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Top Ten Benefits of Living in an HOA

Top Ten Benefits of Living in an HOA

As an HOA homeowner, you already have good reasons for why you’ve chosen to live here. However, it’s always interesting to hear from others why HOAs are a benefit to owners and the community. We recently came across this Top Ten Reasons list in an industry publication and wanted to share. Enjoy the read!

 

  1. HOAs preserve the nature of the community and protect property values by delivering services and providing a safe, well-maintained living environment.
  2. HOA regulations are another layer of protection against neighborhood degradation, and an effective means to maintain community standards and protect property values.
  3. HOAs lessen the need for local government oversight of housing conditions. Most municipalities are not equipped, i.e. do not have the manpower – to monitor housing.
  4. Homeowners in HOAs have a vested interest in reporting and correcting problems from architectural and building code violations to illegal parking and landscaping issues.
  5. HOA leaders live in their communities and better understand the needs of the community, from the delivery of core services, such as waste collection, to amenities and decisions affecting the future of the community.
  6. HOAs promote a higher level of civic involvement than municipalities, in terms of voting, meeting attendance and volunteerism.
  7. By definition, planned communities offer a more efficient use of land to address the growing issue of urban sprawl associated with unplanned development.
  8. Land-use efficiencies can make homes more affordable, a benefit for first-time home buyers, retirees and low- and moderate-income families.
  9. Many HOAs maintain swimming pools, tennis courts, playgrounds and other amenities that most Americans cannot afford on their own.
  10. Associations offer a sense of community.
Snow Contracts and Expectations

Snow Contracts and Expectations

As much as we all don’t want to admit it, winter is coming back to Minnesota. When the white stuff starts to fall again, it’s important for homeowners to understand how specifications in snow contracts will affect when snow is removed from your roadways and driveways.

First off, every snow contract is unique. To better understand the nuances of your contract, check with your Board or contact Sharper Management. We are happy to share this information with you.

In this article, we will be covering some of the most common specs of a snow removal contract.

Specs that will affect your contract include:

Trigger Depth – Most contracts will state an accumulation total that must be met before snow service will commence. This can be anywhere from a trace up to multiple inches. For most, it is somewhere between 1 – 2 inches. This can be one of the biggest variables in the pricing of your snow contract.

Accumulations – The definition of “trigger depth” is important. Does your contract state that service will happen when the trigger depth has been met for a single snow event/storm, or is it vague regarding at what point trigger depth is met? There is a significant difference between the definitions. For example, you could have a winter where less than 1 inch of snow accumulates per event, but there may be many events like this in a relatively short period of days thus creating heavily packed drives in your association. Most contracts are written “by event”.

Timing – The second most important component of your contract is the time in which snow service must be completed. For most contracts, “final cleanup” is somewhere between 6 – 12 hours after the snow has stopped falling. This timeline is also subject to snow accumulation totals. The more snow received, the more time allowed for cleanup.

Open-Ups – Most contracts provide for an open-up during snowfall events that exceed a particular total. For example, if 4 -6 inches of snow depth is met, but the event has not stopped, it is common for an open up to happen. Open-ups are simply done to allow vehicles to come in and out of the complex. They are not the same as a final clean up. Open-ups generally consist of a single pass through the roadways with the plow. One thing to define in your snow contract is whether open-ups include driveways, or just main roadways. Typical language states that an open-up will occur prior to __AM and/or after __PM.

Knowing a bit more about how your snow contract is written may alleviate some frustrations over the coming months. Stay safe this winter!

Board Tips: Managing Open Forum

Board Tips: Managing Open Forum

If your Association falls under state statue 515B (Minnesota Common Interest Ownership Act – applying to all Association build after June 1994 and all Condominium Associations) you are required to hold “open board meetings.”  This means owners can attend. If you don’t fall under 515B, but rather 317A (Minnesota Non Profit Corporate Act), you are not required to hold “open board meetings” unless your governing documents state otherwise – HOWEVER, it is strongly recommended that you do hold open meetings to avoid controversy.
Sometimes “open meetings” can create problems and distractions for the Board in trying to conduct business. A good way to provide an outlet for homeowners to be heard is to offer an “open forum” portion of the meeting. Before/after that time, it is a business meeting of the Board and those attending may only observe.
We’ve written extensively on this topic before, but some key functions to make this work effectively are;
*    Setting an allotted amount of time
*    Set the proper tone for constructive dialog
*    Allow only one person at a time to speak
*    Require homeowners to “register” their issue prior to the meeting
*    Set an expectation that they may not have an answer that evening but the Board will take it into consideration and get back to them.
Remember, the open forum is not an official segment of the meeting. The purpose of this article is to shed light on WHEN the open forum might be conducted. Before the meeting or after the meeting. There are two schools of thought and each has its pros and cons.
Before the Meeting
+ You have a set time to call the meeting to order (on the Agenda), so you can control the time frame
+ You have the option to later address their issue under New Business
+ Homeowners have the option to leave after stating their concern without staying for the entire meeting
– Sometimes it creates the expectation that an issue will, in fact, be addressed at that meeting
– A strong meeting facilitator is required, or the open forum could spill in to official meeting time
– It can derail your meeting and what you had planned to address via the Agenda
After the Meeting
+ Issues on a homeowner’s mind may well have been addressed during the business meeting
+ Homeowner are often tired after observing the business meeting, and any hostile energy may subside
+ Homeowners may not stay for the entire meeting in waiting to get to the open forum
– The meeting topics may generate further questions and open forum can become a Q&A session
– Fatigue may set in for both Board members and homeowners alike
– Facilities may be reaching closing time and the opportunity may be lost

Hopefully these tips can help create productive open forum sessions – and hopefully it provides you with insight on when you may want to offer it in conjunction with your Board meetings.

Dues Increases – No Resident Wants; But Every Association Needs It

Dues Increases – No Resident Wants; But Every Association Needs It

For most Associations, it is budget season. Your Community Manager has worked hard to develop a proposed 2018 operating budget that will keep your association fiscally healthy by projecting and planning for expense trends (such as utilities), plugging in contract figures (such as lawn/snow), budgeting for operating projects you’ve directed to be completed (perhaps gutter cleaning or painting), allocating a dollar amount to contribute to your Reserve Fund (your “savings”), etc.

As you may know, your operating budget is what sets the “dues” amount that people will pay each month. Technically, it’s the “assessment” amount, but no one likes to use that word.  It’s always difficult when the realization kicks in that you need to raise your dues to meet your expenses. No one likes to be responsible for making people pay more money. Nevertheless, it is your fiduciary duty as a Board to keep the Association fiscally healthy.

There is one pitfall that a number of Associations can fall into during the budget approval process. Boards get hesitant to raise dues and they look for reasons to keep stagnant on the revenue/dues need. Perhaps it’s a down economy; maybe a number of your residents are on a “fixed income;” or sometimes it’s seeing the Association is trending positive with their budget vs actuals and have a “surplus.”

Here’s the advice that no one wants to hear – and certainly few have the gumption to say:  You should raise your dues every year.  Costs don’t go down. Inflation is real.

The pitfall many Associations fall into is a reluctance to approve small dues increase, then needing a larger one to catch up the next year.  It is far more prudent and healthy to do smaller increases every year than it is put yourselves (and the residents) on a roller coast ride of no increase, no increase, 12% increase, no increase, 8% increase.  In the long run, you’ll find your Association stays fiscally strong, and you’ll be surprised at how well, and quickly, the community will be conditioned to annual inflationary increases.

Sharper Hires New Greeter!

Sharper Hires New Greeter!

With office traffic at an all-time high, Sharper Management hired a full-time greeter for the front reception area- just in time for the Holiday Season. Bearnard has started his tenure at Sharper Management with a flair unlike any other, walking the streets of St. Paul (see accompanying picture) and visiting long-time employee Kieth Schultz while cheering up children and hospital staff along the way.

Bearnard comes to Sharper after spending a lifetime in China, traveling the open seas, and finally settling in Eden Prairie. His imposing 4 foot 6 inch frame is nothing but cuddly and fuzzy. He never has a negative word to say and constantly smiles at life as his head is often tilted in an all-knowing manner. His demeanor is similar to a perfect community manager- engaged, caring, and listening to every small detail. Remarkably since his hire date, his response time to phone calls and emails has never been an issue. Further, his attendance is inscrutable and work ethic unparalleled. He is always prompt- exactly where you want him to be.

When asked, Sharper management conceded that they “gave in to his somewhat awkward request for a five-week equivalent to rest during the winter.”

Some fun facts about Bearnard are:

  • Favorite food: Honey and Berries
  • Favorite movie: TIE between The Journey Home,The Revenant, and Chucky
  • Favorite song: The Bear Necessities
  • Favorite sports teams: Memphis Grizzlies and for some reason, Manchester City Football Club. He hates the Chicago Bears and has no love for the Chicago Cubs- but thinks he can come around when Sharper Management opens an office in Illinois.
  • Favorite state: He conceded it was California because there is a bear on the flag.
  • Favorite guilty pleasure(s): Flossing, Tail Gating at Vikings Games, Mike Tyson’s’ mental state at any given time, and accumulating giveaways at tradeshows.

Dan Cunningham, CEO of Sharper had this to say about Bearnard: “He is the consummate professional, never has complained and is happy wherever he ends up. There is no drama with Bearnard, just happiness. Everyone loves him.”

Matt Froehlich, COO of Sharper responded that “we’ve never had an employee with such an even keel attitude. He takes all situations with a grain of salt, knowing that if we can fix it we shouldn’t worry about it. Conversely, if we can’t fix it we shouldn’t worry about it.”

Hakuna Matada!

Aaron Osowski Joins the Sharper Management Team

Aaron Osowski Joins the Sharper Management Team

Eden Prairie, MN, (November 7, 2017) – Sharper Management is pleased to welcome Aaron Osowski to its community management team as an Assistant Manager. He will be working with our Community Managers to ensure tasks and requests from Sharper Management properties are attended to efficiently.

Osowski comes to Sharper Management with a background in property management. A rental associate at a 66-unit complex where he was responsible for leasing, tenant communication, and assisting in unit turnovers, gives him a solid base upon which to build. He’s looking forward to learning the ins and outs of HOA management and the various rules and regulations of the industry.

“Aaron comes in with experience in the property management industry. His attention to detail will serve Sharper’s clients very well. I have no doubt he will have a long and successful career in this field,” state Josh Reams, Associate Director of Community Management.

Founded in 2010, Sharper Management is a locally-owned, mid-sized property management company offering a full suite of premiere services to homeowner’s associations of all sizes. Sharper Management currently provides services to the Minneapolis-St. Paul seven-county area.

For more information on Sharper Management services and employment opportunities, call 952-224-4777 or email to info@sharpermanagement.com.

Eric Reinke Joins the Sharper Management Team

Eric Reinke Joins the Sharper Management Team

Eden Prairie, MN, (November 3, 2017) – Sharper Management is pleased to welcome Eric Reinke to its community management team as an Assistant Manager. Reinke will be assisting in many of the day-to-day tasks and communication of community management. He will be working with our Community Managers to ensure tasks and requests from Sharper Management properties are attended to efficiently.

A background in real estate, Reinke has been a Realtor in the past where he enjoyed helping people find properties that were the right fit. His experience also includes customer service in the automotive industry and an educator. A passion for learning and assisting home owners along with a desire to know more about property management industry are reasons he was drawn to this position.

“We are thrilled to have Eric join the team. He comes great experience that will translate nicely to the association management industry. We are always looking to provide additional support to our management team, which will ultimately result in our being able to continually provide the best customer service for our clients,” state Matt Froehlich, Partner and Chief Operating Office.

Founded in 2010, Sharper Management is a locally-owned, mid-sized property management company offering a full suite of premiere services to homeowner’s associations of all sizes. Sharper Management currently provides services to the Minneapolis-St. Paul seven-county area.

For more information on Sharper Management services and employment opportunities, call 952-224-4777 or email to info@sharpermanagement.com.

 

Understanding Insurance in a Homeowners Association

Understanding Insurance in a Homeowners Association

Understanding insurance in a multi-unit dwelling/Association can be daunting. What does the Association’s master policy cover? What does my personal insurance policy cover (usually referred to as an “HO6” policy)? Which policy kicks in for a particular loss?

Unfortunately, there are a number of variables that makes it impossible to give a universal answer to these questions. Here are some important concepts to understand.

Coverage – In general, the most important thing to do is read your Governing Documents (typically the Declarations) and try to understand what the Association is responsible for insuring. Does it say the Association will insure wall coverings, floor coverings, cabinets, fixtures, etc.? These are some common terms used to state it is an “all in” type of a policy. Another important distinction is whether the Association will or will not insure “betterments and improvements” or is it “original specs.” If none of these items are listed, it may be stated or implied that the policy is a “walls out” policy and nothing on the interior of the unit is covered.

You should discuss with your personal insurance agent what the Documents state on insurance coverage. One of the first questions your agent should ask when writing your policy is to review the Governing Documents. It can also be helpful to call the Association’s agent and verify what, in fact, the Association has for scope of coverage. Even better, tell your agent they should contact the Association’s agent and “cross the T’s and dot the I’s”

Remember, the role of your HO6 policy is three-fold. 1.) at a bare minimum, to insure construction of the unit (sometimes known as “real property”) up to the Association’s deductible. 2.) to insure components of the property outside of what the Association’s master policy covers. 3.) to insure your personal items/property. In short, understand the Association’s insurance coverage and bridge all gaps with your HO6 policy. *** The amount of coverage to carry on an HO6 policy is completely subjective and up to you, as the owner. Again, at a bare minimum, you want to carry coverage up to the Association deductible on construction already covered under the master policy.

Loss Assessment – Another important aspect of insurance when living in an Association is “Loss Assessment Coverage.” Again, read your Governing Documents. Some Association’s legally require homeowners to carry this type of policy. Loss Assessment Coverage provides protection to the owner should the Association have a loss that exceeds the coverage limits of the master policy, or should/when the Association assess the owner for their share of the master policy deductible. Loss Assessment Coverage would help the homeowner with such an assessment. The amount to carry is very subjective and up to you and your agent to determine – but at a minimum, it should be equivalent to the master policy deductible.

Deductible – Which brings us to the last important component of Association insurance – deductible. It is very important to know what the Association’s master policy deductible is. And to stay on top of it from year to year, as it can change. In most cases, the master policy will not kick in coverage unless a Loss exceeds the deductible. Your HO6 would pay if it is under the deductible. If the Loss does, in fact, exceed the deductible, you/your HO6 would be responsible for the amount up to the deductible.

For example – you live in a condo building and the master policy is an “all in” policy with a $10,000 deductible. There is a $15,000 water loss in your unit. Your HO6 policy covers the first $10,000 – while the Association’s policy covers the remaining $5,000.

To Recap – read your Governing Docs to understand the Association’s insurance scope. Talk in depth with your agent and the Association’s agent, if needed, to develop an HO6 policy that bridges all coverage gaps and requirements. Consider carrying, if you are not already required to, Loss Assessment Coverage. And finally, stay on top of your Association’s policy each year as it renews to make necessary adjustments to your HO6 policy.

Sharper Management HOA Wins CAI MN Association of the Year

Sharper Management HOA Wins CAI MN Association of the Year

Sharper Management is pleased to announce one of their managed HOAs, the Territory Homeowners Association, has won CAI MN’s Association of the Year Award. Honored on September 14 at the annual Vision Awards, Territory is under the supervision of Sharper’s Community Manger Jeremy Larson.

The Association of the Year Award recognizes the outstanding team effort of an association board of directors and homeowners whose members clearly understand their roles and fiduciary responsibilities putting the association’s interest ahead of and above all personal agendas. A board comprised of effective volunteer leaders who are fair, responsible and reasonable in their decisions.

A lovely single-family home development, Territory HOA is still in development but recently transitioned from Declarant to Homeowner Control. It is because of the smooth process and expert planning during this transition that this Association was so deserving of Homeowner Association of the Year.

A key factor contributing to the success of Territory HOA is the diverse expertise their Board members bring to the table. Their skills were put to the test when tasked with developing a detailed Architectural Review process. This is a very important process for all HOAs, but particularly important for this one since parts of the community are still in development. A reliable and efficient approval process is essential in maintaining the continuity of the community.

Another strength of this Board of Directors is their fiduciary diligence. Territory has expansive common areas throughout the development that include a variety of amenities. This Association has found a perfect balance of revenue and managing expenses. Their healthy cash flow is in part due to their diligence in staying on top of Collections.

Maintaining the value of their property through a healthy cash flow, maintenance of common areas, and oversight of the community architecture keeps the continuity and the value of the property high. This Board accomplished all of this in a short timeframe and it is working wonderfully.

“All of us at Sharper Management are happy to see the Territory Association honored in this way. It is truly a testament to innovative thinking, dedication, and great leadership. Congratulations to Territory and to our manager Jeremy Larson for a job very well done,” states Sharper Management’s Associate Director of Community Management, Josh Reams.

About CAI-MN
Founded in 1973 as a multidisciplinary, nonprofit alliance serving all stakeholders in community associations, CAI is the only national organization dedicated to fostering vibrant, responsive, competent community associations. CAI is regarded as the national expert in educational programs and publications about community association governance, operations, and management. CAI’s members look to us for information about new products, educational opportunities, technologies, and better ways to run their communities.

Founded in 2010, Sharper Management is a locally-owned, mid-sized property management company offering a full suite of premiere services to homeowner’s associations of all sizes. Sharper Management currently provides services to the Minneapolis-St. Paul, MN seven-county metro area.

For more information on Sharper Management services and employment opportunities, call 952-224-4777 or send an email to info@sharpermanagement.com.

Chris Gosse Honored at CAI Vision Awards – Financial Impact

Chris Gosse Honored at CAI Vision Awards – Financial Impact

Members of the Minnesota Chapter of the Community Associations Institute recently honored Chris Gosse for his work in the field of community management. Gosse received the Financial Impact Award at CAI-MN’s annual Vision Awards ceremony held Thursday, September 14 in Minneapolis, MN.

The Financial Impact Award is given to a manager who has positively impacted a community in a significant manner from a financial standpoint in areas such as; budget management, capital improvement management, warranty, and insurance claim management.

Among the many accomplishments of Gosse in the past year, his guidance in helping three of his Associations realize the benefits and subsequent implementation of Reserve Studies was significant. Prior to Gosse, the properties did not have a Reserve Study and all three had a history of special assessing members if a need arose. Gosse convinced the Boards of the importance (and statutory requirement) to having a Reserve Study. Through his leadership, each Association did a complete paradigm shift to their capital funding philosophy. From start to finish Gosse was engaged with the Boards and their chosen firms to complete the studies. He also worked with the Boards to incorporate the funding plan in their operating budget and cash flow.Gosse’s other accomplishments in the past year include:
• Improving cash flow by helping a board identify ways to save. The end result was roughly a 20% saving.
• Implementing a Special Assessment in an Association that had previously not done this. Through Gosse’s expert guidance, the Board had a 100% collection rate and the project that necessitated the Special Assessment was completed successfully.
• Helping an aging condo association acquire a loan for $650,000 to complete major repairs that we in immediate need.

This is the second year in a row Gosse has been honored by CAI-MN. In September 2016, he was awarded the Rookie of the Year honor for his outstanding work as a new Community Manager.
“Chris has really hit the ground running since first becoming a Community Manager at Sharper. His willingness to “get the job done” and find creative solutions to problems makes him a great asset to our organization and the communities he serves. He is well deserving of this honor,” states Matt Froehlich, Partner and Chief Operating Officer.
About CAI-MN

Founded in 1973 as a multidisciplinary, nonprofit alliance serving all stakeholders in community associations, CAI is the only national organization dedicated to fostering vibrant, responsive, competent community associations. CAI is regarded as the national expert in educational programs and publications about community association governance, operations, and management. CAI’s members look to us for information about new products, educational opportunities, technologies, and better ways to run their communities.

Founded in 2010, Sharper Management is a locally-owned, mid-sized property management company offering a full suite of premiere services to homeowner’s associations of all sizes. Sharper Management currently provides services to the Minneapolis-St. Paul, MN seven-county metro area.

For more information on Sharper Management services and employment opportunities, call 952-224-4777 or send an email to info@sharpermanagement.com.