FredF5 (North Carolina)
Posts: 14
Posts: 14
Posted:
I recently joined the Finance Committee for our HOA. This is a 68 lot community for single family homes established in 2003 with only 10 homes built. No one on the previous board lived in the community and they let the PM take care of just about everything. The new board is much more hands on and several live on site. I see that last year the PM had his "construction division" make repairs and updates to the clubhouse and pool areas to the tune of $16k. These are his employees. He is a small operation with a handful of employees and manages a few communities in the area. No estimate was given from his "construction division" and no bids were requested from other contractors. The quality of the work looks okay, but I can't judge whether the price was fair. He was performing the work, creating an invoice and writing the check to his company.
We have additional work to be done this year. We asked the PM for a list of work to be performed and an estimate. He said he works on a time and material basis and won't know the cost until he "opens it up". We are reluctant to work that way. The main work involves replacing and repairing decayed wood in the clubhouse. I get it that the extent of the work may not be known until someone gets into the area, but we are reluctant to give him carte blanche. We asked him to get bids from other contractors. He said he would help create an RFP but getting bids is outside the scope of his contract. He was very proactive and eager to get going on the additional work until we asked for estimates and bids. I pasted the relevant text from our contract at the bottom of this message.
My questions to the group:
1) How common is it for the PM/MC to also perform major repair work with their own employees? Conflict of interest?
2) How common is it for repairs to be done on a time and material basis and we won't know the costs until we "open it up"?
3) From the contract text below, is he responsible for getting bids? He was very active to identify vendors and get bids for a reserve study.
"Management, in coordination with the appropriate Committee, will assist the Association in the development of Statements of Work to be solicited from qualified contractors.
Establish and implement a preventive maintenance program for all real and personal property, as approved by the Directors.
Supervise the operations of all contractors who perform work for the Association, including but not limited to investigation as to bonding, insurance materials, workmanship, and warranties and by reviewing work of contractors and enforcing the conditions of those contracts.
Make recommendations for capital improvements and any other recommendations as may be appropriate for the improvement of the community.
Oversight of extraordinary projects (i.e. Painting/Staining, Paving, Roofing, Stucco, Landscaping other than regular maintenance, etc.) shall be subject to additional fees as prescribed by Project Management Article XII Summary of Services."
We have additional work to be done this year. We asked the PM for a list of work to be performed and an estimate. He said he works on a time and material basis and won't know the cost until he "opens it up". We are reluctant to work that way. The main work involves replacing and repairing decayed wood in the clubhouse. I get it that the extent of the work may not be known until someone gets into the area, but we are reluctant to give him carte blanche. We asked him to get bids from other contractors. He said he would help create an RFP but getting bids is outside the scope of his contract. He was very proactive and eager to get going on the additional work until we asked for estimates and bids. I pasted the relevant text from our contract at the bottom of this message.
My questions to the group:
1) How common is it for the PM/MC to also perform major repair work with their own employees? Conflict of interest?
2) How common is it for repairs to be done on a time and material basis and we won't know the costs until we "open it up"?
3) From the contract text below, is he responsible for getting bids? He was very active to identify vendors and get bids for a reserve study.
"Management, in coordination with the appropriate Committee, will assist the Association in the development of Statements of Work to be solicited from qualified contractors.
Establish and implement a preventive maintenance program for all real and personal property, as approved by the Directors.
Supervise the operations of all contractors who perform work for the Association, including but not limited to investigation as to bonding, insurance materials, workmanship, and warranties and by reviewing work of contractors and enforcing the conditions of those contracts.
Make recommendations for capital improvements and any other recommendations as may be appropriate for the improvement of the community.
Oversight of extraordinary projects (i.e. Painting/Staining, Paving, Roofing, Stucco, Landscaping other than regular maintenance, etc.) shall be subject to additional fees as prescribed by Project Management Article XII Summary of Services."