Tools of the Trade: HOA Board Project Planning and Hiring a Professional Vendor
The first responsibility of the HOA board when beginning any project in a non-profit corporation such as a homeowners association is to avoid any conflicts of interest while planning the project.
In community associations, each board member is considered a fiduciary and is duty bound to act in the best interests of all residents, not his or her own best interests. In general terms, fiduciary duty is the highest standard of care imposed under law, and it occurs when one or more persons are responsible for the money or property of another. The fiduciary is expected to be honest, free from fraud and faithful to his or her obligations.
Accusations of self-dealing or conflicts of interest sometimes arise during the vendor hiring process. Generally, board members or management companies who profit financially from hiring a vendor risk putting their own interests before those of the community.
What is your association doing to ensure the community comes first?
- HOA Board members should fully disclose a conflict when objectivity cannot be maintained.
- Ensure the board minutes reflect the entire disclosure.
- Require conflicted board members to sit out the board’s decision on the conflicting matter, as well as related executive sessions that may occur.
- Review multiple, sealed bids and carefully review them before making a decision.
Are the Vendors Qualified once the Planning is Completed?
One of the most frequently asked questions we receive during interviews with potential new communities is, “do you have a vendor list that can match the needs of our community”. With over 25 years of experience, we have accumulated a select list of highly qualified vendors that can design and build a clubhouse or cabana or licensed and insured vendors that do general maintenance and repairs such as roof, electrical or plumbing. Our recommendation of vendors directly effects the standard of excellence that we hold our company accountable to every day.
Hands on HOA Management: From Fiduciary Project Planning to Vendor Completion!
Our HOA board members feel confident that their projects will comply with the intent of the CCR’s, budget approval will be adhered to and the project will meet the expectation of the community through vendor oversight. We have complete confidence in our vendors both in their price quotes and their quality of work. Our vendors understand they represent our company in how they present themselves on the work-site and through the quality and integrity of the project.