HOA structure for dummies?

It sure would be nice to have something like that.

The large majority of HOAs are incorporated and governed by a board of directors. They're not social clubs or fraternal organizations, and they're not democracies. That's it in a nutshell.

The problem is that, for all of their similarities, HOAs can have some significant differences, and a few of your questions touch on areas that can vary.

The differences will be found in your governing documents (CC&Rs aka Declaration and your Bylaws) and in your state's laws regulating community associations and not-for-profit corporations. There is no "For Dummies" for these things. They're written in legalese, you have to read them in their entirety to make sure you haven't missed something relevant, and exact wording and punctuation matters. (We've had discussions of "shall" vs. "may" around here.)

There is also a hierarchy to these laws. Federal law supersedes state law which supersedes local municipality law which supersedes CC&Rs which supersede Articles of Incorporation which supersede Bylaws which supersede a community's Rules and Regulations. To make matters even more interesting, any of the laws can have verbiage that defer to one of the other categories - a particular section of the state's law may defer to the HOA's CC&Rs, for example.

Long story short, there is a learning curve to being a director. Ditto for managing the community, which is a separate profession that can use different knowledge and skills. In all cases, if you hire an outside community manager, the manager works at the direction of the board - but experienced boards know the difference between exercising the authority of their position and micro-managing the manager.

As for committees, unless your bylaws say otherwise, committees serve at the pleasure and direction of the board, and committee members can be removed with or without cause. You may not be required to have them at all - check your bylaws. Committees have no independent authority (exception, in some communities the Architectural Control does have some level of authority). Your bylaws may require at least one board member to be a member of any committee, and the board member may or may not have voting authority on the committee (bylaws again). In my experience, committees are a mixed bag. They can be very useful if they're supplementing the board's knowledge (eg. a Finance committee). They can also attract people with an axe to grind and will accomplish nothing beyond wasting the board's time. The real problems are the folks with an axe to grind who don't recognize the board's authority (hint: avoid social media like the plague).

What the board can regulate as far as landscaping goes will depend on the wording of your CC&Rs, including what kinds of restrictions are spelled out. In every HOA and COA (condos) I've heard of, the board is the final authority on what happens on the common elements. There may be other restrictions on the nature of individual homes - it's also common for CC&Rs to require prior approval of exterior modifications to homes, and it's common for homeowners to ignore this and do what they want. Legal wrangling can follow.

Did I mention that there is a learning curve?

One piece of advice I have is to do what you're doing: figure out what you can and can't do, and then enforce your governing documents consistently and fairly. One of the board's roles is to enforce the terms of the CC&Rs which are part of the contract on people's homes - and one of the hardest things to do is to start enforcing after previous boards have neglected that job. Homeowners get offended even though they agreed to follow the rules when they signed all those papers at closing. Also: people don't want to live in a police state, but ignoring violations will allow the community to go downhill. There is a happy medium in there somewhere, although reasonable people can disagree about exactly where that is.

Michael

What are your structures? Standalone homes, townhouse, multi level buildings, etc. How many units? What are your dues? What is included in the dues? Landscaping, trash collection, water, etc.

What amenities do you have?

It helps to know what kind of community because condo/townhome communities have more greenspace and common areas relative to the homes, and these things generally must be maintained by the HOA.

For example: your townhomes may be condos (meaning that homeowners own from the drywall in, but the association owns the foundation, framing, roofs, etc. in addition to the greenspace). The association has to maintain everything on the exterior *and* since it's all common elements, homeowners can't just do whatever they want as far as altering the exterior of the buildings or planting whatever.

On the other hand, some townhome communities are HOAs/landominiums. Homeowners may own roofs and foundations, they may own the land underneath their homes (and possibly a buffer zone of a few feet around the home). This will mean homeowners have more wiggle room about what they can do, and the association has less maintenance to do.

But your CC&Rs should tell you all of that. Since this is a new community, your CC&Rs will probably spell out who owns what and who is responsible for what. Two communities can appear to be almost identical from the outside, but have very different legal definitions and obligations for everyone involved.

Which is why somebody asks at some point in nearly every discussion we have.

Michael

Typically in a townhouse setting the association is also responsible for all outside shell maintenance so they have some control over how the units look. While not always the case it is something you should be sure of. Is there fencing/walls separating the units front and/or back. If so, who is responsible? A shared fence/wall between units can get tricky.

Also it appears your association might be responsible for roof repairs/replacement. This is typical as you do not want a series of different type roofs especially if they touch/overlap. Again, take a close look as roofing can be a very expensive project requiring a large Reserve to cover it.

Also look at what authority the association has when it comes to yard maintenance as enforce some standard.

Imagine letting each owner dictate exterior looks, roof, etc. The place could end up looking like crap.

Your situation is not unique. We are just trying to zero in on things so we can offer the best advice. I would advise putting together a list of questions and getting some legal advice.

With only 22 units, it does lean toward self management if (and a big IF) several owners were willing to do the work. Or even hire a book keeper (collect dues and pay invoices) for a few hundred dollars a month.

Unfortunately the HOA isn't responsible for outside shell maintenance. Several of us think it should be but we still have convincing the membership in front of us before that becomes reality. If ever.


We have and I think we're doing well overall. I probably muddied the water a bit by adding the info about the committee. With this post I was really just looking for "dummies" level information I could send to our membership to try to get them somewhat educated on how HOAs work without having to sit down with each of them individually. I'm retired but I do not have that kind of free time.

One of our core problems is simply people are lazy. We have owners that are convinced they know how the neighborhood should work and haven't bothered to self-educate on how HOAs actually function and won't listen to board members who have gone to that effort.

Get a management company....Period