September 2009 Developments - 58

HOAs New Board Members, Transitions, and Orientation ith summer in the not-so distant past, many of us are just coming off our annual meetings, where we developed budgets for the upcoming ﬁscal year. Often at that meeting, this is when we recruit new owners for the Board of Directors, as older ones retire. Some of us have had the good fortune to maintain the same board members year after year, developing a strong bond in the group and creating a continuity and knowledge base to ensure a resort’s successful management history. But what do we do when the association is less than 10 years old, policies and procedures have been changed from the original documents, and a new board member is elected or appointed? Will an educational program to bring this person up to speed be considered too demeaning for someone who has worked in the professional business world for many years? Maybe so, but the terminology of timeshare resorts, as well as its unique business model, is important to communicate to those members who guide the future of the property. It may not be like any other board or condominium association on which they have ever served. Establishing a “New Board Orientation” program is your ﬁrst step in welcoming a new member and making him/her part of the team. Our industry in particular yields itself to needing this kind of orientation program for members who just joined the leadership of the association. It is the only industry that I am aware of, where an individual can be elected to control a multi-million dollar not-for-proﬁt corporation with thousands of owners (clients) and annual budgets in the millions of dollars—with no experience and only having won by popular vote or because no one else wanted the position. We have had air conditioner repairmen as presidents, plumbers as treasurers, and photographers as secretaries, some with no board or Dennis DiTinno W business experience. All they had to do was receive the necessary orientation and be receptive to their responsibilities, and they jumped right into the action. purpose of this board, can be summed up in seven main areas of responsibility: (1) To counsel and advise, giving the beneﬁt of its judgment and expertise and familiarity with the local settings; (2) To consult with the manager on all matters it is considering; (3) To provide support to the manager and staff in carrying out its professional duties; (4) To support the manager in all decisions and actions consistent with the policies of the board and community and to hold the resort management staff accountable for its actions; (5) To evaluate the work of the manager at least annually in a “private session; (6) To make all staff responsible to the manager and develop a clear chain of command; and (7) To delegate responsibility for all executive functions and to govern on all things reasonably, lawfully remembering they can delegate authority but not liability. Here is a “job description” for each of the different board members who hold leadership roles. Simply put, the president must realize s/he (a) is the leader or head of the “corporation” and establishes goals with the other members of the board, (b) serves as chairperson, (c) supervises committees, and (d) is the liaison to the manager or management company. Most of all, this person must train a successor. The vice president’s role is exactly the same as the president’s when s/he is not available to act for the board or attend a meeting. The treasurer or CFO assists in preparing the budget for the ensuing year, tracks the ﬁnancial performance of the corporation, understands and summarizes the ﬁnancial reports, and presents the ﬁnancial report regularly at board meetings or when requested by the president. Setting out the Program The orientation package should be printed out and formalized (creating a video version also works), so the new member can absorb as much information as possible on his/her own at an individual pace. You may also choose to have on-site workshops, inviting as many members as possible to make it more interactive and perhaps less overwhelming. I like to say to board members that their main functions are to “maintain, protect, and enhance the value of the asset and quality of life for the members.” This is a large mission, but if you can communicate it effectively, you will have a strong working board. They will be in charge of looking at the big picture, leaving management to “sweat the small stuff ” at the ground level. This helps to clearly delineate their role in the resort overall. Based on past experience, the best way to begin an orientation program, is with a brief overview of the resort prospectus; the sales package; and pertinent laws that govern the industry and the resort professionals and their boards (i.e., a state like Florida requires the manager to be licensed as a CAM). You also can go over the the resort’s registered business model, whether condominium, not-for-proﬁt corporation, for-proﬁt corporation, co-op, tenants in common, vacation club, etc. Then, you can discuss the bylaws (the actual operating guide for the resort), outlining the duties, liabilities, and obligations of each of the owners and board members, so they know what the general expectations of them are. Roles & Responsibilities The general expectations of board members, which can also be seen as the 58 Developments • September 2009
September 2009 Developments

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