HOAs & Owner Involvement: An Oxymoron? (part 1 of 3)
guest blog by Deborah Goonan
Let’s get real!
One of the most common laments of HOA industry professionals is this: “Owners are apathetic. No matter what we do, we cannot get them involved in governance of the community.”
I have previously blogged, tongue-in-cheek, about the tendency of Boards to cultivate apathy. Today I will explore the issue in more depth.
Is it realistic to expect widespread participation?
Historically, few people actively participate in city, town, or county government, so what makes anyone believe that there would be a higher participation rate in HOAs?
Consider that HOAs (and especially condo associations) are marketed as carefree, low-maintenance lifestyles, often including amenities that owners do not have to personally maintain. HOA homes are not explicitly disclosed as what they are: shares in real estate investment, almost always part of a corporate entity. And, even if we could enlighten buyers and owners about the need to protect their investments in their HOAs, how many would take active roles? After all, most people with retirement accounts tend to put their money into funds managed by financial professionals – few actively monitor their funds.
Does HOA governance structure encourage or discourage participation of residents?
Some critics of HOA governance have suggested that Boards should allow residents to actively participate at meetings, with the ability to present ideas, make motions, and vote on resolutions directly affecting them.
But I doubt we will see such change, because CAI – and most governing documents written by attorneys for developers – promotes policies that give the Board broad authority to act on behalf of the association.
Refer to page 30 of Community Association Living: (Emphasis added in bold)
“Board members and committee members are volunteer leaders who meet regularly to discuss pertinent details about running their community. A board meeting at a community association is comparable to a town council meeting of a municipality. The basic authority in a community association lies with the owners. However, the owners elect a board of directors to act on their behalf. Usually the governing documents delegate almost all of the association’s decision-making powers to a board. This leaves the owners with very few direct powers. Typically, owners have only the voting power to:
- Elect and remove directors
- Amend any of the governing documents, except board resolutions
Occasionally, owners will approve the annual budget for their association. But all other decisions are usually left to the board. As a result, if owners are unsatisfied with a board decision, they usually do not have the direct authority to “veto” or “undo” its action. Under such conditions, their only remedy is to elect a new board to represent them.”
Clearly, the status quo discourages active participation of owners, exacerbating apathy. See Part 2: Reality Check
