How to Effectively Use Methods of Communication in Your HOA

, , ,

People Communicating

The Dilemma of Communication

One of the biggest challenges for managers and boards of directors is to deal with both mundane and serious situations on a daily basis. If the board discovers a large problem that will require substantial funding, it must figure out how to proceed by analyzing the problem, approaching the solution pragmatically, and figuring out how to communicate with the owners. This can involve many approaches.

Board Meetings

These are important and basic methods of communication with owners. Many boards prefer to meet in secret when any matter comes before them that is difficult. The manager should guide them by pointing out what they are entitled to discuss in private legally. Sometimes feedback is needed from an attorney and it is frequently up to the manager to determine when a question goes beyond the board’s expertise. Civil Code Section 4925 (the Open Meeting Act) requires that meetings be open except for specific subjects, including contract negotiations, personnel matters, disciplinary matters, matters that could adversely affect someone’s privacy, or attorney-client privileged matters.

The manager generally helps set the agenda for a meeting and often provides management reports outlining the action items the board will need to consider. The manager also usually prepares the financial reports. All of these things are communications that help the Board to do a better job.

Manager Reports For the Board

These are among the most important of all communications . Through this reporting the manager can accomplish the following:

  1. Provide an organized method for the directors’ review of and handling all matters, especially if the order in the report corresponds to the agenda.
  2. Provide a summary of reports, bids, contracts, letters, reported problems, owner complaints, architectural recommendations, and other documents that board members might have failed to read.
  3. Propose fixes, solutions, suggestions and recommendations for the board to consider, culled from resources to which only the manager has access.
  4. Organize financial reporting, copies of bank statements, reconciliations, income statements, balance sheets and other documents that the board members are required to review.

One shortcoming that the author often observes is a failure to segregate manager reporting on executive session-qualified items and non-qualified items. This can lead to problems if there is a demand for review of association records by an owner or there is a legal claim involving litigation and discovery. It is easy to overlook portions of management reports that deserve confidentiality when records inspection is arranged or records are turned over to the other party as a result of a request for production in a legal proceeding.

Meeting Minutes

Managers often prepare the minutes of board meetings, a task that involves a lot of responsibility to make these communications suitable to serve their purpose. Finding the balance between saying too much and too little can be precarious. Experience is the best teacher. In other words, used too many words or he/said she/said statements or individual comments can easily backfire. Minutes should include the a record of those attending (board members for a board meeting, homeowners for a homeowner meeting), whether a quorum is established, the old business and new business discussed, motions and action items, reports given at the meeting by any committee or board members, or any vendor of the association (such as the accountant or investment manager), and the motion to adjourn. Minutes should not include individual statements made during a homeowner forum, personal attack statements or verbatim recitation of discussions or comments by attendees.

Any manager who has been involved with a board that has been sued for defamation or discrimination probably has some experience with how seemingly innocent statements made by board members that were included in the minutes of the meeting can be used against the association.

Some associations distribute minutes of board meetings to the members. Some post them on association bulletin boards or websites. Some send them out via email. One of the easiest ways to create a contingent of complainers is to leave some group out of the loop. In California, boards are required to make minutes of open meetings available for inspection and copying within 30 days of the meeting if an owner requests them. Some associations make them available for inspection or copying by owners without any mandate to do so. With the advent of and excitement over the use of the web, many communication doors have been opened—some successfully and some not so.

When a property sells in a common interest development, it is common practice for an escrow demand to include a request for association meeting minutes for the past 12 months. Boards and managers should consider carefully the picture that may be painted for a potential buyer if these minutes include he/said-she/said statements, personal attacks, typing errors, poor grammar and structure, disorganized thoughts or offensive remarks. Such communications have a face that can become the “face” of the community.

When a board is confronted by angry owners about one of their issues that has been festering a long time unknown to the board, boards can become defensive. This is often a time when a manager should step in to remind the both the board and the owners that the board will take a pragmatic approach, and as information becomes available, will make available to the members what it can. This is a very important process that often occurs at the beginning of discovery of a difficult situation. The reason it is so critical is that the board and management needs to be concerned from the very start when it is facing any very difficult issue. If the board and management try to move forward without giving due regard to what the members deserve to know, it can be the digging of a hole that will eventually become very difficult to climb out of. On the other hand, if too much is said without verifiable back up information, a panic or onslaught of unanswerable questions can be started. Remember that when there are no answers to questions, trust tends to slip away.

And one more thought. In California, the court in Moran v. Oso was deciding whether an owner, whose demand for 10 years worth of association minutes was refused, was entitled to recover attorneys fees for having to bring a legal action to get the review of the minutes she wanted to see. The court noted disdain for the board’s attempt to charge $200 in costs to dig through old association records to provide several years worth of minutes. An expert witness for the owner testified that standard industry practice was that minutes should be kept in a manner such that a board can retrieve them readily, and that an owner should not have to pay for the time consuming task of going through poorly organized association records as important as minutes. Keep a minute book!

Townhall Meetings

A town hall meeting is a good way to communicate face-to-face with Owners and pass on and/or receive important information. It’s a good way to get a finger on the pulse of the community. Some examples are to hold one during a document update- restatement project, to answer questions the members have, and to alleviate concerns. The format can be very good for presenting the “team” of professionals being used in a major rehabilitation or reconstruction project (such as the architect, contractor, banker, and attorney), or can be used to meet with neighbors in a neighborhood watch situation when there is criminal or drug activity in the community. Of course, it can backfire if there is no planning or organization to it. If the Board and management appear disorganized or unable to handle hecklers or important questions, the meeting can be very detrimental and cause owners to lose their trust in either or both. On the other hand, a manager and an attorney with experience in crowd control can help a board prepare for the worst. Organizing the order of things to happen, setting the agenda, and giving thought as to how to keep things moving, preparing question and answer handouts – these are all things a manager can do, with the help of the Association attorney when there is the propensity for a really “lively” or “rowdy” crowd, or the need of some legal explanations of processes. Craziness and disorganization, too small a room, an overheated or chilled room, can engender distrust in the body (or manager) that organized the meeting. Do everything you can ahead of time to make sure that attendees will be comfortable, at least in their surroundings.

Letters/Packets to Owners/Direct Mailings

Obviously, letters are a means of communicating with the owners. Some people are very good writers, but the majority of people are not. This is another skill that a manager would do well to develop. The better writer the manager is, the better he or she can communicate ideas and helpful suggestions to the Board of Directors. Many Boards generally rely on a manager to supply it/them with form letters or suggested letters in the event of any disciplinary actions or communication with vendors about services. A manager who has really good writing skills can help write for/with the Board a summary of ongoing events or problems, in preparation for a town-hall or other meeting requiring action on the part of the homeowners. A good writer knows what kind of words create tension and engender defense of responses, and that words to use any alternative. For example, any use of the word “but” will commonly engender resistance to any statement containing the word, but in the alternative, the use of the word “however” will instead been tend to evoke a more sympathetic understanding. Use of the word “No or “prohibited” where in the alternative positive choices can be given such as “not allowed” or cooperation is “encouraged” is another instance of “fighting words” versus “inviting” words.

Personnel Contact/Telephone Call

Some managers do not want to be bothered making telephone calls, or would prefer to have written record in any situation. In this day and age, some managers have come to expect negative reactions more commonly than positive reactions, especially if they are calling to let someone know about a pending or potential violation of the governing documents. On the other hand, we often hear owners complain that getting a letter is offensive, when the manager could have picked up the telephone and let them know is going on. Managers certainly can create a written record of telephone calls, including the date, time and place, and what was said by them, and what was said by the Owner, so adding this personal touch in many cases allows the owner to avoid the stigma attached to getting the nasty letter. Truthfully, it does not really matter how nice of a letter a manager writes on behalf of the Board, or a Board writes, even if, or maybe more-so because, the owner is guilty of the violation, the most common reaction is that the owner is either hurt, embarrassed or angry in a “how-dare-they” mindset, where a simple call saying something like “there is a report of ….” and “although you may not be aware, the association has a rule on that, ….. “ and “…if you are in fact doing that you would stop ….it would resolve things without requiring a written “citation” (or whatever the Association uses).

Newsletters/Flyers

These can be a great way of communicating with the Owners. Likewise, they can be idiotic and useless drivel. When prepared by people who do not have any design sense, creative genes, or writing skills, they can read like newsprint or a gossip rag. Of course, as a manager it’s hard to challenge someone’s “perceived” creative energy gracefully. It is a good thing, we think, that most associations defer to management to create the newsletter. Its extra work, yes, but it is also a tool that can make your job a lot easier. Let’s take a look as to how that may occur. The newsletter can be used to:

  1. Satisfy statutory requirements to announce meeting dates as required in many states.
  2. Broadcast committee reports, officer reports, surveys, questionnaires, emergency information requests.
  3. Satisfy disclosure requirements for some things, possibly some of the state-required financial reporting requirements, news/progress reports of pending Association projects, policies of the Association, proposed rules, etc.
  4. Provide important reminders to owners about ACC requirements for making changes to property, purchasing individual insurance coverage to cover gaps left from the master coverage (if any), days to put out and bring in garbage cans, speed limits in the complex, and important people, parking or pet rules. It can remind owners of prohibited activities, laundry room or swimming pool hours, etiquette, clubhouse use requirements.
  5. Bring the personal touch by featuring an article about an owner, board member, committee member, board/owner liaison, or anyone that is worthy of introducing, on a regular basis.
  6. Remind owners that if there are any complaints, that there is a written form available upon request.
  7. Report on contest rules and results (such as landscape maintenance award of the month, best Christmas display, or other contests that some associations have).

Rules, Policies and Procedures

These can be used for many purposes. They are much more likely to be read than deed restrictions, the declaration or CC&Rs, or any of the other governing documents. They can and should be simply stated, and as much as possible in the positive rather than the negative. For example, compare: There shall be no parking in the guest parking by residents,” or” Residents are not allowed to park in ….” to “Guest parking is reserved for guests. Please park your own vehicles in your assigned spaces.” Or, for another example of poor wording: “Dog waste must be picked up by hand” (this is not made up, its a rule a board actually came up with) to “Dog droppings are harmful to the common area vegetation, unsightly and hazardous to health. Owners are responsible to pick up after their pets.”

Rules are an important tool for tenants too. What tenant is ever going to read a stack of papers an inch thick.

Opening the rules with a paragraph like what follows sets the stage for a cooperative response, as opposed to making a new owner feel like he/she has entered no man’s land:

“Please review the following items. We have adopted some simple rules based on our Association documents so that we can all do our part to make this community a better place to live. We ask for your cooperation with the following:”

Email

Email is a blessing and a curse at the same time. Some managers keep their email addresses very closely guarded. Others give it out freely to homeowner board members. It can seem overbearing to sit down and see that there are 25-50 emails waiting to be answered. On the other hand, if you had 25-50 telephone messages to return, would that be more appealing? Responding to telephone calls can take all day and still be unproductive. We both use email pretty freely. In this age of busy people, busy schedules, busy phones and voicemail, telephone tag can become a time consuming bore. Being able to get information and respond without having to wait to talk to someone can really minimize wasted time. On the other hand, sitting at the computer is a very passive means of communicating and does little to build relationships. Do you need to build relationships … or get business done. That’s a question that could bring mixed responses. Everyone has their own management style and either can work for specific reasons.

Email can be very dangerous. Emails are most likely discoverable in any lawsuit situation so care must be taken to make sure that damaging statements, admissions and offensive, legally actionable comments are not made. Homeowners (and managers) have to be constantly reminded to attach confidentiality statements to emails they want to “try” to protect from eventual discovery in the event there ever is a legal action where someone demands review or production. This comes naturally to attorneys because attorneys are trained to remember to mark anything confidential they intend to be confidential, like letters. But neither board members nor attorneys have this kind of training, generally. But even with a confidentiality statement – discussion over email of what kind of a person Smith or Jones is or how much or how little they are liked can come back to haunt a Board or manager. Calling someone a drunk, a crook, or carrier of a contagious disease can lead to an indefensible defamation claim (unless you can prove the truth of the defamatory statement). Discriminatory statements can lead to “big bucks” lawsuits. Talking about owners for all the wrong reasons is a common occurrence.

Even without the threat of any litigation, emails sent in haste can prove to be a great embarrassment. Reacting in anger without a cooling period can lead to very hard feelings and alienation. Hitting the wrong button and sending something meant for one person to another can constitute a huge faux pas. Say you are an attorney and you have your client contacts and the opposing attorney next to each other in the address book. So you compose a letter for your client telling them of potential problems caused by their actions, and then hit the wrong address book address and the letter goes to the attorney instead. A very careless and possibly harmful “faux pas”. Say you start to compose a message, and then decide the better of it, and instead of closing the message you accidentally hit send instead. Say that you hit “forward” to send someone a message that you have just read, and do not realize that there is a long string of emails attached to and from the person who sent the message to you, or an embarrassing board dialogue attached. Board members seem often to have no conscience about what they say in emails.

With email, you have to be very careful.

Websites

Websites can be a blessing and a curse also. Associations are finding it very helpful to have a website for posting documents, notices, suggestions, rules, and important messages. Posting recorded documents and filed articles of incorporation are posting of public records, not a problem. But posting of bylaws, rules, minutes of meetings, and posting of socials, townhall meeting subject matter, etc., constitutes posting of private information and if there is no effort to protect entry, can lead to problems. Associations that open up the website to “chatting” by Owners or residents sometimes wish they didn’t. If Owners are all respectful, honest, and kind people, there probably won’t be a problem. But when vindictive, mean spirited, unhappy residents get into the chatting mode, things can go downhill fast. The “chat” room can become a place to criticize, ostracize and condemn.

Last, but not least,

Presentation of a Ballot and Ballot Package on an Important Issue

Sending out a written ballot without any information attached, or conducting an election at a meeting without a full explanation of what people are voting on can turn out to be an exercise in futility. A well-drafted, organized communication with a ballot package can make the difference between success and failure in the voting measure. Make sure your ballot is legally correct for your state. California has specific requirements in the Corporations Code. Basically, the information needed is the voting measure, an opportunity to approve or disapprove it (giving one possible answer only is not wise), names, signatures, dates, and the voting requirements, such as how many votes it takes to approve the measure. The materials leading up to the balloting can be just as important. Owners will generally balk at approving a very large assessment if they have no historic documents setting the stage. Even if you have arranged a town hall meeting, you need to make sure that you have also prepared a fully informative package that can be given out at the meeting and/or mailed to everyone, or at the very least, those that did not attend. Some Owners may even crow loudly claiming a lack of history when there has been a considerable course of communication. Of course, it is better to be in the position of having sent out communications along the way as things evolved, even if the Owners are not reading them. At some point, the timing, clarity, frequency, and completeness of disclosures might become very important.

All in all, communications are one of the most important functions of the Board, management and the owners in an HOA, so put some time into thinking about how they might improve in your Association.


Adapted from an article by Beth A. Grimm is frequent contributor to the ECHO Journal. Grimm s a Bay Area attorney that writes books, articles and newsletters and is active in ECHO and other groups that serve community associations.