Board members with no terms?

We got rid of our president, now we are in the process of the next meeting of electing the officers. However, one person seems to be pushing for a board members to be able to serve forever rather than terms of 2 to 5 years. I think it is a bad idea mainly because she is acting like she owns the whole place. She wants her boyfriend to do all the maintenance which some of us said we have to have 3 estimates on work. I get the feeling she is going to try and run the place and it is not sitting well with some. Also there are book discrepencies because our last president held 3 officer positions and was doing what he wanted while the rest of them slowly took action. A few of us mentioned that we need to approach him with the discrepencies and she kind of blew us off. Months later he still has not turned over paperwork and has it off the property. As a new board members we feel we are under the obligation to find the money and determine the next course of action if there is to be one. Can we actually have an endless term for board members? Nothing in our bylaws I can find yet. And am I correct in finding out this money issue so that we can be clear of the past boards lack of management?

BethS1,

Your cc&r's are not the place to look for term length of board members. CC&R's are covenants conditions and restrictions more related to the do's and dont's such as holiday decorations, flag display, modifications on the exterior, etc.

Look within your gov. docs. perhaps under transition elections to find term lengths. Usually terms lengths are staggered to avoid vacancies and let the seasoned board members teach the new commers.

If your docs. are silent on term lengths, than the board should adopt a method to achieve what I said in paragraph two (2) above. Unlimited term lenghts can foster stagnancy and a variety of other undersirable situations.

I would suggest the board adopt a policy that no contractor can be a resident in the association and that a minimum of 3 bids must be received.

Best of success!!
GeraldT1
NNJ

If your governing documents, such as the Bylaws, do not provide for a term legnth for directors then, if your HOA is incorporated, you should look to the State Code for Nonstock Corporations. For example in Virginia the Code provides for a 1 year term for directors unless the corporation's governing documents provide for a different legnth of term.

In any case I agree with the previous comments that there must be limits on the length of term of directors and awarding contracts to friends, spouses etc of directors without competitive bids is a clear conflict of interest and may expose the HOA to fraud and may also expose the directors to financial liability.

bill

Beth, I can't believe your By-laws don't state the term for Board members. If they don't you need to amend the By-laws promptly. I recommend a staggered 3 year term with 3 Board members if under ~100 owners; 5 Board members for ~100 to ~500 owners; and up to 9 Board members when greater than ~500 homes.

Homeowner should be allowed to submit sealed bids to do work for the subdivision as long as you get 3 bids. They can be hired as Independent Contractors and insurance should be required.

It is good policy to have an independent financial review annually. This can be done by an HOA financial committee if funds are not available to hire an accountant. Use a CPA when income or expenses are over $250,000. As a member you have the right to review the HOA's records upon request to check the financial records.

We have a very apathetic community, the past boards have made it hard to find people willing to run so this is the first time in a while we actually have 8 members, prior we were lucky to have 4. I am going to ask that term limits be mandated and have it voted on. I'm sure it will pass.

When it came to audits, we just don't have the funds to hire a professional auditor. Myself and our now treasurer can go thru the checks one by one and match up deposits, but I still say that our paperwork should be returned and to try and get an explanation on some issues with our past president. I don't think that some of the board members are aware that they were in the wrong to let him take full control and not say anything for over a year. My understanding is everyone on the board is liable for what takes place?? Which is why I am being really adamant about EVERY board member know everything and see the financials at EVERY meeting. It just bothers me that something is not right with the funds when I come onto the board and they say we are short money and they think he spent it but can't find receipts. I say make him produce receipts or payback.