What happens when no one wants to be on HOA board?

Q: What happens when no one wants to serve on the homeowners association board?

A: The management company would contact the Nevada Real Estate Division, which would determine the severity of the lack of volunteers to serve on the board of directors. Here are some possible suggestions in finding potential directors:

1. Check your covenants, conditions and restrictions or bylaws before proceeding with any action.

It may be possible for your particular board to function without a board member until the next election. Sometimes, the governing documents allow the remaining board to appoint a temporary member. A temporary appointment may require only a majority vote of the remaining board members, which if possible can be done by the “lone” director.

2. Re-recruit past board members.

Contact past or recently resigned board members and ask them to serve again, even if it would be on a temporary basis.

3. Call a meeting at a convenient location to persuade homeowners to run.

You may need to have more than one meeting on different days and times.

You need to thoroughly discuss the responsibilities and duties of being on the HOA board so that the position is understood. Let them know the assistance that you as a community manager and management company can provide to them in helping them to serve. Most important is to let the homeowners know the consequences of not having a board member and why it would be easier on everyone to serve the community for a period of time.

4. Widely publicize the HOA board opening and the requirements.

More than one notification will be needed. Use all resources from flyers, letters, website, eblast, etc.

Having a receiver assigned by the court to oversee your community is the last thing you want to do. The Nevada Real Estate Division would be involved in this process.

Assuming after all alternatives have been exhausted, legal action would be taken by the division, resulting in a receivership overseeing the management of the association until a suitable board could be put into place with a demonstration that volunteers could be found on a continual long-term basis.

The court, after determining that no members of the association are willing to serve on the board, would appoint a receiver to conduct general business on behalf of the association.

Unfortunately, receivers are usually expensive and may charge $150 to $250 per hour for the work the board would have done at no additional cost. The costs of appointing a receiver would be passed on to the owners, resulting in increased assessments and special assessments. Also, the receiver most likely would hire a management company to handle the daily operations of the association, so that expense most likely would not be eliminated by the appointment of a receiver.

If your association is in a receivership, that will impact the selling and buying of your homes and the financing and refinancing of your homes. And that most likely would harm your property values.

In addition, you would pass the decision making for hearings and architectural requests to the receiver unless the receiver can find some volunteers. Instead of having a quorum of board members to listen and to vote on these issues, the decision would fall upon one person, the receiver.