Board Talk: A Conversation About Proxies

Patrick

I’m currently the board president at a large condo in Manhattan. We are now in our fifth year of the residential board. Our current voting process allows for proxies to either assign the proxy to someone in attendance at the annual meeting, or default to the board president if the name filed is not filled in. We also allow candidates to run from the floor.

In the last five elections, the board has remained consistent. The vast majority of proxies are assigned to the board, and therefore we tend to reelect ourselves. Our finances are great, with millions in reserve, low common charges, and a great staff and building environment.

However, there are a group of board-haters who claim this process is unfair, that they are not represented, and would like to use a ballot system. Two flaws I see with ballots are lack of the ability to run from the floor, and difficulty achieving quorum (which is hard in our building without proxies). I suppose we would have to allow proxy in addition to the ballot, which makes things more complicated.

How do other buildings handle their elections and what are the pluses and minuses of each system? Do you allow early voting or do the votes require you to be present?

Dianne Stromfeld

I too, live in a very large co-op. Perhaps you might consider distributing ballots a few weeks before the meeting, allowing owners to vote up until a set time at the meeting. Perhaps a locked box in the lobbies to collect ballots from those who cannot attend the meeting. An option to return the ballot by mail for snowbirds or absentee owners. This will give people who cannot attend [the opportunity to] vote for whomever they choose. They can use a proxy if that is their choice. You can still have nominations from the floor if you choose to by allowing people to change their ballot on the night of the election. Be sure to have a line on the ballot with date and time so that only the last ballot cast is counted. My personal problem with floor nominations is that the voters don’t have any time to learn about the candidate and might not vote as they would have with more information.

Patrick

Typically, we have around 80 unit-owners represented at the annual, out of nearly 400. So we need a proxy system to gain quorum in the current model, since most unit-owners live abroad or don’t attend. The folks that do show up tend to be the vocal complainers with an axe to grind. The proxy allows anyone to write in someone to vote on their behalf, or give the board the proxy. We argue that if a unit-owner gives the board their proxy, they are in fact OK with the status quo. In the last four elections, the board has achieved over 40 percent of the common interest with just over 50 percent of eligible unit-owners casting votes. I agree that allowing ballots provides more opportunity to vote for candidates on an individual basis, but we still have the quorum problem which adds complexity to the process. Nearly 20 percent of the building is not owner-occupied. In the last three elections, we’ve only had two or three other candidates run that were not already board members. And in each year we’ve had people run from the floor.

Voter

There should be ballot voting. To allow proxies to be assigned to the board is quite unfair; of course the same board will continue. With ballot voting, someone can still run from the floor; the person writing the ballot can always change it at the meeting if they so choose to. But allowing the board to reelect itself with proxies seems quite suspicious at best. The question is, does anyone else other than the current board members run for the board? If so, people can fill out proxies with the name they choose, not allow board members assigned to the board.

burt

In our large co-op, we post notices about five weeks in advance of the annual meeting [so] people who want to run [can] submit their name. We distribute the official meeting notice several weeks before the meeting, which includes the proxy ballots with the names and backgrounds of anyone who wants to run for the board. A locked ballot box is at the front desk for shareholders to vote in advance. They can also mail them in. We have a representative from the building attorney coordinate the counting of ballots at the annual meeting. The ballots allow voting for the individual board members or giving the board the proxy to vote on their behalf (which is hardly ever done). We require a majority of the shares to be present at the meeting or voting by proxy to constitute a quorum to hold the meeting and official vote.

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