Transition from one Management Company to Another

Jeff, the timeframe requires notifying owners immediately. The next assessment notice needs to come from the new management company. The files need to be obtained before assessment notices can be provided.

Following is DARCO's HOA Management Transfer Check List for Colorado

 Notify all owners of change in management company
 Receive, analyze, and organize HOA files from previous management company
 Transfer funds if necessary; order checks and deposit slips
 Create HOA electronic files using accounting software
 Notify Secretary of State and vendors of change of Management Company and address
 Review insurance; a better company with better coverage may be available at less cost
 Review annual operating budget and 20 year reserve plan
 Review taxes and provide IRS guidelines on reserve and operating funds
 Collect all outstanding assessments
 Resolve all Covenant violations
 Digitize HOA documents. Post to web site and provide to Seller or their Agent to give to a prospective Buyer.
 Welcome new residents and provided an HOA information packet

Other items to review ASAP after the above are:
 If needed recommend amending the Declaration to update and remove obsolete items. DARCO can assist as desired.
 If needed recommend amending the Articles of Incorporation to strengthen protection of the Board members.
 If needed recommend amending the Bylaws to update and remove obsolete items. DARCO can assist as desired.
 If needed recommend updating the HOA Rules and Regulations to comply with the Colorado Common Interest Ownership Act (CCIOA) as amended by SB05-100 and SB06-89. DARCO can assist as desired.

Most important: If all your recurring bills have been going to the management company, be sure the mailing address is corrected. We almost lost our common areas to a tax sale because the tax bills were going to our former management company and they were just tossing them. When my wife got on the board, she wondered why no property taxes had been paid for several years. A visit to the county found that our common area was about to go up for auction! She quickly paid all back taxes and changed the mailing address.
But I'm curious what would have happened if that had occurred. I'm sure the buyer would have tried to sell it back to us, but what if we told him to go to h e double l? (It is just a retention basin and a tiny entrance area.) Let him maintain it! LOL Maybe the board could fine him for not maintaining his property. I don't believe it would have any value being designated as storm retention. Just wondering. Harold

Jeff,

Make sure a Board officer, ideally the treasurer, is signatory on the association bank account.

GeraldT1
NNJ