AlM4 (Georgia)
Posts: 6
Posts: 6
Posted:
Why does a HOA or POA have Officers and Board Members? Do Officers have different responsibilities? What are the responsibilities of Officers?
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Offficers and Board Members
Started by AlM4 • 6 replies • 1517 views
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TimB4 (Tennessee)
Posts: 21,062
Posts: 21,062
Posted:
Al,
Welcome to the forum. What an excellent question.
Decisions for the Association are made by the Board of Directors. Each Director has one vote and, typically, a simple majority is all that is needed.
Implementation of those decisions are made by the Officers of the Association as the Officers perform the day to day activities that are needed in any organization. Usually, Officers are appointed into their position by the Board of Directors. Often, those appointments are made from amongst the Directors themselves. When this occurs, that individual is holding two jobs (one being a Director and one being an Officer) with each job having it's own responsibilities.
What specific tasks each officer is required to do should be identified in your governing documents (typically the Bylaws). These specific tasks are the minimum and additional tasks/duties may be assigned by the Board.
Hope this helps,
Tim
Welcome to the forum. What an excellent question.
Decisions for the Association are made by the Board of Directors. Each Director has one vote and, typically, a simple majority is all that is needed.
Implementation of those decisions are made by the Officers of the Association as the Officers perform the day to day activities that are needed in any organization. Usually, Officers are appointed into their position by the Board of Directors. Often, those appointments are made from amongst the Directors themselves. When this occurs, that individual is holding two jobs (one being a Director and one being an Officer) with each job having it's own responsibilities.
What specific tasks each officer is required to do should be identified in your governing documents (typically the Bylaws). These specific tasks are the minimum and additional tasks/duties may be assigned by the Board.
Hope this helps,
Tim
CarolR11 (Colorado)
Posts: 2,563
Posts: 2,563
Posted:
If the HOA/POA is incorporated, directors are required by state corporation laws. Your bylaws set how many directors you must have. Those state corp. laws also required that you have officers and may list a minimum, e.g., president and secretary. Your bylaws will state whatever officers are required by your state's laws and often two more, V.P. and treasurer.
If the HOA is self-managed, as Tim's is, the officers perform the duties that are stated in your bylaws and also probably in your CC&Rs. And, since most officers in HOA's also are directors, all directors have general duties listed in the CC&Rs, e.g., make sure the HOA has insurance and pays its taxes.
Your bylaws also might say that those duties can be delegated to a management company (MC). So, in my HOA an onsite full-time mgr. and assist. mgr. perform most of the duties listed in the bylaws (and general duties listed in the CC&Rs) . The board of directors makes policy decisions and instructs mgmt. to carry out the board's directives.
If the HOA is self-managed, as Tim's is, the officers perform the duties that are stated in your bylaws and also probably in your CC&Rs. And, since most officers in HOA's also are directors, all directors have general duties listed in the CC&Rs, e.g., make sure the HOA has insurance and pays its taxes.
Your bylaws also might say that those duties can be delegated to a management company (MC). So, in my HOA an onsite full-time mgr. and assist. mgr. perform most of the duties listed in the bylaws (and general duties listed in the CC&Rs) . The board of directors makes policy decisions and instructs mgmt. to carry out the board's directives.
MatthewW4 (Arizona)
Posts: 500
Posts: 500
Posted:
My state has no requirement for the minimum number of officers nor does it dictate titles. You could have a single officer with the official title of Great Grand Gila Monster.
Board members are normally shielded from liability for their acts. Officers are not. A board member who accepts the position of officer may expose himself to personal liability that he would otherwise not face.
Board members are normally shielded from liability for their acts. Officers are not. A board member who accepts the position of officer may expose himself to personal liability that he would otherwise not face.
TimB4 (Tennessee)
Posts: 21,062
Posts: 21,062
Posted:
Quote:
Posted By CarolR11 on 05/04/2013 8:20 AM
Your bylaws also might say that those duties can be delegated to a management company (MC). So, in my HOA an onsite full-time mgr. and assist. mgr. perform most of the duties listed in the bylaws (and general duties listed in the CC&Rs) . The board of directors makes policy decisions and instructs mgmt. to carry out the board's directives.
Your bylaws also might say that those duties can be delegated to a management company (MC). So, in my HOA an onsite full-time mgr. and assist. mgr. perform most of the duties listed in the bylaws (and general duties listed in the CC&Rs) . The board of directors makes policy decisions and instructs mgmt. to carry out the board's directives.
Providing that the Officers understand that they can delegate the duties but not the responsibility of the task being done this utilizing a management company works out fine. Based on various posts in this forum, it's typically when the Officers no longer desire accept the responsibility and therefore fail to verify the tasks are being done properly that issues arise.
As I see it, there is a definite Order of Responsibility:
Members - Accountable to each other and Responsible to check on the Directors (can be done simply by attending meetings and/or review the minutes of meetings and asking questions when needed).
Directors - Accountable to the members and responsible to make decisions based on their fiduciary duty and common sense.
Board of Directors - Accountable to the membership and Accountable to the State (for corporate reports, etc.). Responsible for the affairs of the Association, providing specific services outlined in the governing documents, maintaining the common area, operating the common amenities and oversee compliance with the governing documents and compliance with applicable laws. Along with the individual members, the Board typically has the authority to enforce compliance with the governing documents.
Officers - Accountable to the Board and responsible for those areas assigned to them (Secretary-Records, Treasurer-Finances, etc.).
Contractors (bookkeeper, MC, PM, landscape, trash, etc.) - Accountable to their perspective Officer based on duties and responsible for completion of tasks identified in their contract.
Sub-Contractors - Accountable to the contractor who hired them and responsible for the tasks identified in their contract.
As you can see, you may delegate the tasks required to fulfill your responsibility but you are still accountable for fulfilling that responsibility.
MelissaP1 (Alabama)
Posts: 13,836
Posts: 13,836
Posted:
I always believed that Officers are also board members. They are elected to the board and then the board chooses who their officers are going to be from that group. So they would be covered under the liability insurance. The membership doesn't usually elect officers and board members separately. Board members terms may be staggered or last a couple of years versus yearly. An office position may be yearly while the board is bi-annual. It really depends on how your documentation is set up. If your incorporated it should detail this information in the Articles of Incorporation.
By the way, the President can't act as Secretary in most HOA documents. Vice-President position does not necessarily take over for the President position if they were to resign. The Vice-President's duties typically are to fill in when the President can't make a meeting. It does not mean they automatically get that position if it is vacated. Not like how the USA government is set up. Since HOA's are kind of both government and corporate. They have a corporate structure but act as quasi governments with governing documents. Just to add on to all of this confusion...
By the way, the President can't act as Secretary in most HOA documents. Vice-President position does not necessarily take over for the President position if they were to resign. The Vice-President's duties typically are to fill in when the President can't make a meeting. It does not mean they automatically get that position if it is vacated. Not like how the USA government is set up. Since HOA's are kind of both government and corporate. They have a corporate structure but act as quasi governments with governing documents. Just to add on to all of this confusion...
Former HOA President
CarolR11 (Colorado)
Posts: 2,563
Posts: 2,563
Posted:
Matthew, we have D&O (directors & officers) insurance in our HOA. Re: names of officers & our state's corp. code, I generalized to other states and I wrote they "may" name what officer(s) are required. As you say it may only be one.
Melissa, our bylaws and I believe many others, permit the board to appoint a non-director homeowner as an officer. A few years ago none of us directors felt qualified to be treasurer and a non-director agreed to fill that role. A few months later she agreed to fill a vacancy on the board and we appointed her. The details about governance generally are in the bylaws. Our articles are very brief and are silent about these details.
Tim, oh, we all have indeed seen lots of posts about boards that don't properly supervise their PMs. We do and our treasurer chairs our Finance Committee, and another director serves on i along with three h'owners. The FC recommends to the board the acceptance of our financials and investment strategies. I still scrutinize the financials closely. Our board understands that we directors are ultimately responsible for the PM's actions.
Because of our large budget, complexity of our 200+ unit high rise's mechanical and plumbing systems, and appx. 20 annual contracts, which our board approves, no owner would be willing to serve on our board if there were no PM.
Melissa, our bylaws and I believe many others, permit the board to appoint a non-director homeowner as an officer. A few years ago none of us directors felt qualified to be treasurer and a non-director agreed to fill that role. A few months later she agreed to fill a vacancy on the board and we appointed her. The details about governance generally are in the bylaws. Our articles are very brief and are silent about these details.
Tim, oh, we all have indeed seen lots of posts about boards that don't properly supervise their PMs. We do and our treasurer chairs our Finance Committee, and another director serves on i along with three h'owners. The FC recommends to the board the acceptance of our financials and investment strategies. I still scrutinize the financials closely. Our board understands that we directors are ultimately responsible for the PM's actions.
Because of our large budget, complexity of our 200+ unit high rise's mechanical and plumbing systems, and appx. 20 annual contracts, which our board approves, no owner would be willing to serve on our board if there were no PM.
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