By: Stuart Goldstein, President of the Regency Board of Directors
A New Year’s wish to everyone in our community that you have a healthy, happy and stress-free 2019—and beyond. This time of year is great for looking back, taking stock and considering what’s really important in our lives.
My colleagues in prior columns have covered the landscape of the Board’s work and accomplishments last year—and the list should convince you that we’ve been very committed to making progress and serving our community. So it might be useful to focus on the future and how the Regency community sustains this progress.
While Regency is 17 years old, the community took control of the HOA only 3 years ago. Since that time, we’ve experienced “Transformational” change. The transfer of control from Toll Brothers to a self-governing environment created a whole new set of challenges—and a recognition that we needed to adopt rigorous business principles and financial discipline to insure the long-term health of our HOA.
Our relationship with Toll Brothers can be adversarial at times, as it was during the tense & difficult Transition 1 negotiations (and later negotiations on budget contributions in 2018/2019 and the easement rights resolved last year). However, to the developer’s credit, they have stepped up and ultimately met their obligations. Other Monroe Township communities have not had this experience. Nevertheless, what do we do when the music stops—and the funding ends?
During the budget presentation in October, we connected the dots so homeowners better understood the strategic approach and vision for our fiscal future. In 2018, we completed restructuring and validating the Reserve Fund assumptions (covering our liabilities over 20 years); we modified our investment strategy to earn more interest on reserve funds; we created a 4-year look ahead budget so we could better anticipate how Board decisions might impact maintenance fees; we increased new-home buyer contributions so we can build a Working Capital Fund; and we adopted a strategy so a rainy-day fund could be used to mitigate the size of future maintenance increases.
While HOA Board activities cover a spectrum of decisions from Transactional to Strategic, the “Strategic Issues” we’ve pursued are critical and leverage our ROI (return on investment). That’s not to say fixing the Bocce Court is less important. Actually, it is a high priority to keep our amenities in pristine condition (e.g., see the work this year to clean up the golf course). But at the end of the day (or the end of a Board member’s tenure in office) what institutional change can we point to that is lasting and impactful on a homeowner? What transcends us as Board members, defines us?
Few of us, as homeowners, contemplated second careers serving on the Board of Trustees–or contributing their technical experience & knowledge to a strategic initiative or committee launched by the Board.
But we all share responsibility to contribute and make the Regency community better—and stronger. Consider that only 60% of residents voted in the last election. Not everyone is inclined or capable of volunteering their time. However, the most critical decision you can make is in choosing the folks who will serve on the Board—and lead the governance process.
We’re all at a point in life where family, travel or choosing to do nothing is a right we’re entitled to. Yet you still have a meaningful contribution to offer by reading up on candidates for the Board –and voting in the spring.
Some tell me they don’t follow HOA issues enough to make an informed decision. Well, elections are more often about governing philosophy and values versus rules regarding where residents walk their dogs. Are candidates committed to “openness & transparency” so decisions aren’t made behind closed doors? Are they committed to engaging homeowners to participate in governance? While you are traveling, can you be certain candidates will be on the job & fully engaged? Do the candidates bring technical skills or corporate experience that compliments others on the Board? Can they communicate their Vision with clarity of purpose and direction?
An election is really about a commitment to how they will govern. The understanding of issues comes later, after being elected and the candidate gets a handle on institutional memory, legal parameters—and can begin the process of researching “best practices”.
Two years ago, my column in the Reporter encouraged women to run for the Board, part of a pitch for greater diversity generally. We’d be well-served to have qualified female candidates run for election.
The response to the Board’s request for volunteers to work on Strategic Initiatives (i.e., cross-functional teams of professionals with technical skills/financial expertise) yielded only 20 emails this past fall. That represents about .009% of the more than 2,100 folks who live here.
We can’t underscore enough how critical it is to expand the governance process by having more professional voices in the room helping the Board make informed decisions. The Strategic Planning Group, for example, has some of the smartest financial folks you’ll find at Regency. We are lucky to have them.
Frequently, the line “change is the only constant” has been used as a central theme in speeches written for CEOs during my career. Change can seem unsettling at times, but the goal should be to balance:
- Have we created institutional processes to mitigate risk and ensure financial stability
- Do we have the ability to “skate to where the puck will be”, understanding the challenges ahead of the curve and adapting existing strategies to meet them.
Again, wishing you all a good New Year! And a note of thanks to our Board for the time and energy they give selflessly in serving our community.