Steps to Take When Changing Management Companies - A Brief Look at How We Do It

If your community is like most others, you will at some point be faced with the tough decision of changing management companies. A majority of our business comes from dissatisfied Board of Directors who are looking to take their communities management in a new direction. When that time comes, it is helpful to the community and the outgoing and incoming managers if the Association has taken the necessary steps to insure a smooth transition. We have substantive experience in handling these transitions and in this article we have detailed some necessary steps that all Boards should be sure to take when changing management companies.

Pursuant to the Florida Administrative Code, a Community Association Manager or management company is required to provide all original books, records, accounts, funds and all other property of the Association within 20 business days of such request or termination. This time frame gives the existing management company sufficient time to compile all of the records which it must provide to the Association.

Financial Records:

Perhaps of most importance during the transition process is the smooth turnover of the Association’s finances and official records. This is particularly true when talking about Associations where the management company accepts direct payment of assessments from the owners and where the management company performs the day to day banking and accounting for the Association.

Although it may be overwhelming, there are steps the Association can take to minimize the risk of an assessment check going missing, or a vendor not being paid in a timely manner. These types of situations are common when changing managers and can be avoided with some careful planning by the Board. Your incoming manager should be able to assist in providing assistance.

The Association should first arrange a specific and mutually agreed upon date for the turn over of financial records. The Association should avoid having two management companies maintaining two separate financial books and records. This should be separate and apart from the reconciliation of the final month’s accounting by the existing management company which should be provided to the Association on the date determined in the existing management contract, or a date agreed upon by the parties. The new management company will need the current year’s finances as early as possible to have their accounting system up and running by the date of the transfer of services.

A list of all Association vendors should also be made available to the new management company as soon as possible. This will insure that vendors are properly informed by the new management company of the change and helps avoid having any lost or misplaced invoices or bills during turn over. This process is important because if not handled correctly the Association could be subject to unnecessary late fees and charges from its vendors.

A list and current status of all collections files should be prepared prior to the transfer. The report should detail whether an account has been forwarded to counsel for collections or foreclosure efforts. Considering the financial state of many communities, particularly those looking for new management, it is imperative that any possible delay in the processing of delinquent accounts or collections matters be prevented.

Collection of Maintenance/Assessments:

Although, this may seem obvious, you’d be surprised how often it is overlooked. The first step the new management company should take is to send an introductory letter to all the members of the Association advising them of the change of management. This step should take place well before the start of new management. Association members must be advised where their current assessment payments should be sent and new coupon booklets, if any, should be distributed. This is critical or your community will not receive very many monthly assessment payments on the first month of management change. This can greatly affect your communities’ financial position and also risk the credibility of the Board among Association members, not to mention the credibility of the new management company.

Correspondence and Service of Process:

Arrangements must be made with the existing (prior) management company to make sure that they forward any correspondence they may receive for the Association to the new management company in a timely manner. Correspondence received by them should be forwarded to the Association, or picked up at their management office at least once a week during the first month after transfer. This will make sure that all correspondence is received, that bills do not go unpaid, and that the payments of any unit owners still sending their payment to the prior management company get processed.

The new management company should also update the Associations corporate record with the Department of Corporations and the Division of Condominiums to be certain that the existing (prior) management company is not listed as the Associations registered agent. If so, the new management company should submit a change of corporate record as soon as possible to be certain that the Association is made aware of any and all legal matters.

Other Official Records:

The transfer of the official records of the Association may also be a troublesome process when changing management. This is particularly so when an Association has had its existing (prior) manager for many years prior to the transfer. In those circumstances, the composition of the board of directors may have changed a number of times between the time in which the existing (prior) manager first began servicing the community and the time of the transfer to the new management company. In these instances it become difficult for the board of directors to determine what records were initially given to the manager to maintain, and what records the manager has been maintaining since he began servicing the community. It is also important to note that management companies usually do not always keep records in a uniform way, only making it more difficult to really know what they have and what they are expected to turn over.

The Florida Statutes, Chapters 718.111 and 720.303, attempt to facilitate the turn over of Association records by providing an official list of all of the records of the Association which must be maintained and/or kept for at least a period of seven (7) years. Even if your Association is not considering a change in management in the near future, it should always maintain a list based on the official records listed in Chapters 718.111 and 720.303, identifying where those records are kept, and to whom they have been entrusted, even if they have all been entrusted to the management company. The most difficult time for the Association to try to make this determination is during a transfer of control between management companies. This will lead to confusion, and possibly lost or missing records.

With an updated list of the Associations official records, the Association (or the new management company) should inventory the records provided by the existing (prior) management company at the end of their services. This inventory should be kept as part of the official records of the Association. Thereafter, should the Association wish to again change its management, an inventory will exist of all the records the manager received. The official records inventory list benefits both the Association and the management company by providing peace of mind for all.

Conclusion:

Ultimately, should problems arise in the transfer of management services the Association should always consult its legal counsel for advice. However, a professional management company with experience, specialization, and a proven system for the transfer and turn over of management companies should be able to provide invaluable input and assurance during this important time for the Association and the Board.

Should your Association be considering (or is in the middle of) a transfer of management companies, please do not hesitate to contact us so that we can assist you by answering any questions or concerns you may have.

A Condo Association’s Board Responsibilities Defined

A condo association is a miniature form of representative government. The board members are elected by the condominium unit owners (the membership) to run the association and to manage the condominium property. In most cases the board will need to hire a professionally licensed manager to assist in managing the Associations day to day activities. Condominium unit owners rely on the board to resolve community problems ranging from building maintenance to unruly residents.

Rules and Covenants

The first priority for a condo board of directors is to carry out its duties in accordance with state law and the governing documents of the condo association. Directors are also responsible for enforcing the governing documents, the community rules, and doing so uniformly and fairly, including obeying the same rules themselves. This responsibility requires the directors to review complaints, reports from management, and decide if the rules have been violated. The Board (or a committee appointed by the Board) may choose to impose fines on owners who have broken the rules. In the course of business, it may also become necessary to change or revise the association rules, doing so is also the board's responsibility. Beyond the requirements specifically written into the law and the governing documents, directors also have a fiduciary responsibility to the Association and its membership. The board is obligated to always act in the best interests of the association.

Maintenance

Condo owners handle repairs on their own units, but it's the board's job to fix problems with the common areas, this includes the building's exterior, the hallways and amenities such as a pool or tennis court. The board must arrange for regular inspections and maintenance of such elements and, if major repairs or upgrades are necessary, the directors must set priorities for which problem needs fixing first. In most cases, the board will need to put projects out to bid, at which time the directors must review the bids and select the best one. Many associations hire a manager to deal with such issues.

Finance

It's up to the board of directors to handle the condo association's money. Every member of an association is assessed a fee which funds the associations’ day to day operations, such as maintenance, repairs, and administration. It's the directors' job to review and approve the annual budget and reserve schedule for the association. The directors must also take action against owners who don't pay their portion of the assessments; if an owner continues to refuse, the directors have an obligation to the other association members to take legal action against the non-paying unit owner.

As you can see, being on the board of directors of any condominium association takes a lot of hard work, dedication, and responsibility. The hiring of a professional manager will assist your board with many of the day to day activities of the association.

The anatomy of a Great Manager

All communities and Board Members want a “great manager”, because they know that a Community Association Manager can make or break an entire community. However, what differentiates a bad manager from an average manager? And what seperates an average manager from a great manager? What does it mean to be great in Community Association Management?
Over the years, in speaking with Board Members and industry leaders we’ve identified key areas and traits that make a great manager. The below should act as a Code of Conduct for any great manager.

1. Great managers understand the power of effective communication
2. Great managers are effective communicators
3. Great managers present themselves professionally
4. Great managers are organized
5. Great managers follow through, always
6. Great managers do not procrastinate
7. Great managers never give information they aren’t sure of, or hearsay
8. Great managers understand the value of their relationship with vendors
9. Great managers admit mistakes, take responsibility, and then fix them
10. Great managers maintain professional detachment
11. Great managers stay current with their industry and with business in general
12. Great managers deal with change well
13. Great managers have a sense of humor
14. Great managers value their integrity and creditability above all

Top 10 Things to Consider When Hiring a Property Management Company for Your Community.

1) Licensing: Is the property management company licensed in the State of Florida? Unfortunately, many management companies do not have the necessary licensing required by the State and say they do.

2) References: Has the property management company you are thinking of hiring provided you with references? Call current clients and ask – “do they have a good response time, do they provide timely reports, do they provide the service they promised?”

3) Experience: What types of properties do they manage? Are they specialized in any aspect of the industry, or do they do it all (sales, rentals, mortgages, etc.)? They may not be focused or attentive to the services you need.

4) Services: What property management services do they provide? 24 hour emergency service? Collections? Monthly reports? Financial Management? Attendance at all meetings?

5) Response time: What kind of response time can they guarantee, during business hours and emergencies? Do they answer their phones 24 hours a day? Are their emails answered throughout the day?

6) Fees: What kind of fee structure do they have in place? Are fees all inclusive? Do they charge for office supplies? What tracking system is in place for additional fees? Do they nickel and dime you? Sometimes the lower priced companies have add-ons or kickbacks. Ask.

7) Certifications: What organizations are they a part of? Is the property manager an active member of any of the national property management associations, such as CAI (Community Association Institute) or any local chambers of commerce or business organizations?

8) Delinquent Owners: How will delinquent owners’ accounts be handled? Will they charge late fees? Will they send out monthly late notices and demand letters? Do they have a separate Accounts Receivables Department? Will they maintain an open line of communication with the Associations attorney if needed?

9) Violations: How will violations be handled? Will they send violation notices? Will they impose fines? Will digital pictures be taken as evidence? Will they maintain an open line of communication with the Associations attorney if needed?

10) Property Inspections: How often will they personally inspect your property? Weekly? Quarterly? Do they have trained and licensed managers visiting their properties? This can be very important and if not attended to frequently can lead to many disgruntled residents.

The information above was prepared by Marc Rodriguez, a Licensed Community Association Manager and President of Four Points Property Management, Inc., a property management firm specializing in community association management and consulting services throughout South Florida.

This publication was created as a guide to assist members of the Board of Directors when choosing a management company for their community. Mr. Rodriguez can be contacted at mrodriguez@fourpointsproperty.com or you can visit www.FourPointsProperty.com for more information about the company.

Governing Documents

We are frequently asked by Boards which laws or rules govern Associations. Many Board Members are unaware that there is a hierarchy of what laws and rules govern their community.

In this hierarchy, federal and state laws always take priority. However, every community association also has governing documents that are meant to enhance the federal and state laws and are more specific about how the community is to be run.

Below is a list of governing documents most community associations have. The documents have been listed in order of the one with the most authority to the one with the least authority.

The primary document is often called a “Declaration” for Condominium Associations or “CC&Rs” (Covenants, Conditions, and Restrictions) for Homeowners Associations. The Declaration is kind of like an operating agreement for a business; it lists the details of the property included in the development and contains restrictions on use of the individual units or homes. It specifies what authority the association has and how it can or must do certain things, like maintain the common areas. It also defines the rights and obligations of the individual owners and the Association, like paying their maintenance fees.

The next document in the hierarchy of Association governance is the Bylaws. The Bylaws are intended to cover the procedural aspects of how an association is run. For instance, this document will include information on electing a Board of Directors, association meetings, voting procedures, budgeting procedures and guidelines, and much more. The Bylaws should be your property manager’s number one reference tool.

The Rules and Regulations are the next set of governing documents. Every Community Association should have a set of Rules and Regulations. Although some associations do not, we recommend that if your association does not have rules and regulations that the board should consider adopting a set of rules and regulations for living in your community. Rules and Regulations are usually adopted by the Board of Directors and are meant as a management tool to further clarify the rights and obligations of owners and their guests.

The final governing documents, which not every community association has is the Boards Policies and Resolutions. These are voted on by the Board of Directors and are meant to keep consistency among different Boards and management companies through the years. There may also be Amendments to your association’s Declaration or CC&Rs, which can change the terms of the original document.

It’s important to remember that the Declaration is above everything else besides the federal, state, or city laws, so any provisions in your Bylaws, Rules and Regulations, or other documents that conflict with the declaration are probably invalid.

Understanding the contents of your association’s governing documents is an important step towards being an informed Board Member. All unit owners should have received a copy of all governing documents for the association at the time of purchase. If you have misplaced them, please contact our office and request a copy for your records.

If you have any questions or comments, please feel free to leave a comment or contact us.

The Special Assessment and Reserve Account Connection

Tim (fictional) lives in a 30+ year old association. Tim pays his assessments on time each and every month. The association needs to make a major renovation to repair exposed rebar, stucco repairs, and painting. The project will cost the association approximately $375,000 dollars. The association does not have an adequately funded reserve account and a special assessment is necessary. Each unit owner will be assessed between $8,000 and $10,000. Tim cannot afford the special assessment and the association is considering the foreclosure of Tim’s unit.

Does this hypothetical scenario sound familiar? Unfortunately, many older associations are faced with this issue. Special assessments are commonly used to pay for expenses outside of the budget, which can create hardships for both unit owners and associations.

The Florida Legislature has attempted to provide a solution to this issue by requiring Association to fund a reserve account and suggesting that Reserve Studies be performed regularly.

Has your association ever had a reserve study prepared and then adequately funded the association reserve account pursuant to the reserve study recommendations? If so, congratulations! If not, how should your association plan ahead for future repair and replacement projects without causing an additional burden to unit owners by having to adopt significant special assessments?

Step #1, hire a professional to conduct a reserve study. If you are lucky enough to have had a study prepared in recent years, have it updated to reflect the properties current condition. A properly completed reserve study will provide your association estimates and information about the remaining life of the physical components the association is required to maintain and the estimated replacement costs associated with the replacement of and major repairs to those components. A reserve study will significantly help your association in properly budgeting for future repairs so that adequate reserves can be funded, as well as reflect an accurate picture to unit owners of the associations condition, both physically and financially.

Step #2, understand your budget. An association that properly plans in advance should only need to make small increases to its regular monthly assessments in order to properly fund reserves. While the majority of unit owners will not be happy about increases to assessments, homeowners should be educated about the benefits of reserve funding and the possibility of a significant special assessment in the future for major repairs should a reserve fund not be maintained.

Step #3, your association may be able to obtain a loan to cover some or all of the costs associated with a repair or improvement. Although lending guidelines are stricter now than they have been in the past, this option is still available as long as your delinquencies are reasonable and below 7%. In order to obtain an association loan the association/management will need to provide the bank with important information, such as financials, cost estimates for the anticipated project, and collateral (an assignment of the right to future assessments).

Your association should stay ahead of the game and be able to fund significant repairs and replacement projects without the need for special assessments by updating its reserve study regularly, keeping delinquencies low, and creating a plan of attack for raising reserve funds.

We have successfully helped dozens of Associations by performing Reserve Studies, implementing a reserve funding policy, maintaining an adequately funded reserve account, and developing a plan of action for major repairs and necessary funding. For questions regarding this article or for assistance with creating a Reserve Study, please contact us at 305-403-0575 or send us an e-mail to info@fourpointsproperty.com.

"How much money should we have in Reserves?"

A common question I am asked frequently is “how much money should we have in our condo reserve"? Well, according to the Florida Statutes, the amount required is what is considered to be “adequate”. Obviously this is a very vague term.


It's important to understand that there is absolutely no way to come up with a one system fits all formula for establishing reserves. In my opinion the more money available in the condo reserve accounts the better. Condo Associations should include a line item for future replacement cost of common area items in their monthly budget each and every month. These funds should be maintained in a special reserve account. The specific amount set aside each month is determined by the size of the property and the amount of common areas/elements that will need attention in the future.

The best way to determine this is to have a Reserve Study Specialist or Professional Engineer provide you with a Reserve Study. This Reserve Study will determine the expected useful life of all your HOA or Condo Association common area items. The A/C system, roof, painting, structure, lighting, interior painting, pool, gates, etc. are all included in this Reserve Study. The Reserve Study preparer will then apply future expected costs to each element and determine what needs to be put aside each year to meet these goals for you Association.

"How much should you have in condo reserves?" Your Association may have enough money in a condo reserve account if it can address a condo association common area issue without having to implement a Special Assessment. This is a simple definition of what "adequate" reserves really mean.

We always highly recommend that Associations have a Reserve Study completed at least every 5 years. We can assist your Association in having this important study completed. An accurate Reserve Study can save your community from facing large Special Assessments or rushing around to obtain a high interest loan for major repairs. Contact us to find out how a Reserve Study can help your Association.

Check out our NEW Website!!

Our new Website is finally up!! 'Important Announcement from Four Points Property Management'

2010 Legislative Update

We have some exciting news to share with you and your community members. This years Legislative Session turned out to be a very productive session that we believe has produced many positive changes to the Florida Statutes that govern Community Associations.

Earlier this year we provided a brief summary of the many changes being considered by Legislators in Tallahassee. Below we are happy to provide you with a summary of the Legislative changes that have fortunately (and finally) been signed into Law which will take effect July 1st, 2010. Please note that we have only summarized the changes we feel will be most valuable to our clients, not all changes or amendments have been included below.

For over a month we have been reviewing the 103 page Bill (SB 1196), as well as held meetings with Association Attorneys to familiarize ourselves as best as possible with the new Laws in order to best assist our client communities to take advantage of the new resources available to them.

Common Elements:
1. Common elements that serve only one (1) unit may be reclassified as Limited Common Elements by a vote of the membership to amend the Declaration.

Official Records:
1. An Association is clearly not responsible for the misuse of information provided to an owner or representative of an owner in compliance for their request for a records inspection.

2. Any person who intentionally harms, destroys, or who fails to create or maintain the Associations accounting records with the intent to cause harm to the Association, will be subject to a Civil Penalty.

3. The following records are not accessible to owners: personnel records of association employees (including payroll), e-mail addresses, telephone numbers, website passwords or property access codes, accounting software or backups.

Elections and Director Eligibility:
1. Co-owners are now permitted to serve on the Board where such co-owners own more then one (1) unit, or where there are not enough eligible candidates to fill the Board vacancies.

2. The director delinquency restriction has been expanded to include any director delinquent more than ninety (90) days in the payment of ANY monetary obligation. This includes fines, fees, regular and special assessments. Such owner will not be permitted to serve on the Board.

3. Each newly elected or appointed director must certify in writing within ninety (90) days of being elected/appointed that he or she has read the governing documents and that they will work to uphold those documents to the best of his or her ability. In lieu of providing such written certification, a director may submit a certificate of satisfactory completion of the educational curriculum provided by the Division. A Director not completing this certification will be suspended from service.

Collection of Assessments:
1. The liability of a Lender (First Mortgagee) that acquires title to a unit through foreclosure has increased from six (6) months to twelve (12) months of unpaid assessments. However, it remains constant that a Lender is only responsible for the lesser of twelve (12) months or one (1%) percent of the mortgage debt. We are of the opinion that most, if not all mortgage foreclosure cases will now receive the one (1%) percent value as opposed to the new twelve (12) month amendment.

2. This change will take effect on all foreclosed units in which a lender acquires title after July 1st, 2010.

Collection of Rents:
1. If a unit is occupied by a tenant and the unit owner is delinquent in paying any monetary obligation to the Association, the Association may make a written demand that the tenant pay the future monetary obligations related to the unit to the Association, and the tenant must make such payment until the Association releases the tenant.

2. A tenant who acts in good faith in response to the Association's request will be immune from any legal claim from the unit owner (i.e. eviction, etc).

3. The tenant, like a unit owner, must be notified of any increases in monetary obligations.

4. The unit owner shall provide his or her tenant a credit for any rents or amounts paid directly to the Association.

5. Should the tenant fail to act in response to the Associations demand for payment, the Association may file for eviction under the Florida Residential Landlord and Tenant Act (FRLTA). However, the Association is in no way considered a Landlord under the FRLTA and has no obligations there under.

6. The tenant does not have any rights of a unit owner in any election or vote, and does not have any right to examine the books or records of the Association.

7. This new law does not supersede the appointment by any court of a Receiver.

Budgets and Financial Reporting:
1. The Division of Florida Condominiums, Timeshares, and Mobile Homes shall adopt a set of revised rules outlining the uniform accounting principles and the standards to be used by all Associations.

2. The revised rules must include standards for presenting a summary of Association reserves, including an estimate on the amount of reserves necessary to fully fund annual reserves per each reserve item.

3. A Condominium Association operating fewer than seventy five (75) units shall prepare a report of cash receipts and expenditures, as opposed to financial statements.

Fining:
1. Previously Associations were only able to issue fines if their declarations or by-laws granted the Association such right. The new statutory amendment now grants all Associations the right to issue fines pursuant to statute, regardless of what the declaration may state.

2. An Association may only levy a fine for failure to comply with provisions in the governing documents.

3. Previously the Condominium Act stated that fines should be levied "against a unit". The new changes expand the Associations fining ability by permitting fines to be levied against any individual that is authorized to be on the property and who fails to comply with the provisions of the governing documents, this shall include owners, invitees, licensees, and occupants.

4. Fines still may not exceed $100.00 per violation for a maximum of 10 days. Additionally, fines can only be properly levied at a properly noticed hearing of a non-board member committee of unit owners.

5. Unfortunately, non-payment of fines may not be collected through lien or foreclosure. Therefore, because collecting on a delinquent fine is somewhat difficult, this enforcement ability is not always practical.

Suspension of Use Rights:
1. Condominium Associations may now, in limited cases, suspend the use rights of unit owners, their invitees, licensees, and occupants, who are more than ninety (90) days in the payment of ANY monetary obligation.

2. The use rights that can be suspended include the right to use common areas, facilities, and other Association property. Use rights shall not be suspended for Limited Common Elements, common elements needed for unit access, parking spaces, elevators, or utility services provided to the unit. The statute is not clear as to whether cable and other bulk services are defined as "utilities", however, we believe that they may be, but this is yet to be determined.

3. A unit owners' voting rights may also be suspended, however, their unit shall still count towards the necessary quorum requirements for any meeting or amendment.

4. A use right suspension ends upon payment in full of all monetary obligations.

Property Insurance Requirements:
1. Unit owners are still responsible for insuring their personal property within the boundaries of their unit, including their limited common elements, and their floors, walls, ceiling coverings, electrical fixtures, appliances, water heaters, cabinets, window treatments, and all other items which are located within the boundaries of their unit and serve only such unit.

2. Condominium Associations are no longer required to obtain evidence of a unit owner’s insurance coverage for their personal property located within the unit.

3. Condominium Associations are no longer authorized to force place coverage on behalf of a unit owner for failure to provide proper proof of insurance.

4. Unit owners’ insurance policies are no longer required to name the Association as an additional insured and a loss payee. As such, unit owners are no longer required to obtain the Associations endorsement for payment they receive on an insurance claim on their policy.

Fire Prevention Code:
1. A condominium that is less than four (4) stories in height and has an exterior corridor providing a means of egress is exempt from the requirement to install a manual fire alarm system under the Life Safety Code adopted under the Florida Fire Prevention Code.

2. A Condominium Association may now vote to waive the requirement of retrofitting the common areas in a high rise building with a fire sprinkler system by recording such vote in the public records of the county. A high rise building is defined as a building greater than seventy five (75) feet in height.

3. Shall an Association not be able to obtain the necessary votes to waive the fire sprinkler retrofitting requirement; the deadline for retrofitting completion was extended to 2019.

Elevator Safety Code:
1. The Legislature has created a moratorium on the enforcement of amendments to the Safety Code for Existing Elevators and Escalators (ASME A17.1 and A17.3) requiring modifications to elevators in condominiums. Such retrofitting requirements cannot be enforce for five (5) years. However, shall a building require an elevator replacement or major modifications before the expiration of the five (5) year moratorium the building must meet the Elevator Modification requirements.

2. A Condominium Association may waive the requirement for installing alternate power sources for elevators upon an affirmative vote of a majority of the membership.

Distressed Condominium Relief Act:
1. In response to the downturn in the condominium market affecting the economy, developers, lenders, unit owners, and associations, the Legislature created the Distressed Condominium Relief Act (DCRA).

2. The DCRA establishes that a bulk buyer purchasing seven (7) units or more within a condominium association shall receive an assignment of some or all of the developers rights except those related to warranties, obligations to fund reserves, auditing requirements, and liability to issues or claims made prior to their assignment.

3. The DCRA creates a detailed process for the assignment of units within a condominium to a bulk buyer and the management of such association thereof.

Does Your Association Suffer From Unruly Board Meetings?

If you're lucky, your board meetings are calm, civilized, and organized. However, as you may know, that is not always the case. During association meetings emotions typically run high, sometimes these emotions are caused by unpopular board decisions, increased assessments, or violation compliance letters sent to an angry owner. Although the conflict and unrest might be unavoidable, if the board members and management come to the board meetings prepared it will be possible to run an unruly meeting even if angry owners attend.

One of the best tools any association can use to control unruly meetings is to create a "meeting conduct" policy. This policy should specify when and for how long association members are permitted to speak on a particular subject, require courtesy to others present when speaking, and permit the board to require attendees to leave if he/she gets out of order or fails to follow the approved policy.

Below we have provided some additional tools and policies your association can implement to help the board control unruly meetings: 

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  If the board or management are anticipating an intense association matter to be discussed at a meeting, the board should try to calm association members about the specific matter prior to the meeting by discussing concerns with the individuals prior to the meeting.
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  Require owners who wish to speak on a particular matter to sign up prior to the meeting, rather than having them raise their hands during the meeting.
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  Set a specific time limit for any association member desiring to speak and allow them to only speak on only one particular topic at a time. This will keep the meeting in order and focused.
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  Appoint a committee, specific board member or management to investigate certain issues raised by association members and report back to the board.
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  If necessary, have the association’s attorney present when legal or sensitive matters are being addressed, this can help control emotions.

 While many associations have “meeting conduct” policies and rules for their board meetings as described above, it is the responsibility of the board to keep control of the meeting, follow the meeting agenda properly, and enforce the conduct policy as necessary.

The board must be organized and properly prepared for their meetings. The board and manager should always remain composed and calm throughout the meeting. Should the board be faced with a difficult owner, the owner should first be warned and reminded of the associations meeting conduct policy. If the difficult owner refuses to come to order the board should issue the disruptive owner a warning or ask him/her to leave the meeting. Although, we suggest that this be a last resort. An alternative to asking the disruptive person to leave the meeting is for the board to adjourn the meeting and reconvene again when all emotions have cooled.

Can Associations Restrict Access to Census Workers??

Once again, the government is ramping up efforts to tally the country’s population. With the 2010 census underway, the U.S. Census Bureau is asking Condo Associations and HOA's to help them reach as many residents as possible. Since participation in the census is a federal obligation for all U.S. Residents, associations need to determine how census workers will gain access, especially in secured communities.

The U.S. Census Bureau has made it well known that their Census workers are given carte blanche when it comes to gaining access and possibly gaining repeated access in order to fully complete their responsibilities. Therefore, Associations cannot deny access to any Census worker who has shown proper identification.

In order to comply with federal regulations, make sure your property manager or any security staff understand that access must be granted to Census workers. That includes allowing them access to secured buildings and any apartments they request. They are allowed to knock on doors, ring doorbells, use call boxes, etc. Also, there may be times when the Census workers must return to the building to attempt resident contact again. If Census workers cannot locate occupants, it is within their right to ask property managers and associations for occupancy information and resident contact information. While you’re not expected to supply the information immediately, you should provide the requested information within a reasonable amount of time.

But how do you know if the census worker is legitimate? All census workers will be issued a census badge, which property managers may ask to see. When in doubt, contact the nearest Regional Census Center to verify a census workers status.

Associations should expect to see Census workers after the April 1st deadline, in which all residents are required to have returned their mailed questionnaires. Expected in-person visits are scheduled from May through August of this year.

25 Common Board Member Mistakes

Board members are subject to many demands and expectations. Serving on the board of an association can be a rewarding experience. The majority of board members have strong ideas of what being on a board is all about. Capturing the board's eagerness, enthusiasm, and will to govern for the common good of the community can be accomplished in conjunction with the manager's experience, knowledge, and guidance. Managers are licensed professionals and have specific knowledge that is required of them to maintain their license and a code of ethics that must be followed.

To be effective, managers need the cooperation of all board members. Experienced managers are knowledgeable and educated. Once trust and confidence has been established, the board of directors should consent to allow their manager to manage and provide guidance in leading them in the right direction. Here are 25 common mistakes that boards make: 

1. Failure read and understand their governing documents, rules and regulations, and State Statutes. 
2. Failure to be prepared for meetings and follow the meeting agenda. 
3. Selective enforcement of the rules and regulations or the governing documents -- playing favorites. 
4. Failure to conduct open meetings and elections. 
5. Failure to maintain confidentiality or generating gossip. 
6. Ignoring responsibilities to fulfill fiduciary duties in maintaining the property - - overlooking needed repairs due to costs. 
7. Failure to hire experts and professionals in their respective fields - - engineers, managers, attorneys, etc.
8. Being emotional and hindering their capacity to make business decisions. 
9. Being swayed by others when making business decisions. 
10. Being swayed by others and not voting their conscience. 
11. Micromanaging and abusing their power and authority. 
12. Failure to disclose personal interests and considering taking kickbacks and/or hireing someone that creates a conflict of interest that may involve self-dealing. 
13. Harassing community members and slandering them. 
14. Failure to clearly define the roles and responsibilities of the board of directors, committee members, and management and taking action contrary to the board's decisions or acting unilaterally. 
15. Failure to obtain two signatures on checks and contracts.
16. Not taking the time to read and understand the financials and budget, and not asking questions about them.
17. Failure to follow a consistent collection policy - - playing favorites.
18. Failure to act professionally, courteously, and respectfully at meetings. 
19. Failure to outline and summarize their expectations and establish that everyone is on the same page. 
20. Self-serving interests -- rather than making decisions to serve the community as a whole, decisions are made in favor of themselves personally, breaching community trust. 
21. Failure to post notices, newsletters, and memos, communicating the board's activities. 
22. Failure to review and evaluate contracts and decide how and when the various maintenance tasks will be performed. 
23. Failure to plan, focus, and follow through. 
24. Failure to make timely decisions. 
25. Attempts to institute new policies and ground rules without doing their homework.

Board members are usually elected because they are movers and shakers. They have the ability to get things done. The board should expand upon defining their overall goals of the association and communicate them to the manager. Very often boards micromange because they think that is what they should be doing.

The board needs to have a clear idea of their role in the community. Management of day-to-day activities is the responsibility of management. Boards are to lead and serve in the capacity as an advisory body. As managers, we can navigate and guide the board to focus on ensuring that the community will function in a positive direction, providing a safe and healthy community and follow the path and mission that the board will lead.

Nevertheless, everyone needs a clear understanding of what is expected of them and must have concise expectations in order to measure performance. A competent manager knows the ropes and need for improvements. Boards spend an exorbitant amount of time discussing possible scenarios and solutions. Managers have the ability to make recommendations and save precious time in fully addressing the issues.

Therefore, good communication will aid the process. Sharing information on the issues and discussing issues with the members gives them a sense of purpose in the operation of the association. Board members that rely on seasoned managers can effectively approach a variety of issues and deal with the challenges of managing a successful community association. Listening is the most essential tool for all.

The purpose of the Board is to represent the interests of the owners as a whole, as these interests relate to the property. They are responsible for making timely decisions on behalf of the owners. Being a board member is not a casual undertaking. By working closely and proactively with management, the board can spend its time on areas that can move the community forward, enhancing results and solutions. Mistakes will occur, but with proper guidance and the hiring of experts in their respective fields, the board can reduce the number of mistakes and develop a full understanding of what it takes to manage the community.

I hope that these suggestions will offer a positive and satisfying direction in which the community can work together for the best interests of the association. 

Taken from http://www.caionline.org/

Miami Beach Condo Association Has Very Creative Idea for Project Funding.

A Miami Beach Condominium who has been unable to obtain a loan or grant for building restoration, and with little hope of gaining funds any other way, looks to Corporate America for assistance to restore their beautiful building, in an imaginative way.

Located on busy Collins Avenue and built in 1940 as the Lord Baltimore Hotel, this beautiful example of art deco architecture has undergone a long history. During World War II the building was used to house troops, and later become "La Playa" apartment building in the 1960's. In 2003 at the peak of the South Beach real estate boom it was converted to a Condominium Association.

Soon thereafter, in 2005 the City of Miami Beach issued the Association a violation to repair exterior concrete throughout the building. The Board passed a special assessment on the 32 units, and work began. Once the selected contractor had commenced work, additional extensive damage was discovered which had been unanticipated. The Board passed a second special assessment, and the work continued. However, in December 2008 the Associations funds ran out, the contractor ceased work, and the building was left looking like a gray shadow of its former glory.

The Board of Directors, unable to get a loan or grant, and with little hope of gaining funds from another special assessment, decided that the only way to get this project completed was to seek assistance from a corporation

The Board of Directors, unable to get a loan or grant, and with little hope of gaining funds from another special assessment, decided that the only way to get this project completed was to seek assistance from a corporation willing to fund the project, paying off the debt to the contractor, and completing the job.This is estimated to cost close to $250,000. "With its prime location, the building would be a great space to wrap with advertising (subject to city approval) in return for the funds and it would be great PR as a community project for any company willing to take up this unique opportunity. The tower on the north east corner of the building would make the perfect setting for a beverage company to advertise, " says Anthony Parker, President of the Board. "I love this neighborhood, this is my home and it's just such a shame that we can't get it back in the shape it should be; I worry constantly that we will lose it all if we can't get the funding to fix this."

He advised that the Board has considered several creative ideas and are currently willing to rename the building, wrap the building with advertising, or do whatever else it takes to get this project completed and their beautiful building back to the South Beach gem it once was.

For more information or to assist this community please contact Anthony Parker at 305-534-1212 or antparker@msn.com

Eliminate Flood Insurance Premiums for your Community

Don't you wish that you could eliminate Flood Insurance premiums for your community, forever? Did you ever think that this could be possible? We know just how to do it.. Read the following link to learn how, and contact us so we can help you today!


'Eliminate your Communities requirement for Flood Insurance'

8 Tips For A Successful Board Meeting

To ensure that your Board's meetings are efficient and effective, consider the following Board Meeting tips:

1. An agenda is developed for the meeting and provided to all board members and management before the meeting so that they know which topics are going to be considered and they can come prepared.

2. Minutes of the last meeting are distributed in advance so that they can be reviewed before the members come to the meeting. Any changes or corrections that have to be made can occur at the meeting.

3. A moderate degree of formality must be used in conducting the meeting. Certain rules for discussion are defined. Everyone's expectations regarding decision making are agreed upon and understood.

4. Principles of good communication are practiced. These principles include; only one person may speak at a time. No interrupting. No ridiculing another person's point of view. If it seems that there is another, unspoken meaning behind the words being used, it is the board's job to work with the speaker to identify the message.

5. Set time limits. For example, the meeting will start at 7:00 p.m. and adjourn at 8:00 p.m. Set a specific time limit for each particular agenda item (example: no more than 10 minutes will be spent on the financial report). If board members wish to continue beyond the agreed upon time limit, there should be a procedure for approval to continue the discussion.

6. The chair (usually the President or Manager) must encourage free discussion of the topic being considered, to keep the discussion moving, and to identify issues relating to the topic. It is also the chair's job to define the decisions that are made. The chair must always remember that the board members have been elected to govern the association, not just to discuss it.

7. Adjourn the meeting on time.

8. Follow up. There always will be action items that require attention from the manager or from specific board members. See that the follow-up is accomplished before the next meeting.

If you follow these guidelines you will spend less time in your meeting. You will accomplish more. And you may find more qualified owners willing to participate and assist the board of directors.

Law Gives Tenants Rights During Foreclosure - News Story - WFTV Orlando

Some of the biggest victims of foreclosures throughout Florida are not the homeowners, but the tenants living and renting the homes from the homeowners facing foreclosure. Florida, unlike other states, does not currently have any laws that protect the rights of renters in a foreclosure action, but a new federal law may provide these renters and their families some protection.

Read more about this and how it can affect your Community Association below...


Law Gives Tenants Rights During Foreclosure - News Story - WFTV Orlando

Why your lawyer won't take or return your phone calls - top 10 reasons

We found this to be a great "Top 10 List". Its a great report we wanted to share.


Why your lawyer won't take or return your phone calls - top 10 reasons

Can the Association check credit scores for prospective owners and tenants?

It is not surprising in today's economy that more and more boards are asking if they can check credit scores to determine whether or not a potential purchaser or potential renter in their community has the financial resources to meet their financial obligations to the community after moving in.

As with any other restriction or board action, the first step is to determine the source of such authority and whether it is statutory or documentary (Florida Statutes or Condo Docs). The Florida Statutes do not allow the Board the right to check credit scores for potential purchasers and renters. We must then look to an association's governing documents to determine if such authority is allowed to the board.

Let's take the best case scenario (for a board wishing to do this) that the association's original recorded governing documents contained the right to check credit scores. The board in this situation would still need to obtain the consent of the potential purchaser or renter to check his or her credit, since any time a credit inquiry is made, the persons score is affected slightly. A board that makes such an inquiry without first advising the subject that such action will be taken and getting consent to do so exposes itself to great liability. Most boards and management companies choose to include a form along with the screening application that must be signed by the applicant acknowledging and consenting to a credit check.

Even if all of the above is properly handled a board still has a complicated issue with which to contend when the credit report comes back negative. First, is a low score really indicative of the person's current financial situation or is it the result of a life event such as a job loss, divorce, or illness? Moreover, some people fail to build up high credit scores because they don't like credit! These are the folks who don't have 10 credit cards, don't demand high limits on the ones they have and pay for most things in cash. This might actually be a desirable resident!

If the low credit score is truly indicative of a person who will be unlikely to meet their financial obligations after moving in, it is essential to speak with your association attorney to ensure that the association's governing documents allow you to reject an application based solely on such information found on a credit check. To add further, even if the governing documents allow for such action by the Board it does not always mean that a court will uphold it in the event of a challenge. A knowledgeable community association attorney can walk you through this and be sure to limit the Associations and Board Members liability.

Now, if the Board is considering an application for purchase, you should take into consideration that the lending institution (mortgage company or bank) will more than likely have already done a very thorough credit history check on the prospect, probably even more thorough than any the Association will have done.

One last thing you should think about when pondering whether or not it is necessary or even desirable to check credit scores for potential new association residents: how many of your long-term residents' would be disapproved if you checked their credit scores today!?


Excerpts taken from Donna Berger, Esq.

2010 Census: Distinguishing Census Workers from Con Artists

The first phase of the 2010 U.S. Census is under way, with workers verifying the addresses of households across the country. Eventually, more than 140,000 U.S. Census workers will count every person in the United States and will gather information about every person living at each address including name, age, gender, race, and other relevant data.

The big question from many of you is -- how do you tell the difference between a U.S. Census worker and a con artist? So below are some recommendations from the Better Business Bureau and law enforcement across the country.

If a U.S. Census worker knocks on your door, they will have a badge, a handheld device, a Census Bureau canvas bag, and a confidentiality notice. Ask to see their identification and their badge before answering their questions.

However, you should not invite anyone into your home. Do not give your Social Security number, credit card or banking information to anyone, even if they claim they need it for the census.

While the Census Bureau might ask for basic financial information, such as a salary range, don't give them anything pertaining to your financial situation. Also, they should not be asking for any donations, so don't give them money. 

If they start with any pressure or you are not comfortable with the questions, please close the door and call the police. Also be advised that according to the Census, they will not be using anyone with the community group ACORN. If a worker says they are with ACORN, feel free to close the door and report it to the police.

Also, census workers will NOT contact you by e-mail. Do not respond to anyone claiming to be with the U.S. Census by e-mail. Use the ``delete'' key!

Keep in mind that you will not receive a 2010 U.S. Census form until March of 2010. No one will come to your door if you complete the form and mail it back to the 2010 U.S. Census office on or before April 1. If you did not complete the form for your address, then you will be contacted by a worker.

The Census is extremely important. That is how our State and County gets money from the federal government, so I encourage everyone to participate. Lord knows this state and county are disasters when it comes to proper funding for many services we need. So please do your best, but also be totally aware and cautious so as not to become a victim of fraud or identity theft.

Again, when in doubt, please call police.


Carmen Caldwell, for The Miami Herald. January 17, 2010

Naples residents and leaders sound the alarm over cost of condo sprinkler system retrofit..

Naples homeowners aren’t happy about the potentially staggering costs associated with complying with the Florida Fire Prevention Code.

The Naples City Council this week discussed the cost associated with complying with the recently revised code. The discussion came about a month before City Council is scheduled to sit down with representatives from the state fire marshal’s office to discuss a state-mandated sprinkler system retrofit. The retrofit must be done by Dec. 30, 2014. But Monday’s discussion had less to do with the retrofit and more to do with code violations that have been popping up in low-, mid- and high-rise condominium complexes in the past few months.

Fire Chief Stephen McInerny has said that the city began inspecting multifamily residences back in June. Those inspections, he said at the time, turned up code violations that had been in place for a while. Those condominiums now need to get in compliance, McInerny said, something that could come at a high cost.

In a memo to City Council members, McInerny outlined the potential costs to condominiums for different code violations. McInery said the pricing — which came directly from fire alarm companies — varied, and he didn’t have an estimate for how much residents will have to pay to get their units in compliance.

That concerned Councilman Gary Price. “We have the obligation to try and work through how many buildings and what the costs are,” he said. “When I asked for the associated costs and estimates, I got a one-page memo and no one can tell me how many units are affected. Our citizens deserve better. I deserve better. We deserve better.” Residents agreed. Condominium owners said the estimates McInerny presented to council weren’t exactly on target.

Ewing Sutherland, president of Gulfside Condominium Association and a member of the Community Advocacy Network, said the retrofits and push to comply were proving costly for condominiums. “This enormous cost associated (with it) are unaffordable by many owners,” Sutherland said. “It could also put associations into receivership.”

McInerny said the high cost could be because some associations are making the choice to retrofit the sprinkler system in addition to making changes to get them in compliance with code. And while McInerny said he understood the frustration condo owners were experiencing, he also said he couldn’t turn a blind eye to code violations.

“What do you want me to do, just ignore it?” McInerny asked. You have violations that exist now and (we’re working to see) how they can be corrected.” McInerny said his department is willing to work with associations in order to comply with current code.

Taken from Connect with Naples.

Four Points Property Management Welcomes New Client Communities..

Four Points Property Management proudly announces three new Community Association Management clients; Sunshores Condominium Association located in North Miami Beach, Florida, Monterey Gardens of Pinecrest Condominium Association located in Pinecrest, Florida, and Kenland Walk II Condominium Association located in Kendall, Florida.

Four Points Property Management will provide the following services to the association as part of their Management Agreement; administrative management services, financial management services including payment of all association invoices, preparation of monthly financial statements, and also physical property management services and project management. Additionally, Four Points Property Management will prepare the associations annual budgets, annual meeting and elections, and will also provide Board of Director support and education. The Company will also be providing weekly maintenance and janitorial services.

Follow the links below to read our recent Press Releases:

Kenland Walk II Condo - Press Release

Monterey Gardens of Pinecrest Condo - Press Release

Sunshores Condo - Press Release

We welcome our new clients, we are excited to have them on board and we are looking forward to working with them!

Insurance? For What??

Every resident of a Condominium Association should carry homeowners insurance on their home and personal items. Each unit owner is responsible for purchasing and maintaining their Condo Unit Owners Policy (HO-6 Policy).

Why do you need this insurance? Doesn’t the association carry insurance of some kind? Yes the Association does carry insurance… On the building and common elements only. The Association Master Policy does NOT include coverage for the units themselves or the homeowner’s personal belongings. Association coverage does not include anything within your unit walls. If you’re a homeowner you are responsible for the inside of your unit as well as all of your personal belongings in the event of a fire, flood or any other kind of disaster, even a major plumbing leak.

Everyone in your community works hard to enjoy a certain quality of life. Don’t let one unforeseen event ruin it for you. In most cases your auto insurance company would be more than happy to provide any type of personal residential insurance for you. They may even provide a multi policy discount.

A very important coverage for a condo unit owner is LOSS ASSESMENT. This coverage will pay for a special assessment charged to each unit owner by the Condo Association as a result of a covered loss when the Master Policy does not provide enough coverage to pay for the loss. The HO-6 Policy usually provides $1,000 or more depending on the Insurance Company.

If you don’t know what kind of coverage you need, you may submit a copy of the Condominium Bylaws to your agent. Remember that your insurance is only as good as the carrier you choose and the agent you work with; make certain to pick a carrier with a good reputation. You get what you pay for.

If you have any questions, or need assistance selecting a qualified agent, our office staff is available to assist all of the homeowners in your community.

Four Points Property Management Participates in an Emergency Haiti Relief Drive.

'Four Points Property Management Participates in an Emergency Haiti Relief Drive.'