FCAP Community

Published May 2023

     Florida Community Association Professionals’ (FCAP) training is offered on two levels. Level one consists of courses meeting Florida’s continuing education requirements for CAMs, and level two is the Florida Advanced CAM Studies (FACS) course. For further information about the more than 38 online continuing education classes available or to pursue the Certified Florida Community Association Manager (CFCAM) designation, please visit www.fcapgroup.com/membership/education-training/.

Marcy L. Kravit

Suggestions on How to Write a Request for Proposal (RFP), Part IV

By Marcy Kravit, CMCA, AMS, PCAM, CFCAM, CSM
Director of Community Association Management Hotwire Communications
FCAP Program Coordinator

     Editor’s Note: This is the final part in a multi-part series. Part I (February 2023 issue) explained how service providers/vendors are to submit an RFP. Parts II (March 2023 issue) and III (April 2023 issue) explored the information a community association needs to obtain from a potential security vendor, from insurance and workers’ compensation to company information and staffing.

      The security contract defines the rights and responsibilities between the association and the contractor and ensures that the contractor will meet the community’s needs. Does the contractor indemnify the association for all security-related liability for which the contractor is responsible? In cases where partial liability is determined by a court of law, does the agreement clearly specify how such indemnifications shall be applied?   

• At contract time will there be a price increase? How much? Why? If no price increase now, when will it occur?  
• Does the association retain the right to terminate the agreement at any time and for any reason? Is this right mutual?  
• Is the amount of notice required for contract termination—by the contractor or association—reasonable? (Thirty days is the standard.)  
• Is the agreement sufficiently flexible to meet the association’s needs?  
• Does it ensure fairness to the contractor and sufficient control to the association?  
• Can a guard be replaced if necessary? What is the course of action? What is the chain of command?  
• Are the detailed post orders and patrol instructions attached as a contract addendum? 

     According to RealManage at blog.realmanage.com/en-us/guide-to-creating-an-rfp-for-your-community-association is an excellent sample community association management RFP Template document offered on their webpage: 

SAMPLE Community Association Management Request for Proposal

Date: 

Requested by:

[Enter Board Members Names]Evaluation Criteria

The answers to the following questions will be used to evaluate the services offered by your company as it relates to providing professional management to [insert community name].

Ability to Perform

• Business name and headquarters address
• Number of years in business
• Is the business or parent publicly traded?
• Full legal name of parent or holding company if any
• Does the management company carry errors & omissions insurance? What is the policy limit?
• Provide company mission or principles
• Is the company a member of any community association organizations? Which ones?
• What is the minimum length of agreement?
• How many days’ notice is required for termination by either party?

Quality

• Provide total number of properties currently managed
• Provide a breakdown of types of properties managed by percentage. Include: single-family homes, condominiums, townhomes, leased, etc.
• What continuing education is provided to managers and other staff members?
• How are service providers screened?
• Are there any companies related to your firm that will provide services to the associations?
• Please describe your mechanism for logging, tracking, and responding to concerns from the board or from the homeowners.
• What amount of time is needed to complete transition from previous supplier?
• What transition activities are anticipated?
• Please provide three community references below

Administrative Services

• Will you arrange, schedule, and attend annual, organizational, and board meetings?
• Will you prepare documentation for board meeting agendas, management reports, and meeting minutes?
• Describe how you handle on-site amenity reservations (community meeting rooms, park shelters, etc.), including keys/access codes.
• Will you maintain files, records, and minute books for the association?
• Describe the process used to collect association mail and how critical items to board members will be distributed.
• Will you post minutes, announcements, notices, and newsletters to the community website?
• How will you prepare and present administrative reports and business correspondence?
• How soon are calls returned?
• How soon are emails returned?
• How are after-hours calls handled (i.e., pager, answering service, etc.)?
• How are emergency calls handled?
• What are preferred methods of communicating with homeowners?
• How is correspondence with homeowners logged and filed?
• Does supplier provide a website or customer portal for homeowners?
• Does supplier provide a separate website or portal for board members?
• Does supplier provide newsletter services?
• Will third-party contract administration be provided?
• How will ACC requests be processed and coordinated?
• What is the process for repeat deed restriction violations at the same location?
• What is the process for interacting with board and committee members on day-to-day types of concerns?
• What is included in a welcome package?
• What is the process to review and recommend modifications to HOA documents (i.e. bylaws, resolutions, etc.) to meet current needs?

Financial Services

• Who performs financial management?
• Describe the credentials of the accountant and/or accounting staff
• Does the same accountant or staff person handle the day-to-day financial data?
• Are financial statements reviewed prior to submission to the board?
• List accounting software used in preparation of HOA financials
• On what date each month are financial reports completed and provided to the board?
• Are financial reports electronically archived and delivered to the board?
• List financial reports produced on a monthly basis
• List financial reports produced on an annual basis
• What bank is used?
• Are there any monthly bank charges for association accounts?
• Is there monthly reconciliation of all bank accounts?
• Are invoices paid at net 30 or longer?
• Is invoice backup provided (i.e. receipts, etc.)?
• Is there any invoice threshold for board approval?
• Will you monitor expenses for unexplained increases?
• Will a monthly schedule of accounts payable be provided?
• What methods are available (i.e., lockbox, manually, ACH, credit card) for collecting assessments and water bill payments?
• Do you have the capability of collecting bi-monthly, quarterly, or annual assessments?
• What is the process for handling delinquent accounts?
• Is a monthly delinquency report provided?
• What is the process for a budget creation for operational and reserve accounts?
• When must the annual budget be completed?

Costs

• What is the setup charge?
• What are minimum monthly service fees?
• What are optional services and corresponding fees?
• What are the costs for printing and mailing letters, flyers, and postcards?
• Provide a detailed list of any and all additional charges which have not already been provided herein.

Innovation

     The following questions are designed to get a unique perspective from the management company about why they feel they are the right choice for your community. 

• Describe why your company is right for our community.
• What makes your company unique among other property management providers?
• Anything else you would like to share about your company?

Additional Enclosures

     Please let us know what else may be enclosed with this RFP for board review.

Document Included
Certification of Insurance                              Management Agreement

Betsy Barbieux

Because You Asked
By Betsy Barbieux, CAM, CFCAM, CMCA

Betsy,

     I’m on an HOA board and took a class with you recently on HOA board officer basics. You mentioned that there was an option, after some sort of study, to move all of your reserve funds into a single fund so that you can be more flexible on spending for maintenance.
    Can you tell me what the study is called and what must be done first before that can happen? You mentioned a specific term and said that an outside agency usually needs to do the study. We’d also be interested in any recommendations for such an outside company so that we can start the process. I think it may be worthwhile for my community.
– James

James,

     I probably mentioned a reserve study. This is an analysis of the state-required capital expenditures and deferred maintenance items—roofing, pavement, painting, and anything that costs more than $10,000 to repair or replace. Some reserve studies can be quite extensive while others might include only those three components.
     The reserve study specialist will calculate for you the state-required straight line component funding and can also give you the optional pooled component funding. This will give you the amount of money to be collected from the owners in each assessment payment and then transferred to your reserve bank account each month.
     By using the pooled method of funding, payment for any capital expenditure or deferred maintenance item that is calculated within the pool will be paid from the “pool” even if it depletes the “pool.” That would not be wise to do since another component may need replacing and then there are no funds.
     What the pooled method eliminates is a shareholder vote to move reserve funds from one component to another. The board makes the decision to use the funds in the “pool.”
     There are several reserve study specialists that advertise in the Florida Community Association Journal, and there are two shows on CAM Matters that address reserves.
– Betsy

Betsy,
     We were recently reclassified by FEMA into a flood zone that now requires flood insurance. Have you heard of any community hiring their own surveyor/engineer to do a site survey and appeal the results to FEMA?
– Jaime

Jaime,
     That is a question I don’t know much about. I am aware you can petition to have your property reclassified, but I don’t know if that involves your own survey. Maybe this website, www.fema.gov/flood-maps/change-your-flood-zone, would be helpful. 
– Betsy

Betsy,
     I haven’t emailed you in a while because I get most of my answers from your videos, but I have a question that nobody feels comfortable answering. Can a board of directors go into executive session to discuss names of individuals who are being considered for a vacancy appointment on the board of directors? What do you say? Also, what about discussing a management company in an executive session?
– Jon

Jon,
     Good to hear from you, and thanks for watching! I assume by “executive session” you mean a closed meeting to the owners. No, you cannot go into a closed board meeting to discuss possible board appointees. The only closed sessions are with the attorney OR if the board is discussing personnel/employees (not vendors). A management company is a vendor, not an employee. An employee is someone who receives a paycheck, has taxes withheld, and receives a W-2 at the end of the year.
     Discussing delinquent owners and account balances, fines, violations, contracts, and bids does not qualify for a closed session. Since there is no statutory requirement ever to take the lowest bid, sealed bids for contracts don’t seem necessary.
     Board members may converse (no voting) outside a board meeting via email, telephone, text, or in person. If you talk in person with each other just make sure you don’t have a quorum of you gathered so it looks like a board meeting.
– Betsy

Betsy,
     My condominium’s first notice of election was sent out with seven seats open for election. Only six people returned their notices of intent, so no election is required. The seventh seat is to be filled at the board organizational meeting. The annual meeting notice/agenda was sent out with an explanation that no election was necessary and gave the names of the six owners who had submitted their notices of intent. Now there are apparently more people who want to submit their notices of intent saying they did not get the first notice of election and blaming the management company. The current president seems to be caving into these other owners and wants to start the election process all over again so these other people can submit their notices of intent. All this means a 60-day delay and changing the date of the annual meeting. Can the board president change everything once it’s in motion? What would you do?
– Zusy

Zusy,
     I don’t think the election process should start over again. There will always be owners who say they did not get the first notice. Once the election side of the track starts, there should be no turning back unless there was a material error on the first notice of election form. And since there were not enough candidates to hold the election, the second notice is not necessary.
     But the annual meeting notice/agenda, previous minutes, general or limited proxies, amendments (if any), etc. is sent out at least 14 days before the meeting.
     Remember my election and annual meeting chart? There are two processes going on at the same time, which many managers and boards still do not understand. The election process has its own timeline, and the annual meeting has its own timeline. Each process is independent of the other.
     You’ll want to read Rule 61B-23, Florida Administrative Code, for more information. There is a show on my YouTube channel, CAM Matters, addressing elections. 
– Betsy