By Deborah Goonan, Independent American Communities (IAC)
In March, Community Associations Institute (CAI), a trade group for managers, attorneys, and other professionals servicing Association Governed Housing developments, published four white paper reports on the future of the industry.
I’ve already reviewed several of these reports (see below for links, in case you missed them). This week, I’ll comment on the Community Management Report.
No respect?
The overall impression is that, according to the CAI panel, community association managers deserve more respect. Panel members lament that the public is simply not aware of the important, valuable contributions that managers make. If only the public were fully aware of the complexities of the job, that would command a more favorable employment status and higher salaries.
The panel also calls for a minimum of a bachelor’s degree to do the job, but, at the same time, expresses grave concern about a shortage of experienced managers, and few people willing to take up the profession.
Now for a reality check
Given that a substantial number of portfolio managers are primarily responsible for billing, bookkeeping, or mailing out violation notices, four years of college hardly seems necessary. An Associates degree in accounting or business is probably more than sufficient, especially when you consider that the return on investment for education dollars is fairly low.
According to the Bureau of Labor Statistics, the median U.S. salary for community managers is around $55K.
The nature of the job itself is challenging. Managers are not popular with homeowners and residents, because they are the ones responsible for sending assessment invoices, late notices, and violation letters for various, sometimes trivial offenses.
That means they often must cope with irate and dissatisfied consumers.
Therefore, is it realistic to expect a large number of people to intentionally choose community association management as a profession?
And then there’s the commitment and aptitude necessary for higher education. In Colorado, community association managers are having difficulty passing the new licensing exam. Will it be possible to attract talented youths that can graduate with a bachelor’s degree?
Furthermore, it may be a huge challenge to find universities interested in developing specialize curriculum for a profession that remains “ambiguous” and not clearly defined. Many universities have experienced financial distress and reorganization over the past decade, eliminating academic programs with lagging enrollment.
For management of large scale communities, although a degree in business management or public administration might be beneficial, specialized knowledge is likely not necessary. Typically, the management company seeks out contractors and professionals with specialized skills and knowledge as needed. In mega-management firms such as Associa and First Service Residential, in-house vendors and specialists are referred to the association under a “preferred vendor” or “one-stop-shop” arrangement.
There are only 55,000 managers to serve 325,000 associations – according to CAI’s estimates. Most small associations do not hire a manager, and, due to cost considerations and increased financial stress on HOAs, that is a circumstance that is unlikely to change in the future.
How to earn respect
If the management profession wants to earn public respect, then it must embrace high ethical standards and accountability.
CAI needs to fully acknowledge and denounce rampant financial mismanagement, self-dealing, theft, embezzlement, and fraudulent activities committed by community association managers and management companies – even those holding credentials and CAI membership!
Instead of lobbying and politicking for higher wages and management fees, and opposing state laws regulating associations and management companies, CAI needs to raise the bar for personal conduct and show respect for the homeowners and residents in Association Governed Housing.
References:
Previous IAC articles:
Dissecting the CAI white paper manifesto on Association Governance (part 1)
CAI to “enlighten” developers of Association Governed housing
CAI’s White Paper on HOA Reserves, Escrow of assessment fees
I have come across many documents and news articles as given by these managers of large industry HOA management companies. What I have found, are half truths, and misleading information which constantly promotes how they are doing such a great job, when in fact they are not. These companies as like First Service Residential are in the news and not due to a great job, but are in the spotlight for misdeeds, not following the govern documents nor the state laws; when in fact by admission state they are following orders as given by the board of directors within these HOA’s, but with these very remarks does the board realize that these companies have in fact thrown the board of directors under the bus which will lead to possible legal legislation against these very directors who could end up losing far more than just their seats on the board. This leads these directors open for failure to use due diligence and responsibilities towards the homeowners/members which they could personally be accountable therefore these very directors without thinking about the ramifications of their action. All board member directors must perform and do their due diligence it is a state law by signing any contracts or an act that does not use care to investigate the evaluation process to ensure that the legal members are being represented and not special interest groups whose only means is profit when guided by these management companies and yes even the HOA attorneys and even how these attorneys were hired. When hiring any HOA management company it is prudent to investigate the reputation, not just by their intently painted picture as being a great company to run your HOA. You would be shocked by how some of these companies/attorneys/vendors are selected if the directors do not do due diligence, it will leave a lasting impact on the members and the community maybe for years. These directors must be chosen very carefully by the members, if they are chosen by other means or appointed your HOA may not be representative of the members wishes and could lead to many issues and problems as the directors are not using due diligence to represent its members and not special interest groups, they thereby become misguided and doctored falsely in favor to oneself or standard representative of the HOA Industry and not the members.