Emergencies are a part of life. Disaster can strike at any moment, without warning, and put homeowners’ associations (HOAs) in a challenging position — they can cause unexpected property damage, disrupt infrastructure, and threaten the safety of residents. Thus, HOAs have certain emergency powers.
These emergency powers may vary by state and by county. Additionally, each of your clients may have unique emergency protocols outlined in the association’s bylaws. Make sure you are familiar with the client’s Covenants, Conditions & Restrictions (CC&Rs), and other relevant governing documents.
While you can’t control an emergency, you can help your clients prepare. Creating an emergency preparedness plan will help an HOA protect its community in the event of a natural disaster or global events like a pandemic. We hope your clients will never need to use their HOA’s emergency powers — but if they do, make sure you know what they are!
When it becomes necessary to expand an HOA’s powers in an emergency, there’s no “one-size-fits-all” answer. From a legal perspective, an association doesn’t have the same level of authority as a state or local government. HOAs need to abide by their governing bylaws and can’t make sudden, sweeping changes to the rules just because there’s an emergency.
Look to the CC&Rs for guidance. In most cases, the rules grant the board emergency powers based on predefined terms. Here are some examples of the types of changes an HOA’s board can make in an emergency:
The specific details about these emergency powers should be agreed upon by the board’s founding members, then periodically reassessed as needed.
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As mentioned above, emergency powers frequently change the rules around an HOA’s finances. An emergency may require the association to freeze certain types of spending, such as discretionary funds while expanding the budget for repairs and maintenance.
In addition to the financial accounts for everyday operation, all HOAs require special reserve funds. Within a reserve fund, a specific portion is always set aside to cover emergencies, but any amount can be reallocated to cover costs during a disaster or crisis. For example, if an earthquake damages the roads within the community, the HOA board can use the Reserve Fund to pay for immediate repairs.
Emergencies can also give HOAs special authorization to raise membership fees or levy special assessments. Many HOAs over extra expenses or replenish the reserve fund once the crisis has passed.
Ideally, an HOA’s emergency powers should be custom-tailored based on the type of emergency. A flood will require a different kind of emergency response than a tornado or a pandemic.
HOA emergency plans can also be divided into tiers based on the severity of the crisis. Specific crises may require the HOA to exercise a higher degree of emergency powers. The particular details of the situation can also determine how long the HOA uses its emergency powers.
For example, a one-time emergency like an earthquake may require an extension of powers that lasts for a few weeks, while an ongoing crisis such as a pandemic may require indefinite emergency powers.
You and your client may have enough warning to help safeguard the association’s community with some natural disasters like hurricanes and monsoons. In these cases, the HOA may choose to pre-authorize emergency powers.
By authorizing emergency powers before a situation arises, it allows the board to use money from the reserve fund to purchase emergency supplies, backup generators, or hire contractors to install extra weatherproofing. Pre-authorization can also give you and your clients more time to communicate with the HOA’s residents.
If you use association management software like CINC Systems to provide a resident web portal for your clients, make sure emergency resources are available online. These resources may include copies of the HOA’s emergency plan and documents highlighting the association’s emergency powers under various circumstances.
During an emergency, use CINC’s customized web portal to post essential announcements and messages from the board. You can also provide real-time status updates about the current situation. Although you’ll probably be communicating this information to residents via email or letters, it’s always good to post emergency information in multiple places to improve accessibility.
Finally, make sure your clients plan to return to normal operations once the emergency ends. In some emergencies, the options may be clear and easy to execute. For example, if there’s a storm, you and your clients will be able to return to standard operations after maintenance works clear debris and make necessary repairs.
With other emergencies, particularly ongoing situations such as pandemics, the path may not be so obvious. However, you and your client should understand when the HOA’s emergency powers will end to make the transition back to standard controls as easy as possible.
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As an HOA manager, tools like CINC Systems provide many vital solutions for your business. Use CINC Systems to make your clients’ governing bylaws available online so that residents can understand the association’s emergency powers. You’ll also find that using CINC Systems for managing work orders and repairs will make it much easier to help your clients after an emergency strikes. Click here to try a free CINC Systems demo today.