What Are the Duties of HOA Board of Directors?

• The HOA Board of Directors is responsible for managing the real estate development. Jerusalem Real Estate image by A74.FR Ben Fontaine from Fotolia.com

  Real estate developments or planned unit communities create homeowners' associations (HOA) to oversee the maintenance and organization of the properties. Duties of the HOA board of directors are provided in the community's governing documents, known as the Declaration of Covenants, Conditions and Restrictions. The homeowners' association board of directors is comprised of an elected body of homeowners, who ensure the declaration and any applicable state homeowner association laws are enforced.

Enforce the Rules

• Following rules when utilizing common areas within the real estate development is needed to maintain a sense of order amongst the homeowners. The residential houses or units also need to conform to a particular standard in terms of external aesthetic appearance and maintenance. The HOA board of directors enforces these rules and standards by sending a notice to the homeowner who committed a violation. The notice states how to rectify the situation and the legal recourse that may be taken by the HOA if the violation isn't remedied within a certain time frame. Enforcing the rules amongst the homeowners helps the community maintain its property value, a sense of order and commonality.

Keeping Minutes During Board Meetings

• The board of directors keeps a record of the decisions made during board meetings. Tracking the minutes of a board meeting consists of creating a document that states the issues addressed during the meeting and exactly how the issues were resolved. Listing how each board member voted on issues and stating any objections raised by HOA members or the board is the type of information that should be provided when keeping minutes. Maintaining accurate minutes of board meetings permits the HOA to reference when declaration provisions were amended and who voted for those changes.

Executing Contracts

• Executing contracts and creating binding legal or financial obligations with third parties on behalf of the association are among the HOA board of directors' duties. Services needed by the association include retaining legal counsel to protect its interests, acquiring adequate insurance coverage with a reputable insurance carrier or possibly hiring a property management company to help oversee the day-to-day operations of the real estate development. The board of directors must satisfy its fiduciary duties and make decisions in the best interests of the homeowners.

Financial Management

• Financial responsibilities of the board of directors involve assessing and collecting monthly HOA fees from homeowners. The amount of the HOA fees should be enough to cover the association's expenses and to create a reserve of funds for any additional expenses that may be incurred. The board provides an annual budget and maintains the financial records of the association. The budget should allow the HOA to meet its financial obligations in terms of maintaining the common areas, keeping the facilities fully functional, paying taxes and paying for any property inspections. It is the board of directors' duty to ensure sound financial judgments are made on behalf of the homeowners.