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Posting HOA Financials online

Started by MarcusB2 • 13 replies • 2639 views

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MarcusB2 (Maryland)
Posts: 11
Posted:
We are considering posting our financials on our password protected webpage for residents. We were going to include the Income Statement and Balance Statement. One of our board members suggested that we also include our bank statement (account number blacked out). Is this wise to do?

Marcus
MelissaP1 (Alabama)
Posts: 13,836
Posted:
It sounds like a good idea but think it will create MORE issues. Once it hits the web you can't really control the privacy even with password protections. You don't know who your residence may have shared their password with.

Additionally, with OUR HOA Collections was a PRIVATE matter handled ONLY by the board members. We did NOT reference people's names but their LOT numbers. Some people may take offense to their personal information such as address or name being posted even if they are in good standing.

HOA's Expenses are a different story. ALL members should be aware of where the money goes and why. If you were to post any financials it may be along these lines. I believe in OPENLY discussing expenditures because the money in the HOA's is EVERYBODY's money. The board is just to REPRESENT the general membership in controlling that money/budget on a daily basis.

I did create a web page at one time. However, many of my residents were NOT technically savvy. Plus many were elderly and did not have computers to access the web. Take in consideration how tech minded the people are in your HOA before trying to create something.

You may want to post other things besides the financials. The rules or a posting board is an excellent idea for feedback.
Former HOA President
MarcusB2 (Maryland)
Posts: 11
Posted:
Quote:
Posted By MelissaP1 on 02/24/2011 6:42 AM
It sounds like a good idea but think it will create MORE issues. Once it hits the web you can't really control the privacy even with password protections. You don't know who your residence may have shared their password with.

Additionally, with OUR HOA Collections was a PRIVATE matter handled ONLY by the board members. We did NOT reference people's names but their LOT numbers. Some people may take offense to their personal information such as address or name being posted even if they are in good standing.

HOA's Expenses are a different story. ALL members should be aware of where the money goes and why. If you were to post any financials it may be along these lines. I believe in OPENLY discussing expenditures because the money in the HOA's is EVERYBODY's money. The board is just to REPRESENT the general membership in controlling that money/budget on a daily basis.

I did create a web page at one time. However, many of my residents were NOT technically savvy. Plus many were elderly and did not have computers to access the web. Take in consideration how tech minded the people are in your HOA before trying to create something.

You may want to post other things besides the financials. The rules or a posting board is an excellent idea for feedback.

Yes we only plan to post the HOA Income Statement, Balance Sheet and the Operating account and Reserve Bank Statements. Of course we will scratch out our HOA Bank Account Number. I just want to know if anyone is out there does this and has it been positive?
RichardP13 (California)
Posts: 1,767
Posted:
We post the Income /Expense Statement on our password protected website. I have seen many other HOA's post their financials on a non protected site. We post the financial to provide some form of transparency to where and how their money is spent and how close it is to what was budgeted.
JohnO6 (Georgia)
Posts: 424
Posted:
I'm in favor of posting Income Statement and Balance Sheet. Between the two it provides an adequate summary of the state of the HOA's finances. The bank statements add no value except possibly the aura of transparency. Furthermore, if the closing dates of the bank statements differ from the date of the Balance Sheet, the numbers may well not jive - which could be a source of confusion to some owners.

SteveM9 (Massachusetts)
Posts: 3,699
Posted:
Quote:
Is this wise to do?


YES!!! All good ideas. Being transparent is the best idea you can do. So many issues are solved by being transparent and informing residence of what is going on.

Want trouble, drama in your HOA on a regular basis? Keep everything a secret.
LawrenceC1 (Georgia)
Posts: 480
Posted:
Posted By MarcusB2 on 02/24/2011 6:45 AM
Of course we will scratch out our HOA Bank Account Number. /div>

Marcus,

You needn't bother scratching out the account number. Any vendor who you have paid with a check has your account number. Any homeowner who paid their dues to you with a check now has your account number printed on the back of the returned check.

An HOA bank account number is not very secret, which is why every HOA treasurer needs to reconcile the bank account carefully each month.
TimB4 (Tennessee)
Posts: 21,062
Posted:
Marcus,

We include the financial information as part of our minutes (attached to it) of the Board and annual meetings and post those minutes on the website in a password protected area for our members.

We have done this since 2005 and never had a problem.

Tim

Brian. (Oregon)
Posts: 4
Posted:
with regards to this discussion, is it legal under state law to post a list of delinquent homeowners past 90 days on the HOA website? Anyone have an easy answer or will it depend on state law. thanks
LawrenceC1 (Georgia)
Posts: 480
Posted:
Brian,

As long as the information is available only to the other members of the Association you are on firm legal ground in any state. In fact, the other homeowners are likely guaranteed access to such information, even if they have to request it.

You would be treading on thin ice if you posted such a list of delinquents on a public site. One of the common privacy torts is public disclosure of private facts about a person.

Be sure that sufficient protections are in place on your web site to keep the information restricted.
TimB4 (Tennessee)
Posts: 21,062
Posted:
Brian,

Some Associations chose to publish names, others just lot numbers, others just the total number and some don't disclose any of this info unless they are asked for it specifically. Legally, it will boil down to your State laws and privacy issues. Therefore, a good rule of thumb is to take the appropriate measures to minimize disclosure to non-members.

Personally, I believe that those that really want to know who is behind in dues should make the first move by asking for specifics. Our Association does identify the number of lots who are behind in paying assessments at each board meeting and it's recorded in the minutes. The specifics of what lot, how much and who the owner is are not mentioned in the minutes or in the meeting.

Per Oregon Law 94.640 [emphasis added]:

(7)(a) All meetings of the board of directors of the association shall be open to owners, except that at the discretion of the board, the board may close the meeting to owners other than board members and meet in executive session to:
(A) Consult with legal counsel; and
(B) Consider the following:

(i) Personnel matters, including salary negotiations and employee discipline;

(ii) Negotiation of contracts with third parties; and

(iii) Collection of unpaid assessments.

I would interpret this section of the law to indicate that it's the board discretion to make the information open to the membership or not.

Tim
LawrenceC1 (Georgia)
Posts: 480
Posted:
Quote:
Posted By TimB4 on 02/27/2011 11:57 PM
(iii) Collection of unpaid assessments.

I would interpret this section of the law to indicate that it's the board discretion to make the information open to the membership or not.

Tim,

You may be reading too much into this section. The law you cite says that the board may discuss unpaid assessments in executive session. All that this does is give the board the latitude to discuss strategy without having to reveal everything to the homeowner that they are collecting against. For example, planning to attach bank accounts is not something that you would want to announce before you tried it.

Further in the Oregon statutes in section 94.670 it says that financial records must be made available to any owner. So although the board's strategy and planning need not be made available and can be shielded in executive session, the records themselves are open to any member.
TracyH (Texas)
Posts: 3
Posted:
Our board in Texas is NOT transparent. Budget material is only handed out to the property owners that attend a qtly meeting. If you request financial information from the office they charge you $.25 per page, $20 hr for Administrative Fees, research and retrieval.

As property owners we pay annual dues. This income pays for; payroll, insurance, legal, office, taxes utilities, etc. Being a member in this property owners association I think it is double-dipping to charge for copies, administrative fees since our dues covers all of the above. What do you think?

Secondly, we have board member who also does construction work. He has access to our financials. He has been building our community center $150K, pavillion $60K just to name a few with the approval from the other board members. I see that being a huge conflict of interest. Our by-laws directive is as follows...

Thirdly, we operate on an "all cash basis", but run in the deficit the first three months of the year until dues are turned in in March.

No director or officer of the Association shall be required to devote his time or render services exclusively to the Association. Each director and officer of the Association shall be free to engage in any and all other businesses and activities either similar or dissimilar to the business of this Association without liability to the Association. Likewise, each and every director and officer of the Association shall be entirely free to act for and serve any other corporation or corporations, entity or entities, in any capacity or capacities and become a director or officer of any other corporation or corporations, entity or entities, whether or not the purposes, business and activities of this Association, without breach of trusts to the Association or its members and without liability of any character or description to the Association or its members. No contactor other transaction of this Association shall ever be affected by the fact that any director or officer of the Association is interested in or connected with any party to such contract or transaction, or is a party to such contract or transaction, provided that such contract or transaction shall be approved by a majority of the disinterested directors present at a meeting of the Board of Directors at which such contract or transaction shall be authorized or confirmed.
TimB4 (Tennessee)
Posts: 21,062
Posted:
Tracy,

Unfortunately this type of stuff happens. Typically State laws don't require that the membership be informed of anything until the annual meeting and then it's just a generalized report. Members are typically allowed to view the records but must initiate the process. It's not fair, I agree. However that is typically the facts.

The Associations that do disclose more to the membership (and there are a lot) usually do it because someone who believes in disclosure did the work and got themselves and few more like minded individuals elected to the Board or just attended the Board meetings to see what and why things were happening.

Typically Board members are volunteers who have little if any training in performing those duties. They typically all have day jobs, family life and are trying to do their best with the time they can devote. Most discover that it takes far more time serving as a member of the Board then just an hour or two a month to attend a meeting. Some stick with it, some just quit doing the work or leave the board altogether having the remaining members pick up the load.

Tim

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