Effective January 1, 2024, most Virginia community associations will be required to comply with the federal Corporate Transparency Act (“CTA”) and its regulations, unless a community association fits within one of the narrow exemptions to the Act.
CAI is calling on members and advocates to learn more information about a federal law that has a sweeping impact on most community associations incorporated in the U.S. We need your help to educate Congress about the unintended consequences of this law and urge them to delay implementation and exempt community associations from the requirements.
Annual and special meetings require homeowner votes for new board members, assessment increases, capital improvement projects, and amendments to the association’s governing documents. The goal is to reach a quorum—a minimum number of members who must be present for business to be validly transacted.
Some insurance carriers refer to Directors and Officers (D&O) Liability as miscellaneous liability. Take my word, it is not a coverage that should be considered miscellaneous. There is a world of difference between D&O coverage offered to you as an endorsement on your master policy and proper D&O coverage specifically written as a stand-alone policy.
Perhaps the greatest achievement for any association is creating and sustaining a sense of community among residents and leaders. This goal is best achieved when homeowners, non-owner residents and association leaders recognize and embrace their rights and responsibilities. It was with this goal in mind that CAI developed Rights and Responsibilities for Better Communities. These principles can serve as an important guidepost for board and committee members, community managers, homeowners and non-owner residents.
Homeowners have the right to:
Community Associations are wonderful organizations benefiting millions of US residents every day. There are countless benefits to living in community associations. One of the beautiful things about people is that we have figured out that banding together in communities is generally beneficial offering clean, cohesive neighborhoods oftentimes with amenities such as parks and pools, further encouraging the idea of community. These inherent benefits have association living on the rise, providing homes for nearly 1 in 5 Americans. But where did it all start?
"Our Board Just Inherited a Host of Old Violations - What Should We Do?"
We often get calls from new board members after transitioning from developer control. They have questions like this one: Some of the homeowners have added fences, above-ground pools, and sheds without getting approval from the Association. Many of these changes do not appear to meet the standards that are part of our documents. No action has been taken to correct these violations. How do we go about enforcing the covenants and rules?
What’s your annual plan?
As we begin another year, it’s important for associations and their business partners to have a clear understanding of what the coming year will look like. What are our goals? What strategies will we use to reach those goals? Did we meet the goals we had for the past year? Without a mechanism in place like an annual plan, it’s almost impossible for an association or business to know where they’ve been and where they’re going. The inclusion of an annual plan can help take the guesswork out of the process.
Over the many years I have been practicing in the community association law field I have seen and dealt with many boards of directors. In doing so I have seen considerable variation in the level of interest and commitment of community members to serve on the board of directors. Some communities have the assistance of professional management companies and others are self-managed. While a community may have professional management, it is the board of directors that is given the power and responsibility in the governing documents to operate the community. Regardless of the type of management, a group of homeowners actively participating on the board and on committees is essential for the successful functioning of the association.
Neighbor to neighbor disputes seem to be at an all-time high right now. Many times, the neighbors are trying to bring the Association into these battles. In order to best utilize the Association’s assets, Boards and managers must recognize when it is appropriate for the Association to engage, and when to stay out of the conflict.
There is a widespread belief among homeowners who live in associations, that if their assessments stay flat and do not increase, their community is in good shape and the Board is doing its job. And while it’s easy to understand the appeal of a historically flat budget, a lack of increases in an association’s assessments could be an indication of rough seas ahead.
Winston Churchill once stated that, “Plans are of little importance, but planning is essential.” There are several different facets of a community association that allow it to operate properly and effectively, but none so important as the organization’s financial stability. Within the next couple of months, managers, Boards, and committees will begin acquiring costs of current contracts and projections for the upcoming year to start the arduous process of creating the operating budget for next year.
Let the sunshine in. I am not talking about the popular 1969 song by The 5th Dimension. I am referring to the statutes governing Virginia community associations that require all meetings of a board of directors, including any subcommittee or other committee of the board of directors, where the business of the association is discussed or transacted, to be open to all owners of record[1]. These are known as “sunshine laws” and are the rule for community association meetings.
As with most rules, there is an exception - executive session, during which it is permissible to “close” the door, so to speak. Too often in our practice, we are reminded that the permitted reasons to convene in executive and procedure are not well understood. This article will uncharacteristically shine some light on executive session and examine what it is and how to do it correctly.
