Special Assessment and Dues Increase, Oh My

TWO SUBJECTS THAT STRIKE INSTANT ANGER INTO THE HEARTS OF HOMEOWNERS: SPECIAL ASSESSMENT AND DUES INCREASE. Both have the potential to be uncomfortable conversations that force boards to make, what can be perceived as, an uncomfortable decision. But how do you start the conversation? How do you lead a productive discussion with a resolution as opposed to a dispute?

At the root of any resolution that managers propose to boards of directors is the one key commonality that needs to be perused first: communication. Thorough communication and being transparent, while having the best interest of the association at the center, is how you effectively accomplish what is needed for your association.

SPECIAL ASSESSMENT AND DUES INCREASE,

OH MY!

■■■By Leslie Barton, CMCA®

SPECIAL ASSESSMENTS Where do you begin getting a special assessment passed? It is likely that homeowners are already aware that extra work is needed or that an unforeseen project has come up and now funds are needed to correct it. You as the community’s manager get to set the narrative for the journey that you will take with the Board to 1) make quorum for the meeting and 2) receive a majority yes vote. Chances are the issue has been a continuing item on the agenda and the Board has discussed what is needed to be done at great length. They are invested and eager to start the project, but no one has shown up to a board meeting and no one has called or emailed the manager for information. And even worse, since you rarely make quorum for the Annual Meeting, how are you going to make quorum for a Special Assessment vote? It all starts with that little word: communication. But I am going to step it up a notch—you need effective communication. We live in the 21st century where information is as readily available as you can type and hit send. Anyone can seek out information and find the answer to the question they are asking. This is where you and your board need to take a step back and put together a plan on how the special assessment is going to be effectively communicated to the Membership. If you have the technology available to you, begin with an email campaign. Have a few emails drafted that communicate in a positive tone what the project is, why it is needed, and how the homeowners can take action and help. Post flyers around the Association that give key points for what the project is and contact email for them to reach out and ask questions. If it is an option in your budget, send out the flyer in a mailer.

Giving the project a why helps guide the conversation from “We have to do this” to “As a neighbor, we need your help to better our community”.

Let the Membership know that they will receive a ballot in their mail in the next week or so. Communicate to them the importance of their participation and that they need to actively look for the ballot in their mail. You effectively communicated. You started an email campaign and received a few complaints regarding all the wasted paper from the flyers that you posted around the Association. You kept the item on the General Session agenda for discussion at every meeting. What next? Along with the aforementioned methods it is time for good old-fashioned face-to-face communication. It is time to work with the contractor of the project, your accounting team, and the Board to organize a Town Hall. The Town Hall has a strategy all of its own and needs to be held at a time that is convenient for homeowners to attend. You are not going to get the desired turnout to create allies for your cause if you are not setting yourself up to be successful. Take into account the time of year. Are there holidays you need to be aware of? Is there an event going on that is going to pull homeowners away from being able to attend? Picking a time that works for the majority of homeowners is going to give you the best results. Send calendar invites to homeowners. Ask them to RSVP and follow up the week before the meeting, again three days before the meeting, and the night before the meeting, reminding them of the commitment they made to participate. Ask them to invite their neighbors to go with them. Hold the Town Hall meeting a week or two after the ballots are sent out. Bring blank ballots with you and, at the end of the Town Hall, ask if they turned in their ballot. If not, let them know you can give them one and they can fill it out there. This helps set you up for making quorum.

When it comes to your presentation—practice, practice, practice. Practice in the mirror, practice in front of your peers, practice until it sounds like a conversation and not a presentation, practice until they can recite what you are saying. Not only that, ask for and be open to constructive feedback. On the day of the meeting, take a deep breath, smile and relax. You are prepared and know what you are discussing inside and out. And because you effectively communicated the issue, the homeowners are open to listen and not attack. You are 100% of the time going to have your naysayers and individuals who are not going to be on board and who will attempt to sabotage what you know is right and true. In your communication strategy, you need to do everything you can to prove that one individual wrong by speaking in a positive information-based way to the majority of the homeowners. The grass is greener where you water it. You sent email blasts; you posted flyers; you mailed flyers; you sent out the ballot; and you hosted the Town Hall. Now it is crunch time and the part that most miss: following up. Send an email out that recaps the Town Hall so any member who was not able to attend can still have the information. Continue to send reminders to the Membership of when the ballot is due. Ask board members if they are comfortable going doorto-door to ask if homeowners need more information to turn in their ballot. Keep the same positive message that you have worked so hard to create.

DUES INCREASE Similar strategies can be used for a dues increase. Effectively communicate that there is a need. That communication starts with the Board. Do your homework and procure budgetary numbers for items that have been deferred for years and need to be addressed. Compare those numbers to what is currently in their budget and show them it is not possible to continue to be fiscally responsible with what they have been doing and still uphold their fiduciary duty. Take it a step further and have the vendor help them understand that if they do not take action soon, a maintenance item will cost more and be more invasive in the future. It is our obligation as community managers to help them understand. Once the Board is committed to raising dues, let the membership know in advance. Include the narrative in an email blast and in the next newsletter and continue to do so until the annual disclosures are sent out. Allow people the opportunity to properly budget for an increase. Explain projects that will be able to be completed or that will be in the pipeline with realistic start dates. As humans, we are visual creatures. We may know that the roof needs to be repaired, but we cannot see it. It is hard to understand that so much money is needed for something that is out of sight. To help mitigate that, work with your contracted maintenance companies to see if there are costeffective strategies to help spruce up the place. Whether that is a touch of seasonal color near the mailbox cluster and at the entrance or it is a fresh coat of paint in a common area, it will help owners see that the extra money is being used responsibly to protect their investment both structurally and aesthetically.

Most likely, the homeowners will be aware that something needs to be done. If it is effectively communicated, you can help them realize the “something” is a dues increase. The pushback will then not be as severe.

I can tell you with confidence these strategies work. I have used them for special sssessments and dues increases with minimal pushback from the Membership. They felt included, and it bought back the sense of community that can get lost in the modern world.

Leslie Barton, CMCA® is a community manager with FirstService Residential, AAMC, a full-service management company serving community associations throughout the country. She can be reached at leslie.barton@fsresidential.com.

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