Posted:
Thomas,
3 months ago, we had a paid property manager whose husband was the VP and of the remaining 8 board members, 4 were her closest friends, 1 ineffectual president who merely recited what the board told him to, and 3 members who wanted change, 2 of which were followers only. Luckily, 2 of the board members (one of the PM's friends and one of the followers) had resigned pending replacements.
I had been working on one of the board members, trying to convince her of the mismanagement of association at the hands of the PM and likely several of the board members. Finally, the shocking amount of our delinquencies came to light as did the realization that we were quickly headed towards bankruptcy.
I have owned & operated a tax accounting / business consulting firm for many years and, as such, was asked to join the Finance Committee along with another guy with significant finance experience (who is now my VP). At our first meeting, we introduced ourselves and gave some professional background - we were voted on to replace those resigning (who immediately left). As soon as we were voted on the board, the treasurer stormed out of the meeting, having resigned. This left us down one board member, but the ranks were thinning on the side of the PM.
Because of my accounting and auditing background, I took charge of our audit to determine just how bad the finances really were. I was able to show how had we not eliminated the PM position and moved to true self-management, we would be declaring bankruptcy by the end of this year. Even her closest friends could not dispute the numbers and analysis I presented - we voted to remove the PM. That move alone bought us quite a bit of time before bankruptcy would be necessary.
Even though the PM's friends voted to remove her, they did so very reluctantly and each of them resigned within a week. While that left us seriously short-handed, the odds were in our favor now. Our annual elections were coming up and, for the first time in 27 years, we held actual, legitimate elections, allowing nominations from the floor. Our docs provide for this of course, but nonetheless it was never done before. We got several excellent new board members, and went a long way to restoring the membership's faith in its board.
Our ineffectual president saw that he was ill-qualified to lead the association in difficult, uncertain times - he stepped down as president, but remained on the board. I was elected president.
With the PM and the dead-wood board members gone, we were free to make the necessary changes. Since we opened communications up with the membership for the first time in nearly 30 years, we had gained back a lot of their trust. We then restructured how we do business, saving thousands in every day operations. We were able to renegotiate contracts, saving tens of thousands. We began aggressive collection of our delinquencies and have already returned about $10,000 to the reserve funds (which were nearly depleted, having been used for operating expenses).
2 1/2 months later, and we are no longer in danger of bankruptcy and our community is generally happier and friendlier that it has been in years. We still have a long way to go, but we've made great progress in a short period of time. I'm a lucky guy, I have a nearly ideal board at my side who share my vision for a better community and are willing to work for it.