Thoughts About HOA Governance

Recently, a friend was visiting, telling me with some excitement about a condominium that she and her daughter are having build for them. They are hoping to move in by December.

As I understand it, there will be 14 units and the developer intends—as one of their last acts—to set up a standard governance structure, with a board of directors and the typical array of officers: President, Vice-President, Secretary, and Treasurer. All households will have one vote and periodically there will be elections to see who is on the board. In turn, the board will determine who fills the officer roles. Among other duties, the President will set the agenda (perhaps in consultation with the other officers), and facilitate board meetings, at which binding decisions will be made. In all likelihood, board meetings will be run according to Roberts Rules of Order.

My guess is that the vast majority of HOA are governed in this way. Based on my 4+ decades of working with cooperative groups, however, I know this can be done better.

Don't Start with a Structure; Start with a Conversation

As my friend was open to hearing my ideas about how this might be done better, I put together this basic list of foundational recommendations:

First off, set aside the question of what governance structure residents want to use until everyone can gather and discuss what they want it to accomplish. (Don't place the cart ahead of the horse.)

I imagine that most (all?) residents may agree on the following features:

—That all residents will have a reasonable opportunity to be heard on any topic to be decided at the group level, before a decision is reached.

—That issues impacting the whole group will be discussed and decided at whole group meetings (plenaries) to which everyone will be notified ahead (two weeks?) about the timing of the meeting, its location, and the proposed agenda—so that there are no surprises, and everyone will have an adequate opportunity to share their input on topics of interest in the event that their household will miss the meeting.

—There should be a clear pathway by which topics get on the plenary agenda, which everyone has access to.

—The ideal in HOA decisions is discerning what, on balance will be best for all. This does not guarantee that others will agree with your thinking about an issue, or that your household’s preferences will prevail, no matter how strongly held.

—A reasonable effort will be made to find responses to issues that will work for all owners. However, if that does not seem possible, the group may make decisions by vote (one vote per household), with a majority prevailing.

—Clear written records will be maintained about the topics discussed in plenaries, the gist of what was considered, and any outcomes. A time will be set (one week?) for when meeting minutes are expected to be released for review and comment. Once accepted (or corrected) they will be kept in a file accessible to all residents. This may be physical, electronic, or both. In particular, this record should be made known to all prospective buyers, so they’ll have a better idea about they are getting into if they buy.

I further recommend:

• While the ideal is to have each household represented at every plenary, the reality is that people lead busy lives and that this will not always be possible, thus it needs to be possible to conduct business from time to time with one or more households absent. The keys to this working well are:

    ~Defining what constitutes a quorum (the minimum number of households present at a plenary to make binding decisions); and 

    ~An understanding that households who expect to miss a meeting are allowed to submit input about topics to be discussed to everyone ahead of time, which will be duly considered, but is not binding. 

    ~I suggest that you do not allow proxies, as someone not present will not be able to hear and be persuaded by what others have to say—they simply have to trust their neighbors to act in the best interests of the whole. (This prevents someone blocking consideration of a matter through non-attendance.)

• If proper process has been followed regarding advanced notification about when a topic will be discussed in plenary and a household chooses not to attend the meeting, they will have to trust the group to do good work without them, and will nonetheless be bound by the plenary’s decisions.

• When there is a turnover in ownership of a unit, the group will be responsibility to see that the new owner is made aware of: a) how the HOA functions; and b) the body of agreements in place, which they will be expected to abide by.

• Meetings, in the ideal, should be run (facilitated) by someone who is suitably disinterested in the outcome of the topics to be discussed. If there is no such person in your group available for a given topic, consider asking the member of a different HOA to facilitate that topic. Note: I am expressly recommending that you unlink the traditional role of president from the person who runs plenaries, as the skill set of someone who may be a suitable public face or point of contact for the group may have no overlap with the ability to run meetings well. The facilitator’s primary job is to see that the group follows its process agreements and that all voices have been heard and considered. Facilitators should not be taking sides.

• Just because there may be a legal requirement that the HOA has a designated President does not mean you are obliged to give them any power, and I suggest that you don’t. Keep that role titular.

• When it seems in the group’s interest to delegate, don’t start by asking for volunteers to fill slots (either for a manager position or for a committee). Rather, start by thoroughly delineating what you want that person (or persons) to accomplish and in what time frame—so that people who step forward have as clear a picture as possible of what they are signing up for and will be held accountable for. This should expressly include what they can decide on their own, and when they must consult—the limits of their power.

• Next, take time to discuss what qualities are desired in people filling the slot(s), so that everyone can reflect on whether they have them or not, before you ask for volunteers or nominations. This process will considerably reduce the level of frustration that arises with people not fulfilling assignments well. (Hint: if there are no available candidates within the group with the desired qualities, consider hiring outside the group.)

• Discuss how the HOA might productively respond if interpersonal tensions (conflict) arise among you that do not get resolved in a reasonable timeframe by the players involved. I guarantee you that this will occasionally happen—despite the best of intentions. It can be excruciating when tensions persist because the players are either unwilling or unable to work their way through it and this impacts everyone, seriously degrading the experience of living together, and the group's response has a significantly better chance of succeeding if you have an understanding about it ahead of need, rather than creating one in the moment.

• • •

As all of the above concepts are developed more fully elsewhere in this blog, you can consider this an outline of Cooperative Living Light.