5 Tips for Success When Transitioning an HOA Board
Let's face it! Change is inevitable, and after a successful tenure, a new HOA board should come to play. So, if you're a major player in your community and looking to transition HOA board members, we got your back.
Below is a quick rundown of what to do:
- Training for incoming members
- Review Board's financial standing
- Evaluate the budget and other financial records
- Reminder to uphold the fiduciary duty
- Don't rush it
This is only the tip of the iceberg. In the rest of this post, we'll elaborate on these tips in detail. As a key decision-maker for your board, we understand you want the best for it. The good news is, we're here to help you.
So, without much ado, let's get to it!
1. Training for Incoming Members
Information is power and a basic requirement for leading HOA boards. As a rule of thumb, you should ensure all new board members have the necessary knowledge of how to run a successful community HOA board.
In addition, this should apply to all members, whether it's a single member or the entire board you're onboarding. When everyone on the board is on the same page regarding expectations, it's easy to lead the community to success.
Therefore, you should bring the new members up to speed on HOA law, Community guidelines, the management team, financial standings, and rules of engagement. Proper training when transitioning new members may take time, but it's worth it in the end.
2. Review Board's Financial Standing
Good financial standing means the board has sufficient funds to run all the board's activities and bring development to the community. This fund takes time to accumulate, so it should be put to good use.
In addition, when a new board is coming in, it's important to review the current reserve to get a clear picture of the board and the community's financial standing. Also, this would be the time to sort out any discrepancies before a new board comes to the office.
More importantly, when you have a good reserve, it's easier to budget for the community and tell where there are financial gaps. If your board doesn't have a reserve review plan, it's important to create one to give the new board an easy time in office.
3. Evaluate the Budget and other Financial Records
Apart from the board's funds in reserve, it's prudent to assess the balance sheet. If you're wondering what this is, it's a simple income versus expense sheet. This record should tell you more of your financial standings than what you have in reserve.
Think of it this way! If you have higher expenses than income, it means the future is bleak for the board and the community. Therefore, after knowing what you have in reserve, it's also important to analyze how the board spends and generates income.
4. Reminder to Uphold Fiduciary Duty
When running a community board, members must uphold community interest at all costs. So, new members should know upfront that the role entails protecting and championing the community's interests even when there's a conflict.
5. Don't Rush it
Lastly, the transition process takes time and needs no rush. Therefore, it's important to create time while allowing room for adjustments as you onboard new members. As a rule of thumb, it's good practice to prioritize goals and objectives based on urgency.
Wrapping Up | Dealing with a Reliable HOA Management Company
HOA board transitions can be a brainer! If you want the procedure to be a success, it's important to put your best foot forward. Otherwise, everything can snowball back to your face. The good news is, RealManage can help you with the process without the stress. If you'd want to know how it works, don't hesitate to contact us here.