Learn about the requirements and fiduciary responsibility of HOA board members
Watch our webinar, Get on Board: Onboarding New Board Members for practical guidance for new board members and the peers tasked with onboarding them.
Have you seen community notices about board elections and wondered if you could run for the position? More to the point: What criteria must a person meet to be a board member in Georgia?
To start with, let’s explain what an association board is and does. In Georgia, an association’s board of directors is an executive and administrative body that governs and runs the business of an association. Basically, the board is charged with maintaining the community, running the affairs of the association such as enacting any bylaws or regulations governing the association, operating the business aspects, and helping foster a sense of community among members. Homeowner and condominium associations are both governed by Georgia statutes.
What are the eligibility requirements to become a board member? This article will answer this question from both a legal and a practical standpoint.
The Georgia Property Owners’ Association Act (POA) allows the association to determine eligibility for board membership, including whether members must be homeowners and if partners or other family members of board members can also serve. While requirements may vary slightly by association, there is a minimum eligibility threshold for individuals who wish to run for their board.
Be 18 years or older.
The law requires individuals serving on the board of directors to be at least 18 years old. Therefore, minors are not eligible for board membership.
Be a member of the association.
Simply put, you have to own a home or condo in the association to serve on the board. The law defines this as “any shareholder, director, officer, partner in, or trustee of any person who is, either alone or in conjunction with any other person or persons, a unit owner.”
Be able to fulfill fiduciary duties.
Board members can be held liable if they do not perform their fiduciary duties to the association. Broadly, the law describes three aspects to these duties: the duty of care in enforcing the association’s Covenants, Conditions, and Restrictions; the duty to use sound business judgment; and the duty of good faith.
“In addition to the legal requirements, we’ve seen high-performing board members share some common attributes,” says Reid Schermer, vice president of FirstService Residential. “They should be an effective leader and communicator, be business savvy, organized, understand the community and its needs, and have an unbiased concern for the well-being of the community as a whole.”
As a board member, you’ll make key decisions that affect your community and plan the future of the property. It may help to understand the strengths and struggles of the association through its history and the immediate next steps to be accomplished. Some decisions may be tough, and leadership skills will help win over members to a particular vision.
There are laws limiting contracts or transactions with other entities tied to board members. These include letting all voting members know of any potential conflicts of interest and a majority vote of the others present (not fewer than two votes). Another rule forbids compensation to board members of nearly any sort (one exception is food at business meetings, which is not to exceed $25 per person.)
There’s no end to the organizational needs of an effective board member. Consider the property’s accounting, keeping track of the association’s governing documents and related bylaws, not to mention the state and federal laws dictating what is legal for the association. It’s a lot of data to process, so organizational skills are a necessity.
All business decisions of the property are overseen by the board, so strong business acumen will prove vital. Duties may include establishing sound fiscal policies, maintaining accurate records, developing a budget, carving out reserve funds, acting on budget items, and collecting assessments. Securing adequate insurance coverage also falls under the board’s mandate.
Running an association requires detailed knowledge and deep understanding of the concerns that can impact a community. Whether you’re a leader in a condominium or homeowner association, education and training are key to understanding the most critical aspects of day-to-day association operations. In order to make the right decisions for the association, you will need to be well-versed in the laws and regulations related to community associations.
Transitioning into a board role may take some time but, but you can jumpstart the process by networking with fellow board members and attending classes. Board member training courses, online or in person, offer guidance in the areas of the rights, roles and responsibilities of your position, meeting and quorum requirements, financial reporting and obligations, and how to approach association business.
Board members need to be consistent when it comes to enforcing rules within the community. Each resident should be treated equally, regardless of their relationship to you. Remember that the rules apply to everyone, including yourself. Effective board members understand that they are not exempt from community regulations.
Ideal board members have the best interest of the entire community in mind, rather than anyone’s personal interests. It is important to set aside personal relationships and biases regardless of how you feel about an issue personally. Being a board member requires you to make objective decisions and lead by example.
The best board members take pride in where they live and enjoy building community. Encouraging community involvement and resident feedback builds relationships and enhances the value of a community both socially and financially.
Being clear and transparent is key to effectively serving on a board. It is your responsibility to disseminate information in an effective and clear manner. You will need to approach others with good faith, and dutifully serve the needs of the community above personal interests. Ideal board members have the best interest of the entire association in mind, rather than personal gain. As there are competing desires among association members, conflict resolution may come into play as well.
A healthy condo or homeowners association can help create a thriving community. The association board is in charge of running the association to protect the investment of and provide the best living situation possible for members. So choosing board members wisely becomes crucial, and knowing the Georgia board member requirements and necessary attributes is the first step to accomplishing that goal.