Education for HOA Directors and Staff

The Annual General Meeting (AGM) is the highlight on the HOA calendar. The HOA uses the AGM as a platform to highlight their successes from the previous AGM and share the plans and vision they hope to accomplish by the next AGM, and sometimes goals that reach beyond that date. The AGM is the meeting that most members attend. They also use the platform to raise concerns and give praise.

The election of Directors to the HOA Board of Directors forms part of the AGM agenda. The build-up to the election includes the collection of proxies for votes. Election promises, slate elections and in some cases a well-oiled election campaign appear on Facebook and WhatsApp groups spring up overnight, and candidates make all sorts of promises to attract votes.

Very few HOA’s have processes in place to manage the election process and to determine the suitability of candidates to serve on the Board of Directors. The HOA budget might make provision for education and training for staff – but very little for education and training of the Director.

The Director of an HOA has a fiduciary duty to fulfil. They must act lawfully, honestly, make decisions to the benefit of the HOA and the members. In many cases, they also have the same responsibility towards a Sports Club, usually a Golf Club, that is owned or managed by the HOA. Over the next 12 to 24 months the newly elected Director sets the budget, determines the levies, enters into contracts with service providers, appoints new staff, approves salary increases, enforces rules, takes legal action against members and provides strategic direction for the HOA and the Sports Club.

In many cases they change the management structure to suite their specific requirements and needs. Changes to the governing documents that include the Memorandum of Incorporation (MOI), Code of Conduct (Estate rules), Architectural, Design and Aesthetics rules are also very high on their agenda during their term. The Directors do not get paid for their services (there are exceptions) and meetings take place after-hours, in family time

During this period of perpetual change there is an Estate Manager together with the management team that is required to divorce themselves from the outgoing Director and quickly align with the incoming Director’s vision and process. This sometimes leads to uncertainty and mistrust that can filter through to the HOA members and their relationships with their employer.

Often, a management team will bemoans the quality of the Director and that the Director does not understand the workload and working environment. On the flip-side the Director bemoans the quality of the management team and everybody feels that they are one meeting away from being dismissed. It is therefore no surprise that many Directors resign early in their term, disappear or do not get re-elected, resulting in this process repeating itself over and over again.

To change the current state of affairs, Homeowner’s Associations may want to explore some new approaches.

• The development of policies and procedures for the Director’s election process: this could include a process to identify, interview and screen available candidates and recommend their own choices for the Board of Directors.
• The nominees should also be educated regarding the functions and workings of the HOA and sign a code of conduct for the election process.
• The induction process (after being elected) should include continued education and training regarding the policies and procedures of the HOA.
• There are various institutions that could assist in this process – previous Chairs and Directors (HOA body of knowledge) would be a ready source of knowledge and could offer valuable assistance.
• To make use of similar HOA’s body of knowledge. I foresee that independent HOA directors will play a more prominent role on a HOA Board of Directors in the future.

As we can see, there are numerous individuals with the necessary skill set and who could be useful to overcome the present setbacks experienced by HOAs. There are skilled people willing to play a big role in improving their current, often dismal, service offering.

A Professional Management Development Program (PMDP), with various courses for management, directors, staff and owners does exist in South Africa. The Community Associations Institute of South Africa (CAISA) offers great courses and these PMDP courses that have been developed over many years. The PMDP course content has also been “localised” for a number of countries and is offered in different languages. A license agreement with a South African University has been approved and this will unlock even more opportunities for all role players in the HOA.

As with any profession, the education and training of all the role players contributes enormously to their development and ultimately leads to an increase in value and a higher return on the investment.

In conclusion, it is clear that HOAs would benefit from the introduction of new policies and procedures for the election of Directors. In addition, making funds and time available for education and training for all the role players in the HOA would create a better overall outcome.