Self managed or professionally managed

I've been a participant on this forum for a short period of time, and on the board of our HOA for an equally short period of time. I'm curious about the make up of the participant organizations. Is it made up of largely self managed groups or professionally managed groups.

I'm also wondering how others find the function of the HOA. My group is relatively small, 34 lots, the organization is only a little over a year in existence, although the subdivision is 10 years old, the developer has only just turned it over to the homeowners. We were professionally managed, very badly and very expensively, for the first year. We are now engaging in semi self managed, with the goal of becoming fully self managed. We have engaged a consultant to help, in lieu of expensive professional management, she's knowledgeable and I can appreciate that, but she makes me feel like I'm playing Monopoly with my husband. He finds all kinds of bizarre and weird rules when we play all in his favor, to the point that we never play Monopoly, it takes the fun out of the game. She seems to do the same thing and at each step of the way tells us of incredibly ridiculous steps that we need to take because of statutes or the interpretation of our documents.

Our first annual meeting is coming up and frankly, I'm finding it to be incredibly cumbersome. We need to elect one board member, which should be a relatively easy thing. Proxies are not simple, the ballot is not simple, voting is not simple, planning a meeting is not simple. We are a very simple organization with no common areas or common assets, so the function of the board is simply the administration of the CC&Rs and the By Laws. I'm really frustrated with how it's turning out. Maybe I just need to vent, but I would like to know of the experience of others. Thanks

You need to read and understand both the state statutes that govern HOAs and your governing documents so that the consultant doesn't keep surprising you. Depending on the quality of your documents, they may be clear or leave an awful lot open to interpretation.

Proxies really aren't that complicated. You just need to read up on "the rules" that apply. i.e. Can you use general or only limited? Is there a limit to how many proxies one person can collect? If you do run a proxy campaign (to make quorum and/or to win an election), you'll have to fully understand the proxy and make sure people fill them out properly. Most will have no idea and not take the time to carefully read either the proxy or any instructions given.

Paula

It is not that difficult.

In order to conduct business (including a BOD Election) there must be a Quorum of owners present or represented via a Proxy. How many are needed for a quorum should be in your Bylaws. Typically expressed as a %. With 34 owners you would need 17 for a 50% quorum, 7 for a 20% Quorum, 4 for a 10% Quorum, etc.

The larger the requirement to establish Quorum the more difficult it is to achieve Quorum, especially without proxies.

There are actually 3 type Proxies. A General Proxy allows the Proxy holder to vote any way they want to vote. A Directed Proxy dictates how the Proxy Holder will vote. There can also be a hybrid between General and Directed meaning they can vote as they wish on some items but must vote as directed on other items.

Be sure a Proxy says that this Proxy counts toward achieving Quorum.

The latest dated Proxy is the one that counts.

One can attend the meeting and cancel their Proxy.

Some Bylaws limit the amount of Proxies one person can hold.

It is common for the Proxy to be made out to the BOD thus allowing the BOD to vote them.

It's like anything else that one would hire a professional to do, whether it's taxes or car repair -- if you have the knowledge, skills, and time to do it yourself, then self-managing can work, and there are HOAs that run themselves just fine. But a lot of HOA boards don't have those things, which is where the pros come in. The amount of responsibility the HOA has makes a big difference too.

For my current HOA, I would not want it self-managed unless we had extremely knowledgeable people running the show, and thus I think using an MC is the way to go. But other HOAs may come to different conclusions.

I've heard other people say this, too. What does it mean, "the board votes them"? Does the board have to vote first on "how" to vote them? What if there's a controversial amendment to the CCRs, for example, and some of the directors are in favor of it and some others opposed to it? How are those proxies voted? In proportion to how the board votes?

Homeowner proxies are normally for use at an owners' meeting where the board members are not acting as a board. Who casts votes on behalf of those proxies? Can "the board" act at an owners meeting? The board, per se, can't do anything during an owners' meeting, I thought, and I would think that includes casting votes as a proxyholder.

I think it's simpler where a a proxy is given to "the secretary" or "the president" as opposed to "the board".

Thanks, John. We had a homeowner vote on a propsed amendment to our CCRs last week and the president, who was against it, said he had a number of proxies he would be bringing to the meeting. Some of us were very concerned about a January Surprise where he's whip out 20 proxies and cast "no" votes for each. Our fears were unfounded, however, and the amendment passed with 84% of the votes cast approvaing it. One reason we were worried is because the proxy form sent out said to name "__blank__ or the president" while the instructions said "return your proxy to the secretary". Many people found that extremely confusing. I thought it was pretty self-explanatory but most people do not understand proxies. I agree that it's not that difficult but real-world experience suggests differently.

Use mail in ballots!

This board took over the management because of the extraordinary expense of the PM - $900 a month with most homeowners feeling there was no value in that. In the end there was no value, we have three owners with overgrown weeds (seriously overgrown) with no letters or contact from the PM, one homeowner built a rock wall that does not comply with the CC&Rs nor is it what was approved by the Design Review Committee - no action taken, just a lot of verbal complaining, issues on the agenda tabled at each meeting during the year because nobody had done anything to address them, non responsive to homeowner questions or requests, lack of knowledge of our documents, the list just goes on and on. They also signed us up for extraordinary amounts of insurance at very high costs ($5,000,000 commercial liability when there are no common areas and no reason for the HOA to bring vendors into the subdivision after telling the original board that it was a legal requirement to carry such insurance). Once we have procedures in place for elections - documents, dates, mailings, etc, this should not be a difficult task. It just feels like the consultant we have is making it difficult. I think much of what we are dealing with now supports the argument of some that the only real purpose of an HOA is to keep lawyers, accountants, and property managers in business especially when there are no assets to be maintained.