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Small Association's MUST still enforce Documents

Many Associations, both Condo's and HOA's, are considered small because of the number of homes and residents within the community. A small community typially consists of 50 or less units/homes. These "small" communities typically survive "paycheck to paycheck", maintain small reserves, and do not have much funds available in their budget to enforce their rules and regulations. Although, sometimes larger communities greater than 100 units/homes are finding themselves in the same situation.

Board of Directors must be reminded that they have a fiduciary responsibility to enforce the rules and regulations and to raise sufficient funds to do so whether by special assessments or whatever other authority the Board may have. A Board who fails to properly enforce their communities Rules and Regulations can be held accountable for failure to enforce the Associations bylaws and/or declaration no matter the size of the community associaiton. It's important to remember that no matter the size of a community, every community has Documents that must be followed and enforced, in addition to the Florida Statutes.

9 Habits of Highly Successful Boards

9 Habits of Highly Successful Boards

Much like the book "The 7 Habits of Highly Successful People" (a highly recommended read). We have created "The 9 Habits of Highly Successful Boards". By using these tools your Board will be much more successful, much more efficient, and your community will also experience great success. These 9 Habits were developed through our experience in working closely with Board of Directors, training and educating Board of Directors, and managing community associations. Our 9 Habits are a proven tool for Board Member success.

1) Invest Reserves - Invest them and monitor those investments regularly. Contact our Accounting Department for assistance and information.

2) Meetings - Hold frequent meetings, prepare a detailed agenda, and set Board Meeting goals and expectations. Contact your Manager for assistance.

3) Disclose Conflicts - The Board should always disclose any conflicts with vendors, contractors, etc. This will benefit all parties involved.

4) Enforce Rules & Regulations - Proper violation enforcement is important to maintain order and property values throughout the community; however, do make sure that all rules are being fairly and equally enforced. Contact your Manager for assistance.

5) Enforce Collections & Delinquencies - Proper aggressive and efficient delinquency enforcement is necessary to maintain a financially healthy community and to increase property values. A fair and equal collections policy should be established and our Accounting Department can assist you with this.

6) Adopt Policies and Procedures - The Board should adopt Policies and Procedures that include resident applications and screening, move in/out, violations, collections, architectural enforcement, and many others.

7) Keep Records - Maintain proper records such as financials, meeting minutes, notices, contracts, and so much more. We can help with this.

8) Reserve Studies - Be sure to have an updated Reserve Study completed and updated at least every two years, this is important for accurate Budgeting, reserve funding, and may also now be requested by mortgage lenders prior to approving a purchase. Contact us for more information.

9) Use Professionals - It's important that Boards use experienced professionals to their full advantage and refer to them frequently. These professionals include Management Companies, Attorneys, Accountants, Contractors, etc. An effective Board refers to it's professionals to be sure that the Board is doing things correctly and that the Board fully understands the effects of its decisions.

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Citizens' Property Insurance Corp. announces it will increase premiums by about 20% for properties with a replacement value over $10 million

Citizens' Property Insurance is the state not-for-profit insurance company in Florida. Citizens insures over 23,000 Community Associations in Florida and recently issued a Bulletin notifying of its intent to increase premiums for policies of properties valued in excess of $10 million. The increase may be by up to 20%.

Insurance premiums are almost always the largest line item in a community associations budget. Communities in Florida already dealing with large delinquencies, large expenses, increased govrernment fee's (fire, elevator, etc.), and bad debt need to take this into account when preparing their budget for 2010
 
If you are unsure if your community falls within this increase, please contact us.

New Report Details Mortgage Foreclosure Frusturations For Community Associations

In August 2009, the newly appointed Residential Mortgage Foreclosure Task Force, created by the Florida Supreme Court released it's final report on Mortgage Foreclosure Cases. The Task Force is Chaired by Judge Jennifer Bailey. Having listened to Judge Bailey speak recently on the issue of Mortgage Foreclosures and their effect on Community Associations, as well as having met with her briefly, I can say that Judge Bailey is very informed and aware of the burden the current Mortgage Foreclosure Crisis is having specifically on Community Associations (Condo's and HOA's).

You can find the complete report at

http://www.floridasupremecourt.org/pub_info/documents/Filed_08-17-2009_Foreclosure_Final_Report.pdf

Judge Bailey uses an excellent example to describe the situation we are facing today.

Picture this: the biggest road out of town. Now imagine it is rush hour. In
a thunderstorm. Add that it also a hurricane evacuation. A lane is closed due to
construction delayed by budget impacts. Imagine the traffic jam.

The clearest description of the impact of the foreclosure crisis and the
following recession on Florida's courts can be summarized by that picture.
Imagine every car a case. The General Jurisdiction Courts of our State have a
certain amount of judicial infrastructure, just like there is a certain amount
of room on the road. There is a certain capacity of judges, of court staff, of
clerks, of filing space, of hearing time, or courtrooms, even of hours in the
day. Year in, year out, that capacity flexes with the caseload traffic to afford
reasonable, prompt, efficient and fair justice.

The enormous increase in foreclosure filings has overwhelmed those
resources in many circuits and represents a traffic jam that the infrastructure
cannot meet in a timely and efficient manner without support and traffic
management.

Our client Board Members come to us often wondering why the long delay in many Mortgage Foreclosures. Although, we have been able to develop valuable tools to move rather rapidly with most collection cases, even Mortgage Foreclosures, sometimes the Association may have no choice but to monitor the Mortgage Foreclosure. This report provides details as to why those delays are occurring (for example, the rescheduling of final judgements) and even provides options that can be used to speed up the process and recommendations that will eventually, if approved, benefit Community Associations.

Contact us with any questions about this report, or about Community Association collections. We can help!

Adopt A Road

We have partnered with the Miami Dade County Adopt A Road Program. We continue to be committed to our local community, and believe in participating to improve it.

Check out our Press Release:
Miami Community Association Management Firm Participates in County Adopt a Road Program

Do you have a good Condo Association Insurance Agent?

Are you comfortable with your condo association insurance agent? This is one topic that is frequently over looked by many Board of Directors. Did you know that you can keep the same condo association insurance company but change agents? This can be done pretty easily without lapse in condo association insurance coverage or without payment interruption.

If you believe you condo association insurance agent is not answering your questions or if you feel that he or she is not an "expert" in the industry, and would like an insurance agent that devotes all his time to Community Association Insurance, Homeowner Association (HOA) Insurance, and Condo Association Insurance then by all means make a change. Some of the money that you pay goes to the Community Association’s insurance agent in commissions and if he or she is not doing a good job or if you feel uncomfortable with them, then make a change immediately.

As a Community Association Management firm dedicated to residential condo and homeowners associations we have developed business relationships with professional insurance agents that are experts on insuring communities just like yours. Contact us and see what we recommend and how we can help you in your decision making.

Boynton Beach Condo President ARRESTED!!

Today the Sun Sentinel reported that the Boynton Beach Police Department arrested the President of a Boynton Beach Condo Association for stealing $166,646.00 from the Condo Association bank accounts.

The Board President allegedly used the money he stole for several trips to Disney World, art work, jewelry, and even cash advances. You can see the detailed article at http://www.sun-sentinel.com/news/palm-beach/boynton-beach/sfl-boynton-hoa-theft-p072109,0,954367.story

As a Management Company, we establish financial controls for all of our client communities. Our Boards receive timely financials, along with easy access to reports, invoices, and other financial documents. We recommend a dual signature policy be adopted by the Board requiring two signatures for any and all checks paid out. Our Accounting Department consist of several employees who handle the bookkeeping, reconciling, and depositing, in addition to a property manager reviewing the financial statements, having these controls as a Board and within the Management Company allow for increased security of Association funds, and definitely deter this kind of behavior. In addition to increased security of Association funds, many Directors & Officers and Crime/Bond Insurance Policies are not only requiring that these control policies be put in place, but may also request proof that the procedures are being used effectively. These type of controls protect the Association, it's Board of Directors, Unit Owners, and the Management Company and it's employees. Our office also recommends and may establish several additional financial controls on behalf of our client communities. If your Association does not use any of the above financial controls or you are unsure, contact us for more details.

Unfortunately for Associations, these kinds of instances seem to be occurring more often, and I'm glad local authorities, along with state authorities and the Attorney Generals Office are taking proper action in protecting the rights of all Association Members.

New Remote Capture Deposit System

Here is a link to a new Press Release recently submitted. We have been offering this service for several months now and it has definitly turned out to be greatly benefit to our client communities. Deposits are made instantly and the funds are made available the same day, simply put, we act as the bank teller. This really is a great tool for those cash strapped communities and it is a FREE service.

Four Points Property Management Announces New Remote Capture Deposit System

Do fines always REALLY Work??

In these tough economic times, Board Members are trying to do whatever they can to save money. While this mindset is obviously necessary, Boards need to be careful about being "penny wise and pound foolish." Clients often call us and ask what they can do to stop owners from violating the association's rules and regulations. This question is normally followed with an explanation that the Board cannot spend a lot of money on legal fees to enforce the rules. In other words, the Board asks that we get these people to comply with our rules but to do it cheaply. This brings up the fining process.

Imposing fines may be an inexpensive alternative to filing lawsuits or arbitration petitions, but does it actually help in unit owners correcting violations or deterring owners from violating the association's rules and regulations?

First, the association cannot even consider this option unless the authority to impose fines is found within the governing documents (usually it is), if you are not sure, ask your property manager. If the board indeed has the power to impose fines, it must establish a separate committee (usually known as a fining committee or enforcement committee). The committee must consist of at least 3 owners who are not board members, not related to board members and do not live in the same household as a board member (the law was recently amended). Then, before any fine may be imposed, the Board must provide the offending owner with reasonable advance notice (i.e. 14 days) of the date, time and location for the owner to appear before the committee. The offending owner must be given the opportunity to explain to the committee why a fine should not be levied. If the fining committee determines not to impose a fine, no fine may be imposed and the Board cannot overrule the fining committee and levy a fine where the committee voted not to impose a fine. Even if the committee votes to fine an offending owner, the fine cannot exceed $100.00 per day for a continuing violation and no fine in a condominium may exceed $1,000.00 for any single violation. Homeowners Associations may have the ability to levy fines in excess of $1,000.00.

So, do fines REALLY work? In both Condominiums and Homeowners Associations, no fine (if unpaid) may become a lien against the owner's unit. Therefore, if a unit owner fails to pay a fine, the association would need to file a claim for damages in small claims court. Also, the imposition and payment of fines does not necessarily mean compliance. A fine does not force the owner to comply. As you can imagine, many owners would gladly pay a $1,000.00 fine in order to keep their dog or continue with that unapproved tenant in their home. Therefore, while imposing fines may seem like an attractive and cost-effective solution, it does not guaranty an owner's compliance with the association's governing documents. If an owner refuses to abide by the rules, the Board's only realistic option may be to file a lawsuit and seek an injunction against the non-complying unit owner. If successful, the association is entitled to an award of its reasonable attorney's fees and costs. Then, if the owner still fails to comply, the judge may levy sanctions, hold the owner in contempt of court or ultimately issue a bench warrant for the owner's arrest.

Based on our experience, it is our recommendation that the Board always try issuing fines first. Then, if the non-complying unit owner fails to pay the fine and continues to be in violation, we recommend the Board seek legal action, at which point the associations' attorney will not only seek an injunction against the unit owner, but will also seek payment of all fines. Typically, this type of legal action usually takes at least 90 days.

So what do you think, does fining always REALLY work?

Social Media

We recently decided to implement a Social Media campaign which will be updated frequently with interesting infomration related to Community Associations, Condo's, and HOA Management.

Check out our Blog at http://fourpointsproperty.blogspot.com, follow us on Twitter at http://twitter.com/FourPointsMgmt, you can also look for us on LinkedIn or Plaxo.

Enjoy!