Across the country people are wondering how and where their HOA dues are being used. It’s a good question to ask, but it also one that an HOA board should be able to answer quickly and easily.

To reduce miscommunication with homeowners, the board first needs to understand these things about HOA dues and openly and effectively communicate this information with residents:

  • How the money is spent is likely predetermined by the community CC&Rs. Occasionally big capital improvement decisions will require a community vote, but more often the governing documents and board discretion determine how the majority HOA dues are spent.
  • Paying HOA dues isn’t optional. In fact, when you buy a home in a planned community chances are you signed a legal document acknowledging your financial responsibility and requirement to pay dues. Homeowners can’t simply stop paying because they dislike the direction of the community.  Instead, encourage people to become actively involved and run for board elections.

As board members it is important to remember:

  • HOA dues are someone else’s hard-earned money. Be conscious and open with how it is spent and why. Annual meetings that discuss the financial status of the HOA and where money was spent are crucial to showing homeowners’ you respect their contribution
  • Manage dues based on the needs of the community. Before worrying about the cost of dues, the board needs to ensure sufficient funds are collected to maintain the community. Don’t operate under the assumption that it’s the board’s job to keep dues low. It can be a priority, but the board’s primary responsibility is to act in the best interest of the association.
  • Strive for clear communication and financial reporting. This is the easiest and best way to make sure your community avoids financial misunderstandings between the board and homeowners. If people can understand why and how their money is spent, it eliminates the chance for confusion and mistrust

HOA dues are a necessity and most homeowners are happy to pay them so long as they see the benefits. Establishing strong communication with residents, and ensuring the vendors (i.e. landscapers, etc.) you are paying perform their job properly to help reduce frustration over HOA dues. If your community is trying to find a way to communicate how dues are being used, contact us at Spectrum. We are always excited to help an association out!