Who’s Who in Development Communities

Welcome to the Community!
Are you confused about who’s who in your neighborhood? Here’s a quick overview.

Developer/Declarant
The declarant is the entity that established the association and created the legal documents by which the association operates. The declarant appoints the initial board of directors and remains in control of the association until a homeowner board is elected, usually when the number of homeowners in the community reaches a certain percentage or on a date specified in the legal documents. Once this transition is complete, the homeowners elect their own board of directors that oversees the management of the association.

Builder
This is the company or person who built your home. You need to contact them for warranty items during the warranty period (typically the first year) for your newly-built home. They may also have some information regarding your plans, paint colors, etc. While the declarant and builder are sometimes one and the same, it’s often the case that the builder purchased lots from the declarant and they are two completely different entities.

Homeowners/Community/Condominium/Cooperative/ Master-Planned/Property Owners Association
The homeowners comprise the association and elect a board of directors to represent them, very similar to local municipal governments. Membership in the association is mandatory and begins when you purchase property within the association. You cease to be a member of the homeowners association when you sell your property. Whoever buys the property from you will then become a member. When you receive your paperwork at your closing, there is typically a document included that states you are a member of your homeowners association and that you agree to abide by its restrictive covenants and pay the assessments.

The association will function best when many homeowners are involved in their association. You can get involved by running for the board, joining a committee, volunteering to help out with events, and attending or sending in your proxy, if applicable, for the annual meeting.

Board of Directors
The board of directors of a community is composed, initially, of declarant appointees, and later of volunteer homeowners who are elected by their neighbors to represent all homeowners. When one sends a question or complaint to the management company which is not easily answered, or when there is a major violation beyond the scope of authority of the manager, the manager presents this information to the board for guidance on the matter or to submit a recommendation for action. The board makes all the policy decisions for the community and deliberates on them at their board meetings. Except for executive sessions, where permitted, board meetings are usually open to all homeowners who might like to attend, although homeowner involvement is usually limited to an open forum at which owners have an opportunity to express opinions and concerns.

Each association holds an annual meeting to conduct the business of the association (primarily the election of board members). The board generally then appoints volunteers to an Architectural Review Committee which reviews and approves or denies all applications for modifications to existing homes and lots. The board encourages participation by all owners in the operations of their association; by serving on committees, residents can contribute to the success of their community.

Architectural Review Guidelines, usually found in the government documents or created by the board, provide direction to the owners on what may or may not be permitted in changes to the exterior appearance of the home or unit.

Management Company
The management company takes direction from the board of directors and does not make the major decisions for the community. The manager provides the day-to-day management of the association, helping things run more smoothly by providing administrative support and customer service to the residents. When specific expertise is necessary in areas such as contracting, accounting, legal, etc., the manager directs the board to professional advice from experts in that field. Homeowners should contact the manager with any questions, comments or concerns related to the association. The manager will do his or her best to resolve your issue quickly and satisfactorily with a friendly customer service attitude. If your issue is beyond the purview of the manager, he or she will ask the board for expeditious resolution.

John Lawton,
CMCA®, RCM®, PCAM®
President
HRW, Inc.
Raleigh, NC