How Do Board Know When PM's Have too Much Power

Carol,

This is a good topic. We are self managed so I won't have much to add to it.
I would just like to point out that, in my opinion, the PM (or a MC for that matter) should not have the authority to sign and issue checks. This authority should stay with the Board.


The President is one individual. The issue is with the Board.

The Board appointed the individual and the Board may remove the individual from the Office of President. If the President is too uninformed to perform the duties perhaps the Board should remove the individual and appoint another who is more informed.

PM's should certainly be consulted on matters of policy and budget but is, at day's end, a facilitator of the board's direction. If the PM handles multiple HOAs, then their experience will keep you connected on issues that others have faced.

PM isn't grabbing power for the sake of it. You have a president who needs removing from the position by a board vote. An ignorant president is unacceptable. A board that allows an ignorant president to reign is more negligent.

PMs should be given the authority to expend funds on small but urgent repair and maintenance matters. That's part of managing. Boards who cut off all authority from the property manager are 1. wasting dues payer money 2. not maximizing the ability of the manager 3. micro-managers.

Carol,

Unless you'll be one meeting personally with every repairman and handing them the check, just monitor expenses without worrying over an argument over repair expenses and defining it they're an "emergency." It will drive you nuts.

Thanks, Kelly. I wouldn't dream of questioning our PM about repair or maintenance expenses--we have way too many in our 25-story twin towers. We have two onsite engineers who are fabulous and do a lot of repairs in-house that we used to have to hire outside vendors for. Our engineers also make small purchases for us and just submit their receipts to mgmt. Larger purchases must be approved by the board, e.g., we recently approved a new water softener tank for the premises.

We have about 20 contracts with various vendors and the MC pays them their monthly contract fees

I should have written that these expenses do not have anything to do with maintenance/repairs--one is for a common area purchase and one for a non-repair expense of over $700 that I've never seen before.

Well, that's part of the topic. She automatically brought the pool clock to the board because it's a decorator item being added to the common area. Our rules & regs state specifically that nothing can be added to the common area without board approval. She, of course, can purchase pool cues if ours disappear!

A few months ago, the board voted down $300 (max) to buy a new swivel chair for our entry gate kiosk officers--the chair's occupied 24/7 and the old one is not adequate for them--especially for a couple of larger officers. I voted to approve one, but there was a 3-3 tie & the motion failed. There's now a new chair. The board should be involved because it's a good thing if the chair is a color that blends with the (new) kiosk desk, flooring, etc. I'd prefer one that's ergonomically designed, etc. I actually haven't seen it yet, but assume that it's appearance is OK. But the point is the PM has no authority to make these kinds of purchases. Nor does the president, who actually voted against it a few months ago.

We have line items in our budget for things like light bulbs, we have a vendor contract for janitorial supplies and paper goods, there's no need for her to get authority for stuff that's built into our budget. Our budget mainly i very large because of staff & mechanical items. Elevator repair is an example We have a monthly service fee for it and repairs are built into the budget. There's a budget line item for our copiers and staff's computers, etc., etc. They certainly do not have to come to the board to buy ink cartridges or office supplies, etc. etc.,There are numerous tasks that she juggles and very ably too. I believe I explained this to you previously, Larry. You've mentioned your 130+IQ and high level of reading comprehension in the past, but perhaps retention isn't one of your strengths.

I disagree that the PM sets policy--our bylaws don't give her that latitude nor does our contract with the MC, but our PM definitely recommends policy. And we usually follow her recommendations if carefully researched.

Tim

Refresh my memory on your association size and budget. Reason I ask is this year the Declarant will be turning over the association to we owners. 113 standalone, patio homes, no amenities, budget about $70K so self managed does interest me.

Thanks

Seems some lack any real understanding of their roles and the role of those they hire to manage a property.

The PM or MC is an employee and should be doing what they as required and instructed to do. If the President prefers they can turn over all the duties and decision making over to the PM IF the remainder of the Board goes along with it. In some cases it might work IF you have a prefessional PM in other casaes you might be taken to the cleaners if you have a self serving PM.

The PM has as much authority, power and influence as they are allowed to take by the Board. In some cases you might have Board members with no clue as to property management who think their role is micro-manage the operations and by doing so kid themselves into thinking they are doing their jobs.

You can have a property managed by the Board, you can have one with a PM who does the bulk of the work while bringing the Board up to speed once a month or you can have a PM and Board that works together has defined roles and responsibilities. But that requires people on the Board actually having the knowledge, expierence, and ability to do the job required.

With time in becomes quite clear what type of property people live on. When the roles of individuals becomes unclear or in some cases unknown there is little chance to avoid abuse and ensure the positive operation of the property.

Many folks who post here see three different groups who in their minds are by nature working against each other. The owners, the members of the Board and the PM or MC. It's them against US. It's the President's fault the PM is taking to much power. The PM is not doing what they should.

IMO those three groups should work together for the mutaul benefit of all involved. If not everyone suffers. Does that happen?? Rarely.

The strongest chain the world is only as strong as its weakest link. The weak link in HOA operations are the Board members who in fact have no clue as to what their role is or should be. So they set standards for themselves that in the end serve no useful purpose other than giving the illusion the Board members are doing their jobs.

Many HOAs have quite a few weak links.......

I recently was called by a young woman looking to take on a new property as their PM. She was seeking my advice as to how she should proceed.

My first suggestion was that she arrange to sit and meet with the Board.
Find out what type of people they are, how they function, who in fact is running the show, and what they might think YOUR role would be. Is it realistic and are you willing to assume that role?

If the answers you find are not good ones then walk away. Without a Board having knowledge, a realistic understanding of just what an MC should be expected to do, the ability to offer mutual respect not a situation I would ever jump into.

Our current MC was introducing me to a vendor at the annual CAI trade show several years ago. In his introduction he stated "I work for Jon he is the President of the ___________ association". I responded " We do in fact work together to manage the property and I don't view him as an employee but as a partner in doing the job". Over the years he has mentioned to me several times that he remembers my comments and appreciates the working relationship we have developed with defined roles and one single common goal. Doing what is best for the property.

The Board is NOT some separate enemy. They too own property. The MC/PM is not an adversary with whom you need to do battle with. IF that is the case something is seriously wrong and YOU just might be part of the problem.

Carol

Trust, but verify.