Guest Post By Holly Smith, CMCA, AMS, PCAM
This article first appeared in the CAI Coachella Valley HOA Living Magazine, February 2025 Issue.
One of the most important aspects of a community manager’s job is to ensure that you are managing your associations in accordance with their governing documents. Community management isn’t a one-size-fits-all approach when guiding and conducting the business of the association. Each community has unique nuances that require you to know and understand what the documents say.
When managing a community, the first step should be reviewing the Articles of Incorporation, CC&Rs, Bylaws, Rules and Regulations, Enforcement Policy, Election Rules, and any other policies the association has in place. Familiarizing yourself with these documents and pinpointing any inconsistencies between the documents and current laws is crucial to your role.
Let’s explore some major areas where you need to ensure familiarity with the governing documents, as following them closely will help protect both the association and your management company from liability issues.
MAINTENANCE
If you are fortunate enough to have a Maintenance Agreement, your job of determining homeowner versus HOA responsibility is often straight forward. You may want to have the board review the indemnity to ensure it comprehensively covers the association’s maintenance needs. If this isn’t an option, deciphering responsibilities can be more challenging. Using the Association’s insurance policy and determining whether it is a wall-in or bare-wall policy, may be helpful, but this may still not fully define all HOA responsibilities. In cases where responsibilities are not clearly defined in the governing documents, the best course of action is to seek a legal opinion for clarity. This may also be a good opportunity to assess whether the documents are outdated or ambiguous enough to warrant a re-write for better clarity and compliance with current standards. Providing clear maintenance responsibilities can prevent costly disputes and ensure long-term property upkeep.
ANNUAL MEETINGS
The governing documents will provide extensive information on how elections must be conducted. The Bylaws will be the primary document guiding the number of officers, terms, quorum requirements, and nomination guidelines.
The Election Rules combine pro-visions from the CC&Rs and Bylaws with requirements under the Davis-Stirling Act, which may override certain governing document provisions. For example, while the governing documents may state there is no reduced quorum for an adjourned annual meeting due to lack of quorum, the Davis-Stirling Act allows for a reduced quorum to 20%.
Election rules should be reviewed by the association’s attorney to ensure they comply with all current state election statutes. Your attorney may also recommend amending the CC&Rs and even the Bylaws to allow the association to take advantage of provisions such as electronic balloting. Best practices for annual meetings include preparing a checklist for quorum verification, nomination procedures, and proxy voting to ensure a smooth and compliant process.
INSURANCE REQUIREMENTS
The governing documents provide guidance for both the association and homeowners regarding required insurance coverage. This is why your insurance agent will request these documents to ensure the coverage they provide meets the association’s needs. If you are shopping for insurance and not asked for these documents, it may indicate the agent lacks HOA expertise, and you should consider seeking coverage elsewhere to ensure proper protection for the community. Common types of HOA insurance policies include general liability, D & O coverage, and fidelity bonds, each serving a unique role in protecting the association.
ARCHITECTURAL CONTROL AND COMPLIANCE
The governing documents often outline architectural standards and the process for homeowners to submit modification requests for approval.
Understanding these provisions helps ensure consistent enforcement of design guidelines, prevent unauthorized alterations, and maintain community aesthetics and property values. It also provides clarity on how to handle disputes and enforcement actions if homeowners violate architectural rules. Examples include restrictions on exterior paint colors, fence height, and landscaping modifications, all designed to preserve the community’s appearance and harmony.
This list only highlights a few key areas and is by no means a comprehensive list nor the only provisions you should be looking for in your association’s governing documents. The idea is to help you understand that these documents are not only a useful tool but are the most essential tool you need to use in helping to manage your associations. Reading through and understanding the documents is crucial to ensuring you’re not steering the association in the wrong direction. Thus, keeping the board, you, and your company out from under potential liability issues.
If you don’t understand the documents, chances are the board will not understand them either. To fully comprehend their meaning, it’s important to turn to your legal counsel to help make those determinations. Using your third-party professional also provides you the benefit of proving that you did everything in your power to make the best decisions for the association based on professional guidance and limiting liability.
Ultimately, a thorough understanding of your association’s governing documents is fundamental to effective HOA management. These documents serve as the foundation for decision-making, conflict resolution, and maintaining the integrity of the community. By staying informed, consulting legal counsel when necessary, and consistently applying the guidelines outlined, you can help create a well-managed, harmonious community while safeguarding both the association and your management company from unnecessary risk.
About Holly Smith, CMCA, AMS, PCAM
Holly Smith has been in the property management industry for over 20 years throughout Southern California. With a culmination of experience in managing Federally funded low-income housing programs, rentals, and Homeowners Associations.
While those opportunities came with many specialty designations, Holly has continued her education and has earned her CCAM through the California Association of Community Manager and her PCAM through the Community Association Institute as part of her dedication to growing the CID industry.
Holly was awarded Portfolio Community Manager of the year in 2019, been published in numerous industry publications due to her experience with HOA management and is often an Instructor for the Desert Cities HOA Council guiding Board Members on best practices.
Holly is currently leading her own team of professional managers as an Executive Director of Community Management with Associa – Desert Resort Management in the Coachella Valley.