Special Assessment Success Through Communication and Transparency
I recently spoke with the President of a very large association, wherein a much-needed special assessment went to the membership for a vote… and was summarily defeated, and it wasn't even close. I won’t go into all the gory details; however, my analysis of why that vote went down in flames is that communication surrounding this wasn’t politically adequate to get the job done, resulting in the Board being perceived as not transparent to the membership. Unfortunately, special assessment failures are not a rare occurrence. The question becomes: How do we, as managers, guide Boards to best communicate issues (real or perceived) of negative impact to the owners in such a way as to make them understand the often grave necessity for that special assessment? By assisting those Boards in developing a complete communication plan that promotes transparency at every level. Is the communication/transparency plan going to be easy? I can tell you from experience the answer is no. It requires dedication, coordination and lots of work from all involved. Let’s take a look at how such a plan can be set up.
The Communication Plan
Start ASAP. “Three may keep a secret if two of them are dead.”(1) No truer words were spoken, especially in the closed system of a community association. Before the Board votes to call for a special assessment, have a draft of the communication ready to go out to the members, so the Board is notifying the owners virtually immediately, and not being perceived as “hiding the ball.” When it comes to volatile issues, you must address them early, often, and publicly, as any information vacuum will be filled with rumor, innuendo, and disinformation. To mitigate the impact of these three demons, get in front of the issue… before it's all over Nextdoor or Facebook (where thoughtful discourse goes to die).
Recruit allies in the community. The Board and management should seek out owners who support the Board and can understand and articulate the issues to others in the community. In particular, look for high-profile members with credibility and a large social circle, such as the golf or pickleball committee chair. Bring these allies into the process by giving them all essential information and always being available to support their mission on behalf of the Board. These allies can be crucial in spreading accurate information daily; quelling rumors and correcting disinformation in real time.
The Board and its allies should have all the same talking points and answers to standard questions posed by owners. The same questions come up in every situation like this, so to promote a consistent message coming out from the Board and its allies, put together a Q and A sheet for each person; e.g.:
? Why is this necessary? The cost of property insurance increased over 35% in a single year. We simply don’t have the funds to cover it.
? When did the Board learn about this? When our insurance agent attended the Board meeting last February.
? Well, did they look for cheaper insurance? Yes, in fact we have bids from 3 different companies, all within the same range.
? Did YOU see those bids? Yes, I did.
? Why us? It’s not unique to our community, my understanding is HOAs all over the country are facing such increases.
? Do we HAVE to have that much coverage? Yes, we have been advised by general counsel we must maintain insurance, or new buyers may not be able to get financing. It’s also our fiduciary duty.
? When will I have to pay? The Board is working on various payment plans to meet the needs of as many residents as possible.
PRO-TIP MANAGERS: THE ABOVE GOES FOR YOU, TOO!
Very important point: The Board MUST believe. The Board itself must believe in its mission when embarking on such a politically volatile undertaking, and they must be willing to discuss it at any time with residents; be it at the pool, the tennis courts or while dog-walking. If the Board is unwilling to do this, they will be viewed as not being transparent, will lose credibility in the eyes of the membership, allies will be non-existent and the endeavor will be doomed to failure.
Map out communication touchpoints. Using a 6-month time frame as an example, month 6 is devoted to voting, so we have 5 months to communicate to the owners the what, when, where, how, and crucially, the why of the increase or special assessment, and what method of communication will be used at which touchpoint. E-blasts are very important, cheap, and convenient for all involved, but don’t stop there. Use available bulletin Boards, the community’s social media page, the monthly newsletter, the website, etc. Keep a record of what you posted where and when, and ensure ALL touchpoints are updated with the latest information to promote that all-important transparency.
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All communication must be well-written and well-spoken. Whether writing an e-blast or speaking to owners, remember these 3 principles for excellent communication: clarity, brevity, and tone.
? Clarity means the intent of your communication is clear and there is no confusion, and is very important when communicating a negative impact issue; ? Brevity (being brief or concise), means the communication is only of relevant information and is as short as that information allows; and ? Tone,?which reflects the writer or speaker’s attitude, is conveyed by the choice of words, and will be crucial when communicating about a negative impact issue, with the goal being to make unpleasant news as pleasant as possible.
Communication must be regular, and more often than in “normal” times. I highly recommend bi-weekly e-blasts and other updates, even if there is nothing new to report. When residents can count on information from the Board at regular intervals, they view the Board as not only being transparent, but is in touch with the needs of the members who want to know what’s happening.
Townhalls. Townhall-type meetings of the membership are a great way to promote transparency and give out “official” information that naturally dovetails with information being sent to the members, posted online or discussed on the pickleball court. Townhalls also promote a back-and-forth communication (feedback) that allows the Board to “read the room” and understand how the communication plan is working. What are we doing right? Where do we need improvement?
Use experts. Having your insurance agent, attorney, or other expert at a townhall, or giving their expert opinion on the matters at hand within your communications to the members, gives the Board added credibility, and points out they are fulfilling their fiduciary responsibility by conversing with and relying on the advice of field experts.
Communication = Transparency Transparency = Communication
Whether it’s the cost of insurance or utilities, funding severely depleted reserves, or all three, community associations are facing fiscal crises, posing serious challenges to Boards as they struggle to devise a way to convince owners that yes, we must increase dues and/or levy a special assessment if we intend to keep the lights on, the pool heated and insurance intact. These issues are assuredly difficult in the best of times; however, in today’s world of political and financial instability, where many residents are just barely hanging on, they can be explosive. Unfortunately, assessment increases and special assessments are here to stay for the foreseeable future, and managers must be prepared to help their Boards get through the process with as little pain as possible to them, and the membership. The keys are communication and transparency.
Does your community need assistance in developing communication strategies for difficult situations? Adamen Inc. can help with that! Email Julie Adamen at [email protected]
Footnotes: (1) Benjamin Franklin
DO YOU HAVE BOARD MEMBERS THAT COULD USE SOME HELP? HAVE THEM TAKE CAM 101 for BOARDS !
c. 2024 Julie Adamen, Adamen Inc. all rights reserved
Thank you for sharing this!
President of The Avalon Management Group - AAMC?
5 个月Often the need for special assessments is due to decades of underfunding reserves across multiple boards. The sad part is that membership almost always pushes back against even minor increases in dues. Then something happens that requires special assessments and the current board takes the heat for decades of bad decisions. While your post is accurate few managers have the training, or the time, to implement what you outline. In addition during the town hall meetings members often personally attack the board and management. Since special assessments will probably become common place, there should be new courses created just to deal with them. The managers need training to deal with what will soon become the new normal for many condo and townhome communities.
Self Employed - Ok I admit it. Unemployed.
5 个月Julie a observation I have had as a homeowner is that none of the community managers, I have dealt with over the last 7 years have any sales skills. (I have dealt with 5 different management companies and probably 15 different managers from the assistants to the CEO) Watching these companies over the last several has made me realize what the majority of the issues with your industry are. Trust: Trust is huge and the first thing any good salesperson does is gain the trust of their customers. It's hard to sell a set of $3000 tires on the service drive to someone you just met.... You have to gain their trust, quickly. LOL The community managers I have dealt with all tend to use what I call "strong arm tactics" with homeowners. At first, I thought this was just the individuals I was dealing with, but I have found that all the community managers I have dealt with have this attitude about them that from a sale standpoint doesn't build trust. Sales Skills: I have not met one person in your industry that has any sales skills. As an example, to sell a special assessment you need to build value in it. (educate) Consistency: Your industry lacks standards which in turn make you all untrust worthy. This I probably need to explain.
Founder at Leahy Legal Consulting PLLC
5 个月Well written, Julie, and good points. I've long believed that the job description of a board member might be reduced to just this: EARN the trust of those you serve.
Regional VP at Griswold Real Estate Management
5 个月Educate, educate, and educate some more. If you educate people on the reasons, they will understand and vote for the necessary increase. I once had to request a $1,500 special assessment to replace the roofs in a community.?(This was several years ago, and it would translate into about a $5,000 assessment now.) We called a meeting to vote. Not only were all the homeowners present, but they all voted yes! We had educated the homeowners well and a recent rain just put the icing on the cake.