Question 1

What is an HOA /COA? Are they required?

Accepted Answer

For more than twenty years, Oregon, and Washington have required by law the formation of community associations for all new development. While there are some very small exceptions to the rule, 95% or more of the communities built after 2000 in either state are required to maintain an HOA/COA association. In Oregon associations are required under ORS Chapters 94 or 100 (depending on the type) and in Washington under RCW 64.90. The purpose of these associations is to ensure the maintenance and repair of your common areas/elements (which can be as little as a water quality swale or as large as clubhouse) while also applying a set of rules for maintaining community values. While in theory, it might be nice to get rid of your HOA/COA, it’s virtually impossible to accomplish.

Question 2

Ok, so we have this HOA/COA thing, what is the purpose?

Accepted Answer

When your community is first constructed, the builder/developer, known as the declarant, is charged with building all the common areas for your community. These items are either required by the local jurisdiction (think private streets, water quality facilities, parks, open spaces, curbing, stormwater management etc.) or included by the developer to make the community more attractive to buyers (playgrounds, clubhouses, pools, tennis courts etc.). Once the declarant has completed construction of these items, they are required to create a reserve study and budget that establishes the value of each common element and assigns certain maintenance and repair functions over a thirty-year period. This process is also required by the jurisdiction.

It is then the responsibility of each homeowner to contribute on an annual basis to this maintenance and repair. This is the basis for your homeowner association dues. In addition to the budget and reserve study, the declarant also adopts governing documents. These usually include a set of bylaws and a covenants, conditions and restrictions document, commonly referred to as CCR’s. These documents provide additional regulations for living in the association and create a baseline for how homeowners conduct themselves within the community. The HOA is the organization that administers these documents, the budget and the reserve study.

Question 3

Is the HOA/COA a positive thing or a negative thing? The monthly payment I make always feels like a negative thing, why is it so much?

Accepted Answer

Whether the HOA/COA is a positive or a negative often depends on your individual understanding of how it operates and your willingness to accept its existence and duties. HOA/COA’s, if properly administered, keep the neighborhood looking nice, maintain the common areas and keep home values up. On the other hand, they cost money to administer and have the right to make decisions on behalf of homeowners in the community. For some, that feels too confining.

Living in a community under an HOA/COA means accepting certain rules of conduct and responsibility. Membership in the HOA/COA is automatic upon purchase and is disclosed at the time of sale. Each homeowner should get familiar with CCR’s for their community and understand what they do PRIOR to purchase. If you cannot live under those circumstances, better not to purchase a home in a community with an HOA/COA.

As for the cost, HOA/COA budgets vary greatly depending on the size and value of the areas designated as “common” for your community. The cost to repair and replace these items are catalogued in a document called a reserve study and from that document a budget is created. In the budget will be the amount required for reserves plus the cost for all maintenance and administration. This often includes contract labor like landscaping or porter services, liability insurance, utilities (like water and electricity for the common areas) and the Community Manager. All these items are necessary to some extent and are not free.

Question 4

What is a Community Manager and why do we need to pay one to manage our association?

Accepted Answer

Associations often have the choice to either “self-manage” or hire an association manager. In self-managed associations, the Board of Directors is responsible for all the administrative functions of the Association. This includes accounting, reconciling of accounts, billing, collection of dues, accounts payable, budgeting, updating the reserve study, complying with state regulations, working through all questions and concerns posed by individual homeowners, processing architectural review requests, policing the community for violations of the governing documents, delinquency, lien processing and much more. Managing even a simple association while trying to hold a job and live your life is a major commitment.

This is where association management companies come in. Most associations choose to employ a management company (often referred to as a community manager) who takes on the day-to-day duties of the association. The association still has a board of directors, but in this scenario, they simply interpret policy set forth by the governing documents and assign the administrative work of the association to the manager, who serves at the pleasure of the Board. The Board can hire and dismiss the manager according to the terms of the manager’s contract.

Generally speaking, nothing requires an association to hire a community manager (except in the rare cases where an HOA or COA’s governing documents required it). Most Associations choose to do so because the work is overwhelming.

Question 5

So when we hire a community manager, we pay them to manage our community exclusively?

Accepted Answer

No. If you did, your HOA dues would be much, much higher. Most community management firms manage dozens if not hundreds of HOA’s simultaneously. They utilize economies of scale to offer the wide variety of services each HOA/COA requires. Each manager has a certain number of hours they commit to as part of their base fee and a set list of services they do for additional fees. It is up to each Association to determine what the right mix of services is for them.

Question 6

How do we know which company to choose and what services we need?

Accepted Answer

Every community manager is a little different, but all of them offer a set of basic services for a base fee. Their contracts will include the services provided for the fee and an additional document that includes fees for services they provide outside their basic package. In theory, the best option includes the most services for the lowest fee. However, an association needs to consider whether the management firm they are choosing can deliver the services they are promising. The community manager marketplace is full of companies who over-promise and under-deliver.

Question 7

What does that mean?

Accepted Answer

It means management companies love to promise services that do nothing, work poorly or serve as a distraction from the actual service you are getting. Virtual town squares, monthly newsletters community mixers etc. might be important to your community, but they have very little to do with the everyday management of your association. All the monthly newsletters and community block parties in the world won’t pay the association’s bills or make sure your landscaping is being managed properly. We believe your community management firm should be focused on providing the core services needed on a day-to-day basis.

Question 8

How Does Rolling Rock Community Management do that?

Accepted Answer

At Rolling Rock, we emphasize with our team the fundamental requirements of HOA/COA management. Are we billing residents in a timely fashion, collecting dues efficiently, actively managing service contractors, administering your budget and reserve study properly, executing our compliance routes to ensure all homeowners are complying with the governing documents, reviewing and approving ARC applications quickly and making sure your Board of Directors is receiving regular communication about the association? These are the core functions of your HOA/COA and we pride ourselves on delivering those efficiently and at the lowest price possible.

Question 9

How do we know you aren’t just telling us what we want to hear?

Accepted Answer

Unlike or competitors, Rolling Rock Community Management contracts have a 30-day termination clause. Simply put, if we don’t do our job, your Board can fire us and we are gone in under a month. Check our competitors’ contracts: All of them are 60 or 90 days for termination. Why should you pay anyone who has failed your expectations for another 2 to 3 months?

Question 10

Do you charge for extra services and labor like the other guys do?

Accepted Answer

We do, but unlike our competitors our charges are generally the lowest in the market AND our list of additional charges is much smaller. For example, most association management companies charge the association or the homeowner for processing an Architectural Review Application (ARC App). Fees can be as high as $50 per application! At Rolling Rock, ARC Review is part of our basic service package and we never charge for ARC applications or processing.

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