HOA board continuity planning is an important part of association management, though many fail to give it the attention it requires. Learn how to plan for the continued effectiveness of your HOA board below.
HOA Board Continuity Planning for Self-Managed Communities
Homeowners associations usually fall under one of two categories: Self-managed communities and professionally managed communities. A professionally managed community is exactly as it sounds. It is a homeowners association that receives assistance from an HOA management company so that the board’s workload is lightened.
In contrast, a self-managed community is one that relies solely on the HOA board to handle various aspects of association management. This means the HOA board must shoulder the burden of collecting dues, overseeing maintenance, handling complaints, and managing the association’s finances, among many other tasks.
While there is nothing inherently wrong with a self-managed community, this type of association often falls prey to poor HOA board continuity planning. For those who are unaware, continuity planning is a process that involves protecting the association’s assets and records in the event of a mishap.
For example, if a board member suddenly becomes incapacitated or passes away, what happens to all of the documents and projects they are in charge of? What if a board member is simply difficult to work with and refuses to cooperate following the expiry of their tenure?
Whereas a professionally managed community has continued access to important records and assets thanks to the resources of their HOA management company, a self-managed community typically isn’t afforded the same luxury. Fortunately, careful continuity planning can save the board a lot of trouble down the road.
What Problems Will Continuity Planning Solve?
Postponing HOA board continuity planning will only prove destructive for your association in the end. Without continuity planning, you will likely need to start from square one in the event of a disaster. Here are possible problems you may run into that proper continuity planning can prevent from happening.
1. Absent, Damaged, or Unaccounted for Records
It is not unheard of for a homeowners association to suddenly encounter missing or damaged records. This can range from crucial documents to financial records. Considering how important these documents are, it is imperative to know where they are located and secure copies if necessary.
Banking records such as the name of your bank, relevant account numbers, physical checks, and debit cards must be accounted for. Make sure you know how to access these accounts and where the association’s receivables and payables are.
Don’t forget to determine the location of other association records as well. This includes architectural requests (as well as approvals and denials), vendor and management contracts, legal documents, invoices, and meeting minutes.
Identify the person/s who keeps these records and determine whether or not it is time to reassign access. If your association only maintains physical records, consider digitizing them for safekeeping. It is also important to have backups in place in case of a cyber attack.
2. Missing or Misplaced Equipment
Records and documents are important, but your HOA board must not neglect physical equipment either. Determine the location of assets such as pool items, lawn equipment, gym equipment, furniture, holiday decorations, and supplies. It helps to come up with an inventory list of sorts and recording where each item can be found. If certain items are kept in a locked storage room, identify who has control over the keys. It is also a good idea to make copies of keys and then keep them in a secure place.
3. Unknown Passwords
If a board member who holds all the passwords to important accounts suddenly passes away, the rest of your board will find itself scrambling to retrieve those passwords. To prevent this issue, make sure to identify who has passwords to accounts such as your HOA’s email, online banking, and security systems. You may be surprised to find that some people still have access to these accounts even after their term on the board.
After determining the persons with access, the next step is to examine whether or not these people should retain access. Don’t be afraid to remove people from the list if your board deems it necessary.
The Main Goal of an HOA Board Continuity Plan
To create an effective continuity plan, you must index every significant item the association maintains. As previously mentioned, this includes association documents, financial records, various accounts, and physical equipment. Then, you must answer the all-important question, “What should the HOA do if something happens to the person/s who possesses or has access to these items?”
The primary purpose of a continuity plan is to eliminate possible problems that may come up in case access to certain items or records is somehow halted. It makes sure that your association continues to run smoothly even in the face of a tragic loss or disaster. Did a board member suddenly resign and can no longer be reached? Did a fire destroy copies of your association’s records? With a continuity plan in place, such events will not disable your operations.
Of course, it is worth noting that simply having a continuity plan is not enough. After coming up with your own plan, you must make sure to revisit it on a routine basis. A lot of things can change over time, and even the smallest of adjustments can render a portion of your plan ineffective.
Where an HOA Management Company Comes In
Not every association knows how to approach HOA board continuity planning. Since it usually involves a lot of time and work, not to mention some level of expertise, self-managed communities often struggle with the task. Yet, self-managed communities are the ones that need continuity planning the most.
Fortunately, an HOA management company like Clark Simson Miller can step in to help. Management companies already have prevention and recovery protocols in place. As such, communities need not worry about halting operations in case of loss or disaster. Call us today at 865.315.7505 or contact us online to learn more about our services.
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