expertise. If the project is lengthy and multifaceted, it makes sense to hire a construction manager to schedule the phases, coordinate material delivery, perform progress inspections, process change orders and approve payments. Costs can vary but it's usually more than worth the expense to ensure competence, good work and timely completion. | 
