MD Squared: Documents

THE BIG PICTURE

In my experience in property management, I have found that it’s very helpful if new board members have an understanding of the organizational documents and the manner in which a board operates most efficiently and productively. Bylaws need to be adhered to, but I have found that some buildings let the bylaws prevent them from being productive. I’ve been managing a couple of buildings that have accomplished virtually nothing because they use the bylaws to inhibit themselves. They will get hung up on proper notice for a board meeting. I’m not condoning ignoring the governing documents, but I think it works better if boards keep in mind what’s best for the building and don’t belabor a written document that may, quite frankly, be outdated.

Take email, for instance. Most buildings now are perfectly happy with an email notice of a board meeting. A board member who wants to be an obstructionist will say, “No, we can’t meet because I didn’t receive proper notice.”Another thing is approvals. The managing agent has an agreement that allows him or her to make decisions for expenditures under a certain threshold. In the bylaws, it might say the treasurer has to review every bill. You’ll have vendors who need to get paid, the board knows that the work was done, and the quality of the work was reviewed and approved. Then the treasurer will say, “No, you can’t pay it until I approve it.” You have a good vendor who’s not getting paid, and the next thing you’ve lost that good vendor. A couple of vendors don’t even want to deal with the property.

Be Smart

My recommendation to new board members is learn from those who came before, especially those who have been successful and effective. Keep what’s best for the building in mind, and don’t get hung up on possibly outdated documentation. Another great resource for new board members is the building’s attorney, who can educate them on how to move forward cohesively with the current board.

New board members really need to understand their role. They are there to serve the community and represent their constituents – the shareholders or unit-owners – and not to be an impediment to progress.