Now that the warmer weather is upon us, it is time to take on capital projects for your community association. As a result, I would like to share some thoughts on ways that WILL guarantee a complete disaster for your capital repair and/or improvement project. So sit back, relax, and follow these step by step instructions for a most assured complete failure.
10. Short Term Planning is BEST. Capital planning is for the birds. And a reserve study is a COMPLETE waste of money. Besides, you are probably planning on selling within 5 years so why should you help build the association reserves if you’re on the way OUT.
9. Spontaneous Capital Planning and Decorating is FUN. In fact, it’s much better to wake up on July 4th and decide as the board president that the hallways WILL get repainted and that the stairwells WILL get re-carpeted by the end of August at a cost of $250,000.
8. Lump Sum Special Assessments are the ONLY way to pay for Capital Projects. We need the money TODAY to pay for the hallway and stairwell renovations. So why not just ask the homeowners to pay their share of the special assessment in one HUGE lump sum. Doesn’t everyone have $15,000 laying around for flash cash purposes?
7. Cheaper is BETTER. Since we’re asking all the homeowners to pay for the capital project in one LUMP SUM, it is probably best to go with the cheapest bid. Who cares if all the other bids are 50% higher. Besides, the vendor who is the least expensive said they have been around for the last 10 years under 20 different company names. So that is probably a good sign.
6. Confusion on who is the PROJECT Manager is BEST. Why appoint a specific project manager? Besides, since we have a management company, I’m sure that the property manager will just handle it. That’s what we pay them for. I’m paying $500 in monthly assessments and I think it is reasonable to just expect things to get taken care of as the board president. We certainly don’t want clarity for the contractor and the homeowners on the proper channels of communication.
5. Poor Communication Rocks. Homeowners should know that the common areas need to be renovated. It’s common sense and as a result, there is NO need to send out any notices or waste money on printing pieces of paper to post on bulletin boards. Besides, no one ever reads the notices anyway. In addition, we don’t have to tell the homeowners about the special assessment. We’ll just add it to everyone’s assessment statement next month. And in terms of the start date of the project, once the dust starts flying in the hallways, the homeowners will get the picture, so to speak.
4. Bid Spec is Unnecessary. There is absolutely no reason to define the scope of work for a capital project. It would seem fair to assume that the vendor solutions are all based on industry best practices. Right? In addition, it’s better to get 5 bids that all have different solutions to the problem. That way the board can spend hours and hours trying to determine the difference in the solutions and costs. That is a wonderful way to serve on the board. Spinning your wheels while trying to figure out differences in proposals. No wonder no one ever wants to serve on the board in our community. Then again, that is great news for me as it allows me to serve on the board indefinitely.
3. Chaos is a Sign of a Thriving Community. Drama and chaos is part of a thriving community. Confrontation with fellow board members and homeowners keeps things exciting! Planning ahead and running smooth capital projects sounds BORING! Dropping the ball left and right is just part of the normal day to day experience of a community association. Besides, it gives the board something to yell about when speaking with the property manager.
2. Bullying Board President Knows BEST. As the board president, I enjoy taking charge and making this happen. I get things DONE. And in order to get things done, it’s MY WAY or the HIGHWAY. I love bullyng other board members into submission and I really enjoy telling homeowners who is the BOSS of our community. It’s so much fun and especially given the fact that I have been the board president for the last 20 years. And the best part is that I have a property manager that just does whatever I ask him to do. It’s the perfect relationship for me and for the community association. Everyone does what I say and no one questions what I am doing. And as far as complying with the IL Condo Act and Palm II is concerned, I simply say it’s a fool’s errand. Right?
1. Overspend on Band Aid Capital Projects. The best part about hiring the cheapest contractor for capital repairs and improvements is that the repairs usually only last a few years. Besides, who wants a roof to actually last 15 years? It is much better for the association to hire a roofing company (against the recommendation of the management company) that has changed names 5 times over the last 5 years that can’t provide any references. The benefit is that this company then bills the association for a new roof layer that was not actually installed. Then the management company pays the bill without checking that the work was done or didn’t bother asking the board for approval. Once the check is received by the contractor, the company then dissolves into never never land and pops up under a different company name for the 6th time over the past 5 years. At this point, every homeowner who lives on the top floor starts to experience water infiltration issues because the “new roof layer” has failed. At this point, the association now goes and ahead and actually listens to the property manager and hires a new roofing company who actually installs a new roof layer and charges the association $100,000 to get the job done RIGHT. Now that is what I call smooth sailing!
Summary
Summertime is best spent blowing tons of community association reserves on wasteful projects. The aforementioned 10 steps are a detailed guide to ensure that your projects are as problem ridden as possible. In addition, you are guaranteed to cause headaches and stress for each and every member of your community association. Of course, maybe that was your intention after all. 🙂
About the Author
Salvatore J. Sciacca aka “Condoboss” is one of the nation’s leading experts in the community property management industry and is also recognized for his stress relieving blogs and insight on personal and organizational transformation. He is also the President and Founder of Chicago Property Services, Chicago’s #1 community property management company specializing in management and operations of condos/townhomes/HOA’s of 100 units and under. Salvatore is also the founder of managmycommunity.com (MMC), which is a state-of-the-art online support portal for community associations.
With over 20 years of industry experience, Salvatore is recognized for his extensive knowledge of capital planning, preventative maintenance, cost-saving measures and community building techniques. He holds industry stature as a Certified Manager of Community Associations (CMCA), the designation of Association Management Specialist (AMS) and is fully licensed as a manager (License #: 261.001386) through the State of IL.
Salvatore has also traveled extensively around the world and has meditated with Buddhist monks in Nepal and met the world’s happiest man, Matthieu Ricard. He’s passions include cooking, traveling, meditating and hiking. He is also the founder and executive director of the Chicagoland Italian American Professionals organization.
Salvatore can be reached at: 312.455.0107 x102 or at ssciacca@chicagopropertyservices.com.