For most of us, Spring is a time of renewal. However, for community association boards of directors, Spring can be a hectic time of negotiating and implementing landscape contracts, making sure that the community pool is set to open on time, and handling the lawn maintenance violations that weren’t obvious during the winter, among many other tasks. With such a lengthy to-do list, board members can lose sight of the commitment to community that inspired them to volunteer in the first place.If that is happening to your board, a good means of harnessing the Spring spirit of renewal and reaffirming board members’ commitment to the association is for the board to vote to adopt and abide by the international Community Associations Institute’s Model Code of Ethics for Community Association Board Members. The link to this Model Code can be found here.
With Super Bowl LIII right around the corner, now is a great time to plan for the impact on your community and to make a game plan.
Tens of thousands of fans, workers and volunteers will descend on Atlanta for the “Big Game” in just over two weeks, and most of those people need a place to stay and park. That will certainly pose challenges for many communities.
With the increasing popularity of Airbnb, VRBO and other home-sharing platforms, many homeowners will be looking to cash-in on the fandom. Thus, we recommend reviewing your governing documents to confirm the scope of any leasing restrictions, the association’s enforcement powers and the due process requirements. It’s also a good time to speak with your general counsel about short-term rentals and other leasing issues. Remember, our retainer includes complimentary telephone consultations with Board members and community managers concerning association operations and governance issues.
Parking is also going to be in high demand in Atlanta in the days leading up to February 3, 2019. Thus, we also recommend reviewing any parking restrictions in your governing documents and discussing parking enforcement—including towing and booting—with your general counsel. Check-in with your attorney and have a conversation about what is permitted and how to handle violations.
It’s not too late to make a New Year’s resolution. After all, most people have already broken theirs, so being a few days behind is no big deal!
Here are a few goals to consider for your community in 2019:
Meet with your general counsel.NowackHoward’s retainer includes a complimentary meeting with the Board of Directors. It’s a great opportunity to review roles and responsibilities and to discuss your objectives for the New Year.
Tackle delinquencies.Now is a great time to review your homeowners’ accounts and formulate a game plan to address delinquencies. Our collections team can help prioritize collections and tailor an approach for every budget.
Review your governing documents.A periodic review of your Declaration, Bylaws and Rules and Regulations is a great way to re-familiarize yourself with your community’s controlling authority and to see what needs updating. In particular, many of our clients have passed leasing amendments lately to better address Airbnb, VRBO and short-term leasing.
Establish committees. As the saying goes, “it takes a village,” so draft volunteers to help you research new vendors, plan your pool season and complete big projects. Getting your neighbors involved is a great way to save time, gain valuable insight and build community spirit.
Good luck and Happy New Year!
Most community association Board of Directors understand the importance of maintaining Directors and Officers insurance (“D&O insurance”) to protect the Association, Board members, and those who assist the Board, such as property managers and committee members. D&O insurance provides coverage for claims for “wrongful acts” committed or alleged to be committed by a Board member or someone else insured under the policy. Unfortunately, what many Directors do not understand is that to preserve coverage under a D&O policy, the policy requires that an insured under the policy provide the D&O insurer with timely notice of any threats of lawsuit that it receives that may be covered under the policy. Otherwise, the D&O insurer may deny coverage of the claim.
In the case of Taylor v. State Farm Fire & Casualty Company, decided by the Georgia Court of Appeals in September 2018, a former Association committee member of the Regency Oaks Neighborhood Association, Inc. (the “Association”), Regina Taylor, learned the importance of timely reporting claims the hard way. In this case, Taylor sued the Association after leaving her committee member position with the Association, and the Association brought counter-claims against her. In January 2015, after filing her lawsuit against the Association, Taylor sent a copy of her lawsuit to the Association’s D&O insurance carrier, State Farm, to notify it of her claims against the Association. State Farm appointed defense counsel to defend the Association against Taylor’s claims.
However, Taylor did not notify State Farm of the Association’s counter-suit against her and ask that it cover the Association’s claims against her under the policy until over a year later, in July 2016. Even though Taylor was potentially insured under the D&O policy since she was a former Association committee member, State Farm denied coverage of her claim.
Last, but certainly not least in our blog series exploring the roles of Association officers, we discuss the role of the Treasurer. Like the Association Secretary, the Treasurer may delegate many of the tasks for which he or she is responsible to the association’s managing agent; however, the Treasurer is ultimately responsible for ensuring that all of these tasks are performed properly. In light of this responsibility, the Treasurer should be familiar with the critical areas of financial responsibility.
If an association employs a professional management company, the Treasurer should receive a package of financial material before each board meeting. That financial package should include a balance sheet, statement of income, bank reconciliations, schedule of accounts payable, cash receipt and disbursements activity, homeowner delinquency report, and general ledger or journal entry activity. If self-managed, the Treasurer may personally prepare these items or may use the assistance of a bookkeeper to do so. The Treasurer should give a presentation of the association’s financial position at each board meeting.
In this second post of our blog series exploring the roles of Association officers, we discuss the role of the Secretary. The Secretary is the association’s chief information officer and bears responsibility for ensuring that the association’s records are created and maintained in accordance with state law and the association’s legal documents.
Aside from financial records maintained the association’s treasurer, the association’s Secretary maintains most permanent records of the association. The Georgia Nonprofit Corporation Code, the Georgia Condominium Act, Georgia Property Owners Association Act, as well as an association’s governing documents, identify the records that an association must keep as part of its permanent records. These include, but are not limited to:
- Minutes of all meetings of the members and board of directors
- Signed consents evidencing all actions taken by the members or a board without a meeting
- Records of all actions taken by a committee in place of the board
- The membership list of all association members, including names, addresses, and the number of votes each member is entitled to cast
- Copies of the association’s articles of incorporation, bylaws, declaration of covenants and all amendments
- The association’s most recent annual registration filed with the Secretary of State
- Copies of resolutions adopted by the members or board of directors
- Copies of all written communications from the association to the membership as a whole during the past three years
While the formal agenda for the meeting has not been released, we have information that a City Council vote on this ordinance will be held at the City Council Meeting at 12:30 p.m. on Monday, March 5, 2018 at 55 Trinity Avenue SW, Atlanta, GA 30303. The meeting is in the City Council Chamber on the 2nd Floor.
The Ordinance would prohibit the use of vehicle immobilization devices, or “boots”, on all private property in the City of Atlanta. If enacted, homeowners and condominium associations located within the City of Atlanta would be prohibited from booting vehicles located on association property, whether such booting is performed by a booting company, property manager or by the association. This means that condominium and homeowners associations located within Atlanta would no longer be able to use boots on vehicles that are parked on association property in violation of the association’s rules or regulations, or which are otherwise unauthorized.
We are providing this Alert as a benefit to our clients and property managers who live in and manage properties located in the City of Atlanta, many of whom use boots as a cost-effective means to control unauthorized parking in their associations.
TO TAKE ACTION: Attend the City Council Meeting on Monday, March 5 at 12:30 OR if you are unable to attend, make your opinion heard by e-mailing and/or calling your City Councilmembers. City Council contact information is listed here: http://citycouncil.atlantaga.gov/
In addition, e-mail addresses for the City Council are listed here for your quick reference:
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In the first quarter of the new year, many community associations have either just elected new Boards of Directors and appointed new association officers, or are preparing to do so. As we frequently receive questions during this time regarding the roles, responsibilities, duties and obligations of the association officers, we have prepared a series of blog posts exploring the roles of the President, Secretary and Treasurer. In our following first blog post in this series, we will discuss the role of the Board President.
The President serves as its chief executive officer and generally has all of the powers and duties of any president of any other corporation organized under the Georgia Nonprofit Corporation Code. These powers generally include, but are not limited to, appointing committees, calling special meetings of the association members, establishing agendas for all association and board meetings, and presiding over those meetings.
Many community associations hold their annual Board of Directors’ elections in the last quarter of the calendar year. This means that there may be up to 2-3 months in between when a new Board is elected and January of the next year. This often leads to confusion as to when the newly elected Board should take over- immediately after the annual meeting, or January 1st of the next year?
For the vast majority of community associations, the new Board will take over immediately after the annual election. This is based upon common Bylaws’ language stating that the Board members shall hold office “until their successors are elected by the Association”, or similar such language. In addition, most Bylaws provide that a newly elected Board will meet as a Board either immediately after the election, or within 10 days thereof or a similar short period of time, for the purpose of electing new officers from amongst the new Board members. All of these provisions call for a new Board to take over, and begin conducting business, immediately after the annual meeting at which they are elected.
Budget season is a great time to review the association’s insurance coverage. Although comprehensive, quality insurance coverage can be a significant expense, it is typically far less expensive than paying out-of-pocket for the litigation expenses and/or damages incurred in the event of a loss. And, your association must carry at least the minimum coverage required by its governing documents, and, for condominium associations, as required by the Georgia Condominium Act.
Below is a “checklist” of the coverage that you should always maintain for the association:
Property. Provides financial reimbursement in the event of damage to covered property.