While the election format in a condominium community is pretty much the same as for any other club or organization, property managers and board members are looking to make the process easier and increase unit owner participation. Unit owner participation, in particular, can be a challenge as some condos find it hard to get enough members for a quorum at their annual meetings.
To combat low attendance, some community associations are using raffles, or offering prizes—drawing names from returned ballots at the annual meeting, or combining the meeting with a cookout or other social event. Other communities with low attendance are trying to increase proxy voting. And the use of online voting is definitely trending upward as more business is conducted by computer.
It’s a Numbers Game
Serving on a condo board is voluntary, and getting owners to participate is often a challenge, industry experts agree. But at some point, participation is needed, especially when election and annual meeting times roll around. How often is that? It depends. “The number of meetings will be stated in the community’s bylaws,” says Frank Caluri, board president of Cambridge Heights at Nutley in Nutley. “A meeting per quarter is recommended.” And, he notes, there should be an annual meeting to present the budget.
Details for all aspects of the annual meeting and election will also be outlined in the bylaws. As a guideline, these rules should address the qualifications of candidates; nominating procedures; campaign procedures; qualifications for voting; the voting time period; the authenticity, validity and effect of proxies; and the methods of selecting election inspectors to handle the ballots.
“The procedural requirements for elections are set forth in a typical bylaw provision,” says Bruce Ackerman, partner and head of the corporate/commercial practice at Pashman Stein, P.C. in Hackensack. “It is typical that a specified number of days notice in advance of such meeting be spelled out, as well as who gets the notice. For example, the notice would be required to be sent to all unit owners listed with management on a date specified in the bylaws, such as the day prior to the date on which the notice is provided. The person in charge of the membership records shall provide the official list of eligible members/voters.”
At Cambridge Heights at Nutley, for example, “Notice of elections shall be given not less or more than 60 days before the day of the election. Ballots are to be sent via U.S. mail with the particulars of the meeting,” Caluri notes. “In addition, our board posts all the information on bulletin boards throughout the community.”
At most communities, the management company takes care of annual meeting details, such as communications, notifications and ballots, although in some cases, an attorney might count the votes. Caluri says that in his association, two members of the community are appointed as inspectors to count the votes, while the secretary of the board monitors the counting, along with the board's attorney.
“The board and management try to run a fair and open election every year,” says a West New York board member. To generate interest and help unit owners make an informed decision, the association holds a “meet the candidates” night a few weeks in advance of the early-spring election. And to ensure that the ballots cast are all from qualified voters, the (non-candidate) board members who count the ballots are joined by the manager and the association attorney.
“Usually, our biggest problem is just getting enough people to actually vote so we have the minimum required to have a valid election,” the board member notes. “We have always managed to get enough voters, but it is a challenge every year.”
It’s a fairly universal problem among condominium communities. Jared McNabb, CMCA, AMS, PCAM, director of acquisitions with Crowninshield Management Corporation, AMO, in Peabody, Massachusetts, says “The biggest problem that I face is certainly apathy… at many annual meetings, I’m not getting a quorum and the same cast of characters is who shows up. My advice is always, that each homeowner should serve on the board for at least one term… hopefully you get a couple who stick,” and continue to participate.
Management may take many steps in getting people to participate, he notes: “We can post notices in the buildings, mail meeting notices, email, follow up… but there’s only so much you can do” to guarantee a quorum.
One strategy he mentions is to “go door-to-door with proxies,” which can take the place of an actual head count and ensure that the meeting reaches a quorum.
Proxy Votes Can Help Reach Quorum
The proxy vote is simply when a voter/unit owner designates another person—another unit owner is a frequent choice —to cast their vote, using a signed letter or form. The voter may indicate his or her choice of candidate or issue with a “directed” proxy—or leave the choice up to the person designated as proxy.
If voter apathy is a problem and getting enough voters to show up at the annual meeting is indeed a challenge, Jennifer Loheac, an attorney with Iselin-based Greenbaum, Rowe, Smith & Davis LLP, says proxy votes just might be the solution. They may add up enough for a quorum and allow the annual meeting to proceed.
“Proxy [votes] are authorized under the nonprofit act as well as in a community's bylaws. Typically, the board is authorized to choose the form of proxy to be used in an election. Proxy actually means ‘to step into the shoes of another.’ The proxy is not the actual vote, it's the permission for someone to vote in the place of another person,” Loheac says.
“A directed proxy means that the owner actually submitted the vote for his or her choices and by signature assigned someone else to physically cast the ballot; that's it. An open proxy means that the owner actually allowed another person to choose how to vote as well as cast the ballot. In practice, the results of an election can be affected depending on the kind of proxy permitted. For example, where communities allow open proxies, it's not uncommon for one or two ambitious individuals to convince homeowners to assign that person as proxy. That person in turn can vote "en block" for a favorite in the election. However, sometimes open proxies can also be helpful. Typically a well-drafted open proxy will allow the proxy to be able to cast a vote on any other matter that arises at the annual meeting,” continues Loheac. “This freedom allows the proxies, who are present, to be able to respond with necessary vote that meets quorum through the liberal open proxy whereas with a directed proxy. Proxies are good for 11 months,” she adds.
Loheac notes that communities vary widely in how elections are conducted. She says that most communities tend to craft their own comfortable environments, which she supports, as long as the election process is legal, consistent and transparent in nature. Each community, she adds should create an election process far in advance and even have a resolution spelling out proper procedures. For example, a resolution might direct the form and length of candidate profiles to be submitted, whether or not nominations will be accepted from the floor on election night and the deadline for proxies to be submitted. Resolutions also advise on procedures for the night of the election as well as how any election disputes will be handled after the election.
The Future May be Online
While the promotion of proxy voting may solve the lack-of-quorum problem, an even better solution may be online voting. Many professional groups have been using it for years, and it is slowly taking hold among condo and homeowner associations. Plus, electronic and other methods for holding elections are mentioned as an option in many states that have adopted the Uniform Common Interest Ownership Act or UCIOA. New Jersey, however, has not yet passed legislation to that effect.
At Survey & Ballot Systems of Eden Prairie, Minnesota, Marketing Manager Tim Madsen explains that his firm has been handling the election process for organizations for 20 years, evolving from paper balloting to online and electronic methods, and states, “Going online has really helped (groups) with voter response rates.”
Most clients require a mix, he notes. “We help (boards or trustees) set up the ballot for bylaw changes or elections, both electronically or on paper.”
“The website link includes everything that would have been mailed,” Madsen says, “Voters can fill out ballots online or print everything out and mail it or bring it to the meeting. We collect all the online voting responses and hand over a report of the results to the board at the annual meeting.”
A similar company, BigPulse.com, based in San Francisco, has been handling elections for associations for about 10 years, and started out with an online protocol. Sales Director Dominic Swinn says that his firm can handle “anything that requires a response” such as surveys, elections or any kind of vote or tally. “We have write-in capabilities for the day of the election. It’s easy to create (online) a ballot, candidate bio and photo or other text.”
A Dollar A Vote
To get an idea of the fee for an election service, Big Pulse offers a “price calculator on the website,” Swinn notes. He adds, “For a self-managed election, (as a starting price) you can figure about $1.00 per vote,” and using extra election management services would up the costs. “Going online is very effective for increasing participation,” he states, “Most associations report more voter turnout… (it can be) up to double.”
While online voting offers many advantages, any association considering these services needs to have its data files well prepared, updated and ready to go, advises Katherine Murphy, a website developer and manager based in Denver. She has a homeowner association (HOA) client who has used an online service “for a number of years, to conduct surveys and collect opinions from homeowners about all kinds of proposals for projects within their community. This process has worked very smoothly, once the procedure was understood and everything was in place… the board received great feedback (that) they could use.” Murphy adds that the online election service, for an association that’s well-prepared, “is a much smarter way to go, you get a live record of proceedings and it’s all processed much faster.”
While annual elections will continue to have strict requirements and traditional protocols, the advent of technology and the online voting option appears to add real improvements, from immediate feedback and transparency to better accuracy—and most importantly, participation.
Marie Auger is a freelance writer and a frequent contributor to New England Condominium magazine, a Yale Robbins’ publication. The New Jersey Cooperator’s David Chiu contributed to this article.