License to Manage

 

When you really look at what community managers do, they are individuals acting as town managers.  With licensing, we believe that a community will know they are getting a quality manager to manage a quality community.

Advocates of licensing say it’s just common sense.  “You can’t sell a hot dog without a license, and you can’t give a haircut without a license.  Everybody needs a professional license,” says Evan McKenzie a political science professor at the University of Illinois at Chicago.  “The only way to get a handle on the quality of management is to have government oversight.

Community Associations Institute (CAI) encourages the national certification of community association managers, and, in states that propose mandatory regulation, supports a system that incorporates “adequate protections for homeowners, mandatory education and testing on fundamental management knowledge, standards of conduct and appropriate insurance requirements.”

Manager Basics

Increasingly, community association managers are taking on wide-ranging duties.  They are expected to have an intricate understanding of relevant laws, but in many states, not required to have continuing education to keep current.  In addition, they are often expected to understand accounting, budgeting, maintenance and the association’s governing documents.  And that is just the beginning.

“The perception is that managing a community association is easy, and I say that is not true,” says attorney Lucia Anna “Pia” Trigiani.  “A manager has to understand facility management and governance.  They have to be able to put on a pair of overalls and make sure the landscaping is done correctly, and then suit up and go to a board meeting and understand that the board needs to act in the open and how voting is to be conducted.

State licensing systems generally require an applicant to complete a minimum number of hours of education to obtain an initial license and then additional hours to get it renewed.  The classes concentrate on areas such as management operations, budgets, governing documents and insurance.

It’s like a driver’s license – you know the person at least knows how to turn on the car, where the steering wheel is and where the brakes are.  With a license at least you have the base level of understanding.

From a consumer’s point of view, a designation or certification allows him or her to compare managers against a known standard…,” says Tom Skiba, CAI’s CEO.  “In addition, because our designations include an ethical standard as well, there is an assurance the manager is sensitive to the ethical requirements of the position and the expectation that CAI and customers have regarding professional ethical behavior.”

Protecting Assets

A driving force behind manager licensing initiatives is a growing perception that associations are vulnerable to fraud and theft.  News coverage of embezzlement cases has reinforced the need to protect homeowners and their assets.

Homeowners out there need to be able to ensure that the individuals they are hiring are competent and ethical.  It is important to require that individuals interested in becoming managers demonstrate their qualifications, commit to continuing education and uphold a high ethical standard.

Licensing laws can protect associations by requiring management companies to carry insurance against theft of funds, and they often provide associations with complaint procedures to keep track of problem areas and companies – with the state meting out punishment if needed.  Ultimately, states with licensing programs can revoke a manager’s license – although only after specific administrative procedures.  Also states can choose to take public disciplinary actions, as is done successfully with lawyers.

A manager licensing law can’t stop someone from committing misconduct when they are a manager, but it can prevent them from subsequently continuing to work in an industry where they have access to money.

While there are no guarantees that such laws will protect associations and homeowners from dishonest managers, many say it’s a good starting point.  “if you value your home and you value your community, then you should be willing to make the investments in it…to make sure it’s taken care of and safeguarded in the best possible way,” says Skiba.

Currently there are bills in the North and South Carolina legislatures for mandatory manager licensing. 

Community Association Management fully supports these bills, and already requires all of our managers to hold a Certified Manager Community Association (CMCA) license within one year of employment.  Further, we require 16 hours of mandatory continuing education each year to ensure our staff are capable and competent to service our clients.

You may view CAI’s directory of credentialed professionals and companies should you wish to verify credentials of your property manager.

Author: Anna Stolley Persky