Every industry has its jargon, and who hasn't cringed when friends, family, or partners start chatting in acronyms and terms that only insiders understand? Suddenly, you're yawning, zoned out. Nomenclature can be isolating, and in an Association, everyone must start with the same baseline. Getting owners to participate can be challenging enough without adding the complexity of unfamiliar terms and expected knowledge.
As an Association Manager, one of my biggest challenges was assuming common knowledge, specifically when cultural, generational, or socioeconomic backgrounds varied. The expenses that come with ownership often lead to long, emotional calls from owners who understandably feel lost: Why do I have to pay for this? Why didn't anyone tell me about that?
As I begin blogging to share my perspective and experience in Association Management, starting with a list of basic terms and definitions seems fitting. Please know that I could have expanded on many of these terms but kept basic or broad-stroke definitions. I intend to grow on many of these in future entries.
Annual Meeting
This is a yearly meeting of owners, typically centered around the election for the Board of Directors. The Association's Bylaws normally provide an agenda, and a quorum (percentage of ownership) is required.
Architectural Review Committee
A group of owners who volunteer to review architectural change requests as an extension of the Board to ensure desired changes align with Association standards and safety criteria. The standards are usually found in Rules and Regulations or specific policies.
Architectural Change Request
An application an owner completes and submits when modifying a unit or property submitted to the Board for approval. Each Association will have different expectations, so when in doubt, ask. While it's your property, there are benefits to having changes reviewed to protect your investment—and avoid surprising, creative alterations from neighbors!
Assessment
An owner's financial contribution to their Association expenses. Typically, it is collected monthly, quarterly, or annually. Similar to taxes, these payments are not optional. The term "assessment" is often referred to as "dues;" additionally, assessments differ from "special assessments."
Board Meeting
A formal meeting with a quorum of the Board of Directors to discuss and decide on Association matters. These meetings follow an agenda led by a chairperson and often operate through Parliamentary Procedure. Owners are encouraged to attend and participate in The Homeowner's Forum. This is when homeowners should approach the Board regarding issues or questions regarding the Association.
Board of Directors
A group of owners who volunteer to track and make decisions on behalf of the Association. Think of them as the "city council" for the Association. Each Association's Declaration or Bylaws defines what the Board can and cannot do, the number of directors, eligibility criteria, and term limits.
Budget
An annual financial plan that covers expected expenses and needed revenue. Budgets can also be created for specific projects, often alongside special assessments or reserve projects.
Common Area
The shared spaces in the community, such as lobbies, pools, or elevators. The Association is responsible for maintaining and repairing these areas for the use of members.
Compliance
Adherence to the Association's governing documents, which outline expected behaviors and standards for all owners, is essential.
Delinquency
This refers to owners behind assessments, typically incurring fees and penalties. Legal action can be taken as defined by each Association's Collection Policy.
Fiduciary responsibility
The responsibility of acting in the legal and ethical interest of the Association.
Governing Documents
The legal documents defining how an Association operates, which include:
Declaration (or CC&Rs): Establishes rules, responsibilities, and expectations for members.
Bylaws: Defines how the Association functions operationally (e.g., voting, terms, quorum).
Articles of Incorporation: Filed with the Secretary of State (in Washington) to legally establish the Association as a nonprofit.
Additional documents may include Rules & Regulations for daily community use.
HO6 Policy
A condo owner-owned insurance policy covers the owners' financial responsibilities in case of incidents involving their condo. All condo owners should work with an individual broker to ensure they are covered accurately. This coverage is meant to supplement the Association's Master Policy.
"It depends"
This is a common phrase in Association Management, as the specifics often depend on each Association's unique governing documents.
Lien
A legal claim on a property. Associations typically place a lien on a unit/ account once notices to collect have been unsuccessful and assign them for legal collection.
Limited Common Area
Spaces reserved for exclusive use by one unit (e.g., balconies, parking spots) are the responsibility of the Association. Owners are responsible for the daily upkeep, but the Association is responsible for major repairs and maintenance.
Management Company
A third-party company providing a consistent contact point for Association transactions and partner communications, the management company is typically considered the Association's agent. They present and take direction from the Board of Directors. Without specific policy direction, the management company cannot make decisions for the Association.
Parliamentary Procedure
A set of formal rules and guidelines for conducting meetings and group decision-making, assisting to navigate discussions and decisions in a structured way.
Proxy
A method for owners to participate in Association business without attending meetings. These are often crucial for achieving a quorum at Annual Meetings.
Reserve Fund
A savings account for future projects and major expenses, often based on the Reserve Study.
Reserve Study
A tool for long-term budgeting that forecasts expenses for common and limited common areas over 30 years, completed by a Reserve Analyst.
Special Assessment
A supplemental fee for larger projects, unexpected expenses, or underfunded reserves. This is an assessment in addition to regular assessments.
Well, round one is complete. What did I miss? I know there is something, so please leave it in the comments or contact me directly. This entry is the start of working to identify the barriers that Owner Associations face between their operations and their members. This list of terms will grow, term definitions will be refined, and some of these terms will have a deeper dive. In the meantime, as these terms pop up in conversations, I hope this list helps open the door to those who may find themselves overwhelmed by this new dimension of Association living.
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