Tag Archives: relationship

Bidding Out the Management Contract

Bidding Out the Management Contract

Helpful Hints for the Board of Directors
One of the toughest challenges a board of directors can face is the decision and process of bidding out the association’s management contract. Boards often feel they have a fiduciary obligation to bid out the management contract when, in actuality, the board may simply not realize it is already exercising appropriate fiduciary obligation by working to preserve and extend the relationship with the current management company.

The first thing the board should do in considering bidding out the management contract is to ask itself why it should go out to bid. Is there a service issue with the current managing agent? Or is it really about price? Perhaps there is just a clash of personalities with the current staff assigned to the community on behalf of the managing agent? Any of those issues should be promptly discussed with the current managing agent. From day one of establishing a relationship with your management company, the board of directors needs to be prompt and upfront with the company regarding any issues or obstacles. Just as the board expects management to be proactive and candid, the management company has the same expectation of the board. After all, you are in a partnership with your management company – the fewer the surprises the better the relationship between the two entities. So, whether price, service, or personnel are the issues, let your current managing agent know. When possible, all efforts should be made to overcome any concerns of the current managing agent and contract.

Read more

Best Practices for Working with Your HOA Management Company

Unless you’re careful in choosing a management company, you could end up with someone like Jeffrey S. Koger. In November, the 39-year-old Herndon, Va., man pleaded guilty to bilking about $3 million from 400 homeowners associations in Northern Virginia, according to the Washington Post.

As chief financial officer of Koger Management Group in Fairfax, Va., Koger collected association dues from homeowners.

Read more