Author: aam_admin

Choosing an HOA management company is one of the most consequential decisions your board will make. Get it right, and your community runs smoothly, finances are transparent, homeowners are informed, and maintenance happens on schedule. Get it wrong, and you are dealing with missed repairs, poor communication, surprise fees, and a board that spends more time managing the management company than governing the community.

This guide walks you through every stage of the selection process: from defining your community’s needs to evaluating proposals and reading contracts.

Step 1: Define what your community needs

Before you contact a single management company, get clear on what your HOA is looking for — and what has not been working. The most common mistake boards make is jumping into proposals before establishing internal alignment on requirements.

Identify Your Specific Gaps

Different communities need different things. Ask yourselves:

• Is our current financial reporting unclear or incomplete?
• Are maintenance requests falling through the cracks?
• Do homeowners feel ignored or uninformed?
• Is rule enforcement inconsistent?
• Are we unprepared for large capital projects or reserve funding?

Match the firm you hire to your specific gaps. A management company that excels at financial reporting may not be the right fit if your biggest problem is vendor responsiveness.

Draft a Request for Proposal (RFP)

Once your requirements are defined, formalize them into a written Request for Proposal. Send the identical RFP to every company you are evaluating, this is the only way to make fair, apples-to-apples comparisons. Your RFP should include:

• Your community’s size, type, and location
• The specific services you require
• Your current challenges and what you expect to improve
• Your timeline for making a decision
• A request for a separate service proposal and fee schedule

Reviewing service quality before fee schedules prevents price from distorting your evaluation of competence. Here is a Free HOA Template for an RFP if you need a starting point.

Step 2: Certifications, and Insurance

It is a best practice to consider management companies that promote staff being certified by local and national industry associations such as the Arizona Association of Community Managers (AACM) and the Community Associations Institute (CAI). These organizations were established to improve the professionalism of community management through ongoing education and proactive support.

AACM’s Certified Arizona Association Manager (CAAM®) education program provides the only Arizona-specific professional certification for Community Managers. An AACM-certified management company can instill a greater level of confidence in the management company’s qualifications. In addition, CAI offers various certifications for community management industry professionals, including the Certified Manager of Community Associations (CMCA), the Association Management Specialist (AMS) certification, and the Professional Community Association Manager (PCAM).

Insurance

Always request certificates of insurance from any company you are seriously evaluating. At minimum, a professional HOA management company should carry:

• General liability insurance
• Errors and omissions (E&O) / professional liability insurance
• Workers’ compensation coverage for their employees

Confirm that coverage levels meet Arizona’s minimum standards, and verify that certificates are current not expired.

Step 3: Evaluate Operational Capability

Once a company clears the credentialing threshold, evaluate how well they can actually manage your community day-to-day. A strong HOA management company should demonstrate capability across six core operational areas.

Capability Area	What to Look For	Why It Matters
Financial Management	Reporting, monthly statements, reserve tracking, audit-ready records, transparent expense logs	Sound finances protect property values and board credibility
Vendor Management	Vetted vendor network, competitive bid processes, contract oversight, invoice review	Reliable vendors at fair prices mean lower costs and less board involvement
Homeowner Communication	Online portals, multiple contact channels, documented response-time standards, multilingual support where relevant	Responsive communication reduces escalations and improves resident satisfaction
Rule Enforcement	Consistent violation tracking, documented hearing process, board-authorized fine system	Fair, even enforcement protects community standards and reduces legal exposure
Technology	Cloud-based board and homeowner portals, online payments, task tracking, reporting dashboards	Modern platforms reduce administrative burden and increase transparency
Meeting Support	Agenda preparation, minute-taking, action item tracking, board packet delivery	Well-run meetings keep governance efficient and legally defensible

Step 4: Check References

Every reputable HOA management company will offer references. What matters is how you use them.

Ask for references from communities similar to yours in size and type. A firm that excels at managing a 1,200-unit master-planned community may provide very different service to a 75-unit townhome association. Request references that reflect your actual situation.

When you call references, ask:

• How responsive is the manager to your board’s questions and concerns?
• How accurate and timely is the monthly financial reporting?
• How does the company handle vendor issues and maintenance emergencies?
• Have there been any unexpected fees not discussed upfront?
• How was the onboarding process when the company took over management?
• Would you hire this company again?

Step 5: Understand the Costs

Fee transparency is one of the clearest indicators of a trustworthy management company. Here is how to understand the fee structures you will encounter.

The base fee rarely covers everything. Before signing any contract, ask for a complete written schedule of what is included in the base fee and what is billed separately. Common add-ons include:

• After-hours and emergency call response fees
• Per-meeting attendance fees (board meetings, annual meetings)
• Violation inspection fees beyond a set monthly number
• New owner or transfer setup fees
• Legal coordination and collection escalation fees
• Project management fees for capital improvement oversight
• Postage and printing for mailed notices

Pro tip: When comparing proposals from multiple companies, compare the total projected annual cost, not just the base management fee. A lower headline number can hide a much higher total cost once add-ons are included.

Step 6: Read the Contract

The management contract defines the entire relationship. Here is what to pay close attention to:

Contract Term

Most HOA management contracts run one year with auto-renewal. For a new relationship, a one-year initial term is preferable to a multi-year commitment. It gives your board time to evaluate whether the company is delivering before locking in a longer arrangement.

Termination Clause

Know exactly what notice is required to end the contract. Thirty days provides significantly more flexibility than ninety if the relationship needs to end quickly. Confirm that termination rights exist for non-performance, not just for convenience.

Fee Schedule Language

Every fee should be specifically named and quantified in the contract. Vague language such as “administrative fees as applicable” or “additional services as needed” is a red flag. If a firm promises something verbally, require it in writing before signing.

Performance Standards

Does the contract define response time requirements? Is there a process for addressing non-performance? The strongest contracts include measurable service standards, not just vague commitments to “professional management.”

Transition Obligations

What does the firm agree to provide when the contract ends? All of the following should be explicitly covered in the contract:

• Complete financial records and statements
• All vendor contracts and contact information
• Homeowner data and contact lists
• Insurance certificates on file

A firm that is vague about transition obligations may make switching difficult if the relationship does not work out.

Ready to Find the Right Partner for Your Community?

AAM has been managing community associations across Arizona for decades. Our certified managers combine local expertise with proven processes, transparent pricing, and the technology your board needs to stay informed and in control.

Request a proposal and learn how we can help your community thrive.

• HOA Management Company
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It is never too early in the year to start thinking about HOA budget preparation for your association. AAM begins the yearly budget preparation timeline with budget training sessions for Community Managers in August. The Association Board of Directors also plays an important role in the budget process, so we feel it is important to share a few budget questions for your consideration. August is right around the corner, so let’s get ready for budget season!

Key Questions to Consider During HOA Budget Preparation

Please consider the following during your HOA budget preparation:

• How well is the association performing versus the current year’s budget?
• Is operating cash flow for the association trending up or down over recent years?
• Is the current budget meeting the expectations of homeowners?
• Have changes in economic factors impacted the assessment level?
• Are reserve contributions at an appropriate level to ensure long-term financial health?

Reviewing the Current Year’s Budget Performance

Before diving into a fresh budget season, it is important to compare the current year’s budgeted income and expenses versus actual financial activity while focusing on HOA budget preparation. AAM provides a month-to-date and year-to-date variance report in the monthly financial package that explains why certain income or expense activities are over or under budget. If additional details are needed, the community manager and accounting department will be happy to provide information for budget decision-making purposes.

Managing Cash Flow and Operating Expenses

Under normal circumstances, the yearly operating income and expenses of the association are fairly predictable. With that being said, there is not a lot of room for error in a zero-based budget. Planning for the worst-case scenario will help ensure adequate cash is available to cover operating expenses. Start the budget process by taking a conservative approach and make adjustments as needed during HOA budget preparation. Balance sheet information is sometimes forgotten during the budget process, so please remember to take a look at cash flow trends for the past few budget seasons. Maintaining a modest operating cushion is acceptable, and it will help the association cover any unexpected expenses that might arise from time to time. If nothing unexpected occurs, then it provides an opportunity to fund community enhancement or make an additional reserve contribution.

Aligning the Budget with Homeowner Expectations

Members of the association buy property with certain expectations in mind, and some of them are not shy about sharing feedback when those expectations are not met. As this feedback is gathered each year, there is an opportunity to make adjustments and improvements through the budget process.

Associations vary in size, design, lifestyle, amenities, and owner demographics. Some of these variables may change over time, so the budget will also evolve. If new expenses or services are being added to the budget, they should be carefully evaluated. The short and long-term impact should be considered, as well as how the association will cover the expense. Enhancements to the community covered by operating funds also impact long-term reserve planning, especially during HOA budget preparation.

Evaluating Economic Factors and Assessment Adjustments

Unfortunately, economic factors such as wages or the general cost of services may increase each year. Increases in minimum wage requirements in some areas of the country have impacted many vendors over the last few years. Each year, the Board should carefully evaluate whether an assessment increase should be approved. In most cases, large assessment increases can be avoided by implementing smaller increases at the appropriate time. This will help avoid unpleasant surprises and special assessments.

Planning for Reserve Funding and Long-Term Stability

Planning for Reserve Funding and Expenditures is essential to the association’s long-term financial health. Associations should have a Reserve Study that identifies major replaceable components. Component details include the remaining useful life of an item at the time of the study, typical life spans, and estimated future replacement costs. The study combines this data into a 30-year schedule of repair and replacement activity. Careful analysis of the yearly reserve contribution recommended in the study is important when considering how much the association should contribute to reserves as part of the annual budget and during overall HOA budget preparation. The Reserve Study should be updated as necessary, with new studies performed every three years or as the governing documents instruct.

The budget is a financial roadmap to ensure the association successfully navigates through each year of financial activity. The budget also serves as a guide for long-range strategic reserve planning, a critical aspect of HOA budget preparation. 

• HOA Budgets
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Top Five Considerations for Selecting an Association Management Company

As Board members of an HOA, you recognize the time and effort typically involved in conducting a search for professional community association management. In order to help with the search and to better evaluate management company candidates, below are the top five considerations for selecting an association management company as your community management partner.

1. Communication 

Effective and prompt communication plays an important role in community management and the overall success of a community. Partnering with a management company that emphasizes and promotes a strong communication plan is crucial for selecting a community association management company. Boards and homeowners need to stay updated and informed on what is happening in their community.

A well-suited management company believes in always being there for their homeowners and Board members, treating them with the utmost courtesy and respect. They accomplish this by making themselves readily available to answer questions, solve problems, and address any issues that should arise, through email, web, telephone, or in person.

2. Innovation in Technology 

In today’s technology-driven world, a well-qualified management company will continue investing in technological solutions and service offerings that enhance both management productivity and the user experience of their Boards and homeowners when selecting a community association management company.

Ensuring that Board members and homeowners have access to the best technology available should be a top priority of your community management company. Technology services offered should provide the Association with an array of helpful tools, adapt to the community’s specific needs, and be secure, productive, collaborative, and efficient.

3. Client Longevity 

A well-established management company will have an extensive portfolio of long-term client partnerships and first-rate references. A significant percentage of its current client base will have been with the company for several years. This continued partnership speaks volumes about the level of services when selecting a community association management company.

Other factors to consider about a management company’s client base include its size and growth. Is the company’s client base growing or stagnant? When was the last time they added a new community? How many communities have they added in the past year?

Also, the HOA should evaluate the range of associations the company serves. In other words, is the focus broad or narrow? A full range of association management would include master-planned communities, active adult communities, traditional neighborhoods, condominium properties, and more. The HOA should select a management company with experience in its community type.

4. Qualified People

The services of the community association management company will only be as good as the experience and expertise of the people providing them. Therefore, to deliver the highest standards, the company’s people must be highly trained and motivated. In certain positions, professional credentials are required. In particular, HOAs should evaluate the management company’s executive team, community managers, human resource department, accounting personnel, information technology department, and support staff when selecting a community association management company.

For example, do key personnel hold college degrees and/or professional certifications/designations? Does the company promote a positive culture that drives both success and employee satisfaction?

5. Ongoing Education 

Continuing education and training are essential for both the community association management company’s internal staff and the HOA’s Board members. The management company must make it a priority to invest regularly in staff training for everyone involved in managing the community, as well as providing training opportunities for Board members.

Ongoing education and training ensure that community management professionals have the skills needed to help communities succeed by keeping current on all issues, legislative updates, and best practices concerning association management. Additionally, providing training opportunities to HOA Board members helps develop the skills and knowledge necessary to effectively lead their communities and make informed decisions. Selecting a community association management company that prioritizes education is vital.

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HOA Meeting Basics provides a foundation for running efficient and effective HOA meetings that support community management and homeowner engagement. From understanding quorum requirements to following proper notice protocols, these meetings are essential for making decisions, discussing key issues, and ensuring compliance with governing documents. By mastering the basics, HOA Boards can foster transparency, collaboration, and accountability in their communities.

Quorum

A quorum is a very important issue related to board meetings. The term “quorum” refers to the minimum number of members participating to conduct business. If there are not enough members to make up the quorum, the meeting can’t be held, and actions can’t be taken. Quorum requirements are defined in your Bylaws.

Notice for Regular Board Meetings

Unless otherwise provided in the documents, the Arizona State Statute requires all HOA Meetings to be noticed at least 48 hours before the meeting via conspicuous posting, newsletter, or any other reasonable means as determined by the Board of Directors. However, the notice provision only applies AFTER the termination of declarant control of the association. Check your Bylaws for other possible notice provisions.

It is also important to remember:

• The notice must contain the time and place of the meeting.
• Notice is not required for Emergency Meetings if action must be taken before notice can be provided.
  • The minutes of the Emergency Meeting shall state the reason necessitating the Emergency Meeting. The minutes of the Emergency Meeting shall be read and approved at the next regularly scheduled meeting of the Board.

Additionally, it is required by statute that most topics be discussed in Open Board Meetings, such as:

• Annual Budget
• Assessment Increases
• Contract Negotiations
• Changes in Rules & Regulations
• Financial Decisions
• Improvements to Association Property

Notice for Executive Session

The membership notice requirements of an Executive Session is a new statutory requirement from 2017. Per Section C. of A.R.S. §33-1248, before entering into any closed portion of a meeting of the Board of Directors, or on notice of a closed meeting, the Board shall identify the paragraph under subsection A. of A.R.S. §33-1248 that authorizes the Board to close the meeting.

Section A items include:

1. Legal advice from an attorney for the Board or the Association.
2. Pending or contemplated litigation.                                        
3. Personal, health, and financial information about an individual member of the association, an individual employee of the association, or an individual employee of a contractor for the association.
4. Matters relating to job performance, compensation, health records, or specific complaints against an individual employee of the association or an employee of a contractor of the association who works under the direction of the association.
5. Discussion of a unit owner’s appeal of any violation cited or penalty imposed by the association, except on request of the affected unit owner that the meeting be held in an open session.

Meeting Minutes

Meeting Minutes are used to record the Board’s actions, show why the association took a particular action, and preserve the Director’s voting records. It is not necessary to record word-for-word.

Meeting Minutes Should NOT Include Proceedings of a committee Summary of guest commentsSecretary’s opinion Debate relative to a motion.

Meeting Minutes Should NOT Include Proceedings of a Committee Summary of guest commentsSecretary’s opinion Debate relative to a motion.

Agenda

An agenda is critical to an efficient and organized meeting. It should have enough information to serve as a helpful guide but not be so overly detailed as to be unwieldy or distracting. Also, it is a statutory requirement to provide copies of the agenda to the members at the meeting. 

• The president typically sets and reviews the agenda prior to distribution.
• Time the meeting for the greatest efficiency and ensure the Board’s copy of the agenda refers to numbered pages within the Board packet.
• Post the agenda on the website or in another format to encourage community involvement.
• Template for the meeting minutes.

Parliamentary Procedure

Parliamentary procedures should be used to run effective meetings. This helps the minute-taker record the actions of the meeting and protects the right of the majority to decide the rights of the minority.

• One question at a time, one speaker at a time.
• Personal remarks are always out of order.

Motions

• Board members use motions to introduce business.
• Main motions require a second.
• The secretary should repeat the motion for accuracy.
• Modify a motion before the Chair states it.
• Amend the motion after the Chair states it.
• Withdraw a motion anytime before the Chair states it
• Consider a motion once it has both a first and a second.
• Must give homeowners in attendance the opportunity to speak to an agenda item prior to the Board vote.
• The motion must be made and seconded before the discussion is conducted by the Board prior to the Board vote.
• Use a Simplified Roberts Rules of Order.
• In most cases, the President of the Board only votes in the event of a tie.

Here’s a simplified example of how this process might work:

• The President calls for a motion on an agenda item, and a Board Member indicates they make a motion.
  • Example: “I make a motion to accept the bid from XYZ Landscaping to replace granite in tract C of the common areas at a cost of $5,000.00”
  • A second Board member will second the motion
  • The President will restate the motion and then call for a discussion
  • The President will call for a vote: “All in favor say aye, opposed nay.”
  • The Board President will announce the results of the motion, for example, “Motion carries unanimously.” Or, “Motion fails with a vote of 2 ayes, 3 nays.”

Tips for Running an Effective HOA Meeting

• Be prepared – review your Board packet prior to the meeting and ask questions in advance to the Manager to be better prepared for the meeting. Board packets should be made available 3 to 5 days prior to the meeting.
• Request the Manager to paginate Board packets.
• Set the tone of the meeting during “Orders of the Day.”
• Bring your Board book.
• Provide an open forum.
• Establish time limits (1 to 2 minutes per homeowner) for members who wish to speak.
• Use “Request to Address the Board” forms for the open forum.
• Limit the number of questions.
• Use a timed agenda.

The Role of the Board and Its Members’ Relationship to Each Other

It is critical that the Board provide a unified front. With regard to discussions, it is essential for the individual Board members to present different views on a given subject.

You must confront difficult issues, such as:

• Potential Assessment Increases
• Contract Changes
• Homeowner Appeals
• Enforcement Action
• Foreclosure Action

This may, at times, involve having heated or passionate discussions and debates. However, once the vote is taken and the majority rules, you should attempt to put personal differences aside and move forward. Most importantly, always be respectful of fellow Board members and those in attendance at the meeting.

Dealing with Conflicts during an HOA Meeting

To eliminate or minimize conflicts during meetings, be proactive. Set the ground rules for the meeting early on, such as that a speaker must be recognized by the chair of the meeting before speaking, the chair may limit the amount of time of those wishing to speak, the number of times they may speak, etc. Put those ground rules in writing and distribute/review them at the beginning of the meeting.

Call any attempt to provide unsolicited input “Out of Order.” It may take several meetings to educate the members; however, remaining on task and sticking to the agenda is critical to efficient and effective Board Meetings.

• HOA Board Meetings, Everything You Need to Know
• Annual HOA Meetings

There is great assurance and value in having a professional HOA management company manage your association.  These professionals bring a lot to the table, for example:

• Knowledge of current and changing legislation as it pertains to HOAs
• Years of expertise and experience with a myriad of HOA situations and issues
• Education and training for current and new board members
• Aid in managing Board finances
• Aid in collecting assessments
• Creating monthly/quarterly/yearly financial reports
• Access to necessary forms (architectural submissions, etc…)
• Aid in communication between Board members and homeowners
• Access to customer service and emergency numbers to help with questions and issues that may arise
• Access to vendors
• An expert who will watch over projects and manage their completion
• A guiding force who will be there to answer questions and move the Board and Association in the right direction

With an AAM’s professional hoa management expertly managing your community, we aim to give you total peace of mind in knowing that your neighborhood is well cared for and simply a great place to call home.

• Selecting an HOA Management Company