Page 8 - New England Condominium February 2019

8 NEW ENGLAND CONDOMINIUM - FEBRUARY 2019 NEWENGLANDCONDO.COM C ommunity association and co-op boards typically consist of elected volunteers whose job is to serve the best interests of the community in day-to- day decisions both big and small. In an ide- al world, every board would live and die by its fiduciary duty, making well-informed choices that not only keep its community or building solvent, but also maintain a pleasant environment in which to live. But would even that ideal scenario be enough? If a board is doing all the right things but fails to communicate the hows and whys of its decisions to its constituents, will those decisions be received approvingly? Truth is, in addition to making good decisions, it also falls to the board to communicate those decisions – as well as how they were reached – to its com- munity in a clear and digestible way. The reasoning for this goes beyond just get- ting reelected; to a diligent and capable board, optics may seem performative – but they’re actually a crucial part of being open and transparent with the residents that board represents. A certain amount of marketing and salesmanship is often needed to get buy-in from the folks most directly impacted by a given board deci- sion. A board that does the right thing without showing its work can still face backlash from residents who interpret the board’s discretion as secrecy, or who don’t see immediate positive results from the board’s endeavor. The Messaging Matters “Optics are extremely important,” says Thomas O. Moriarty, a principal at the law firm of Moriarty Troyer & Malloy in Braintree, Massachusetts. “While percep- tion of performance alone is obviously not enough to deliver results, results alone are not enough to ensure content- ment among unit owners. The fact of the matter is that unless a board has systems in place to ensure that unit owners be- lieve they have a voice in the process of governance, those owners may never be happy with the results. In addition, if the actions and deliberations of the board are not transparent, unit owners may not even be aware of the issues the board is confronting – nevermind whether the board has done a competent job pursu- ing resolutions. “Knowledgeable unit owners under- stand and expect that when they buy a unit, they become members of a self-gov- erning association,” Moriarty continues. “While they might not volunteer to serve on the board, they nevertheless have an important economic and personal inter- est in how the board conducts its busi- ness. A unit owner who cannot obtain enough information to reasonably assess the merits of his or her board’s decision- making is not going to develop confi- dence and trust in that board. This can lead to frustration and skepticism.” Moriarty goes on to say that when boards fail to communicate their process to owners, owners nearly always per- ceived that as negative. “While there are always exceptions based upon the need for confidentiality – attorney-client priv- ilege, for example – or because statutes may prevent the disclosure of certain information,” he says, “in every other circumstance it is almost always better to communicate as much information as possible, even if the information is not what the owners want to hear. Reason- able unit owners will understand that not all news is good news, and they will be more content with board operations and governance if they have more accurate and reliable information, good or bad.” A current board can make association business easier for its eventual replace- ment by being explicit with its decision- making methodology. “It’s essential to pay attention to the details, or there can be problems in the future,” warns Mark N. Axinn, a partner with the New York City-based law firm of Brill & Meisel. “For example, when files are reviewed by a future board, it should be clear what the people at the time were considering, and why a particular decision was made. Records should be kept in such a manner that someone who is not familiar with an issue can easily ascertain what happened and why certain decisions were made.” According to Jacqueline Abraham, Regional Director for Lieberman Man- agement Services, which has offices in Chicago and Elk Grove Village, Illinois, a resident will occasionally run for the board with the intended goal of improv- ing its optics. “Once elected, these board members realize that there is a need for greater transparency, and make efforts to steer the other members to communicate more with the community,” Abraham says. “This could mean forming a com- mittee to create and send a monthly or quarterly newsletter, sending meeting minutes to owners electronically imme- diately following a board meeting, in- stalling a bulletin board in the common area on which they’ll post community updates and notices, or utilizing a com- munity website to store documents and share information.” Backlash For a board, neglecting optics and ig- noring the public relations aspect of its job can have abject consequences. “Boards often forget the messaging aspect inherent in getting information to owners before a new policy takes effect,” notes Axinn. “This is especially true if there is a new restriction or a new charge being considered. For example, if a board decides to implement a fee for subletting, it is important to convey to the owners that \[the purpose\] of the fee is to raise funds to help limit future maintenance increases.” Different states have different laws concerning how information can be Board Optics The Perception of Performance BY MIKE ODENTHAL ISTOCKPHOTO.COM BOARD RELATIONSHIPS continued on page 20