As a community association board member, it's crucial to regularly review important aspects of your association's operations to ensure its success and meet residents' needs. In this blog post, we will discuss seven key areas that community association board members should review each year. Remember, if you have any doubts or questions about these items, don't hesitate to seek guidance from industry professionals.

1. Budgets

Reviewing the association's budget is essential for effective financial planning. Scrutinize operating and reserve budgets, ensuring they align with your community's short and long-term goals. Analyze revenue and expenditure trends, assess the adequacy of reserves, and make adjustments as necessary to meet changing needs.

2. Governing Documents

The governing documents, including the Declaration of Covenants, Conditions, and Restrictions (CC&Rs), bylaws, and rules and regulations, form the foundation of your community. Regularly review these documents to ensure they accurately reflect your association's current needs and expectations. Identify any outdated or conflicting provisions that require amendment. If you are considering changes, contact the association's attorney to discuss the best course of action.

3. Laws and Regulations

Stay informed about changes in federal, state, and local laws that affect community associations. Regularly review your association's legal compliance to prevent violations and potential legal complications. Seek legal advice when necessary to ensure your association adheres to applicable regulations- you can learn more about FHA laws affecting community associations here and here.

4. Reserve Studies and Reserve Accounts

The association's reserve accounts are crucial for funding major repairs, replacements, and capital improvements. Review the reserve study and assess its accuracy in projecting future expenses. Reserve studies should be updated every 3-5 years to ensure they align with the current costs and conditions of the association's property. Evaluate the adequacy of the reserve fund and consider adjustments to ensure it can adequately cover anticipated expenditures. If you’re unsure as to whether your reserve study needs updating, contact a reserve specialist.

5. Vendor Contracts

Review vendor contracts and service agreements to assess their terms, conditions, and pricing. Confirm that contracts align with your association's needs and are up to date. Consider conducting periodic bids or obtaining competitive proposals to ensure you get the best value for the services provided. Your community manager can assist you with this.

6. Insurance Policies

Comprehensive insurance coverage protects your community association from potential liabilities and unexpected events. Review insurance policies annually, ensuring they adequately cover potential risks, including property damage, liability, and director and officer (D&O) insurance. Seek assistance from insurance professionals to ensure appropriate coverage.

7. Emergency Preparedness Plans

Preparing for emergencies is crucial to protect residents and property. Review and update your community's emergency preparedness plans annually. Evaluate evacuation procedures, communication protocols, and other components essential to your community's unique plan.

By conducting these seven annual reviews, community association board members can ensure their associations' smooth operation, financial stability, and compliance with governing documents. However, reviewing these complex aspects requires expertise and knowledge. That's where Community Association Management Services (CAMS) can help. CAMS offers professional guidance to community associations, providing expertise in managing your community and pointing you toward industry experts when appropriate. By partnering with CAMS, you can streamline your annual reviews and ensure the optimal condition of your community association.

Remember, as a board member, you have a responsibility to act in the best interest of your community. By conducting these yearly reviews and seeking professional assistance when needed, you can successfully fulfill your duties and contribute to the well-being and success of your association.

About Community Association Management Services

In business since 1991, CAMS is North and South Carolina’s premier community management company. With experienced local managers in each of its nine regions, CAMS provides innovative solutions to the community associations it serves. Additionally, CAMS was featured on Inc. Magazine’s 2022 Inc. 5000 list of the fastest-growing private companies in America. To learn more, visit our website.