Dos and Don’ts of Board Governance for Texas HOAs and COAs
It’s no surprise that running a HOA or COA is far from easy. There are various challenges to overcome and numerous steps to take for a community to really flourish. However, there are ways to simplify the process of boosting your board’s effectiveness. Start with the base - if you ensure your board has a solid foundation, your association’s governance will be a more streamlined process, therefore, much more effective.
To help you improve your board's effectiveness, we have compiled the ultimate list of dos and don'ts for Texas HOA and COA board governance best practices for you below.
DO: Build a board, carefully.
Members of a HOA or COA board should include a board president, vice president, secretary, and treasurer, but that depends on your community’s bylaws. All roles should work together to run the HOA or COA like a business – every member should know his/her responsibilities on the board.No matter the role, an ideal board member takes a genuine interest in community association management, has thoroughly studied your association’s governing documents, and stays on top of current state laws. While each member brings a different skill set to the table, in order to be a successful team player, he/she should also be reliable, proactive, collaborative, accountable, strategic, organized, and ready to make informed decisions with the utmost consideration for the community's values and well-being.
DO: Establish realistic goals and hold each other accountable.An effective board is a collaborative board, with a clear sense of purpose and commitment to shared goals. Since an association’s board of directors is made up of volunteers, all with the best intentions to use their unique skills to serve their fellow homeowners, this means they come to the table with different backgrounds. That’s why it’s crucial to ensure all members are on the same page, working toward the same long-term and short-term goals.
Invest the time it takes to establish realistic goals together and identify specific things in your community you’d like to improve (examples: enhancing security measures by adding more lighting in specific areas, improving amenities with more regular maintenance of common areas, etc.). List the specific action items, timeline required, and indicate ways to track progress toward each goal. This allows your board to envision what success looks like, work smarter as a team, and hold each other accountable.
DO: Communicate openly and connect with residents.
Effective communication is critical to the success of your community. Whether you're dealing with issues as routine as landscaping or as complex as major repairs, you need to keep homeowners informed about what's going on.
One of the best ways to stay connected with your community is by holding regular HOA board meetings. Not only do these meetings provide a forum for board members to discuss issues and make decisions, but they also give homeowners a voice in the process. When planning meetings, be sure to provide ample notice to members, agendas, and post-meeting minutes. This will keep homeowners informed and involved in the decision-making process.
Another way to provide updates on important news and events, as well as to highlight ways homeowners can get involved, is sending community newsletters. You can also use newsletters as a friendly way to remind residents of different board policies and procedures and break them down into easy-to-read summaries. Publish newsletters in a variety of ways – email, print, on your community website, or in resident portals.
Note: In your communications, it's important to remember to be professional, friendly, and conversational. Avoid using technical jargon or slang that may be difficult for homeowners to understand. Instead, use clear, concise language that will resonate with your community. This will help ensure your message is clear and make homeowners feel part of the conversation.
DO: Ask the experts.
Building relationships with local industry experts and service providers in Texas makes any HOA or COA run more efficiently. This may include hiring a property management company to simplify day-to-day tasks so your board can focus more on connecting with residents, working with legal counsel to navigate policy implementation, or seeking trusted vendors to provide needed services within your community.
When building your network of trusted partners, it's important to prioritize their experience and expertise in the specific areas you need. For instance, if you're considering a property management company, look for one with a track record of success in managing communities like yours, with a thorough understanding of Texas laws and regulations, and one that has already built a reliable network of financial partners, legal counsel, and other service providers you can count on at any time.
One of the best ways to build these relationships is to attend local HOA and COA events, where you can meet with industry experts and vendors themselves and see if they can support your community’s specific needs. You can also reach out to other local boards in your area for recommendations. Whether you’re bidding for a new management company or vetting vendors, networking takes time, but it’s time well-spent. In the long run, you’ll enjoy the peace of mind that comes from having a dedicated team of experts in your corner.
DON'T: Neglect your fiduciary responsibilities as a HOA or COA board member.
Fiduciary duties are legal obligations that require board members to act in the best interests of their community members. Neglecting these responsibilities can make you liable for legal action and bring about negative consequences for your HOA or COA. To protect your association, follow these tips for fulfilling your board’s fiduciary duties:
- Bookkeeping. Make sure that the HOA or COA's financial records are thorough, complete, up-to-date, and accurate with no budget blunders. This includes monthly financial statements, as well as an annual budget and audit.
- Bias in decision-making. This means considering the best interests of the HOA or COA and its members, rather than acting in your personal interests or those of your friends or associates. Avoid making decisions that will benefit only one member or a small group of members over all the others.
- Conflicts of interest. Members of the board should not have personal or financial interests that conflict with their responsibilities to the HOA or COA. Any potential conflicts of interest must be disclosed so that they can be resolved or managed in a transparent and ethical manner.
- Insurance. It is also important to ensure that you have appropriate liability insurance (including cyber liability insurance) in place as board members can be sued for negligent acts. A solid property management company already has partnerships in place with insurance professionals to help make sure you’re adequately covered at an affordable price for your association.
DON'T: Micromanage your community or fellow board members.
HOA governance works best when there is a spirit of collaboration and mutual respect. Avoid the temptation to overstep your bounds as a board member or to insist on having things done your way. Instead, encourage open dialogue and a willingness to compromise.
Successful HOA governance requires a spirit of collaboration and mutual respect. Each board member brings different strengths and perspectives to the table, and it is only through open dialogue and a willingness to compromise that you can truly serve your community.
One way to avoid overstepping as board members is to make sure you’re familiar with your community's governing documents, including the Covenants, Conditions, and Restrictions (“CC&Rs”). These documents provide important, impartial, detailed guidance on the board's responsibilities and limitations, as well as residents' rights and responsibilities.
DON’T: Make decisions in secrecy or without homeowner input.
The importance of homeowners’ feedback cannot be overstated as these decisions affect their day-to-day lives. If you make decisions without seeking input from the community, it may lead to misunderstandings, frustration, and even legal complications.
When making significant decisions, take the time to seek input from homeowners through surveys, town hall meetings, or even informal conversations with residents. By doing so, you will not only gain valuable insight into the community's needs and concerns, but also foster a sense of ownership and inclusivity.
It is also important to note that involving homeowners in the decision-making process is not just good practice, it is required by law. In Texas, certain decisions such as introducing new policies, amending governing documents, or adopting special assessments require a certain level of homeowner input and voting.
DON'T: Overlook simple, low-cost ways to enhance residents’ experience.
Sometimes, it's easy to overlook the seemingly small details when serving on your board. However, these small details can affect not just property values, but also the sense of belonging within your community. Not everything has to be a big production – sometimes, the simplest actions can make a big difference.
Low-cost ways to improve residents’ experience may include regular pressure washing of the exterior surfaces and landscaping maintenance, incorporating sustainability initiatives and energy-efficient technologies, or simply holding regular “mix and mingles” and similar low-key events so homeowners (especially those new to the community) can get to know each other better.
Note: These activities can also help increase HOA security — neighbors who know each other are more likely to look out for the safety and well-being of their fellow community members.
As a board member for your HOA or COA here in Texas, you play a vital role in creating a positive living experience for everyone in the community. Boosting your board’s effectiveness goes beyond just rule enforcement. While this is an integral aspect, it's equally vital to establish a connection and open conversation with your residents. By fostering a collaborative relationship with homeowners, maintaining valuable partnerships that support your community’s needs, and working together toward common goals, your board will not only be more effective, but will be set up for long-term success.
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