Quorum — April 2018

Washington Metropolitan Chapter Community Associations Institute

APRIL 2018

A Magazine for Community Association Volunteer Leaders, Professional Managers and Business Partners

ALSO IN THIS ISSUE

____________________________ The Lowdown on Leasing and Fair Housing Considerations ____________________________ The Art of Dealing with Difficult Tenants ____________________________ Amenity Rentals

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APRIL 2018

­CONTENTS 12 Changing the Governing Documents

BY RICHARD KUZIOMKO MBA, CMCA, AMS, PCAM

14 Why Would You Bother? Leasing Cap Amendments Pros & Cons

BY MIRA BROWN, CMCA, AMS

16 What Impact Does Leasing Have on an Association’s Insurance?

BY ANDREW SCHLAFFER

18 The Lowdown on Leasing and Fair Housing Considerations

BY JANIE L. RHOADS, ESQ.

21 The Legal Perspective on Short-term Rentals

DEPARTMENTS AND MORE 5 Letter from the Executive Director 6 Chapter Benefactor: Chadwick, Washington, Moriarty, Elmore & Bunn, PC 7 Welcome New Members 8 Upcoming Events 11 People & Places 36 Classifieds 37 Index to Advertisers

BY TODD SINKINS, ESQ.

25 Practical Tips with Dealing with Short-term Rentals

BY RUTH KATZ, ESQ.

26 The Art of Dealing with Difficult Tenants

BY MARK GORALSKI CMCA, AMS, FMP

28 FHA Leasing & Owner Occupant Standards

BY C. SCOTT CANADY

30 Being a Good Landlord: Don’t Be a Roper!

BY CRISHANA L. LORITSCH, CMCA, AMS, PCAM

33 Amenity Rentals

WMCCAI MISSION STATE­MENT To optimize the operations of Community Associations and foster value for our business partners.

BY AIMEE WINEGAR, CMCA, AMS, PCAM, LSM

Reader comments and suggestions are welcome. Address your comments to: Quorum 7600 Leesburg Pike, Suite 100 West Falls Church, VA 22043

We also wel­come ar­ti­cle sub­mis­sions from our ­members. For author guide­lines, call (703) 750-3644 or e-mail publications@caidc.org.

Articles may be edited for length and clarity.

APRIL 2018

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President Sarah Gerstein, CMCA, AMS, LSM, PCAM President-elect Rafael A. Martinez, CTP Vice President Airielle Hansford, CMCA, AMS, PCAM Secretary Michael Gartner, ESQ. Treasurer Kristen Melson, CMCA, AMS, PCAM Immediate Past President Bruce H. Easmunt, ESQ. Executive Director Jaime Barnhart, CMP (EX OFFICIO)

D IRECTOR S Gordon Boezer, Thomas Burrell, Anthony Humphries, Ruth Katz, Ted Ross, Todd A. Sinkins, ESQ., Stephen Wright, CMCA, AMS, LSM, PCAM

ESQ.,

We make a living by what you get. You make a life by what you give.

– Winston Churchill

CO U N C I L C HAI R S Communications Council Leslie Brown, ESQ. Education Council Jennifer Bennett, CMCA, AMS, PCAM Member Services Orlando Ramirez

CO MM I T TE E C HAI R S Conference & Expo William Cornelius and Donna Aker, CMCA, AMS, PCAM D.C. Legislative/LAC Jane Rogers, ESQ. Education Kevin A. Kernan, ESQ. and James Santos, CMCA, AMS Golf Adrienne Zalenski and David Crone, CMCA, AMS Maryland Legislative Thomas Schild, ESQ., CCAL Outreach Elizabeth Kirk and Sara Ross, ESQ. Membership Joe Inzerillo and Noni Roan Quorum Editorial Susan L. Truskey, ESQ. and Christopher Carlson Chapter Events June Chulkov and Lauren Kolb Virginia Legislative Ronda DeSplinter, LSM, PCAM and William A. Marr Jr., ESQ.

QU O RUM Managing Editor Diane Sohn, dsohn@caidc.org Design Six Half Dozen

QU O RUM E DI TORI AL CO M M IT TE E Co-chairs Susan L. Truskey, ESQ. and Christopher Carlson Members Beverly Alston, James Anderson, Noel Arevalo, CMCA, Sarah Auringer, Mira Brown, CMCA, AMS, Leslie Brown, Chris Carlson, PE, Deborah Carter, CMCA, AMS, PCAM, Sara Castle, Crystal Coats, CMCA, AMS, Kenny Cohn, Cheryl Crawford, Christopher Dibble, CMCA, AMS, PCAM, Bruce Easmunt, ESQ., Sarah ElTaher, Matt Gallagher, Michael Gartner, ESQ., Amy Gaynor, Sarah Gerstein, CMCA, AMS, PCAM, Rippy Gill, CMCA, AMS, Laura Goguet, CMCA, AMS, John Goins, Stephen Grant, Scott Greges, CMCA, AMS, Timothy Hipp, Mary Horner, Chase Hudson, Peter Hughes, Iman Jackson, CMCA, AMS, Shannon Junior, Ruth Katz, ESQ., Leisa Keys, Richard Kuziomko, CMCA, AMS, PCAM, Crishana Loritsch, CMCA, AMS, PCAM, Liliana Martinez, CMCA, AMS, Laura McVey, Thomas Mugavero, ESQ., Crystal Partin, CMCA, AMS, PCAM, Joycelyn Peoples, AMS, Kara Permisohn, Nicki Phenneger, Christine Rudert, Brandi Ruff, CMCA, AMS, PCAM, Lauri Ryder, CIC, CRM, CMCA, Scott Silverman, Mark Smith, Chelsie Throckmorton, Olga Tseliak, John Tsikerdanos, Ron Unger, CIC, Kim Veirs, Lee Ann Weir, CMCA, AMS, Doug White, Samuel Wiest, Lakisha Williams, Aimee Winegar, CMCA, AMS, LMS, PCAM, Jim Wisniewski, Kelly Young, Michael Zupan, ESQ. Washington Metropolitan Chapter Community Associations Institute, a 501(c) (6) organization, serves the educational, business and networking needs of the community association industry in 80 cities/counties in Maryland, Virginia and the District of Columbia. Members include community association homeowner volunteer leaders, professional managers, association management companies, and other businesses and professionals who provide products and services to planned communities, cooperatives and condominiums. WMCCAI has more than 3,000 members including 300+ businesses, 1,100 professional managers from 85 management companies, and approximately 1,500 community association homeowners. WMCCAI is the largest of Community Associations Institute’s 62 chapters worldwide.

Quorum is the award-winning premiere publication of WMCCAI, dedicated to providing WMCCAI’s membership with information on community association issues. Authors are responsible for developing the logic of their expressed opinions and for the authenticity of all presented facts in articles. WMCCAI does not necessarily endorse or approve statements of fact or opinion made in these pages and assumes no responsibility for those statements. This publication is issued with the understanding that the publisher is not engaged in rendering legal, accounting or other professional services and nothing published in Quorum is intended to constitute legal or other professional advice and should not be relied on as such.

If legal advice or other expert assistance is required, the services of a competent professional should be sought directly by the person requiring such advice or services.

Articles appearing in Quorum may not be reprinted without first obtaining written approval from the editor of Quorum. In the event that such permission is granted, the following legend must be added to the reprint: Reprinted with permission from Quorum™ magazine. Copyright 2017 Washington Metropolitan Chapter Community Associations Institute. Quorum is a trademark of WMCCAI. Receipt of Quorum is a privilege of WMCCAI membership for which $65 in nonrefundable annual dues is allocated. The subscription price for nonmembers is $75 per year; contact publications@caidc.org or call (703) 750-3644.

We have multiple education sessions each month, networking events throughout the year, and the monthly publication of a magazine. WMCCAI is a busy chapter! It is all possible because of you, our members.

FROM THE EXECUTIVE DIRECTOR

W E C E L E B R AT E Y O U, T H E VOLUNTEER

O FFICE R S

Becoming a member of an industry association is easy—fill out the application and your membership card arrives in the mail. Committing your time and efforts to volunteer as an association leader is the hard part.

Volunteering is good for you—personally and professionally. Through committee work, you develop new skills, take on a leadership role, and make an impact on the success of the chapter. Friendships develop as you build a network of new business contacts. In 2017, more than 300 members, roughly 10% of our membership that year, donated thousands of hours to chapter programs and publications.

Want to improve your writing—join the Quorum Editorial Committee and write articles. Are you passionate about the benefits of membership? If you are, support your co-members through the Membership Committee. Connect with the community around us as a member of the Public Outreach Committee. Want to develop educational programming for the community association industry? The Education Committee always has room for more ideas! And as you saw last month, Conference & Expo is a huge event, and the C&E Committee loves new committee members to build our premier event. Chapter Events and Golf Committees meet monthly to create major networking events throughout the year for all our members. Our Legislative Committees work to keep the chapter updated on the impact of local legislation on community associations.

National Volunteer Week is April 15-22. We celebrate you. Thank you for all the hours, the ideas, the skills, and the dedication to our chapter’s success. WMCCAI is a strong, vibrant, and growing organization…because of you.

JAIME BARNHART,

CMP

Jaime Barnhart, as the chapter’s executive director, is responsible for implementing the organization’s mission and goals, and managing its staff. Jaime has worked in non-profits/associations in the D.C. Metro area for over 12 years focusing on program management, events and trade shows, and marketing. She joined WMCCAI as the events manager in 2015.

To advertise in Quorum, e-mail publications@caidc.org.

For more information about Quorum or WMCCAI, visit www.caidc.org.

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CHAPTER NEWS

C H A P T E R

B E N E F A C T O R

Chadwick, Washington, Moriarty, Elmore & Bunn, PC 3201 Jermantown Rd. Suite 600 City, State ZIP: Fairfax, VA 22030 Telephone: (703) 352-1900 Fax: (703) 352-5293 Website: www.chadwickwashington.com Year Established or Incorporated: 1990 • CAI Member Since: 1990

• Certificate of Insurance: Yes • Areas you serve: Virginia and the District of Columbia • Services Provided: Legal Representation • Licenses Held: Licensed in Virginia and D.C. • Company Philosophy: Assisting association clients with knowledgeable, thorough and creative counsel.

Chadwick, Washington, Moriarty, Elmore & Bunn P.C. devotes its practice entirely to community association law in D.C. and Virginia, working with: • Homeowners associations • Condominium associations • Residential and commercial master associations • Housing cooperatives Since 1990, Chadwick, Washington, Moriarty, Elmore & Bunn PC has provided comprehensive legal representation

of community associations in Virginia and the District of Columbia, including homeowners associations, residential and commercial condominium associations, and housing cooperatives. The firm delivers wise, creative counsel to support an association’s ultimate goal—to run an efficient community that properly serves its members. Our lawyers provide guidance and assistance to boards and managers on the full array of issues facing community associations—such as covenant enforcement, covenant and bylaw interpretation, contract negotiation, amending governing documents and collecting delinquent assessments. We are also experienced in assisting new communities in transition from developer control and provide litigation services if needed.

In addition, the firm is a leader on Virginia legislative issues and presents annual seminars to clients and managers regarding the latest developments in the law and other topics of interest.

Contacts: Ken Chadwick, ESQ., CCAL, kechadwick@ chadwickwashington.com; Wil Washington, ESQ., CCAL, wwashington@chadwickwashington.com; Brendan P. Bunn, ESQ., CCAL, bpbunn@chadwickwashington.com; Allen Warren, ESQ., abwarren@chadwickwashington.com and Bruce Easmunt, ESQ., bheasmunt@chadwickwashington. com (all of whom are past presidents of WMCCAI)

Article Submissions:

Are you interested in sharing your experiences and expertise with our readers? Quorum magazine is always seeking new article ideas, submissions, and content. If you have an idea or would like to submit an article for consideration, please make sure you contact us before you begin writing to see what our upcoming themes are. Questions and interests should be directed to Diane Sohn at publications@caidc.org or by phone at 703.750.3644.

Advertising:

For advertising, availability, rates, and specifications, please contact Diane Sohn at publications@caidc.org. Targeted advertising in WMCCAI’s Quorum, opens the door to thousands of prospective customers and contacts in the community association industry.

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WMCCAI proudly welcomes the following members who joined the chapter in September 2017.

Community Association Volunteer Leaders from the Following Associations Chantilly Park Condominium Association Fairlington Villages Grandview Estates Condominium Hyde Park Condominium Mid Atlantic Cohousing Monroe House Condominium The Jefferson Residential Condo Waterfront Street Condominium Association Watergate at Landmark Windgate of Arlington, Village II Individual Managers Larry Ayers Andrea N. Beaird, Zalco Realty, Inc., AAMC Birgit A. Burton, Sentry Management, Inc. Lindsay Chickering, Select Community Services Erik Cohen, FirstService Residential, AAMC

Elizabeth Dever, Legum & Norman, Inc., AAMC Jennifer Edwards Crystal Gray, FirstService Residential, AAMC Anita Gregory, Gates Hudson Community Management, AAMC Debra Holcombe, CMCA, Capitol Property Management, AAMC Joyce Hunt, Sequoia Management Company, Inc., AAMC Sherri Kennedy, CMCA, AMS Trish Langley, Langley Financial Solutions, Inc. Maureen Leyva, FirstService Residential, AAMC Randy McClement Wendy Mclellan Marlene Medvick Ebony Pagan, Priority Management & Services Matthew B. Quinn, Maredith Management, LLC, AAMC

Isabel Ramberg Viraxay Somchanmavong Megan Stramel, Landmarc Real Estate, AAMC Barbara Turner, Burke Community Management Group, LLC Taylor Weisbrod, Landmarc Real Estate, AAMC Anastasia Whitlow, Van Ness East Condominium Association

CHAPTER NEWS

Welcome New Members

Business Partner Artistic Landscaping, Inc. JB Kline Landscaping Multi-Chapter Business Partner BB&T Association Services First-Citizens Bank & Trust Co SealMaster

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UPCOMING EVENTS

APRIL 14

Watershed Clean-up Day 9 a.m. – 1 p.m.

Join the Washington Metro Chapter Community Associations Institute as we do our part to clean up the Potomac Watershed and positively impact the communities where we work and live. For more information or to register visit www. caidc.org/event/watershed-clean-up-day

APRIL 18

Spring Happy Hour 4:30 – 7:30 p.m.

Public House 199 Fleet Street, National Harbor, MD 20745

Come join the fun at the Spring Happy Hour! We are pleased to present our first networking opportunity for 2018 at the Public House-National Harbor! This happy hour will allow managers, homeowners, and professionals involved in the community association industry to network in a fun and casual environment.

Registration includes one drink ticket and hors d’oeuvres. Sponsorships are available. Visit www.caidc.org for more information or to register.

APRIL 21

Free Community Education Seminar: Fair Housing 9 a.m. – 12 p.m.

WMCCAI Chapter Office 7600 Leesburg Pike, Suite 100 West, Falls Church, VA 22043

Join Doug Levy, ESQ., and Janie Rhoads, ESQ., of MercerTrigiani, at this informative free session about fair housing laws in our region. Learn from policymakers and experts about recent developments, changes and trends in fair housing laws and how they impact your association. From assistance animals to reasonable accommodations to reasonable modifications, discover what steps your community must take to comply with fair housing regulations and prevent claims of discrimination. This session is FREE. Registration is required. Visit www.caidc.org for more information or to register.

MAY 10

WMCCAI Host Chapter Party

Celebrate with CAI’s largest chapter at the 2018 Host Chapter Party!

7 – 10:30 p.m.

Nationals Park Register for just $99* through April 4th

Hit a homerun by networking with hundreds of community association collegues at Nationals Park, home of the Washington Nationals Baseball team. Get your photo with the famous Racing Presidents. Get a behind-the-scenes tour of the ballpark including the dugout and bullpens. Experience local foods from D.C., Maryland, and Virginia. Ticket price includes roundtrip transportation from the conference hotel, drinks, hors d’eourves, DJ entertainment, and more! You never know who you will run into in Washington D.C.!

Visit www.caidc.org for more information or to register. Sponsorship opportunities available. *Rates increate to $125 beginning April 5th.

MAY 19

SAVE THE DATE

Visit www.caidc.org for more information or to register.

Board Leadership Development Workshop 9 a.m. – 5 p.m.

MAY 31

Manager Roundtable: Safety & Risk Management

Visit www.caidc.org for more information or to register.

12 – 3 p.m.

Maggianos - Tysons Corner 2001 International Drive, McLean, VA 22102

For more information on WMCCAI meetings or upcoming events, contact the chapter office at (703) 750-3644, email info@caidc.org or visit www.caidc.org.

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Goldklang Group CPAs, PC announced the promotion of Jeremy W. Powell, CPA and Renee L. Watson, CPA to Principal. For nearly 20 years, they have both proven themselves consistently as leaders in our industry and within our firm as an integral part of our leadership team. They provide our clients exceptional service and continue to contribute to the overall growth of our clients and the firm.

SOLitude Lake Management Named World’s Largest Distributor of AquaMaster Fountains

PEOPLE & PLACES

Jeremy W. Powell, CPA and Renee L. Watson, CPA promoted to Principal

SOLitude Lake Management® is now recognized as the world’s largest distributor of AquaMaster fountains and aeration systems by AquaMaster, the leading brand and largest manufacturer of lake and pond aeration equipment. The designation was made in January, following several years of SOLitude’s consistent placement as one of AquaMaster’s top three distributors.

Tidewater #1 in Baltimore Business Journal’s 2017-2018 “Book of Lists” Tidewater Property Management has been ranked number one in the Baltimore Business Journal’s 2017-2018 “Book of Lists”, a comprehensive ranking of hundreds of companies in major industries across the Baltimore region. These regions include Baltimore City, Anne Arundel County, Baltimore County, Carroll County, Harford County, and Howard County.

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By Richard Kuziomko MBA, CMCA, AMS, PCAM Richard is the general manager of The Kenwood Condominium in Bethesda, Maryland. He has been an active speaker and lecturer at various WMCCAI forums and member of both the Education and Quorum Committees.

the

Changing Governing Documents

O

ne of the most difficult actions to take by an association is to change the governing documents. The declaration, bylaws, or CC&R’s (Covenants, Conditions, and Restrictions) typically have been created by the developer after the plat was drafted. They are the legal essence of how the association is to look, be governed, and protection for the owners.

How to change the governing documents is usually quite clear. Somewhere in the pages is a threshold percentage. This determines how many owners have to vote in order to make changes. Normally it is a supermajority which is over 50%. Many designations are 66 2/3% of the ownership, but in some cases, it may even go as high as 90%. Another hurdle is developers who do not want changes may have inserted a short-term provision for changing, such as any votes have to be gathered in 20 days.

If this is so daunting then why even consider it? There are many reasons. Among them are: • To set a rental cap for condominiums in order to maintain FHA approval for new mortgage loans (currently at 50% or 35% depending on certain conditions).

• Clean up the developer written governing documents. These often have many sections to protect the developer which become moot when the transition to owner control takes place.

• Incorporate changes to correct the original documents which have errors based on new laws. For example, some verbiage

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is contrary to FHA laws, there may be satellite dish restrictions which are not in accord with FCC rulings, and some very old documents have restrictions not tolerable today.

• Changes to cover new items not considered when the documents were written such as Airbnb, solar panels, wi-fi, or changes in the association physical makeup.

When deciding to make changes, many associations form an ad hoc or governance committee. This is valuable as owner involvement is important in knowing the specifics of the association. Albeit, all too often the committee goes off and tries to re-write the documents themselves, which is time-consuming and unnecessary. Dean Martin ESQ, Partner and Founder of Barker Martin PS, recommends to “let the attorney draft the new governing documents from the start.” There are too many legal issues which only a good association attorney is aware of and can include in the new governing documents.

It may seem that getting a new draft finished is half the battle. However, it is just the beginning.

Most of the work will come after the documents are completed. The community has to be sold on what is being changed, the

reasons why, and the benefit to each owner. This is the hard part as every owner has their opinion. Some just on principle don’t want any change. Others such as landlord owners may feel the changes are contrary to their economic interest. Finally, many owners may feel there is an uncommunicated reason as to why the changes are being suggested.

This is where a dedicated small group of volunteers is crucial. They have to convince the supermajority that a vote for the change is good for everyone. The benefit has to be sold from the standpoint of why it is good for the individual, not just a generic group. The full support of the board is crucial as certainly, they represent the ownership. If the majority can be convinced then the rest is easy. Any singular change will not please everyone but knowing what the important factors for the majority ownership are and addressing them, will get a large portion on the side of change.

Approval is usually a matter of obtaining the votes of the ownership. This can be electronic, as is done for an annual meeting, or signatures on physical documents. Getting the votes is hard work. Sending out a letter to everyone is easy as are messages on the community communications method such as email, association website, BuildingLink, etc. Obtaining the desired results is the hard part. It is well known that only about 5% of the members of any significant sized association are intimately aware of what is going on. Somehow this larger portion

of owners has to be touched. There may also be mortgage issuers who also have an interest and may have to be communicated with as well.

The ad hoc or governance committee can make a world of difference.

Town hall meetings are a good way to answer interested owner questions. Setting up a voting box at a location where everyone passes, such as a front desk or guard house gets the word out. Door to door canvassing is not out of the question, especially for smaller associations. One committee had a baking event and gave out cookies to everyone who voted. Phone calling is good, but it has to be followed up by capturing the physical ballot. Every association is different, so the method to get the vote for governance changes has to be tailored.

Once all the votes are in and there is a supermajority, getting the changes into effect requires several more steps. A special meeting of the association has to be called with one item on the agenda: changes in governing documents. The votes for change are then officially recognized. Here again, the attorney plays a key role in getting the changes effected properly. Martin states that “the attorney will write a resolution for the board to pass at the special meeting and then records the new documents.� This ensures the document will be legally binding.

The final step is to let every owner know of the new document. Copies can be sent electronically, however, something as important as this, a paper copy or booklet should also be sent. There may be other interested parties or locations which should be informed as well: the agent sending out resale packages, a master association if one exists, the loan provider if there is one for the association, possibly the association’s bank, mortgage companies, etc. Of course, the communications site should be updated so everyone can download or search the new documents.

Is it worth the cost, energy, and aggravation to change governing documents? Yes, it certainly is. New documents provide current governance, reflect the association as it is today, and send a message to new buyers of proactivity. Go for it!

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By Mira Brown, CMCA, AMS Mira is the manager of property operations at Delbe Management. She has held a variety of positions within the company, as well as managing several condominium associations in D.C. and one in Virginia. Mira has been a member of CAI for several years and is currently a member of the Quorum Editorial Committee.

Why Would You Bother?

Leasing Cap Amendments

Pros & Cons

T

here’s a lot of buzz these days about leasing cap amendments. What are they? Are they necessary? What’s the benefit? Is there a downside? In its most basic form, a leasing cap amendment simply restricts the number of units that can be leased at any time. For the sake of argument, let’s assume there are 100 units in your association and the board decides to pursue an amendment allowing only 30 units to be leased at any time.

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Why would an association take this on?

First, the percentage of leased units can affect the kind of financing that buyers and existing owners are able to use. FHA and Fannie Mae both look at this number.

Even if your prospective purchaser is not seeking FHA or Fannie Mae financing, the fact of the matter is that mortgages are packaged together for resale, and most lenders seek to have all their mortgages meet this standard.

Just on its face, a leasing cap amendment can serve to limit potential purchasers. If you have reached the stated limit of leased units, owners cannot sell to investors.

Owners may be forced to hold on to their unit because they can’t get their asking price from someone who plans to actually occupy the unit. Or worse, owners may actually lose money if they have to sell.

Let’s assume your association has decided to pull the trigger and you’ve made it through the amendment process. Now what? Obviously, as with any amendment, you have to notify all owners of the amendment. That notification should be accompanied by very clear instructions on how the process will work. You may wish to require that all leased units register with the board and management for consideration to be legal under the cap.

Then, you have to review your existing leases. The board and management team need to be confident that you are aware of all leased units and that all their lease documentation is in line. You also need to define a lease. Check your jurisdiction; there may be laws in place about what constitutes a lease. Does money have to change hands for a unit to be considered leased?

What about a child living in a unit owned by their parents? You need to make those definitions clear and be confident in your numbers.

Until you reach the cap number, all you have to do is make sure you stay aware of all the leases in the association. Once you reach the cap number, you will need to maintain the wait list. Generally, wait lists give an owner a certain amount of time in which to lease their unit before the next person on the list gets moved up to the first position on the list, usually between 60-90 days. This may seem short, but you should consider a set time to actually execute a lease.

Some owners will be inclined to just get on the list, so they have the option to rent their unit if they want to at some point in the future. This can delay the process for other owners on the list who may actually need to lease their units for financial rea-

sons. Imagine you’ve been reassigned for work and your unit has actually been sitting vacant for a couple months. The person in front of you on the list has no intent on leasing their unit. You have to wait until the allowable period expires, losing money the whole time on a vacant unit. For this reason, many leasing cap amendments require that owners who request to be put on the waiting list actually submit some kind of deposit to maintain their place.

The wait list becomes the center of all kinds of concerns and questions. Is your position on the list confirmed by the postmark date on your notification of intent to lease? Or by when it’s received by the management team? In this day of electronic notification, is an email enough? If you require a deposit, is the receipt thereof what secures your place on the list? You need to be sure that these questions are understood by all involved and properly communicated

to all members of the association. The board and management need to work out these details before the notification goes out about the amendment.

You should also consider a hardship clause in the amendment.

Currently, FHA and Fannie Mae have their limit set at 50% of units leased. In our example, we’ve capped the number of units to be leased at 30. This allows another 20 units to be considered before you run afoul of this limit and financing options are limited. This gives the board some flexibility to consider hardships. Maybe your work has transferred you, but only for two years. Having some wiggle room built into your limit would allow the board to consider allowing you permission to lease your unit for those two years instead of forcing you to sell your unit because you can’t afford to maintain a vacant unit.

As with pretty much any rule, you will most likely have violations.

You will need to set the rules for this eventuality: how you are supposed to notify the owner of the violation, what the penalties are for the violation and how the violation can be remedied are important considerations. In most jurisdictions, a hearing is required before fines and penalties may be imposed. The board and management need to be ready for this to happen and have the procedures in place to accommodate this.

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By Andrew Schlaffer Andrew is a vice president in USI’s DC Metro and Hunt Valley regional offices.

He joined the USI team in June 2017 and is a licensed property and casualty insurance agent and consultant in Virginia, Maryland, and the District of Columbia. Andrew has a background in providing customized insurance and risk management solutions to community associations as well as other related industries. He serves on several Chapter committees for both the Washington Metropolitan and Chesapeake Region Chapters of CAI.

What Impact Does Leasing Have on an Association’s Insurance?

T

he percentage of renters is increasing nationally, and our area leads the country in this statistic. A 2014 poll by the National Multifamily Housing Council found that 42% of households in the D.C. area are renting, second only to New York at 51%. Many factors contribute to this statistic, but the area’s transient economy lends itself to this type of living arrangement.

age. Possibly more importantly, only 41% of the renters surveyed said they had obtained renters insurance. Therefore, the necessity of educating millennials on insurance matters is critical to the financial well-being of our communities, especially since trends are indicating a continual decrease in home ownership. If renters understand what is required of them from an insurance and governing document standpoint, the better off associMoreover, 51% of people living in rental ations will be at controlling their insurance housing arrangements are under 30 years of costs long-term.

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Bottom line—insurance carriers are aware that this region has a higher renter percentage than the national average and their concern regarding the negative impact this can have from a claims perspective plays a large part in the underwriting process. Insurance carriers collect and analyze claims data from across the country as part of their actuarial research, and they have come to a consensus that as rental occupancies increase, the likelihood of claims increases.

How do these facts surrounding high percentages of renters impact an association’s insurance program, and what can an association do to effectively control its community’s long-term costs while maintaining a friendly, hostile-free living environment?

We recommend associations implement the following suggestions to effectively identify and solve the challenges of managing a community with high renter occupancies.

1. Require all tenants purchase a renter’s insurance policy (HO–4) with required/ recommended insurance coverages/ limits. Adopting a lease agreement is also highly encouraged. Many governing documents grant associations the ability to subrogate against tenants, so if

the tenant is found to be responsible for a claim that impacts common elements and/or other units, we recommend notifying the master insurance carrier of this circumstance. There is a high probability that most tenants will be millennials, and since millennials are between the ages of 18 and 34, their education and experience level when it comes to purchasing insurance is probably limited. In short, it would be wise to have your insurance broker meet with association members to educate them on the importance and affordability of any recommended/required insurance programs. The typical homeowner’s insurance policy is very affordable, with annual premiums ranging from $150–$350.

long-term costs. This effort should increase homeowner participation, which will, in turn, better protect the association from unintended claims.

6. Work with your insurance broker on exploring the most cost-effective insur-

ance solutions based on your community’s unique demographics. Working with an experienced broker who also has access to multiple carriers is highly recommended to obtain the broadest possible coverage at the lowest possible price point.

2. Require homeowners to purchase an insurance policy (HO–6) with required/ recommended insurance coverages/limits. In many cases, this could serve as a secondary insurance solution in case the renter’s insurance is found to be inadequate.

3. Notify all new residents (homeowners and renters) of any requirements in place when hiring contractors to perform work within units (obtain proof of insurance, permits, licenses, etc.) This will help avoid costly claims and will also provide grounds for subrogation if the contractor causes an issue.

4. Keep accurate owner and tenant information, including the percentage of renters. Start with a survey and monitor occupancy trends moving forward. With accurate information, you can develop policies and procedures tailored to the actual demographic. Furthermore, providing more accurate information to insurance carriers during the bidding process typically leads to more competitive terms.

5. Invite your insurance broker to attend board meetings to discuss the importance of obtaining and maintaining homeowners and/or renters insurance policies. Your broker should be discussing why insurance is important, what each policy typically covers, and how this will help the association control APRIL 2018

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By Janie L. Rhoads, ESQ. Janie is counsel with MercerTrigiani with more than 15 years of experience representing developers of common interest communities and providing general counsel to common interest communities.

THE LOWDOWN ON

Leasing & Fair Housing Considerations

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easing in common interest communities has garnered increased attention over the last few years, especially with the advent of short-term leasing website platforms such as Home Away and Airbnb. Owners are capitalizing on the fact that renting a home – or even a room, in the DC Metropolitan Area can command a small fortune.

In recent years, courts and the legislature in Virginia have increasingly followed the view that association action must be based only on authority established in the recorded governing documents or condo-

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minium instruments or by statute, particularly if the action being taken affects ownership rights such as the right to lease property.

In fact, legislation adopted by the Virginia General Assembly in 2015 and 2016 amending the Condominium Act and the Property Owners’ Association Act proactively limits the authority of associations to charge rental fees or require the use of an association form lease or lease addendum, unless expressly authorized by the governing documents or condominium instruments. This recent legislation does au-

thorize, however, an association to require that the owner provide the names and contact information of tenants and authorized occupants under a lease, as well as vehicle information for these individuals. Also, the association may require the owner to provide the association with an acknowledgment from the tenant that he or she has received and agrees to abide by the governing documents and association rules and regulations.

As community association boards and managers grapple with the administrative and legal challenges posed by the booming

rental market and ever-evolving Virginia law, it is easy to lose sight of the fact that fair housing issues can come into play as well in the leasing context. As a housing provider, community associations are required to abide by fair housing laws. And, because the imposition of leasing restrictions or special requirements may infuriate owners and tenants who may qualify as a protected class under the fair housing laws, these fair housing considerations should not be given short shrift, by anyone.

One primary consideration which is often unknown or overlooked is that the fair housing laws protect not only owners but also current tenants and even prospective tenants.

Virginia common interest community associations cannot discriminate against tenants or prospective tenants based on race, color, religion, national origin, sex, elderliness, familial status, or disability. The locality in which the community is located may contemplate additional protected classes.

unwittingly become exposed to liability is in the screening of tenants. Even in those circumstances where the governing documents or condominium instruments authorize the screening of tenants, a community association must exercise extreme care on the types of information requested.

For instance, the Office of General Counsel of HUD has issued formal guidance regarding the use of criminal records by housing providers in screening prospective tenants. Any screening practice should be vetted by legal counsel for the community association.

Consistency of application, familiarity with fair housing laws, and consultation with legal counsel are all ways an association can reduce exposure to fair housing-related claims. Also, communities should ensure that the association director’s and officer’s liability insurance policy includes coverage for fair housing violations.

Other leasing-related rules or practices which may trigger a fair housing complaint are rules which limit the number of roommates, treat tenants differently than owners or treat similarly situated tenants differently. Even if the rule is neutral on its face and adopted with the best of intention, if the rule has a disparate (unequal) impact on a protected class, the rule may violate fair housing laws.

Where community associations oftentimes

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By Todd Sinkins, ESQ. Todd is a shareholder with the law firm Rees Broome, PC, and is co-chair of the firm’s Community Association Practice Group. He is also a member of the WMCCAI Board of Directors and serves on the D.C. Legislative Action Committee.

The Legal Perspective on

SHORT-TERM

RENTALS

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he problem of short-term rentals in homeowners’ associations, condominiums, and cooperatives in the D.C. Metropolitan area has exploded over the past several years. Not a week goes by when I do not have a property manager or a member of the board of directors contacting me to discuss how to address problems associated with a person renting out their home or unit through a short-term rental website.

And this issue is only going to become more significant as short-term rentals become more pervasive throughout our community.

Short-term rentals put associations and many of their members in conflict with those members of the community who wish to rent their homes out through a short-term rental website.

Proponents of short-term rentals advocate the free rental of homes through shortterm rental websites as part of the new sharing community that allows homeowners to utilize alternative means of raising revenue to pay for the mortgages. However, such proponents lose sight of the very real impacts that short-term rentals have on communities. It is uncontroverted that short-term rentals create a greater drain on association resources than do other forms of home occupancy. First, short-term rental users have a more intent use of association amenities than do regular owners.

One of the drawing points for short-term rental users is the actual use of community amenities. Additionally, such short-term rental users often are a greater drain on management resources than our regular residents of the community. For instance, it is not unusual for a short-term renter to go to a management office requesting access to their unit because it can’t get in touch with their host. Also, it is not un-

common for neighbors to complain that they are being contacted by the guests of short-term rental hosts who are trying to find a key for the home, directions to nearby restaurants, or require other information not readily made available to them. In these cases, the neighbors are complaining to management, who often have to look into the matter and determine whether or not there is any action to take against the owner. In short, management resources get stretched thin when a community wonders of the number of short-term rentals within a community. Moreover, and perhaps most significant, is the fact that the short-term rental of homes or parts of homes within the community violates the recorded declaration or condominium instrument for most community associations in the Washington metropolitan area. Indeed, in many cases, association documents include restrictive covenants dictating a specific minimum rental term. Also, it’s not unContinued on page 23 APRIL 2018

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common for condominium instruments or declarations to include language that prohibits the use of a home for hotel or transient use.

Moreover, and this applies to those situations where only a room within a home is rented out, you may find language in restrictive covenants that does not permit any portion of a home except for the entire home to be rented at any single time. Yet, residents and community associations ignore these provisions and assert their right to rent their homes out on short-term rental websites based on some presumed right.

In these cases, we believe community associations have a right to enforce their covenants to take action to enjoin owners from doing so. Indeed, throughout the country, including in the Washington metropolitan area, associations have been successful in taking enforcement action against owners who permit their homes to be rented out on short-term rental websites. Courts are recognizing that such rentals violate minimum lease term provisions in governing documents. Courts have also recognized that such a use as a hotel or transient use of a home in violation of restrictive covenants. Moreover, recently courts have begun to recognize the increased burden the rental of homes on short-term websites has upon association resources and have permitted associations to enjoin such action and recover damages accordingly.

If your association is facing challenges created by the rental of homes or portions of homes on short-term rental websites, you should explore whether the association has the legal authority to

take action to enjoin such rentals. If they do, then you should discuss with the association’s counsel whether it makes sense to file suit to seek an injunction against the advertisement or rental of a home on a short-term rental website, whether you would have the ability to recover attorney’s fees in such a case and whether there are other actions that you may be able to take to stop the activity within your community. The terms and conditions for the use of Airbnb, the most prominent of the short-term rental websites, it specifically provides that any short-term rental must comply with the recorded covenants of any community association in which the home is located. As a result, you may also want to contact Airbnb to request that any listing that violates the association’s legal documents be taken down. Lastly, it’s important to note that associations board of directors are not the parties taking the lead and opposing short-term rentals. Indeed, I am aware of some boards where board members have explored the renting out of homes on a short term-rental website. Instead, in my experience, associations management companies and boards of directors are taking action when asked to do so by the neighbors who are being detrimentally affected by the short-term rental of a home within their community. These short-term rentals have an effect on the neighbors. In where short-term rentals are not permitted in the association’s legal documents, the board of directors has an obligation to determine whether such negative impacts require the association to take legal action to protect the rights of the owners who have bought into the community that prohibits short-term rentals.

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By Ruth O. Katz, ESQ. Ruth is a community associations attorney at Lerch, Early & Brewer in Bethesda, MD. She serves on the Washington Metropolitan Chapter Community Associations Institute’s Board of Directors and is active on the Maryland Legislative Action Committee. For her efforts, she has been named the “Public Advocate of the Year” and “Volunteer of the Year” by the Washington Metropolitan Chapter Community Associations Institute and a “Rising Star” by the Washington Metropolitan Chapter of Community Associations Institute and Maryland Super Lawyers.

Practical Tips FOR DEALING WITH

Short-term Rentals

W

hether you love them or hate them, it appears as though shortterm rentals, especially in the D.C. metropolitan area, are here to stay. Below are some legal and practical tips for managers when faced with decisions or complaints relating to short-term rentals.

Look to see if the community associations’ recorded covenants prohibit short-term rentals.

The prohibition can come in various forms.

It can be something along the lines of “no short-term or transient use” language prohibiting renting a portion of the home, rather than the entire home, at a time. You may wish to consult with legal counsel to make this determination. If short-term rentals are prohibited, you may have luck contacting sites, such as Airbnb, directly to potentially pull the listing.

You may also have recourse with your municipality if a short-term rental license is required and violating the community associations’ restrictive covenants is a basis for revocation of the license. For example, in Montgomery County, Maryland, beginning July 1, 2018, short-term rental providers will need to obtain a license from the County.

The County can revoke the short-term rental

license if short-term rentals are prohibited in the community association’s governing documents or if association fees are more than 30 days past due.

stead of the short-term rental itself. As discussed below, this may include the adoption of rules and regulations regarding noise and parking.

The association may also have independent enforcement authority in its governing documents or by law, including fines, for violations of its prohibition on short-term rentals.

Review other issues/nuisances caused by short-term rentals in your community.

If short-term rentals are not a violation, you may wish to amend your governing documents to prohibit such use.

This is a determination that should be made by taking into consideration the specifics of your community association. Condominiums should also take into consideration FHA condominium guidelines when deciding whether or not to amend, given the effect the amendment could have on FHA condominium approval. Given that amending covenants is many times not easy, the board and manager should consider whether there are other mechanisms with which to regulate the negative effects of a short-term rental, in-

This is a good opportunity to review rules and regulations relating to noise, pool use, smoking, etc. Even if you are unable to regulate or restrict the use itself, there may be other rules and regulations that relate to the actions about which the association is receiving complaints. These may include parking rules, guest notification procedures, or surveillance measures. While short-term rental guests are less likely to know or comply with rules and regulations, having certain procedures in place may allow the community association to hold the owner liable for violations of those rules and regulations.

The board may also wish to review whether there is operative language in the governing documents allowing the association to assess the owner directly for any damage caused as a result of the short-term rental. Given the different use of amenities by residents versus vacation-type guests, this may be an issue to consider further.

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By Mark Goralski CMCA, AMS, FMP Mark joined Community Management Corporation in July 2013, as the operations manager for field services. He has shown strength in his ability to manage and was promoted to general manager at the Carlton House Condominium in Reston. Prior to joining CMC, Mark spent 29 years with the Baltimore County Police Department. His major accomplishment as a police officer included becoming a member of the Department’s Hostage Negotiation Team where he received specialized training in all aspects of hostage crisis negotiation. Little did he know how it would become a major asset as a general manager of the Carlton House.

THE ART OF DEALING WITH

DIFFICULT TENANTS S

imply stated, community managers must have the ability to deal with difficult people.

Managers employ specialized professionals for many tasks: attorneys, accountants, reserve specialists, and more, but one aspect of a manager’s job that can’t necessarily be contracted out to a professional is dealing with difficult residents. However, there are strategies, resources, and advice available to assist managers in handling situations that involve challenging demands and personalities. Most importantly, managers should have a deep understanding of their communities and should possess excellent communication skills, which includes listening as a priority.

Understanding your community entails, not just knowing people and their personalities, but also being aware of common complaints, and having a thorough understanding of rules, policies, and processes that govern your community. First, learn the rules. Make it a priority to be an expert on community guidelines, and if it takes a while to become that expert, at least know how to quickly and 26 | QUORUM

easily access rules and policies in the event of a dispute.

Next, identify common complaints and learn the appropriate responses to these complaints. Parking and towing policy are primary sources of complaints in many communities. Know the towing/parking policy word-for-word. Print it. Get to know the towing company, not just their phone number and address, how much they charge for towing, accepted payments, etc.

Get to know the people who work for the towing company and the systems and processes by which they work. Lastly, if someone disputes towing or other violations, make sure you know the appeal process as outlined in your governing documents.

Other common friction points include dog waste, noise, broken elevators, trash, and paying assessments.

A successful community manager understands the importance of managing relationships.

One of the most effective tools when dealing with people, especially conflict, is active listening skills. Make eye contact, show

non-verbal cues of acknowledgment, ask open-ended clarifying questions, and summarize back to the person what they said.

Not only does active listening allow you to understand the problem better, but it also allows the other person to know you are listening. Everyone has a story, and sometimes they find the solution themselves when talking with you. Act diligently, not recklessly. A common mistake that staff makes under pressure when rushing to solve a problem is a hasty “yes” when it should be “let me find that out for you.”

Sometimes elevated emotions can affect your ability to communicate confidently. If it suits you, I would suggest that once you become aware of your elevated emotions, give yourself some time to think, step out, or ask a co-worker for advice. When dealing with conflict and problems, it can be more about building relationships and allowing the resident to feel heard then solving problems quickly.

Also keep in mind that there is a pretty good chance that inside your community someone is suffering at this moment, and that can have an impact on how they relate to others. Strive to treat all with dignity and respect. Provide options and ask questions instead of making demands.

In an ideal world, communities would work so closely and harmoniously together that they would have no need to involve management in dispute resolution. Until humanity evolves to that level though, we can take measures to provide sensible intervention. Arm yourself with knowledge, strive for service excellence, and exercise compassion as often as possible.

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By C. Scott Canady C. Scott Canady’s government and public affairs career includes 13 years of public service in the U.S. House of Representatives and the U.S. Department of Housing and Urban Development. Canady is principal of Tambala Strategy, LLC, and serves as Federal Advocate for Community Associations Institute.

FHA Leasing & Owner Occupant Standards

H

aving your condominium association certified by the Federal Housing Administration (FHA) opens doors for homebuyers and adds value for homeowners. FHA certification tells owners and interested buyers the association is in good shape, financially and operationally.

FHA certification also means the association must comply with FHA requirements, including policies on lease restrictions, short-term rentals, and the percentage of owner-occupied units in the association.

Understanding why FHA is concerned about lease restrictions, short-term rentals, and owner occupancy levels can help an association board comply with these important standards.

FHA Leasing & Short-Term Rental Standards FHA insures mortgages meeting federal requirements that include borrower and property eligibility standards. To be eligible for FHA insurance, mortgages must reserve certain free assumability rights for borrowers and be secured by the borrower’s primary residence.

FHA free assumability requirements limit the lease restrictions associations may adopt

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and enforce. For example, a general prohibition against leasing units violates FHA requirements. Requiring unit owners to seek and obtain board approval to lease a unit is a violation as is any requirement the board approve tenants.

Federal law restricts FHA insurance to only mortgages secured by a borrower’s primary residence.

FHA will not certify condominium associations with governing documents affirming that unit owners may offer short-term or transient housing services.

Alternatively, promoting the residential character of a condominium association may enhance quality of life for owners and improve the marketability of units. FHA permits associations to adopt lease restrictions that promote these outcomes.

Acceptable lease restrictions include policies requiring all leases to be in writing and subject to the association’s declaration, by-laws, and other regulations. Associations may require that owners provide a copy of lease

agreements as well as the names of all tenants on a lease.

Associations may proscribe various lease terms as well. A commonly accepted requirement is that no lease may be for a term of less than 30-days or for a term of greater than 6 months or a year. Associations may also limit the total number of units leased at any one time, but this limit may not exceed FHA owner-occupant standards.

FHA Owner-Occupant Standards Based on decades of experience insuring condominium unit mortgages, FHA recognizes the value of owners living in their units. FHA asserts that an owner whose primary residence is in the condominium is more likely to participate in association governance and ensure the association is financially stable and operationally sound.

FHA generally requires at least 50 percent of units in a condominium be the principal or secondary residence of owners. A unit where the owner lives the majority of the year is considered a principal residence whereas a secondary residence is a unit the owner may only use for a limited portion of the year. A vacation property will not qualify as a secondary residence.

In 2016, Congress required FHA to create an exemption to the 50 percent owner-occupant requirement. FHA now allows condominium associations meeting stringent financial standards to maintain a 30 percent owner-occupant standard.

To qualify for the 30 percent owner-occupant standard, associations must contribute 20 percent of the annual budget to reserves, verify that no more than 10 percent of units are delinquent on assessments, and provide 3-years of acceptable financial statements.

Most condominium associations have opted to retain the 50 percent owner-occupant standard.

Future of FHA Leasing and Owner-Occupant Standards In 2016, FHA proposed a sweeping update of its condominium certification rules, which are likely to be finalized in 2018. FHA anticipates these changes will ease the certification process and lead to an increase in FHA-certified condominium associations.

FHA has not indicated the regulatory update will relax rules on lease restrictions, but changes are likely on owner-occupant requirements. The proposed update will allow FHA to establish owner-occupancy ranges, providing additional flexibility in program requirements.

Community Associations Institute (CAI) has urged that FHA finalize the proposed changes to the agency’s condominium rules as soon as possible. The proposed update will make the process of FHA certification easy and more valuable to associations and homeowners. For more information on CAI’s work to improve FHA condominium certification and to download a copy of The CAI Guide to FHA Certification, visit www.caionline.org/advocacy.

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By Crishana L. Loritsch, CMCA, AMS, PCAM Crishana is the general manager of Town Square Towers Condominium located in the SW Waterfront, Washington D.C. She has been an active member of the chapter since 2002, where she has volunteered on the Quorum Editorial, Membership, and Public Outreach committees and has served as Public Outreach Committee chair, Secretary on the Board of Directors, and Communication Council Chair. Additionally, Ms. Loritsch has received numerous awards including Rising Star, Committee Chair of the Year, Chapter Appreciation Award, and was most recently recognized as the 2017 WMCCAI Volunteer of the Year.

Being a Good Landlord: Don’t Be a Roper!

W

hen I think of landlords, the first image that pops into my mind is that of Helen and Stan Roper. As a child of the 70’s, I grew up watching the popular sitcoms of the day, and the antics of The Roper’s on Three’s Company were hilarious. There wasn’t a week that went by where Jack, Chrissy, and Janet weren’t trying to outsmart their landlords, especially Mr. Roper because he was the straight foil to his more fun-loving yet maternal wife, Helen. But was Mr. Roper all that bad? At the end of the day, he only wanted to protect his investment and for his tenants to abide by the terms of their lease. His methods may have been a bit unorthodox, and he may not have been the most astute of landlords, but I think we can learn a thing or two from Mr. Roper and be the kind of landlord that is an example of what we want to be and not what we should not be.

Know the Why I can already see the gears turning in your heads. When I say, “Know the why” the why is the reason you want to become a landlord.

Are you looking to downsize or upsize your living arrangements, yet keep your property as an income generation investment? Are you relocating due to a job change but plan to return to the area and your property later?

Has there been a life-changing event (death, divorce, job loss, or health crisis) that’s led to this decision? Knowing the why will inform the type of landlord you will be and may de-

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termine if being a landlord is the best choice for your situation.

Know Your Financial Health As many landlords can attest, being a landlord does not necessarily translate to increased revenue. Many times, it can mean the opposite and can even lead to lost revenue without proper budgeting and planning. If there is a mortgage on the property you are leasing, can you make your mortgage payment without the benefit of your tenant’s rental payment? In addition to the mortgage, have you budgeted for repairs and maintenance? Do you have a contingency in place for the loss of rental income due to extensive repairs requiring your tenants to vacate the property? Are you prepared for your property being vacant between tenant occupancies? Can you afford the costs associated with evicting your tenant should that ever arise? These are all very important factors in determining whether becoming a landlord is a viable financial option for you.

Know Their Financial Health You’ve heard the adage, measure twice and cut once. The same is true for ensuring that your prospective tenants can afford the rent you are asking. Perform your due diligence and be sure to get a full background check.

Call references and get as much information as you can. Don’t be afraid to ask the tough

questions. Did they pay on time? If not, how often were they late? Once is an anomaly that can be easily explained. Being late every month is a pattern.

There are services available that perform background checks for a reasonable fee.

Use those services. The number of resources available with these services are extensive and are worth the expense. Don’t be penny wise and a pound foolish. Spend the money now so that you are not throwing good money after bad later.

Know Your Property Is your property move-in ready or will you need to give it some TLC from years of being well-loved by your family? Do the appliances need to be replaced? Does your décor and fixtures date back to the 70’s and 80’s? Is your home welcoming and inviting or does it scream, “Run for the hills?” These are important considerations, and if you are unable to assess your property objectively, you should call in a trusted professional in your circle such as real estate agent or property manager. Don’t be a Roper! If you wouldn’t want to live in your property in its present state, you can be assured that no one else does either.

Is your property better suited for a dual income, no kids couple, a family just starting out, a single parent of teenagers, or a single person with no roommate? If your property is a condominium, it may be better suited for tenants who live a quieter life and not one full of the activity such as a young family just starting out. If you own a property in a single family or townhouse community that caters more to families, you should take that into consideration when marketing your property. It’s important that you think of the personality of your community and match those traits accordingly with your prospective tenants. Mr. Roper did not do that. He wanted quiet tenants who paid their rent on time and kept to themselves.

He thought he had that in Chrissy and Janet. Instead, he got Jack as part of the deal, and we all know the shenanigans Jack got himself into. While it made for funny TV, it’s not so funny in real life when you’re dealing with issues that could’ve easily been avoided.

Know Your Strengths…and Your Limitations Do you know where the main water shut off valve is? Are you pretty handy and enjoy tackling small repair projects or would you prefer to hire a professional?

As a landlord, you will be the first call if there is a maintenance issue or concern.

Are you prepared to get the frantic, middle of the night call from your tenants saying that the toilet has sprung a leak and water is flowing down the hall into the living room?

It’s important to know your limitations and employ the help of others when needed. I’m sure we know of a few Harry or Harriet Homeowner jobs that did not go as expected. I am reminded of a time that my Dad, a very handy guy I might add, got in over his head with a plumbing repair. He painstakingly went through each of the tasks related to the plumbing project with laser-like precision and when it was all said and done, stood back to survey his work and was very pleased. Well, that was until he instructed me to turn on the faucet and then all heck broke loose.

After a few expletives, a soaked floor, a mad dash for towels to dry the mess, and then a call to a friend who happened to be a plumber, the repair was accomplished.

Calendar traditions are important in our celebrations and can be important in the workplace in terms of planning.

Stay Engaged and Support Your Community Offsite owners can sometimes get a bum rap as owners who only care about the revenue they are generating from their properties.

For most, that is far from the truth, and yet, one can see where that thought process can arise.

Be sure to stay involved in your community and support its efforts. Continue to go to board meetings and participate in community activities. Know the rules of your community and stress that your tenants keep them as well. Be sure to provide the community rules and regulations to your tenants.

How can they abide by the rules if they do not know what they are?

Being a good landlord, simply put, is abiding by the golden rule: Do unto others as you’d like to have done unto you. Responsible, conscientious and caring landlords are a gem to their communities.

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By Aimee Winegar, CMCA, AMS, PCAM, LSM Aimee has worked in the field of community management for 30 years. She is currently a large-scale manager for Community Association Services, Inc. in Frederick, MD. She sits on the Quorum Editorial Committee of WMCCAI and is currently the Vice-chair of the Montgomery County, Maryland Commission on Common Ownership Communities.

Amenity Rentals

C

ommunity centers are often the centerpiece of an association, possibly the single largest and most expensive amenity. In addition to being used for association-sponsored events, community centers and even pools are often made available for rental, either in an

effort to increase association income or to make sure that amenities are being used to their best and highest capacity. When renting out an amenity such as a community room, the following issues should be considered before the first rental application is signed:

1. Will rentals be limited to association members? Or will anyone be able to rent the center, whether or not they live or own in the association? If non-member rentals are permitted, the community center or amenity may become subject to the Americans With Disabilities Act (ADA), which may require modifications to restrooms, parking lots, and sidewalks. If the amenity is open only to members for rental, it will remain subject to the provisions of the Fair Housing Act, but may not be held to ADA standards. Before you open a community center for rental, you should speak with an attorney about the possible ramifications, particularly if the building you are renting is an older one.

2. Will the goal of the rental be to maximize use of community space or to generate income, or both? The board of directors should set a clear goal for the use of the center, as this will determine the dollar amount of the rental fee. The rental fee should also include a margin for wear and tear on the structure and the use of “consumables� such as toilet paper and utilities.

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Will you permit decorations?

How will you handle noise?

Do you have rules about alcohol use?

3. Will the building be monitored by staff during a rental? Will the building be cleaned before AND after an event for the users, or only before? How much will that service cost? You need to make sure that the rental fee covers the expense of monitoring and cleaning. Remember that rental income in excess of the cost of providing the amenity may be taxable.

4. If the building will not be monitored by staff during the rental, how will renters access the building for their event? If they will need to use a key, do they need to get the key from a management office or will it be left on the property for them in a key box? How do they return the key when the event is over?

5. What types of events will be permitted? Will the event be made available to political parties for rallies or meetings? In order to avoid the perception of bias, many associations prohibit political events with the exception of community-sponsored events that are open to candidates of all parties and are for the benefit of members to learn about candidates or ballot issues.

6. Are there event types that the association does not want to have in the building? The board may want to consider standards for the level of use that exclude certain types of events, such as teen parties, toddler birthday parties, or other events that may be unexpectedly messy.

7. Do you have a way for members to reserve the center? This should include guidelines about when the actual rental transaction can take place–no sooner than two years before the date, but no later than two weeks, for example. There should be guidelines about when a deposit check must be submitted and when the final rental payment must be submitted.

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8. There should be a formal application with a sheet of rules for renters to sign, perhaps even by initialing each line of the rules. This should be signed and submitted before a date can be reserved by a potential renter. Your application should also include provisions for cancellation–how far ahead of an event can a renter cancel and under what circumstances?

What happens if it is snowing or stormy on the event day?

Will deposits be refunded?

9. Do you have rules about alcohol use and smoking inside the center? Some association insurance policies include coverage for amenity rentals that covers alcohol use by the renters, as long as the alcohol is not being sold or used outdoors.

There may be other limitations. You should check with your insurance agent about coverage for the rental use of the centers and potential alcohol use. Most associations prohibit smoking inside the centers, as well as the use of other sources of open flame as a fire hazard.

10. How will you handle food in the property? Can renters bring food in? Prepare it on site? Do you have a full kitchen or a warming kitchen? If either one, you should also confirm that the area has a functioning fire extinguisher and any required licenses or approvals from the fire marshal.

11. Will you permit decorations? How about tape, pins, confetti, glitter, or other items that may be difficult to remove later? Make sure that your rental agreement includes a prohibition on any of these materials that you are not prepared to find weeks, possibly months after a rental is complete.

What types of events will be permitted?

12. How do you expect the facility to be left when the event is over? Many associations require that the renter bag and remove all trash and leave the floors “broom clean.� Renters may also be required to police the restrooms and make sure that they are at least neat, with no papers or mess on the floor.

13. How will you handle noise? You don’t want a rental to become a nuisance. That Quinceanera band might just be pretty loud, and the community center is probably located in the center of your neighborhood. You should have a policy about sound volumes and how late renters may have music. You should also address whether they can keep the windows and doors of the center open, or whether they have to remain closed in order to contain the noise.

14. While we are talking about keeping the windows and doors shut, you should also have a policy for how to address the thermostat. Will renters be permitted to set the indoor temperature? Or will it pre-set by staff or security? What provisions are in place if the building is too hot or too cold?

15. Does the building have a security system, video recording, etc.? Can that be used to monitor an event?

16. Finally, what if something terrible happens? An accident causing injury to a renter, an incident causing damage to the building, or a conflict involving renters. The application should include clear instructions for the renters in the event of a negative outcome, and somewhere on the property should be a fact sheet with emergency contact information, including the police and first responders, in the event of damage or injury.

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Directory and Classifieds AMUSEMENT & PARTY RENTALS

ENGINEERS (CONT’D)

Fantasy World Entertainment 124 Jibsail Drive T: (800) 757-6332 Prince Frederick, MD 20678 www.fwworld.com Brooks Grady brooks@fwworld.com

The Falcon Group 7361 Calhoun Place, Suite 325 www.falconengineering.com Rockville, MD 20855 T: (240) 328-1095 Stew Willis info@falconengineering.com

ASPHALT PAVING

Brothers Paving & Concrete Corporation 9469 Hawkins Dr T: (703) 393-1927 Manassas, VA 20109 F: (703) 393-1928 Paul Battista info@brotherspaving.com Espina Paving, Inc. Asphalt/Concrete 15441 Farm Creek Drive T: (703) 491-9100 Woodbridge, VA 2191 F: (703) 491-9101 Serving: MD, DC, VA info@espinapaving.com

TRC Engineering 9210 Wightman Rd., Ste 110 www.tedrossconsulting.com Gaithersburg, MD 20886 T: (301) 869-6446 Ted Ross ted@tedrossconsulting.com JANITORIAL

Clean Advantage Corporation 4000 Pen Belt Place T: (800) 315-3264 District Heights, MD 20747 F: (301) 595-3331 www.cleanadv.com info@cleanadv.com

ATTORNEY

Segan, Mason & Mason, P.C. Donna Mason dmason@seganmason.com

www.seganmason.com T: (301)251-1414

Thomas Schild Law Group, LLC www.schildlaw.com 401 North Washington Street, Suite #500 T: (301)251-1414 Rockville, MD 20850 Thomas, C. Schild, CCAL tschild@schildlaw.com Scott J. Silverman ssilverman@schildlaw.com BANKING AND FINANCIAL SERVICES

BB&T Association www.bbt.com Let us save you time and money with our lockbox processing, ACH, coupon book, statement printing and transmission services.

Joseph Inzerillo Jr. T: (703) 201-5774 jinzerillo@bbant.com Mutual of Omaha Bank Community Association Banking/CondoCerts Noni Roan T: (301) 639-5503 Noni.Roan@mutualofomahabank.com ENGINEERS

Becht Engineering BT, Inc. 10717 Birmingham Way www.bechtbt.com Woodstock, MD 21163 T: (410) 461-3904 Bill Hasselman info@bechtbt.com ETC Engineering and Technical Consultants Inc. Water intrusion, roofing, exteriors, windows, balconies, property studies, structural & architectural services www.etc-web.com T: (703) 450-6220 Mindy Maronic mindy@etc-web.com

36 | QUORUM

LAKE AND POND MANAGEMENT

SOLitude Lake Management 12522 White Drive info@solitudelake.com Fairfax, VA 22030 T: (540) 371-4382 Kevin Tucker www.solitudelakemanagement.com LAUNDRY ROOM EQUIPMENT

Caldwell & Gregory, Inc. Your Commercial Laundry Professionals 129 Broad Street Road Manakin-Sabot, VA 23103

T: (804) 784-6100 F: (804) 784-7418

MANAGEMENT SERVICES

Associa Community Management Corporation, AAMC 4840 Westfields Blvd, Suite 300 T: (703) 631-7200 Chantilly, VA 20151 www.cmc-management.com John Tsitos, cmca, ams, pcam jtsitos@cmc-management.com Barkan Management Company, Inc 8229 Boon Blvd., Suite 760 T: (703) 388-1005 Tyson Corner, VA 22182 F: (703) 388-1006 Michael Feltenberger, cmca, ams, pcam Capitol Management Corporation 12011 Lee-Jackson Highway, Suite 350 T: (703) 934-5200 Fairfax, VA 22033 F: (703) 934-8808 L. Peyton Harris Jr., cmca, cpm lph@capitolmanagementcorp.net

MANAGEMENT SERVICES (CONT’D)

CFM Management Services, AAMC 5250 Cherokee Ave, Suite 100 T: (703) 941-0818 Alexandria, VA 22314 F: (703) 941-0816 Christiaan Melson, ams, pcam c­­­­­­­­melson@cfmanagement.com CAMP (Community Association Management Professionals) 1921 Gallows Rd., Suite 320 T: (703) 821-CAMP (2267)Tysons Corner, VA 22182 Heathergraham@gocampmgmt.com Susanblackburn@gocampmgmt.com Comsource Management, Inc. AAMC www.comsource.com 3414 Morningwood Drive T: (301) 924-7355 Olney, Maryland 20832 F: (301) 924-7340 Gary M. Simon, cmca, ams, pcam gsimon@comsource.com FirstService Residential DC Metro LLC, AAMC 11351 Random Hills Road, Suite 500 T: (703) 385-1133 Fairfax, VA 22020 Robert Teeling robert.teeling@fsresidential.com KPA Management, AAMC www.kpamgmt.com 6402 Arlington Blvd., Suite 700 T: (703) 532-5005 Falls Church, VA 22042 F: (703) 532-5098 Offering personalized service Ed Alrutz, cpm, cmca, pcam ealrutz@kpamgmt.com Sentry Management www.sentrymgt.com 4401 Ford Avenue, Suite 1150 T: (703) 642-3246 Alexandria, VA 22302 602 South King Street, Suite 400 T: (540) 751-1888 Leesburg, VA 20175 Dave Ciccarelli, ams, pcam dciccarelli@sentrymgt.com Sequoia Management Company Inc., AAMC 13998 Parkeast Circle www.sequoiamanagement.com Chantilly, VA 20151-2283 T: (703) 803-9641 Craig Courtney, pcam ccourtney@sequoiamgmt.com SIGMA Real Estate Services 8911 60th Avenue T: (301) 513-9300 College Park, MD 20740 www.sigmares.com Constantin Anagnostopoulos, President info@sigmares.com Zalco Realty Inc., AAMC, AMO 8701 Georgia Ave., Ste. 300 Silver Spring, MD 20910 Arthur Dubin,cmca, pcam, cpm

www.zalco.com T: (301) 495-6633 adubin@zalco.com

­­INDEX TO ADVERTISERS A Associa-Community Management Corporation, AAMC....................................................................20 B Barkan Management, LLC, AAMC..................................................................................................10 BB&T Association Services.............................................................................................................11 C Caldwell & Gregory, Inc. .................................................................................................................19 Capital Painting Co.........................................................................................................................22 Cardinal Management Group, Inc., AAMC .....................................................................................22 Clean Advantage Corporation..........................................................................................................40 PAINTING SERVICES AND RETAILERS

Capital Painting Co. www.capitalpainting.net 5520 Oakwood Road T: (703) 313-0013 Alexandria, VA 22310 F: (703) 922-1826 George Tsentas george@capitalpainting.net Ploutis Painting & Contracting Co., Inc. T: (703) 360-0205 8365 Richmond Hwy F: (703) 360-5439 Alexandria, VA 22309 info@ploutiscontracting.com Stella Ploutis www.ploutiscontracting.com Reston Painting & Contracting 619 Carlisle Drive Herndon, VA 20170 David Hamilton

Community Advantage, a Wintrust Company..................................................................................15 Cowie & Mott. P.A...........................................................................................................................29 D DoodyCalls.....................................................................................................................................35 F Fantasy World, Inc. dba Fantasy World Entertainment ....................................................................39

T: (703) 904-1702 F: (703) 904-0248 dave@restonpaint.com

FirstService Residential, AAMC.........................................................................................................2

Williams Professional Painting 110 S. Floyd Street VA: (703) 768-8143 Alexandra, VA 22304 DC: (202) 751-2026 williamsprofessionalpainting.com Rick Williams Rick@williamsprofessionalpainting.com

Mutual of Omaha Bank...................................................................................................................35

PET WASTE REMOVAL

DoodyCalls Pet waste management solutions and services 13923 A Willard Road Chantilly, VA 20151 T: (800) DoodyCalls (366-3922) www.DoodyCalls.com

M

P Ploutis Painting & Contracting Co., Inc..............................................................................................2 R Reserve Advisors, Inc. ...................................................................................................................22 Reston Painting Company..............................................................................................................38 S

RESERVE STUDIES

PM+ (Specializing in Reserve Studies Since 1990) A Veteran Owned Company T: (703) 803-8436 www.pmplusreserves.com engineer@pmplusreserves.com or Ben Ginnetti, pra, rs, p.e. pmplusreserves@cox.net Reserve Advisors 4600 North Fairfax Drive, Suite 404 T: (844) 701-9884 Arlington, VA 22203 www.reserveadvisors.com Michelle Baldry mbaldry@reserveadvisors.com RESTORATION SERVICES

Titan Restoration Co Warrenton, VA T: (540) 349-1503 www.titanrestoration.com F: (540) 349-1512 Anita Puckett apuckett@titanrestoration.com WINDOWS & DOORS

Windows Plus, LLC & Allied The Window Center, LLC 4321 Markham Street T: (703) 256-0600 Annandale, VA 22003 F: (703) 942-6987 Kimberly Wayland kknight@windowspls.com

Segan, Mason & Mason, PC ..........................................................................................................17 Sentry Management, Inc.................................................................................................................13 SIGMA Real Estate Services ...........................................................................................................27 SOLitude Lake Management...........................................................................................................23 T The Falcon Group.............................................................................................................................7 Thomas Schild Law Group, LLC......................................................................................................31 Titan Restoration Company ............................................................................................................38 TRC Engineering............................................................................................................................17 TWC Services, LLC..........................................................................................................................29 W Williams Professional Painting.........................................................................................................33 Windows Plus, LLC.........................................................................................................................32

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APRIL 2018

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CHAPTER BENEFACTORS

WMCCAI 7600 Leesburg Pike Suite 100 West Falls Church, VA 22043 www.caidc.org (703) 750-3644

PRESORT STANDARD US POSTAGE PAID ALEXANDRIA, VA # 5659

OUR MISSION To optimize the operations of Community Associations and foster value for our business partners.