Transparency – Great for Windows (HOA Boards Too)

Nothing should be more important to volunteer boards than the trust of their neighbors. However, trust is not automatic and can be easily destroyed. Making good decisions for the association’s best interests is not enough. Decisions must be made in a manner which is above reproach and displays integrity and openness.

These “baker’s dozen” tips may help to build and preserve the trust of the membership in its association governance.

Initial Attitude

• Begin the board term with an attitude of service and not control. Directors with the right frame of mind are less likely to take offense when someone questions board decisions.

 Board Meetings

• Other than the very few permissible closed session items, board discussion should be in open session. While it is easier for boards to work in closed sessions or “working meetings”, this violates the law and destroys the legitimacy of the open board meetings. Members will not trust a board which acts in secret on matters which should be in open session.
• Board actions taken due to emergencies or other circumstances outside of a board meeting should be disclosed in the next board meeting, and the reasons noted why the matter could not wait for the next meeting. A ratification motion can then further disclose the action in the minutes.
• Introduce each agenda item before discussing it. Attending members do not have the board packet, and a brief introduction of each item helps attendees to follow (not join) the discussion.
• Abstaining on a vote which uniquely affects one’s building and not the entire community, or otherwise concerns a director individually, is not enough – step away from the board and join the audience.

Communication

• Work with the Chair or manager (or whoever sets the agendas) to make sure the board agendas are truly informative, and not designed to be so broad so they obscure from the members the real topics to be discussed.
• Work to increase communication with the membership. Newsletters, web sites, email blasts, and bulletin boards are common vehicles to increase communication. Don’t leave it to the nextdoor.com gossip chain.
• When a major issue is in play, such as a major reconstruction contract, consider occasional informational “town hall” meetings, in which nothing is decided and the purpose is to report to members and answer questions.

Association Funds

• Very few questions about the association’s money are out of bounds. Except for rare instances when confidentiality is important (such as pending negotiations or member arrearage questions), questions regarding association money should be answered without hesitation.
• Any disbursement of funds should be confirmed by two directors minimum, unless it is large enough to require board approval under Civil 5502.
• Refuse compensation of any kind for board service, and only seek reimbursement of authorized and documented out of pocket expenses.

Vendors

• Avoid doing business with association members or relatives, unless it is first disclosed to all members.
• Keep vendor relationships clean. Obtain three bids for all significant contracts. If a bidder asks for an unfair advantage or offers any incentive to a director, drop them from consideration – vendors who will cheat to get the account will also cheat the association.

A policy of openness builds healthy communities and arises from a confident board.

Written by Kelly G. Richardson

Kelly G. Richardson Esq., CCAL, is a Fellow of the College of Community Association Lawyers and a Partner of Richardson | Ober | DeNichilo LLP, a California law firm known for community association advice. Submit questions to [email protected]. Past columns at www.hoahomefront.com. All rights reserved®.