HOAs and owners are like the government and its tax-paying citizens. What does an HOA cover? There are certain things owners should be responsible and there are other things that the HOA should be responsible for. Here are the top 8 things an HOA should cover:
Master Property Insurance. HOAs need to maintain and fund insurance coverage for repairs and replacement of damages to common property.
HOA Security. Making sure your HOA is safe is a common pursuit and important to all owners. Costs of HOA security equipment or services should be covered by the HOA.
Financial Management. Books always need to be balanced and bills need to be paid. In smaller HOA's, sometimes the finance work is done by an owner. We believe its fair to compensate for that work and HOA software should be purchased or rented. In larger HOAs that can afford it - its best to leave the work to HOA managers or financial firms.
Legal Costs. Every HOA needs legal representation regardless of how often used. Whether collecting overdue HOA fees, deciphering your HOA bylaws or defending your HOA against your neighbors, proper legal guidance is a must. If your HOA does not have a lawyer, please get one.
Infrastructure Services. What does it take to run your HOA? Critical services include things like cleaning, electricity, oil, gas or solar, water and sewage. Larger HOA's may have elective infrastructure like transportation in the forms of trips to the local supermarket, if enough residents want to pay for it.
Common Area Repairs and Replacement. This is one of the most important ones and most often debated items on our blog. Who covers what? The HOA is 100% responsible for the upkeep of all common areas of the HOA property. This also means making decisions about which projects should be funded and doing the best job possible in dealing with vendors. In cases of upkeep and damages to individual units, sometimes the HOA is responsible and should pay. If unsure, the HOA bylaws should be consulted. The HOA can use its discretion to, sometimes, cover the costs of individual unit repairs when the HOA board agrees that its appropriate.
Parking Governance. Most HOA owners have special parking needs and issues from time to time. The issues can be as simple as where guests can park and for how long to handicap accessible parking. HOAs should govern parking. We aren't talking about parking costs.
Disagreement Resolution. We all know it happens. Owners can fight with the HOA, but can also fight with each other. No one likes getting involved in someone else's problems, but when it effects the HOA community, the board must do its best to make help satisfy all parties and bring closure to issues. An HOA mediation panel for disputes is always a good idea.
We'd like to hear of any other challenges you think the HOA should cover.
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