When the coronavirus pandemic first hit, HOA boards and property managers quickly adjusted procedures to keep their associations running as efficiently as possible. Meetings went virtual, maintenance focused more on cleaning and sterilization, and new or temporary policies were set to handle homeowner safety and financial issues.
But as the pandemic hits the one-year anniversary, we’re seeing some slippage in key processes that, if left unattended, could have a negative financial impact on the HOA going forward. Now that there’s an end in sight to the illness and isolation, it’s time to get back to basics and attend to areas that may have been curtailed or overlooked, specifically financial reporting and review, critical repairs, and contracts.
Fight Zoom fatigue, particularly when discussing financials
While Zoom and other video conferencing software programs have made it possible to continue regular board meetings, these virtual gatherings do have their drawbacks. Zoom fatigue has definitely set in. Getting members to attend meetings, and commanding their full attention while in attendance, is getting harder. Admit it – we’ve all worked on our grocery list, checked emails, or caught up on sports scores during a Zoom meeting!
To ensure HOA board members stay engaged during your virtual meetings, particularly during financial discussions, encourage all members to appear by video. Send out materials, including an agenda, a few days in advance so that members can review them before the meeting. Hit the financial highlights (key revenue, expense, and reserve updates), and ask for feedback prior to the meeting so you can spend meeting time addressing questions instead of waiting for everyone to peruse statements. Visually sharing documents, such as the income statement, during the Zoom call can also make it easier for board members to follow the discussion.
Maintain the reserves and capital improvement projects
Any financial discussion should touch on the reserve account. During the pandemic, it’s important not to just continue funding reserves, but to also schedule the critical repair and renovation work for which the fund was created.
Many communities put projects on hold at the beginning of the pandemic due to safety and health concerns. It’s now time to consider scheduling the work. Weigh the financial risks of delaying a major repair or renovation against the health and safety risks of the homeowners. By putting off a project, will you end up spending twice as much in the long run for a larger repair, or risk having to replace instead of fix a major system?
For most communities, residents and vendors alike are utilizing appropriate safety protocols, so hopefully, projects can move forward. If communities have an older population, waiting a while longer until most owners have been vaccinated might be prudent. But if the work is outdoors or in a common area, it can probably proceed as long as you take precautions.
When starting these projects, remember to consider local and state COVID-19 rules for construction as well as CDC guidelines for social distancing and mask-wearing. Also, keep residents informed of days and times that work will take place.
Keep up (or catch up) regular maintenance reviews
Keeping up with regular maintenance reviews is also important. Many communities put home and amenities reviews on hold during the first stages of the pandemic. If you haven’t already done so, it’s important to restart and bring the frequency up to pre-pandemic levels. Along with the routine daily and weekly property and home reviews by the property manager or architectural committee, it’s also time to return to appropriate maintenance inspections by service professionals. Ignoring the roof, security cameras, or playground equipment could result in unexpected wear, damage, and expense. At best, you could be in for a big cleaning bill. At worst, an ignored maintenance issue could result in a major repair or even a resident injury.
Review and update contracts to reflect current level of effort
As you re-engage regular maintenance checks, consider reviewing your major maintenance and vendor contracts to make sure the terms match the actual services currently being performed. Thanks to the pandemic, vendor services have changed, such as more pool deck or weight room sanitization, less clubhouse cleaning, and changes to property manager office hours. Do the contracts reflect these changes? A contract’s service and financial terms should be current and accurate, not only for record-keeping purposes but also for financial tasks, such as budgeting.
Here’s to better physical and financial health in 2021
After a year of the COVID-19 pandemic, it’s time to establish that “new normal” for our boards and communities, get back to financial basics, and stay vigilant to maintain our physical and financial health.
As always, please contact me if I can help with any HOA financial matters.