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Introduction/Welcome

Self introduction Participant introduction Administration Logistics

Agenda Day 1
Introduction/Logistics/Course Objectives Legal Basis Rule Development/Enforcement Budget & Reserves Collecting Assessments Financial Statements

Agenda Day 2
Maintenance Contracting Risk Management & Insurance Community Management Board Meetings & Decision-Making Manager Ethics Day 2 Wrap-Up

Agenda Day 3
Review/Questions and Answers Course Evaluations Examination 100 multiple choice questions 2 hours

Certified Manager of Community Associations (CMCA) Certification Program


Administered by the National Board of Certification for Community Association Managers (NBC-CAM). Establishes acceptable standards of knowledge and skills for the community management industry. Provides association homeowners with a level of confidence regarding a certified manager's knowledge. Raises the professional status of community association management. Resources: M-100: The Essentials of Community Association Management, Drafting Rules, Bids & Contracts, Meetings & Elections, Reserve Funds, Risk Management and Insurance.
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Certified Manager of Community Associations (CMCA) Certification Program, continued


What are the steps to earning the CMCA certification? 1.Complete and pass the CAI-sponsored course, M-100: The Essentials of Community Association Management 2.Complete and submit the CMCA application 3.Pass the CMCA Examinationa 3-hour, 120 multiple-choice question examination For more information, visit www.nbccam.org.

Other CAI Designations for Community Managers and Management Companies


Association Management Specialist (AMS) Large-Scale Manager (LSM) Professional Community Association Manager (PCAM) Accredited Association Management Company (AAMC)

Module 1: Legal Basis


Focus Why we have community associations and how they are structured.

Legal Basis
This section of the program will introduce you to: The legal nature of a community association, including the scope and limits of its authority (Legal Basis for Community AssociationsLesson 1) Proper rule development and enforcement (Rule Development and EnforcementLesson 2)
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Lesson 1: Legal Basis for Community Associations Session Overview


Learning Objectives
Define a community association. Describe the purpose of a community association. Identify the types of community associations. Identify federal laws that affect community associations. Identify state statutes that affect community associations. Understand governing documents of community associations and their hierarchy of authority.
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Characteristics of a Community Association


Mandatory membership Mutually binding documents Lien-based assessments

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Purposes of a Community Association

Community

Business

Government

Types of Community Associations


Planned Community Condominium Cooperative

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Types of Community Associations: Planned Community

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Types of Community Associations: Condominium A

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Types of Community Associations: Condominium B

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Types of Community Associations: Cooperative

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Other Types of Communities


Master (Umbrella) Association More than one residential community association Mixed-Use Development Mixture of residential and commercial and/or industrial use grouped together 55 and Older Communities Must have one person who is 55 years of age or older living in at least 80% of its occupied units

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Sources of Legal Obligation for Community Associations


Federal, state, and local statutes, regulations, and case law Legal documents unique to the community association called Governing Documents Lender requirements Standards set by professional bodies for example, auditing standards set by the American Institute of Certified Public Accountants (AICPA)

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Types of Federal Laws Applying to Community Associations



Equal Employment Opportunity Commission (EEOC) Fair Debt Collection Practices Act (FDCPA) Fair Housing Act Fair Labor and Standards Act (FSLA) Family and Medical Leave Act (FMLA) Federal Communications Commission (FCC) / The Telecommunications Act of 1996 Federal Insurance Contributions Act (FICA) Occupational Safety and Health Act (OSHA) Soldiers and Sailors Civil Relief Act of 1940 (SSCRA) U. S. Bankruptcy Code
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Fair Housing Act


55 and Older Communities Reasonable Accommodations/ Modifications Maintenance Pets/Service Animals Disruptive Residents

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Types of State Statutes Applying to Community Associations


General State Statutes Applies to all types of associations, including community associations
For example, regular corporate or not-for-profit corporate statutes

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Types of State Statutes Applying to Community Associations, continued


Specific State Statutes - Applies only to one or more of the types of community associations - Takes precedence over any general statute and takes precedence over the associations governing documents For example - Provides for establishment and operation of condominiums as legal entities - Regulate development and sale of condominiums
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Types of State Statutes Applying to Community Associations, continued


Uniform State Statutes National Conference of Commissioners on Uniform State Laws draft generic, content-specific wording for topical issues to encourage uniformity among the states
For more information, visit www.nccusl.org

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Community Association Governing Documents


Purpose: To provide for the legal structure and operation of a community association The documents: o Define the rights and obligations of both the community association and its owners o Create a binding relationship between each owner and the community association o Establish the mechanisms for governing and funding the community associations operations o Set forth rules and standards
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General Hierarchy of Governing Documents for a Community Association

Recorded map, plat or plan Declaration, CC&Rs, proprietary lease or occupancy agreement Articles of Incorporation

Bylaws

Board Resolutions

Recorded Map, Plat, or Plan


Recorded before first parcel sold/title transferred Plat sets developments boundaries

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Declaration, CC&Rs, Proprietary Lease or Occupancy Agreement


In community developments, deed restrictions are recorded in one document instead of the deed/title for each lot or unit Condominium = declaration/master deed Planned Community = declaration of covenants, conditions, and restrictions (CC&Rs) Cooperative = proprietary lease/occupancy agreement
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Articles of Incorporation
Brings corporation into existence Cooperatives must incorporate why? Other types of communities may incorporate varies by state Benefits of incorporating: - Limit liability of individual owners - Right granted all corporations - Easier to deal with utility companies, vendors, etc. - Grants the board the same rights as all board members of incorporated entities under state statutes

Bylaws
Bylaws: Formal procedures for administration and management of the governing entity Examples: - Meeting procedures including voting rights - Board powers and duties - Indemnification of officers and directors

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Resolutions
Resolution A motion following a set format and formally adopted by the board. May enact rules and regulations or formalize other board decisions

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Public Offering Statement


Public Offering Statement Provides association information to first prospective buyers Required by state statute Not considered a governing document

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Lesson 2: Rule Development and Enforcement: Session Overview


Learning Objectives Understand the scope and purpose of rules and architectural guidelines in community associations. Identify the four types of resolutions for community associations. Develop valid and enforceable rules using formal rule making procedures. Develop and implement a due process procedure for enforcing rules.
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Scope of Rules and Guidelines


Rules cover the following areas: 1. The use of common property 2. The use of individual lots/units 3. Exterior appearance of homes or units 4. Behavior of residents, guests, and visitors

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Resolutions
Resolution A motion following a set format and formally adopted by the board. Kept in a Book of Resolutions Four types of resolutions: 1. Policy resolutions owners rights and responsibilities, i.e., use of recreation facilities 2. Administrative resolutions internal operation, i.e., where board meetings will be held 3. Special resolutions apply a policy or rule to an individual owner, i.e., decision about alleged rule violation 4. General resolutions routine events, i.e., adoption 36 of annual budget

Criteria for Valid Rules


Must not violate constitutional rights Must be consistent with laws, statutes, and governing documents Must reasonably relate to purpose of community Must be reasonable and fair Must be capable of uniform enforcement Must be necessary

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Steps in Developing Rules


1. Justify the need for the rule 2. Look at the immediate and long-term impacts 3. Find the authority to make the rule 4. Define the scope of the rule

5. Justify the validity of the rule

6. Give notice of the proposed rule

7. Act promptly on the proposed rule

8. Give notice of the adopted rule

9. Revise the Rules and Regulations document

10. Record the new rule in the land records*

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Due Process Procedure


A formal process to protect the rights of all parties. Alleged violations all handled the same way Courts recognize and value the procedure Majority of violations can be resolved Non-threatening environment furthers voluntary compliance Provides opportunity to explore alternative means of resolution

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Basic Steps in a Due Process Procedure for Handling Alleged Rule Violations
1. Call the resident or send a courtesy letter to resolve the violation. 2. Issue a formal cease and desist letter. 3. Issue a hearing notice if the alleged violation does not end within the stated time. 4. Hold the scheduled hearing if the alleged violation does not end within the stated time. 5. Issue a decision after a hearing is held. 6. Allow for an appeal of a decision.
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Alternative Dispute Resolution


Effective with serious disputes Used before lawsuit/court involvement Trained 3rd party Can include arbitration (binding or non-binding) or mediation (binding or non-binding)

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Internal Resources for Enforcement


Suspend voting rights Suspend use of amenities or recreation facilities Fines Eviction Self help corrections

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External Resources for Enforcement


Health department Zoning department Police Fire department Building/planning department Animal control

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Module 2: Financial Management


Focus How to understand the basic financial reports and activities of a community association and the community managers typical involvement in them.

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Financial Management
This section of the program will introduce you to: Budgets and Replacement ReservesLesson 1 Collecting AssessmentsLesson 2 Financial Statements, Audits, Income Taxes, and InvestmentsLesson 3

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Lesson 1: Budgets and Replacement Reserves Session Overview


Learning Objectives
Use budgets as a management tool to facilitate the effective operation of the community association. Explain the sources of budget requirements. Identify and understand the budget components. Identify the two types of budget line items. Identify the two basic methods of budget preparation. Present a budget to the board of directors. Recognize the purpose and benefit of the reserve account. Calculate replacement fund budget line items.
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Using the Budget as a Management Tool


To plan community activities not a prediction To determine assessment rates To measure and control financial operations To give continuity to services To maintain quality of life To limit surprises and minimize the unexpected To balance the needs and desires of the community

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Sources of Budget Requirements


Federal laws and regulations State statutes, regulations, and court decisions Local laws and regulations Governing documents

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Budget Components
Revenue Owner assessments Interest Other revenue (includes late fees, fines, and user fees) Expenses Operating routine administration and operations Major improvements new Replacement fund repair or replacement of major components
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Calculating Assessments
Formula for calculating assessment fees for condominium owners:
Total Assessments Required Percentage Interest as Found in Annual Budget X in the Declaration

Number of Installment Payments in a Year

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Budget Items
Mandatory line items community and owner needs and obligations - For example: taxes, repairs, utilities, maintenance

Discretionary line items owner, board, and committee desires or expectations - For example: social and recreational expenses, picnic areas, patrols, pool towels

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Budgeting Methods
1. Zero-base budgeting all line items are set to zero and the amount of funds allotted to each must be justified 2. Historical trend budgeting existing line items are needed - Item assumed to be justified - Prior information adjusted for expected changes * Utility costs * Construction materials * Insurance * Staff size * Staff raises
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Reserve Account
The reserve account consists of funds put asidein reservefor the replacement of major components of a communitys common property. Typically used to replace asphalt paving, concrete sidewalks, roofs, central heating and cooling plants, swimming pool, tennis courts, elevators, and other varied property components. Revenue raised for adding a major item will be a major improvement expense. Revenue raised for replacing that item when it deteriorates will come from the replacement reserve account.
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Benefits of an Adequate Reserve Account


Meets legal, fiduciary, and professional requirements Provides for planned replacement of major items Equalizes contribution of new and old owners Minimizes need for special assessment Enhances resale value

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Benefits of a Reserve Study


Fulfills fiduciary duty Meets state requirements Meets AICPA requirements Reduces liability Saves planning time Effective communication tool Reveals unbudgeted items

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Lesson 2: Collecting Assessments Session Overview


Learning Objectives Recognize the sources of authority to collect assessments. Identify the benefits of establishing a collections policy. Identify legal remedies available to community associations for collecting delinquent assessments. Understand the impact of a bankruptcy filing on the association.
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Assessments
Assessment Owners financial obligation to a community association during a given period of time Special assessment One time assessment, often voted on by owners to cover a major expense such as a major repair or replacement

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Benefits of an Established Collection Policy


Educates owners about their obligations to the association and the consequences of not meeting those obligations on time Provides a checklist and a road map to guide a board and a manager Avoids charges that the association is proceeding in a selective or discriminatory way Helps preserve harmony among owners

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Characteristics of an Effective Collection Policy


1. Established by a formal resolution of the board 2. Specify only actions that are within the power of the association and its board 3. Set a firm due date for assessments 4. Outline the steps to be taken when a payment is late 5. Allow for discretion in special cases 6. Specify when a delinquent assessment should be referred to legal counsel 7. Provide for the collection of any costs associated with collecting delinquent assessments

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Delinquency Remedies
Extra Judicial Remedies Late charge or interest penalty Require security deposit equal to certain number of months assessments Acceleration Collection of all assessments due through the end of the fiscal year Suspend owners user privileges, such as pool privileges Suspending owners voting and other participation rights
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Delinquency Remedies, contd.


Judicial Remedies Perfect association lien Foreclose the lien Personal money judgment - Allows association to claim/collect rent from the owners tenant

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Bankruptcy
Immediately take three actions: 1. Contact legal counsel (attorney) 2. Forward any bankruptcy notices to counsel 3. Stop all collection efforts Types of bankruptcy: 1. Chapter 7 liquidation 2. Chapter 11 corporate reorganization 3. Chapter 13 personal reorganization

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Lesson 3: Financial Statements, Audits, Income Taxes, & Investments Session Overview
Learning Objectives
Identify the purpose and types of financial statements. Identify and explain the three types of accounting methods. Differentiate between an audit, review and compilation. Recognize federal income tax requirements and responsibilities for community associations. Explain investment policies and objectives for community associations.
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Accounting Methods
Cash Basis Income when received Expense when paid Accrual Basis Income when earned Expense when incurred Modified Cash Basis Records income and expenses on a cash basis with selected items recorded on an accrual basis Most common = records income (assessments) on the accrual basis and expenses on the cash basis Also known as Modified Accrual
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Financial Reports
The Statement of Revenue and Expense Records transactions during a given time period Three components: - Revenue - Expense - Net revenue (or loss)

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Financial Reports, continued


Balance Sheet Snapshot financial condition at a specific point in time What association owns and owes and its net worth ASSETS = LIABILITIES + MEMBERS EQUITY and ASSETS LIABILITIES = MEMBERS EQUITY
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Financial Reporting Warning Signs


Steady decline in the amount of cash on hand Replacement reserves not set aside (no formal reserve study) Increase in assessments owed to the community Increase in what the association owes for bills Failure to resolve any differences between bank statements and financial reports Significant and/or unexplained differences between actual and budgeted figures Members equity balance is less than one to three months of operating expenses Unpaid amounts showing as due between funds
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Role of the Certified Public Accountant (CPA)

Audit Review Compilation

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Investments

Safety Liquidity Yield

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Safeguarding Association Funds


Work with your board of directors to implement a series of safeguards and internal controls to help prevent fraud and embezzlement.

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Module 3: Facilities Management


Focus How to understand the community managers role in: Operating, maintaining, repairing, and replacing the common elements and common areas. Planning, organizing, leading, and controlling your associations resources in order to achieve its goals.

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Facilities Management
This section of the program will introduce you to: MaintenanceLesson 1 ContractingLesson 2 Risk Management and InsuranceLesson 3

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Lesson 1: Facilities Maintenance Session Overview


Learning Objectives Determine your associations maintenance responsibilities. Analyze your communitys maintenance needs. Identify the types of maintenance work. Analyze your facilities maintenance system and management tools. Evaluate maintenance systems and efforts. Explain the importance of sustainable lifestyles.
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Management Tools for Maintenance


A management tool is any means used to record, remind, or command attention. Examples: Checklists Charts of information Calendars or schedules Records of actions taken Inventories Work orders Request forms Response forms track,

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Identifying Maintenance Needs


Conduct a site visit of the property Examine building plans or specifications Review any reserve studies Review all maintenance records Interview board members, employees, or contractors Review product or equipment information

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Types of Maintenance Work


Routine Preventive Emergency Requested Reserve replacement

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Work Order Systems: Purpose


Document requests Assign tasks Obtain feedback Allocate costs Evaluate staff and contractor performance

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Work Order Systems: Benefits


Ensure follow-up Monitor costs Provide historical records Document problems

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Bayview Towers Condominium Association, Inc. GREEN ENERGY COMMITTEE (Advisory Committee) CHARTER OBJECTIVES: To assist in the education of homeowners and staff regarding energy, water and other conservation related subjects. This shall be accomplished through research, analysis and testing of new technologies, in addition to well established procedures and recommendations. Additionally, the committee will investigate federal, state, and local government programs while also soliciting knowledge and ideas from public utilities and private industry. Communication of technical findings, ideas and suggestions to homeowners will be through, but not limited to, a monthly column, special notices, lectures and demonstrations. Ideas suitable for the community will be presented to the board or appropriate committees. The actions and benefits resulting from this committee will be dependent upon a high level of interest and the involvement of the entire community. Therefore, the committee shall encourage and solicit homeowner participation to the maximum extent practical. ORGANIZATION: The committee will meet as needed, typically monthly. The committee members will select its chair. All committee meetings will be open to the public. Minutes of the meetings will be taken and filed in the corporate files. A report that will be issued to the board will be generated from each committee meeting. The committee will consist of at least five (5) association members. The committee will serve at the pleasure of the board.

Relax Architectural Guidelines


Use broad language Allow multi activities Allow diversity Include sustainable initiatives Assure proper restoration of sustainable systems Predetermine technologies you want Be up to date with terms Allow low tech options, too Allow resourceful and natural systems

Lesson 2: Contracting Session Overview


Learning Objectives Determine whether or not to contract for services. Prepare a request for proposals and evaluate bids submitted for consideration. Identify the provisions that should be included in every contract.
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Issues that Affect the Decision to Contract Services


Personnel Time constraints Cost Tools, equipment, and supplies Insurance coverage Licenses and permits Storage facilities
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Preparing an RFP Packet


The full name, address, and telephone number of the association Detailed description of the work to be done or the product to be purchased Key dates Whom to call for information or inspection of site Where to submit bid Request for three to five references from previous jobs of similar size and scope Warranties required
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Contract Provisions
Parties Scope of work Compensation Time period Performance standards Warranty Restoration Indemnification Insurance License & permits

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Contract Provisions, continued


Notices Termination Default Financial protection
- Performance bond - Completion bond - Waiver of lien

Legal provisions
- Assignability - Modifications - Waiver - Severability - Entire obligation

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Tips for Successfully Completing a Contract


Hire a specialist to inspect ongoing work Monitor the job site while work is in progress Inspect the completed job before final payment Prepare a payment schedule if you are going to make progress payments

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Lesson 3: Risk Management and Insurance Session Overview


Learning Objectives
Identify the four types of exposure to loss for an association. Define risk control. Identify four ways to control risk. Identify the requirements for community associations to have insurance coverages. Identify the four major insurance coverages available to community associations. Explain the managers role in the bidding process. Provide tips for filing insurance claims.
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Exposures to Loss
1. Property Exposure tangible or intangible Real property buildings, land, information Personal property inventory, furniture, supplies 2. Liability Exposure Third-party claim of personal or property damage 3. Income Exposure net loss reduction in income/increase in operating expenses 4. Personnel Exposure claims of employees

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Risk Control
1. 2. 3. 4. Exposure avoidance Loss prevention and reduction Segregation of exposure Contractual transfers

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Sources of Insurance Requirements


1. 2. 3. 4. State statutes and regulations Association governing documents Local and federal law Secondary mortgage market, agency, and lender requirements 5. Contractual obligations 6. Good business judgment

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Property Coverage
Commercial package policy Mechanical/equipment breakdown insurance Ordinance/law insurance Flood insurance Electronic data processing

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Liability Coverage
Commercial general liability Hired and non-owned automobile liability Commercial umbrella liability Directors and officers liability

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Income Coverage
Fidelity insurance Business income insurance Assessment fees receivable insurance Extra expense insurance

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Personnel Coverage
Workers Compensation insurance Employers Liability insurance

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Evaluate Agents/Brokers
Experience Specialty in the field Knowledge of community associations Claims processing history Participation in professional and trade associations Professional standing Licenses Bonding CIRMS
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Module 4: Community Management and Leadership


Focus How to: Inform and guide your communitys owners and volunteers. Successfully perform your role as community manager and leader.

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Community Management and Leadership


This section of the program will introduce you to: Your role and responsibilities as a manager in relation to the roles and responsibilities of your communitys owners and volunteer leaders (Community ManagementLesson 1) The effective use of board meetings for decision making (Board Meetings and Decision-Making Lesson 2) Management ethics (EthicsLesson 3)
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Lesson 1: Community Management Session Overview


Learning Objectives:
Explain the roles and responsibilities of the community association owners, board and committees. Identify the roles and responsibilities of the manager. Explain the different forms of community management. Describe the scope of the management contract. Describe the scope of the employment agreement. Understand the managers role in a developing community. Understand the managers role in overseeing a communitys human resource system.

Role of the Owner


Elect and remove directors Amend any of the governing documents, except board resolutions Approve special assessments or capital improvements Not veto board decisions

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Role of the Board


Act in the best interests of the association Be responsive to the needs and desires of the owners Be familiar with the governing documents, state statutes and federal laws that impact the association Enforce the governing documents fairly and uniformly Set the policies, standards, procedures, programs, and budgets for the community association Not micromanage the manager, volunteers, contractors, and other service providers
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Board of Directors Responsibilities


Care, maintenance, and enhancement of the physical property, common areas, and facilities Management of community finances and developing reserve funds Risk management, including obtaining insurance
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Board of Directors Responsibilities, continued


Establishment, enforcement, and interpretation of rules and regulations Human resources management of employees and volunteers Preservation and promotion of community harmony

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Business Judgment Rule


Based on fiduciary duty act in the best interest and for the benefit of the community association
Business judgment rule applies this as follows
The officers and directors of a corporation are immune from liability to the corporation for losses incurred in corporate transactions within their authority, so long as the transactions are made in good faith, with due care, without any direct conflict of interest, and with loyalty to the corporation evidenced by acting in its best interests. - The court will not substitute its judgment for the boards
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Types of Committees
Mandatory o Required by the governing documents o Typical mandatory committees: - Elections - Nominations - Architectural standards
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Types of Committees, continued


Standing o Ongoing to meet a basic community need o For example: - Budget/finance - Social - Newsletter o Established by board resolution Ad Hoc o One-time issue o Established by board resolution
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Guidelines for Successful Committees


Serve in an advisory capacity Have an appeals process, if needed Have specific job descriptions Keep minutes and make recommendations Have meaningful tasks Have guidance to complete tasks Consideration of their recommendations Recognition of their work

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Role of the Manager


Provide information, training, and leadership on community association operations to the board, committees, and the community at large Foster a sense of community awareness and spirit within the residents Develop a body of leadership through the committee structure Provide the necessary administrative tools to the board to enable it to make wise, informed decisions on both shortterm and long-term actions and goals Facilitate board meetings Provide practical, technical and administrative advice
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Forms of Management

Volunteer Association-Employed Manager Management Company

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Provisions of a Management Contract


Contracting parties Chain of command Responsibilities of management Insurance Terms of agreement Termination Indemnification and hold harmless Compensation

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Provisions of an Employee Agreement


Terms of employment Duties and services to be performed Compensation Termination Associations obligations Exclusiveness of agreement Modifications only in writing Applicable legal sources Nondisclosure of confidential information Notice provisions
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Transition

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Objectives of a Smooth Transition


Enhance community relations Minimize controversy Build trust Resolve issues before they escalate Minimize potential claims Retain management contract Ensure future developer work Less stressful life
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Definition
Transition - (tran-sis'-shun)
n. the gradual process by which the control and responsibilities of the governing board of an association are transferred from the declarant to the persons who bought units/lots in the common interest community.

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Definition
Turnover - (turn'-oh-ver)
n. the date on which the declarant no longer has the right to appoint a majority of the members of the board.

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The Players
Manager Attorneys o Developer o Association Engineer/Reserve Specialist Accountant Insurance Agent
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The Manager
Twinkle in eye o Documents o Budget o Design o Community association creation Orchestra conductor Educator Trainer Coordinator Cheerleader Mediator Discipliner Task Master The Great Communicator Buffer

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Initial Services
Review site, building & landscape plans Confirm amenities Create team Draft realistic multi-year budget Determine developer funding obligations Review documents Craft rules, ACC guidelines Create transition timeline/checklist Train sales and construction staff Create HO manual Create/review Maintenance Responsibility Chart

Pre-Turnover Services
Train initial board Provide leadership programs for emerging homeowner board and committee members Conduct new owner welcome and orientation sessions Update developer funding obligations Frequent Town Hall meetings

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Turnover Services
Prepare for Turnover Meeting o Documents & statutes o Positive environment o Ducks in a row Coach board Prepare homeowner advisory/board members Coordinate transition team Turnover checklist
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Post-Turnover Services
Community association management New board orientation Coordinate transition team Coach new leaders Follow up turnover meeting issues Leadership development

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The Managers Loyalty Conundrum


Developer: Consulting fees Sense of satisfaction More business Easier work No night meetings Manager runs the show

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The Managers Loyalty Conundrum, cont.


Association: Continue after turnover Use skills Challenges Word of mouth

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The Conundrum Winner

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Human Resource Management


Personnel guidelines Job descriptions Personnel laws Performance planning and evaluation Disciplinary actions

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Lesson 2: Board Meetings and Decision-Making Session Overview


Learning Objectives Explain the board of directors decision-making authority. Explain the managers role in preparing for the board meeting. Provide tools for conducting a board meeting. Understand the types of owner meetings. Use techniques to facilitate a successful meeting.
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Board Meeting - Policy Matters


The emphasis of board meetings should be on timely attention to policy matters. And, the day-to-day administration of the community association should be left to the manager.

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Legal Requirements
State statutes and governing documents establish requirements for board of directors meetings. Legal requirements commonly address such issues as: Frequency of meetings When meetings should be open or closed Notice of meetings Voting Executive session Violation hearings 127

Dual Role of a Manager


1. Support Staff Meetings are wellprepared Board members have the necessary information ahead of time 2. Professional Advisor Provide the board with guidance and perspective on the matters at hand

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Helping to Facilitate a Board Meeting


Help keep discussions on target Offer alternatives when discussion stalls Call attention to previous board actions Be a timekeeper Be aware of governing documents Urge consistency in action Support fairness Elaborate on the management report

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Lesson 3: Ethics Session Overview


Learning Objectives: Define ethics for community associations. Identify and resolve ethical conflicts for managers. Understand and apply CAI's Designation Code of Ethics for Management.
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Ethics for Community Managers


Diligent service Full disclosure Reasonable care Avoid competition/conflict No undisclosed monies Accountability Prudent use of authority

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Conflict of Interest
1. Is the transaction which results in compensation to the management company or agent directly or indirectly related to managements relationship with the community association? 2. Will management directly or indirectly receive some compensation from the community association, or a third party, other than the compensation described in the management contract?

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Full Disclosure
1. Make full and complete written disclosure of all relevant facts to your board prior to any dealings which may be, or appear to be, a conflict of interest for you. 2. Obtain specific authorization from the board in writing before proceeding with any action which may present a conflict of interest. 3. Even after full disclosure, avoid any actions which areor may be perceived asa conflict of interest.
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Course Conclusion

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Module 1: Legal Basis


This section of the program introduced you to: The legal nature of a community association, including the scope and limits of its authority (Legal Basis for Community AssociationsLesson 1) Proper rule development and enforcement (Rule Development and EnforcementLesson 2)
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Module 2: Financial Management


This section of the program introduced you to: Budgets and Replacement ReservesLesson 1 Collecting AssessmentsLesson 2 Financial Statements, Audits, Income Taxes, and InvestmentsLesson 3

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Module 3: Facilities Management


This section of the program introduced you to: MaintenanceLesson 1 ContractingLesson 2 Risk Management and InsuranceLesson 3

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Module 4: Community Management and Leadership


This section of the program introduced you to: Your role and responsibilities as a manager in relation to the roles and responsibilities of your communitys owners and volunteer leaders (Community ManagementLesson 1) The effective use of board meetings for decision making (Board Meetings and Decision-Making Lesson 2) Management ethics (EthicsLesson 3)
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Additional Resources from CAI


CAI offers many excellent resources for those interested in obtaining additional information about community association management. For information on these products, call CAI for a bookstore catalog at (888) 224-4321 or visit the bookstore online at www.caionline.org/shop

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Contact CAI

6402 Arlington Blvd., Suite 500 Falls Church, VA 22042 (888) 224-4321 (M-F, 9-6:30 ET) (703) 970-9558 (Fax) caieducation@caionline.org www.caionline.org
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Thank you!
For participating in this course For your support of CAI and the Professional Management Development Program

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Final Questions?

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Evaluations
Please be sure to fill out your course evaluations. Your feedback is important to us.

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Course Exam
100 questions Multiple choice Results will be available within four weeks, if not sooner Good luck!

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