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MikeL16 (California)
Posts: 8
Posted:
Hi,
Is it legal for an HOA board to be comprised of ALL the homeowners? (Assuming there is a consensus among all the homeowners)?
LarryB13 (Arizona)
Posts: 4,099
Posted:
Mike,

Just how many is "all owners?" There are associations with just two owners and some with thousands of owners.

Is this something in your existing declaration or a proposal since you mentioned "Assuming there is a consensus among all the homeowners."

I would think the larger that number the more difficulty with achieving the quorum required to transact business.

As far as I know there is nothing in the law to prevent creating a board where all member/homeowners are also members of the board of directors but it does not sound like a good idea except for the smallest of associations.

My personal opinion is that no board needs more than three members and there should be an absolute maximum of five. I served on a nine-person board and the majority of the members brought nothing - absolutely zero - to the table.

MikeL16 (California)
Posts: 8
Posted:
Thanks for your reply, Larry. I live in an intentional community (categorized as a PUD) which has much owner participation and buy-in with decisions so it would be appropriate and possibly a good idea for us. However, we want to keep things legal which is why I'm inquiring. We currently have the traditional board structure and governing docs in place for some time.
FredS7 (Arizona)
Posts: 927
Posted:
After a couple meetings I suspect people will begin to see the value of representatives and elections.
KerryL1 (California)
Posts: 14,550
Posted:
Welcome to the forum, MikeL. To repeat Larry's question: how many homes are there? Seven? 300? What is an "intentional community?" I assume your community is a Common Interest development (CID)?

Are you also a corporation?

If you're incorporated, your bylaws probably state how many directors your board should have. If your bylaws say five, then all Owners may not be on the board without an amendment to your bylaws. Bylaws amendments usually require a simply majority of all owners, but some require a supermajority.

If you are a CID, you must abide by the CA legislation called the Davis-Stirling Act re: elections, ballots, voting, etc. to amend your bylaws. Go to the excellent resource davis-stirling.com, scroll to elections, to learn more.

If you're a very small HOA and most owners come to your open meetings of the Board (required in CA), there is nothing to prevent your Board as currently composed from asking Owners' opinions, doing straw polls, etc., before the board makes decisions.
MikeL16 (California)
Posts: 8
Posted:
Our community is a "Cohousing" community of 27 households where folks move in with the intention of making shared decisions- we've been doing this for 15 years in a plenary/group manner built on consensus. So, You'll have to set aside some assumptions and preconceptions of owner (lack of) participation. I'd prefer to not go into a detailed explanation but you can check out the Cohousing model online. I'm still wondering if anyone has any specific/concrete examples of an ALL-owners Board of Directors?
MikeL16 (California)
Posts: 8
Posted:
Kerry, as I mentioned, we already have a traditional board structure and bylaws- these were mostly boiler plate when we incorporated 15 or so years ago. I'd like to pursue CHANGING our bylaws to reflect an all-owners hoa board.
KerryL1 (California)
Posts: 14,550
Posted:
Right... so see what the bylaws say about how to amend them...it's in there. You also might want to amend what % of owners at an open meeting are required to attend to make legal decisions. That, usually, in your bylaws, is a majority of the Board. So if it's a Board of 27, at least 14 need to attend to make quorum. And let's say 20 attend a meeting, 11 would need to vote "yes" on, say, a new contract.

As a PUD, you do need to comply with the Davis-Stirling Act mentioned above, but it does not limit the size of boards of directors one way or another.

If you are incorporated, you should comply with CA Corporations Code, after which your bylaws probably are modeled anyway. I do not think there's anything in them to preclude a board of all members of your corporation. There are other things, though, like required officers.

But, no, I have never seen an HOA represented here with a board of all households.

In a community of your size and with your shared philosophy, it seems very workable! Until you get your documents amended, though, as mentioned above, there's no reason why the current board cannot consult with all owners who attend your board meetings.
JeffT2 (Iowa)
Posts: 880
Posted:
Since you are incorporated, you must hold an annual meeting to elect directors to the board. I doubt that your bylaws can automatically confer or mandate that all owners to be directors. People have to volunteer and be elected, or in some cases be appointed by other directors to fill a vacancy. And directors can resign at any time.

Why not just schedule a lot of meetings of the membership (all owners)? What would you gain by putting everyone on the board as opposed to having membership meetings?
TimB4 (Tennessee)
Posts: 21,059
Posted:
As others have said, you will need to amend your governing documents to make this happen.

Typically, the number of Directors is mandated by your Articles of Incorporation and your Bylaws. Be sure to check both documents, as the Articles have precedence over the Bylaws.

Rather than amend the number of Directors, why not simply amend the documents to indicate what issues must be brought to the membership for approval. This will allow a smaller governing body to deal with the mundane items and day to day running of the Association.
KerryL1 (California)
Posts: 14,550
Posted:
Tim makes a nice point about having a few directors, officers perhaps, make decisions about routine everyday matters. How that is decided is another matter.

In addition, you may want a smaller group to make emergency decisions.

Jeff has a fine idea as far as I can tell, Mike. Just make every meeting a meeting of the members. Your bylaws will tell you what % need to attend to make quorum and what % of owners are needed to vote to pass "resolutions" or make decisions.

I may be missing an obvious problem with this approach, but it's simple and costs nothing.

Out of curiosity, Mike, what kinds of common areas does your PUD have? Is your community in a rural, suburban or urban setting? I'm assuming rural, but may be way off base.
MarkM31 (Washington)
Posts: 556
Posted:
Legal? Yes.
LarryB13 (Arizona)
Posts: 4,099
Posted:
Quote:
Posted By KerryL1 on 05/19/2015 7:53 PM
Tim makes a nice point about having a few directors, officers perhaps, make decisions about routine everyday matters. How that is decided is another matter.

In addition, you may want a smaller group to make emergency decisions.

Jeff has a fine idea as far as I can tell, Mike. Just make every meeting a meeting of the members. Your bylaws will tell you what % need to attend to make quorum and what % of owners are needed to vote to pass "resolutions" or make decisions.

I may be missing an obvious problem with this approach, but it's simple and costs nothing.

Out of curiosity, Mike, what kinds of common areas does your PUD have? Is your community in a rural, suburban or urban setting? I'm assuming rural, but may be way off base.

Kerry brought up a rather important point about quorums.

With 27 board members, 14 of them would have to present to even hold a meeting as anything less would not be a quorum. It would be difficult to meet that requirement at meeting after meeting.

Member meetings normally can do business with a much lower number of members. In some states the quorum for a member meeting can be as low as 10%, which I personally would find scary when you realize that in your case that is only three members. If you established a quorum of 20%, you would need only six members to show up and that sounds like a doable number.

KerryL1 (California)
Posts: 14,550
Posted:
So, Mike, what do your bylaws say about the % of members needed create a quorum to make decisions (vote) at a meeting of the members. In our HOA, it's only 25%. and the % needed of that 25% may only be a simple majority for most issues.
MikeL16 (California)
Posts: 8
Posted:
We already have monthly "member" meetings apart from the "Board" meetings, and the quorum on both types of meetings are simple majority (14 out of 27 households). The member meetings usually always have quorum as we are a relatively engaged/participatory Cohousing community with a foundational value of consensus-based decision making. To take care of the numerous tasks of our (suburban located) community, we have many "teams"/ committees. The inconsistency I see with our minority-member board structure is that it technically excludes the rest of us from making the final decisions on big-ticket items. Yes, of course the board has to represent the rest of us and it receives members input, but I'd like to put our board structure where our mouth (consensus value) is- if we can legally do that, especially if we already have the high participation and engagement akready.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Mike

Let us come together to share our views on what toilet paper to use in the clubhouse then after we can split a joint and sing Kumbaya. I am sure we will all "float" home feeling good.....
KerryL1 (California)
Posts: 14,550
Posted:
Wait....what size is your current Board that quorum is 14?! I don't get this.

Is there a reason your board cannot schedule all business to be voted on in members' meetings? Even big-ticket topics? As you know in CA, your board must post agendas 4 days in advance or mail them to you.

Is it that your board itself is not in favor of all community members making decisions?

Otherwise, I can't see why you need to go to the time & expense of legally changing your bylaws when your board can simply vote to have all decisions made at regularly scheduled members meetings with all members voting??

Have you reviewed the davis-stirling.com site, Mike? To change your bylaws you need to hold an election and send out secret double-envelope ballots, appoint an inspector or inspectors of election, certain meeting notice requirement must be met, and you probably want the advice of an attorney on the correct wording for your bylaws revision(s).

I do grasp your community's participatory democracy perspective, but there are certain laws in CA to which HOAs are bound.
CyrstalB (Maryland)
Posts: 457
Posted:
Are you asking that every owner must sit on the board, or are you asking if anyone has a covenant that every HO must take a turn on the board?

I hope for your mental sake, you are asking the latter! I have seen that and would love to make that happen in my HOA, but I also know asking the HOA for that change is a huge waste of time!
MikeL16 (California)
Posts: 8
Posted:
A correction- our quorum is simple majority- for our board of directors it's 5 out of 9, for our all-members mtngs its 14 out of 27; getting quorum for either hasn't really been an issue.
I like the suggestion: "your board can simply vote to have all decisions made at regularly scheduled members meetings with all members voting". You think that could be written in bylaws without contradicting the fact that we have a limited number of board members? Seems line that would put the minority-number of board directors at a disadvantage: all members are making the decisions but only the minority-number board directors are being legally held as fiduciary responsible. An all-members board, on the other hand, is holding everyone responsible for their decisions.
MikeL16 (California)
Posts: 8
Posted:
Hey funny guy- looks like you missed where it was mentioned we have committees- they take care of the various up-keep tasks. Maybe we'll form a committee that deals with how to tell a relevant joke- we'll probably be willing to even let you in since it looks like you might benefit by it 👊😉
MikeL16 (California)
Posts: 8
Posted:
Apologies the rest of you- that last comment was supposed to be a reply to comic John from S.Carolina ☝️
KerryL1 (California)
Posts: 14,550
Posted:
Awww, don't mind JohnC--he has some kind of problem with Calif. that often shows up in his replies. He has remarked that he lived in Manhattan Beach long ago and cavorted with flight attendants--I believe he called them "stews." He sometimes reminds me of when I moved to Charlotte NC from Santa Cruz (talk about culture shock!). One young man asked me in all seriousness: "What do y'all have for Thanksgiving? Soy turkey?"

Hmmmm, good point about the fiduciary obligations of board members that are not shared by other members of the Association. But I also assume that your HOA insurance covers Directors & Officers? In addition, your current board probably would need to convene executive sessions for certain kinds of business that must remain confidential (setting up a payment plan for someone who's behind on their dues, for instance).

I also was wondering if your bylaws mandate a certain number of Board meetings a year. At your size, maybe four? So in those cases, I'd guess the Board would call a board meeting, and keep minutes about who is present, etc., and then adjourn to a members meeting. In CA there are different notice requirements for each kind of meeting.

I do think it can work, Mike. But I feel like I'm over my head and that you may need advice from an HOA attorney about how to proceed--the process- (I'm in no way involved in any legal fields).

Feel free, though, to toss out more thoughts, ideas, etc.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Kerry

I also lived In Contra Costa County. I love CA. It is the over bearing Davis-Stirling I have issues about.

My tease to Mike was his let us all come together to decide just made me think of a hippie commune.

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