The Three Keys to Effectively Delegating to Your Property Management Company
So what can you do to ensure that you are properly delegating tasks to your property management company? Start by following the guidelines below.
Having an established process reduces misunderstandings and enables your management team to work more efficiently. Some of the areas you should cover in your policies and procedures include:
- The community manager’s authority. When can your community manager make decisions unilaterally (if at all)? Which decisions require board approval? The amount of authority your board gives to your manager should be considered ahead of time and clearly spelled out.
- The chain of command. Which board member has authority over the various tasks assigned to the community manager? For example, can the manager get approval for purchases from the board treasurer or board president, or does the entire board need to provide authorization?
- Contingency plans. Include a plan for common scenarios so that you and your community manager won’t be scrambling to address issues or events.
- Emergency authority. Include a plan for what authority your community manager has to act and respond on the property in the event of an emergency.
2. Learn how the role of your property management company differs from that of the board.
One of the biggest confusions for board members (and other homeowners) is the difference between what the board is supposed to do and what the management company is supposed to do. Getting a handle on these differences is essential. Here are some of the basics you need to understand:
- The board sets goals for the HOA; the management company helps the board realize those goals. It is up to the board to come up with its vision for the association. The property management company should then find ways for the board to fulfill that vision. For example, if the board wants to reduce the HOA budget, the management company might renegotiate vendor contracts, find better rates for insurance coverage or use its buying power to lower the associations’ costs for products and services.
- The board makes policies and regulations; the management company enforces them. This is probably the biggest area of misunderstanding. When homeowners receive a violation notice from their HOA’s property management company, they often fail to realize that the management company is simply enforcing the policies and regulations contained in the HOA’s governing documents.
- The board makes decisions; the property management company provides guidance and executes those decisions. Naturally, your board wants everything in your building or community to run smoothly. And it wants to comply with the law and the HOA’s governing documents when it comes to handling association business. But staying on top of these things can often be overwhelming. This is where your management company comes in. It can offer its expertise, handle day-to-day operations, make sure that meetings follow appropriate protocols and ensure that homeowners receive proper notifications.
The Illinois Condominium Property Act and the Illinois Common Interest Community Association Act have sections that specify that the board—not the property manager—is statutorily responsible for providing disclosures. If someone is selling a condo unit, the board must provide disclosures to the seller (upon request) who must then provide them to the buyer.
An experienced property management company can certainly make your life easier and offer valuable guidance—but you must provide the framework and set the priorities. Ultimately, it’s you and the other board members who have a fiduciary obligation to your HOA and to your residents. And that’s something you can’t delegate.
Learn more about how partnering with a professional property management company can help your HOA run more smoothly. Contact FirstService Residential, the leading property management company in Illinois.