Why hire an Association Management Company?

 

By: Pedro Garcia CAM, CMCA, AMS

Affinity Management Services

 

For board members of community associations hiring a management company is one of the most important decisions it can make. It takes an enormous amount of time for volunteer board members to operate the association on their own.

Without the help of a management company the day to day, basic operations will consume a great deal time from anyone’s schedule. Asking a board member to volunteer such a substantial amount of their already dwindling time these days is just not fair and also unrealistic if there are any expectations that the community achieves any level of improvement.

Another key issue is that a simple passing familiarity with the local, state and federal laws that govern condo associations is not enough to keep it compliant.

Continuity is key to progress. Board members might come and go, but a manager can offer a common thread that links one administration to the next. Why does this matter? Think about the importance of continuity when it comes to record keeping, budgeting, dealings with contractors, suppliers, and professional service providers, and even the relationships with residents. Having a dependable point person is invaluable.

 

Services Considered

The management company is a licensed professional firm primarily charged to carry out policies set by the board of directors and to manage the association’s daily operations, with the explicit purpose of achieving the board’s goals.

A good management company is able to provide the professional buffer that can free the board to focus on decision making and allow the regular day to day details to conform to the professional structure that only a management company can implement. Said structure is inherently included through the services the management company offers.

In general, the services of a management company can be detailed as follows:

  1. Administrative Services: Board Meeting Participation, Board Meeting Preparation, Communications, Complaints & Rules Administration, Insurance Administration, Member Meeting preparation and Participation, Periodic Management Report, Policy Development, Professional Services Selection, Record Keeping, Unit Transition Services, Administrative Support, Board Meeting Minutes, Legal Coordination & Participation, Member Meeting Minutes, and Records Transfer.
  2. Site Services:Community Inspection, Contract Bidding, Contract Development, Contract Management, Maintenance Request Processing, Emergency Services Program, and Major Improvement Contract Bidding & Management.
  3. Financial Services; Book Keeping, Budget Preparation, Collection of Assessments, Financial Statements, Invoice Processing & Disbursement, Collection of Special Assessments, Coupon Book, Delinquent Collection & Processing, Electronic Payment, Financial Audits Cooperation, Reserves Investment, and Tax Preparation Cooperation.

 

Indicators of Quality

At some point in comparing management companies, a criterion needs to be used to establish quality and compatibility with the community. Apples to Apples. Each management company can bring in a slightly different flavor on how they will deliver the services required of them. Some will focus on technology advancements, others on the size of the company, and others on the market segment/area niche.

The following criteria focus more on the items that directly translate to benefits to the community:

  1. Training: A Florida community association manager is required to acquire a license from the state of Florida as a permit to work. This basic requirement is an expectation of any manager employed in this profession. However, other advanced certifications do exist and a company should also have a regular internal training program for its managers.While not all company employees should be expected to have advanced certifications, the leaders of the company that direct policy, execute operations, and set cultural norms should certainly have an advanced understanding of the profession. The board should look for advanced certifications and standards espoused by the Community Associations Institute (CAI). CAI is a national organization dedicated to fostering vibrant, competent, harmonious community associations. CAI has been the leader in providing education and resources to the volunteer homeowners who govern community associations and the professionals who support them. CAI awards qualified professionals with designations in order to improve the quality and effectiveness of community management. The acquisitions of these designations are a mark of commitment to a code of ethics, an enhanced professional standard, and a career in this industry. These certifications include Certified Manager of Community Associations (CMCA), Association Management Specialist (AMS), and Professional Community Association Manager (PCAM).
  2. Support: When hired, the management company will immediately assign an individually licensed manager to work for the community. However, realistic observations should be made. Is this single manager able to handle the process of the transition from the prior management or developer control, ongoing routine operations, major projects, etc? Does the management company have a support team to assist or take on the transition process? Does management company have a team and resources to handle most of the customer service issues that homeowners will need help with? Like, payments, account disputes and questions, resident applications, estoppel requests, etc. The more time an individual manager is allocating on these issues the less time he/she is allocating to the community itself and accomplishing the board’s priorities. Besides having a support team, does the management company have a leadership/supervisory structure? An individual manager’s supervisor is yet another resource for the board members and helps ensure the manager is performing their duties to everyone’s expectations.
  3. Solutions: A community will invariably have some obstacles that have yet to be accomplished, or that will present a significant investment of time from the board or from the assigned manager. Individual managers assigned to properties are already very busy handling the regular operations of the community and unexpected owner and vendor issues that arise day to day. This usually leaves very little or no time to devote to major audacious goals or challenges and if any effort is exerted to accomplish them the day to day operations is impacted. The management company should have a senior member of its team available to cut through all the noise and issues and clearly lay out plans to accomplish major goals for the community. This may include special financial analysis, funding solicitations, planning projects, operational restructuring, or simply taking time to explain major issues and how they will be accomplished.

 

In conclusion, the board needs to understand their own roles and that of the management company, each party should set proper expectations, and demand professional services and a dedication to the success of the association. For more information or questions on being self-managed or professionally managed, please contact: info@ManagedbyAffinity.com

 

 

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