Number of Directors - 5 or 7?

Hi All,

Topic relates to a previous professionally managed (CAM) community of 314 SFHs and about 10 commercial properties (they pay assessments for roads and as part of the original development). "Previous" because we moved from that community, but kept the property as a rental.

Our annual meeting was in May. As I had already moved, I resigned as President because I felt it wasn't appropriate to be President. I was asked by the incoming President to remain as VP, which I did. The new President abruptly quit four days ago, after a bit over three months. Said he didn't have time. Sigh.

So, trying to clean up a bunch of planning and actions not accomplished per plan since the annual meeting (next Board meeting will elect a new president, and appoint replacement board member if there is a volunteer). One bit of unfinished business is the restatement of our Bylaws, combining the original and four amendments made over the years, beginning in 1995. The original Bylaws allow for a majority vote of the Board to approve changes. As part of the last cycle, I obtained approval from the Board to engage our attorney to integrate the original and four amendments, and to remove anything no longer aligned with Florida Statute 720. This was accomplished just after the annual meeting. The incoming Board president took over the responsibility to review, but like most of the other pending activities, never completed the review.

Like many HOAs, this one is pretty darn apathetic.

That was a long explanation which provides background to the casual reader.

First Question: Given the original Bylaws called for three (3) Directors, and one of the amendments changed this to seven (7) Directors, can a "restatement" change it back to five (5) if the Board believes this is a more appropriate number?

Second Question: Given that most Boards rarely have seven (7) contributing directors, and it is difficult to even come up with seven (7) volunteers, is five (5) a more efficient number to get business done? Note - at times we have found ourselves unable to field a Fines Committee when we had seven (7) Board members, because the Fines Committee membership cannot be Board members, and there were only a total of about 8-9 members of community involved (7 Board + 3 FC = 10).

Thoughts?

To answer your actual questions:
1) If I understand correctly, you are essentially re-writing your by-laws . . . taking the base document, deleting old stuff that no longer applies, and incorporating amendments that had been written. In the end, you will have an entirely new document. I see no reason as to why you cannot make any adjustments you see fit to the bylaws similarly to what would have been done via an amendment anyway.

2) I personally prefer a smaller Board with members who actually contribute and do work. A Board of 7 with 4 of them doing nothing but filling a seat and the other 3 doing all the work is actually less productive and efficient than a Board of only the 3 who actually do the work. Further, from a simply logistical standpoint and having meetings, it's simpler to align 5 schedules rather than 7 and even simpler to align 3 rather than 5.

You indicated the current Bylaws allow the Board to amend the Bylaws, correct? Is there some reason that makes you think the Board cannot amend the Bylaws to reduce the number to five?

In my experience, three results in too much concentration of power, such that a mere two can push around a minority director. Else I agree with what the others posted: Five seems right to me.

I see a lot of nonprofits do "restatements" of their bylaws. The Florida HOA statute (FS 720) has nothing on the topic. The Florida Not For Profit Corporation statute has a lot on restating the articles of incorporation, and one reference to restated Bylaws. See http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0600-0699/0617/0617.html

In my opinion, changing the number of directors goes beyond a restatement. It is an amendment. Hence the Bylaws procedures for amending must be followed. Support for this position appears at
https://bizfluent.com/info-8462696-difference-between-amended-restated-bylaws.html
and
https://legalbeagle.com/12723042-difference-between-amended-restated-bylaws.html

Legally I believe the amendment requires a formal vote by the Board, properly noticed on a board meeting agenda and documented in the Minutes.

Else as I am sure you know, your attorney would have the final word on how to proceed to change the number of directors.

I oppose offering a range of directors. A range is popular among nonprofits where directors are not elected by members/shareholders. But a range has negative practical value with a nonprofit where the directors are elected.

Isn't a "restatement" technically one big Amendment anyway?

Lots of good reasons here why a board of 5 is prefereable to a board of 7. My HOA's board size is set in the Articles of Incorporation: "... no less than 3." That's the only place in our governing documents where the size of the board is referenced. So a few years ago the board changed the working number from 7 to 5 by unanimous vote. A group of about 10 homeowners complained, naturally, but their stated objection was that they thought the effect would be for a smaller group to "control" everything and shut everyone else up. At the next election with 3 board seats open we only got 2 candidates willing to run. So much for peoples' voices being silenced. The disgruntled group quietly went away.

Amend/Restate Defined. An amendment revises or replaces one or more paragraphs in a set of CC&Rs. A restatement revises and/or replaces, and reorganizes everything in the document. The operative language “amend and restate, in their entirety” or the equivalent phrase “amended and restated in its entirety” are industry standard used in CC&R restatements and is general found on the first page of a restated document.

Our docs say 3 to 7 and do not designate who makes the decision. We have operated with 5 since transition to we owners. We have have gotten as low as 3 (presently 4 of 5). Anyone we appoint fills the vacant persons term no matter how much time left on the term. We can easily run our HOA with 3 and if the vacancy expires at the end of the year, we always wait until election time to fill it. I doubt we would appoint anyone to any vacancy.

He!!..we have to go begging for people to run. Some might call it apathy. I call it happy owners.

In 2005 my HOA increased the size of the board to "distribute the load" since there were a lot of projects going on in the self-managed association. Subsequent boards left it at 7 even after all of the large reserve-spending post-hurricane projects were over. By 2010 the Board was effectively 4 people doing the work and 3 seat-fillers who weren't doing anything at all. We changed the size back to 5 only recently because after a while we couldn't even find people willing to occupy all 7 director seats.

What do you mean your HOA doesn't have any???? I would think something had to be presented to the state to get the association established as a nonprofit. If you didn't get anything with the papers you got at clising, try contacting the county recorders office and see What it has. Or your state's Secretary of state, which may have a corporation division that maintains those records.

There are older conversations on this website that discuss bylaws where you can pick up some ideas. Bylaws dictate how the association is run, so your Bylaws would address things like the powers of the board, homeowner rights and responsibilities, annual meetings, etc.

You might also check out the community association institute website, which has education materials on governing documents and You may pick up so e best practices there. Thousand a do it yourself job, so if your community really needs bylaws, you should get your association attorney to help you draft them do they will stand up in court. You've seen references to Florida HOA law around this website, so go to your state's website and look up the statute - or Google it.

Finally, a look at Roberts Rules of Order would be useful and I believe there's a website with information. While you're at it, look for the national association of parliamentarians website. This organization runs a certification program and the members are often hired to help non profits and for profit companies draft of revise their bylaws. They may have people in your area you can contact. Good luck!

Our Bylaws call for a BOD of 3 to 7 without saying who chooses the amount. Since taking over from the Declarant, we (the BOD) have always set the number at 5 and have operated with as low as 3. Currently we have 4 of 5 and we will probably stay at that amount until next year's Annual Election.

We have to beg people to run and only once have we had had a full field (3 for 3 spots) running in the last 5 years. We usually end up drafting someone at our Annual Meeting.

Some say our owners might be apathetic. I say they are happy.