HOA Insights: Common Sense for Common Areas

060 | HOA Board Heroes: How to Establish HOA Board Continuity

• Hosts: Robert Nordlund, Kevin Davis, Julie Adamen • Season 1 • Episode 60

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This week we meet HOA Board Hero Carol as she talks about how to establish HOA Board Continuity!
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In this HOA Board Hero episode we welcome Carol as she talks to Robert about the remarkable efforts of volunteer board members, showcasing strategies for ensuring HOA board continuity. Learn how to become an HOA Board Hero by fostering professionalism, patience, and grace in board memberships. Discover the pivotal role of building captains in identifying maintenance issues, the importance of understanding board roles, and the impact of effective communication and collaboration. See how Carol’s board handles unique challenges at Plantation South, from limited resources to homeowner disagreements. We also cover going into the necessity of regular reserve studies, budgeting challenges, and prioritizing maintenance to avoid costly future repairs.

Chapters From This Week’s Episode:

00:00 Patience and Grace in Volunteer Board Memberships
01:03 HOA Insights Merch Store Announcement
02:52 Come to Our Live Stream!
 03:36 Ad Break - Community Financials
04:07 Meet Carol
05:07 Motivation to Join the Board
06:17 Time Commitment as a Board Member
07:34 Personality and Attributes Carol Brought to the Board
08:15 Carol’s Favorite and Least Favorite Aspects of the Job
09:31 Challenges with Board Meetings
11:00 Building Captains Concept
12:09 Board Culture and Meeting Challenges
14:11 External Forces Affecting Board Discussions
15:32 State of Carol’s Association Reserve Funds
17:23 Special Assessments History
19:22 Mediating Disagreements
21:28 Property Management and Board Interaction
23:04 Future Vision for the Board
24:42 Advice for Other Board Members

The views & opinions expressed in this program are those of the Hosts & Guests, intended to provide general education about the community association industry. The content is not intended to provide specific advice or recommendations for any individual or organization. Please seek advice from licensed professionals.

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Carol LaTorre. Elliott:

One of the things that comes up almost at the end of every conversation is patience and grace. We are doing our best we have made mistakes. We can't predict the future. So, patience and Grace at this point, because you don't want to lose board members, you cannot afford to keep doing this every few months. Even every year, a lot of patience, a lot of grace, a lot of learning. You know, we've got to figure this out.

Announcer: HOA Insights:

Common Sense for Common Areas, exists to help all 2 million volunteer board members nationwide have the right information at the right time to make the right decisions for their future. This podcast is sponsored by for companies that care about board members, association insights and marketplace, association reserves, community financials, and Kevin Davis Insurance Services. You'll find links to their websites and social media in the show notes.

Robert Nordlund:

To celebrate your support for our show, I've got a fun announcement to share. HOA insights now has its very own merch store. Our team has whipped up some hats, mugs, T shirts, and more that we think volunteer HOA board members are gonna love. We also offer dozens of free zoom backgrounds. If your board is meeting online these fun zoom backgrounds are a must check out the HOA board member merch shop at board heroes dot SELLFY dot store. That's board heroes dot SELLFY dot store or use the link provided in the show notes. Well thankless job what comes to your mind when you hear those two words, having served on the board of my condominium association for several years, followed by decades of experience in this industry. There's only one job that without a doubt deserves to be at the top of the list and that's an elected volunteer HOA board member. So regular feature of our weekly podcast is one episode a month devoted to sharing the stories of real life unsung board heroes. In our eyes. A board here was one of the 2 million elected volunteers who are worthy of recognition for simply performing a thankless job. Well, if you match our definition of a board hero or know someone who does, please reach out to us. Our contact details are provided in the show notes. Well, welcome back to Hoa insights common sense for common areas. I'm Robert Nordlund. And I'm here to share the story of an unsung board hero named Carol LaTorre. Elliott, this is episode 60. And if you missed meeting any of our other board heroes, you can find them easily on our website, Hoa insights.org, or on our YouTube channel or by subscribing to Hoa insights on your favorite podcast platform. And speaking of upcoming meetings we'll meet next week for episode 61 which will be recorded as usual, but you can also catch it as a live stream. Episode 61 will be an askme anything show with our three regular hosts, myself, Kevin Davis and Julie admin. So mark your calendars for 3pm pacific time on July 8. Click on the YouTube link in the show notes below to visit the live podcast YouTube page and click on the Notify Me button to make sure you get notified when the live podcast is about to begin. Now before we introduce you to today's Board hero Carol and her story. Let me introduce you to one of our sponsors. Is your HOA or condo self managed and you don't want to work as hard volunteering. Are you full managed and looking to save money? Are you looking to split the accounting from a manager's role for better service? Let community financials handle the monthly accounting for you? We collect dues pay bills produce financial reports include portals and help with other support services, all while providing awesome service. We'd love the opportunity to help you make your community accounting stress free with our industry leading systems and expert team. Visit our website community financials.com to learn more.

Carol LaTorre. Elliott:

My name is Carol dilatory Elliot, and I've served as a volunteer on the board of plantation South condominium association for five months when I'm not wearing my board member hat. I'm a retired accountant manage my real estate investments advocate for Community Housing, and volunteering for my community. Three words that I would use to describe the job of being a board member, our patient, curiosity, and compassion. The main story I'd like to tell is these are volunteer positions but the community is also a business and we need to have continuity and professionalism when it comes to managing these communities.

Robert Nordlund:

plantation South is a 219 unit condominium complex and Huntsville Alabama with an annual operating budget of about $600,000. The property is about 40 years old and while Carolyn has lived in the community since 2019, she only started her term as a We're treasurer. About five months ago, we asked Carol what motivated her to join the board after four years of living in the community.

Carol LaTorre. Elliott:

So I promised myself I would never be on a bulkhead. And our entire board resigned. Prior to Thanksgiving of last year, we had already stood up a community engagement forum. So a group of people that were just active in the community. So when the last standing board member had to appoint an entire board, during the holiday, we already we had been content to wait on the board, just kind of replacing everybody every two years. So we ended up getting an entirely appointed board. And starting the whole thing from scratch.

Robert Nordlund:

I could immediately relate to Carol's story since, as I've mentioned on this podcast before, but I to join the board during a moment of crisis. In fact, at the very first board meeting I ever attended, the entire board resigned, and they asked me and the other homeowners in attendance if we would mind volunteering to run the association in their place. So I know how intimidating it is to have so much responsibility pushed on to you. To that end, we decided to ask Carol how many hours she was investing into her board member duties each week.

Carol LaTorre. Elliott:

Well, right now, it's probably maybe 30 hours a week. So it has become a full time job. And that is intentional. At the moment we because we were in financial crisis mode, when our board resigned, our management company also terminated. So we had to stand up, we had to transition to a new management by which we could only afford the accounting component. But that served us okay, because we didn't need to know what was going on, we start up with several critical issues, three water main breaks, and a couple of stairs that needed critical maintenance. So we have been in crisis mode, pretty much the entire four or five months, we are spending an inordinate amount of time we are as a matter of fact, in May, transitioning to full service management, we have decided to go on to fourth full service management and then prioritize what needs to be done on the complex,

Robert Nordlund:

we were pleased to hear that the new board members at plantation South weren't afraid to get their hands dirty in order to better serve the community at large. To get a better understanding of how they were serving the community. We asked Carol what kind of personality or special attributes she was bringing to the board.

Carol LaTorre. Elliott:

I am very much a mom, and a business woman. I am a pragmatic person, I am a strategic thinker, but I'm also someone that has to implement, I'm not the best at execution. But I do need to see action. Keeping people on task is important. And doing the right tasks at the right time.

Robert Nordlund:

It was evident that Carol's career history has prepared her to step up and take on the responsibilities of an association board member, we then ask her if she had any favorite or least favorite aspects of the job. And here's what she told us when

Carol LaTorre. Elliott:

you're working together and you can get people siloed being able to delegate to different board members, everybody having a specific role isn't about board is our full time workers. So figuring out which tasks worked best for them, you know, when when we're winning, and we're gelling that that's great. One we can't seem to get, especially when you're getting new board members on having to go back to the history and bring everybody up to speed is very challenging. So a lot of that, especially from my perspective was going to YouTubes and kind of come up to speed on I'm watching YouTube that too am. But all of that is very helpful. So if we can get a board oriented and functioning as a board, we are optimally functioning board and operations. It satisfies my little need to be doing something. But there's so much to do. There is so much to do. But I do I do enjoy it. It's just that it's almost never ending at the moment. We

Robert Nordlund:

noticed that board meetings weren't mentioned in her previous answer. So we asked her whether she enjoyed them or not. And also if the board was meeting virtually or in person,

Carol LaTorre. Elliott:

I do not enjoy board meetings now. They can be very, very contentious, because you didn't do enough pre walk. In either case we have we don't have a flow yet. So we're you know trying to figure out Robert's Rules and and still get things done, how much decision making needs to go or how much discussion needs to go on before the board meeting, keeping those board meeting short and in actually following through with the resolution. that you the decisions that you make at a board meeting, and how they need to be disseminated. So, board meetings from a business standpoint, you know, what you need to do you go do it from a board perspective, you know, what you need to, you might know what you need to do, you got to get approval to do it. And then you gotta go do it. So or, and figure out how you're going to pay for it, telling COVID, we they were just meeting, the Board itself was meeting virtually coming out of COVID, we were still doing a lot of virtual, they kind of seem to like that. But it wasn't open to the community. And there was not a lot of communication to the community. So now we have more meetings, you can attend, we are going to initiate a zoom setup for that we have initiated web page, we do have a Facebook page, the board doesn't really engage on Facebook, but it gives the community an opportunity to vent so we can see, you know what, what things are going on out there. And a lot of what we're trying to do now is we have things that we're calling building captains. So the building captains are in charge of, of identifying maintenance and bringing it to the board, when we had to lock down the water situation on a moment's notice. It's the will or it's the board, the community captains job, it will be the committee cabin itself to notify everybody in their in their building that keeps the board out of the frame, we don't have to engage with the same questions over and over, you can ask your your building captain, what's going on kind of like a Resident Advisor in college, you know, that's where you go for your resource. So we're hoping that that will take some pressure off the board. And we can get down to the business of running the association as opposed to trying to bolster the community from the board down. We

Robert Nordlund:

thought that their idea of having building

Carol LaTorre. Elliott:

We haven't run for election. So captains was a great one and a smart way of compartmentalizing tasks for the board, especially while they're short a community manager. We then asked Carol, how she felt about both the culture of the board and what sort of challenges that they've come across in their meetings. we're not really a community elected board. At this point. We're just more of a coalition of the willing at this point. So the board meetings themselves. Because we're new, we haven't quite figured out everybody's personality, we just had our president resign earlier this month that she was doing a lot of the on ground, she was a librarian. So she was wonderful at organization. She just ended up having some other commitments. Part of the issue is some folks think being on a board is he's got to show up once a month getting folks to understand the realistic side of this, it is a 30 hour commitment. If you have a full time job, that's going to be hard to do. But we can walk we can still work with that, we just have to realize that, you know, your engagement is going to be limited. So just trying to get those personalities to coalesce. And also the actual structure of the bylaws, the legal issues with being on a board engaging with with the owners has been it's been tough, even things like neighbor to neighbor issues. You know, what's what's the board's responsibility for that. Even what actually the board is responsible for from a component level turns out pretty much everything that's not inside your walls. And that was that was talking to some of the board members to realize what do you mean, we have to we have to worry about the electrical running through the, the the wall. So just trying to get the board up to speed as to what the board's function, what the roles are, why it needs to operate the way it does. Why you need continuity with

Robert Nordlund:

cost of goods, services and property rising over the past several years. We're curious to know if any external forces or changes in the world were affecting their conversations during board meetings. And here's Carol's thoughts on that.

Carol LaTorre. Elliott:

One of the things that drew me to this board you asked earlier, was I saw it as a microcosm of what's going on in the world, what's going on in the country, what's going on and community if we could get this 218 unit community to coalesce. Maybe there's some hope for the town for the state for the country. So there was a little bit of a challenge going on there. And it's been a Yo yo, we have certainly political differences in our community, although we'll discuss it at board meetings. You know, we can tell where some folks are more conservative, some books want. Green, you know, we'd like to recycle more. But I believe that everybody who is beginning to realize that if we don't hold this together, it is a statement on can Can we hold things together? Are we going to be resilient? Or are we just going to let things deteriorate or we're going to treat it as a consumable? And that's I mean, that's a that's a choice. So a great choice and an asset, but but you do have to make those decisions.

Robert Nordlund:

as a community association reserves specialist and the founder of a company that performs reserves studies, I always find myself curious about the state of the reserve funds at our board heroes associations. So we asked Carol what plantation South's percent funded of reserves was, the

Carol LaTorre. Elliott:

first thing I got, and they were very proud of was his 2008 reserve study that defined all the components, we had about 13 million in assets, that would have to be, you know, worked, the issue was, they were not setting aside for reserves had not been for 15 years, 16 years now. And we're also not doing the maintenance that needed to, to happen. One of the questions I've had early on was, so this percent funded, what is what is the actual definition of that, you know, are we're supposed to be 10% funded 10% of what. So we did find out that that was 10% of our operating budget, we did manage to pass a budget that included $100,000 worth of reserves savings on top of operating budget. So that satisfied our 10% for FHA, for Fannie mortgaging, however, the other side of that is to be fully funded, was at a compounded level, the 70% that everybody aspires to, is at the component level, we didn't even have a handle, everything was beyond useful remaining life. So getting there on a $13 million capital situation was not going to happen. It took years to get to this situation gonna take decades to get out of it. You know, one of the things that I love is the the Father Time and Mother Nature, don't wait, we are crossing our fingers that we have enough time so that we can get enough money to, to figure some of this stuff out.

Robert Nordlund:

When our community's reserve components are in such a dire state. It's hard not to fear the idea of that dreaded special assessment looming around the corner, we asked Carol, if plantation South had ever tried to pass a special assessment in the past.

Carol LaTorre. Elliott:

we have we have what we call our bylaws call for something called a supplemental assessment. And that is, generally when you have a operating budget shortfall special assessment. Actually, our units came out with a they didn't want to do a special assessment. They wanted to increase the association dues by double. That, of course did not sit well. We also have bylaws that say the members have to approve the budget, they consistently rejected the budget. So turns out, they had had a little bit of money leftover, they were consistently spending that overage and last year fell into deficit spending. So they did enact a supplemental assessment in October of last year, right before they left, by the way. Yeah, to be paid in three months didn't go over well, was absolutely necessary. It was a cash flow situation where they were starting to not be able to pay the bill, will we have special assessments? Probably we one of the things that I was asked as the treasurer was, during the meeting, when we were trying to pass this new budget was are we confident in this budget? And the answer was no, we don't know what priority is, until we get in there and see what it is we can tell you. And in fact, we can tell you that this is not going to be the the budget. But we will try to provide as much predictability and sustainability as we can we know we can go hit everybody's bank account for everything and everything else around it is going up. And everybody still wants the same amenities and services and and that design is impossible, with the money that that we have, without downgrading something.

Robert Nordlund:

From our previous answer. It seemed that there had been a long history of disagreement and animosity between the Board of plantation south and some of the individual homeowners. We asked Carol if since setting up to serve on the board, if she ever had to mediate a disagreement between the board and the homeowner.

Carol LaTorre. Elliott:

We have a couple of issues. We because we're a new board, we've had to defer to legal on some things. And then the part of the legal thing is, is that they have a process for doing things that we can't always share with the owners. So that becomes a little bit of a battle. We're doing what you're asking us to do. We just can't give you the details. So it looks like we're not doing things and then that sometimes there are things that we cannot do. We cannot engage neighbor to neighbor disputes. We can engage in that. So we have had a few. A lot of things are really ongoing maintenance issues where people have been Asking for a decade for things. And now don't trust the new board to do them either. Because, you know, unfortunately, your windows although they are old, we've got to replace them stairs first. Right? So priority is safety, one of the things we did. So as an example, we had to downgrade our landscaping, we are a wooded, it's beautiful wooded area. However, there are some manicured areas that need to be maintained. Well, we were spending 20% of our budget on landscaping, when we needed. We had critical maintenance had to be there. So we downgraded our landscape to $25,000. Well, this week was the first pass, nobody was happy, nobody was happy. And then apparently some people just didn't get the memo. Landscape is not a priority this year. So people aren't happy. And well, we'll deal with it. We have a lands volunteer landscape committee now by have a weed trimmer in my trunk the things that we cannot pay for that we can do, we'll try to do. In

Robert Nordlund:

another previous answer. Carol indicated that they had downsized their relationship with their property management company to just merely accounting, but that they would resume using a property management company in the future. This will naturally help to provide a buffer between the board and the homeowners. But we want to know how Carol felt about their current arrangement, and also what wishes she has for them in the future. Yeah,

Carol LaTorre. Elliott:

I can honestly say that none of what has gone on with our management staff has been the management teams. It has been the coordination between the board and the management. One of my biggest fears about going full scale management at this point is that it puts another layer between the owners and the board, my hope is that when the management team brings issues up to the board, the board will act on them. It's hard for the board right now because we're acting on everything. But once we get that buffer, the fear is that we go back to that delay. It's the same stuff. It's just now consolidated. So I do worry a little bit about how that interaction, we don't want to lose management. We don't want to have to start over again. We know we have owners that have been not nice people to management. And honestly, when you get down to it, it's not the management's fault. It's because the board's not engaging. Hopefully, this board will stay engaged, keep the owners out of the fray. Keep the management, folks doing management stuff, as opposed to social work sometimes. So Carol

Robert Nordlund:

has had the opportunity to serve on a board emerging from the past that had a lot of baggage from many years of mismanagement, with all things considered, it seemed like she and the rest of the board of directors at plantation South had acquitted themselves rather well, since the previous board resigned. We asked Carol what she thought about the board and what it looked like in a year's time. And if she had any words of advice to the current board,

Carol LaTorre. Elliott:

I think the rod will be more representative of the, the the owners. So there does need to be that component. I care about this place because I live here, there will be some professionalism, you know, taking that board from Yes, it's a volunteer board. But there is structure that needs to be adhere to and processes. When you're changing out a third of your board every year, you have it takes a while to spin these people up. So one of the things that we're trying to do is to and which is why I'm stepping back to the community level is to get these committees done so that we can breed our board members, they already know the history by by, you know a year out and know how the board functions. So we got younger people coming in, the older folks don't want to be on the board. The younger people have busy lives. So somewhere in there, we've got to figure out how to make it attractive to be on a board how to be a part of community how to get things done. One of the things that comes up almost at the end of every conversation is patience and grace. We are doing our best we have made mistakes. We can't predict the future. So patience and Grace at this point. Because you don't want to lose board members. You cannot afford to keep doing this every few months. Even every year, a lot of patients a lot of grace, a lot of learning. You know, we've got to figure this out.

Robert Nordlund:

Finally, we want to close this board hero episode out as we often do by giving Carol the chance to share a word of advice to any other board members tuning into the program, especially if they're struggling with getting used to board service.

Carol LaTorre. Elliott:

One of the things that is important to me and which has become very To hobbyists is reaching out to the resources folks like HOA inside suppose like some of the the components of that figuring out what your reserve study means from a budgeting standpoint, but also how to fit that those kinds of advisors into your board structure and also helps with continuity. If you know who to go to to ask the question. The resources are available, they don't cost anything. To stay on top of best practices is very helpful. Figure out what folks in California are doing what folks in Florida are doing because it's coming, it's coming our way, when it's a no cost. If you're building it Anyway, go ahead and build it the best way possible.

Robert Nordlund:

Want to publicly acknowledge Carol for performing a thankless job well, and to compliment the entire board of directors at plantation south for taking their responsibility seriously, to act in the best interests of their association. We hope you gained some HOA insights from Carol's story and that it helps you bring common sense to your common area. Thank you for joining us, and we look forward to another great episode next week. And remember, if you match our definition of a board hero or know someone who does, please reach out to us our contact details are provided in the show notes. See you next week for our live cast asked me anything episode number 61. We're here for you every week on the HOA insights podcast, equipping and encouraging you for the hard work you do as volunteer board members.

Announcer:

You've been listening to HOA Insights: Common Sense for Common Areas, you can listen to the show on our podcast website, Hoainsights.org, or subscribe on any of the most popular podcast platforms. You can also watch the show on our YouTube channel. Check the show notes for helpful links. If you like the show and want to support the work we do, you can do so in a number of ways. The most important thing that you can do is engage in the conversation. leave a question in the comment section on our YouTube videos. You can also email your questions or voice memos to podcast@reservestudy.com Or leave us a voicemail at 805-203-3130. If you gained any insights from the show, please do us a HUGE favor by sharing the show with other board members that you know. You can also support us by supporting the brands that support this program. Please remember that the views and opinions expressed by the podcast do not constitute legal advice. You'll want to consult your own legal counsel before making any important decisions. Finally, this podcast was expertly mixed and mastered by Stoke Light Video & Marketing. With Stoke Light on your team. You will reach more customers with marketing expertise that inspires action. See the shownotes to connect with Stoke Light.

People on this episode

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Robert Nordlund, PE, RS

Host
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Julie Adamen

Co-host
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Kevin Davis, CIRMS

Co-host