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The Art of Picking Professionals To Choose or Not to Choose

The Art of Picking Professionals

Running the day-to-day business of a condo development or an HOA of any size—be it a sprawling, multi-building community, or a single self-contained building—requires not just a functional board but a team of competent outside professionals. These professionals keep things running smoothly and efficiently for residents and boards—from the legal counsel who advises board members on their responsibilities under the law to the accountant who balances the books and keeps tabs on the building’s assets to the property manager who juggles board, resident and mu nicipal concerns.

Since the professionals working for your building community are so essential, it’s critical that you as a board collectively choose the best people to work for you, whether as an attorney, accountant or manager. Figuring out how to choose those people is the difficult part however, as there are hundreds of professionals in each market, all clamoring for your community's dollar.

The Decision-Makers

While just about everyone in your association or building will have an opinion on who should be hired to do a particular job for the community, ultimately that's a decision made by the elected board. Board members get to figure out which management company to select, along with which accountants, attorneys and other professionals to hire, says Andrew Fortin, senior vice president of external affairs at Associa, an association management company with about ten offices in Florida and nationwide.

“The board should give special thought to how each professional level service provider is hired, and should engage in due diligence to confirm professional licenses, uncover any ethics complaints or other potential red flags,” Fortin says. “Some management companies offer pre-screened vendors that the association may choose to use if they wish. This can be a benefit to the board, as many of these vendors are pre-screened to ensure they are fully licensed and insured.”

In some jurisdictions, state law requires that any service to a community above a certain dollar threshold—say, $5,000 or above—must be obtained through a competitive, sealed bid process, Fortin says. Once the condo board decides on its management company, the management can look for the other professionals via bids or via their own recommendations.

Before any final decisions are made however, the board must take a vote—and according to Steven J. Weil, PhD, EA, LCAM, the president of Royale Management Services, Inc., based in Fort Lauderdale, each board member’s vote typically has equal weight, regardless of their position within the board.

“It’s important to remember that in most associations—and check the governing documents in your own to be certain—the president has no more or less decision-making power than any other board member,” Weil says. “The president is generally more about leadership as the meeting chair than about decision-making.”

Any important decisions and policies, such as which professionals should manage the building, are made and set by a vote of the board of directors, and unless a long-term contract exists with the manager or other professional (which Weil strongly advises against), all professionals serve at the pleasure of the board of directors.

“While no one board member can or should be able to control these decisions, a majority of a quorum can decide to hire or fire a management company or manager,” Weil says.

Community Input

Non-board members do have some say in the process, however. While the board has 100 percent decision-making power when it comes to the vote, residents definitely have the right to speak at meetings so they can make their feelings known.

“Sometimes, a board will form a search committee, to which they can delegate some decision-making,” says Evan Bradley, chief financial officer of Campbell Property Management, based in Deerfield Beach. “The committee can make a recommendation to the board—and then the board will make the final vote to decide.”

During the interview stage, the board should publicly interview the managers, accountants and attorneys during open meetings where the owners are free to observe. The board is under no obligation to allow owners to question prospects, however, and may hold all owner comments until after all interviews are done, Weil says.

“Again, this is up to the board,” he continues. “We have attended meetings at which owners were invited to ask questions, which can sometimes be informative; we have also been to meetings where the board didn't allow any owner questions, which can be a little strict, but can also prevent a one-hour interview from becoming an all-night review of what-ifs or what has been done in the past.”

References, Please!

When boards or associations choose a professional, the board—or the search committee appointed—shouldn’t simply do a Google search and select the least expensive company. They should check licenses with the state, and, most importantly, check references from other properties, says Weil.

“This is about matching community needs to management style, skills to community issues,” he says. “It’s also about finding someone who will respect the board but will also help keep the board on track and out of trouble. If a manager will do anything the board says, it might be a good idea to find someone who will stand up to the board members and owners when it comes to things like following the rules, governing documents and the law.”

Most professionals should be licensed—and this includes community managers in some states, and attorneys and accountants nationwide—but you should also check to see whether their licenses are current, and also to see if any complaints have been filed against them, Fortin says. Most licensing agencies, professional organizations or state bar associations can provide this information.

Licensed and Bonded

Fortin goes on to say that it's critical that the board ensure that vendors have the appropriate bonding and workers compensation insurance in place to protect the association from mishaps. “I have seen instances where a community hires a local handyman to help with the landscaping, and the person does not have insurance or proper bonding,” he says. “The vendor is injured on the property or damages a home, and the association is on the hook for the damages.”

If the building already has a professional they trust—their accountant, for example—they can start by asking that professional to recommend another company (a good real estate attorney or a management firm), Bradley says.

“Word of mouth is where you can start,” he says. “Angie’s List may work for small companies but larger companies generally get referred through word of mouth or industry professionals.”

Another idea is to look at trade organizations like the Community Associations Institute for directory resources or publications like The South Florida Cooperatorfor service professional contacts.

A Good Fit

The professional dealing with your building or HOA must also click socially and professionally with the board, because you'll be working together closely on personal and business matters.

“Anyone who deals with residential matters should have an outgoing demeanor, be pleasant, and look professional,” Fortin advises. “Professional association memberships are a good sign that the professional or his business support the industry as a whole, and educational credentials provide evidence of an investment in their skill set and also can provide recourse should the professional not live up to their obligations.”

For example, if you aren’t satisfied with the work done by a professional working for your community, a resident or board member can file a complaint against the individual or company with a professional designation issued by a trade group.

However, says Fortin, “The bottom line is that the evaluation process should look at the totality of factors available that included professional designations, word of mouth, and references.”

Once the board selects a company for any job, they should sign a contract with that company, though the cancellation terms will vary, Bradley says. A good company will generally give you a 30-day or a 60-day cancellation clause, though some companies will prefer to lock associations or building communities into longer-term, performance-based contracts.

You're Fired

Dissatisfaction with the given company can be handled in a number of ways, depending on the cause of the dissatisfaction.

“For example,” says Weil, “if an association has roofing problems because the board has avoided spending money for years to make proper repairs, and the manager presents the board with a solution to the problem that involves a special assessment, a group of owners might complain because, ‘It’s not leaking in my unit so why should I have to pay?' Sometimes even the board will complain as well. But an experienced manager knows that the cost goes up the longer the problem is ignored, and that at some point, the roof will collapse—so he or she brings it up, even though it’s not popular.”

That may cause dissatisfaction with the manager, and while the owners may express unhappiness at the meeting or in writing, it’s up to the board to act, if they wish to replace the manager—or to determine that the manager is simply performing his job—and take his or her advice regarding the assessment.

“If the board desires to replace the manager or any professional, they can do it at any board meeting by a majority vote if a quorum of the board is present,” Weil says.

Contracts can be cancelled, but you do have to be wary of contract provisions already in place before doing so, Fortin says. Even if there is dissatisfaction, it’s hard to break the terms of the contract unless extreme measures are taken.

“The professional contract usually spells out the terms by which the contract should be terminated, and these terms should get close review prior to signing the contract,” Fortin says.

    Certain types of repairs and services are prone to contract disputes. You just have to trust that your board and management team have made a good decision, and shut the door on the subject.    

Danielle Braff is a freelance writer and a frequent contributor to The South Florida Cooperator.