Tim Long: 0:00

In retrospect, I think we were lucky that we got the board to agree to do a reserve study. I was not aware of the history, but it turns out that previous boards had been asked to consider a reserve study, and every time that he unanimously said that they were not interested. So there was already in this community, this feeling that we do not need a reserve study, and I didn't know that at the time,

Announcer: 0:31

A regular highlight of the HOA Insights podcast is our board heroes feature, where we dedicate one episode each month to celebrate the remarkable efforts of HOA board members to us, a board hero is one of the 2 million elected volunteers who deserve recognition for excelling in a role that often goes unnoticed. Today, we're excited to spotlight one of these exceptional board heroes and share their inspiring story. If you match our definition of a board hero, or know someone who does, please reach out to us. Our contact details and those of our sponsors are provided in the show notes.

Robert Nordlund: 1:03

Welcome back to HOA Insights: Common Sense for Common Areas. I'm Robert Nordlund, and I'm here today for episode number 147 with another one of the board heroes. We're proud to celebrate. We finished a reserve study for a 66 unit town home Association in Las Cruces, New Mexico earlier this year, it was our first engagement for this property, and we ended up recommending a significant increase in their reserve funding and a special assessment. Not surprising, so far, for a first time client of ours, then we received a long email from the secretary of the board, Tim long in his email, Tim went on to describe how the reserve study, got their attention, how they engaged the homeowners with this news, made some adjustments, customizing the reserve plan, then pitched the increase to their association at their annual meeting. Listen to this. At that annual meeting, the Board passed the plan to increase assessments, and this news was greeted with a round of applause, and that's what got our attention and why I asked Tim to be on the program today. What the board did to engage the homeowners, to help them understand the needs of the property and how the board was going to lead them forward with the best interests of the association in mind was nothing short of fantastic. Now, Tim is not a magician or a hypnotist. He's retired from an academic career and is a first time board member, and we'll hear more from Tim in just a moment, but first, I hope you enjoyed last week's episode number 146, with regular co host and management and leadership consultant Julie adaman, I always find myself taking notes whenever she's on the show from all the lessons she shares from her years in the industry. And if you missed that episode or any other episode, you can find them on our podcast website, Hoa insights.org, on your favorite podcast platform, or on our YouTube channel. But better yet, subscribe to the podcast in order to get every episode delivered right to your phone or mobile device. And those of you watching on YouTube can see the HOA insights mug I have here that I got from our merch store, which you can browse through from our Hoa insights.org website or the show notes, and you'll find we have plenty of free items there, like the board member zoom backgrounds and some specialty items for sale, like the mug. So take a moment after the show see what we have for you in the merch store, and at least pick up one of our free items before your next board meeting. Well, we enjoy hearing from you, and most episodes, episodes are in response to a topic you've recommended. So stay in contact, letting us know what questions you have or topics that you'd like to hear about. Leave us a voicemail at 805-203-3130, leave a comment on YouTube video or send us an email at podcast at reserve, study.com but back to today's episode. So Tim, let's start with what got you onto the board in the first place. Why did you decide to run?

Tim Long: 4:07

Think it was a weak moment. Actually, I didn't give it a lot of thought. There was a big turnover from the 2024 board. We needed a lot of candidates, and my neighbor just said, Hey, I'll run if you run. I said, Okay, that was

Robert Nordlund: 4:24

it. So that was a dare, almost.

Tim Long: 4:27

It was, it was not a heavily thought out decision, although I think we're at a point in our life where we have the time and feel the responsibility to contribute to the operation of the community, so it just seemed like the right thing to do.

Robert Nordlund: 4:46

Okay, how long have you lived at the association?

Tim Long: 4:50

We've been here now

Robert Nordlund: 4:53

about two years full time. Okay, so you're relatively new to the association, and in your second ish year. Or you ran for the board. You thought, I can do this. How hard can it be? I guess maybe, yeah, okay, so he didn't come on to the board because you had an agenda. There was something wrong that was just fueling your anxiety. You just came on the board because they needed board members and you had some time, yeah,

Tim Long: 5:24

kind of that was it. I I also was interested in doing a reserve study, and I thought if I was on the board, I'd be able to make that happen. So that was in the back of my mind. Also, okay,

Robert Nordlund: 5:37

so you knew what a reserve study was? Yes, okay, how did you know

Tim Long: 5:42

what a reserve study was? Well, I had a friend here, is a long time resident, and he, he told me about reserve studies and pointed me to your podcasts and things like that. Okay, so I kind of knew what it what it might do for us. What happened here is in 2023 when our roads were about 45 years old, they were resurfaced for the first time, and the community chose to go with the chip seal process, and the results were terrible. And I don't think anybody here is happy with the roads that suggested to me that we were going to need to resurface again much sooner than we thought, and it was probably going to be a lot more expensive than we thought. But I didn't hear anybody in the community talking about that. I didn't hear anybody saying, Hey, we better start planning for the future. We're going to have some major financial problems coming, and we better get ready for it. So I was hoping that a reserve study would act as a catalyst that would cause the community to start thinking about the financial issues that we were going to face soon and and get us started planning on how we're going to address them. So that's what I was looking for out of a reserve study, and that's why I was interested in it, cool, excellent.

Robert Nordlund: 7:09

So that was just your general awareness as a homeowner, that roofs get old, the water heater gets old, the asphalt gets old. Just an awareness that things have a life limit, and you're looking around and you're thinking, Are we are we not ready? I'm concerned. Is that fair? Yes, exactly. Okay. Well, is your association professionally managed? No, we're

Tim Long: 7:33

all volunteer. And it has. It's been that way from the beginning. Okay, so the

Robert Nordlund: 7:39

board members are carrying the entire burden. Do you even have an accounting service to help with the monthly invoicing and monthly financial reports? We do have that? Yes, excellent. Okay, good for you that that's a specific skill. Is yours a December 31 fiscal year end property? Yes. Okay, so you got a proposal early in the year, and you commissioned the reserve study. And do you remember what time of year you got the results,

Tim Long: 8:07

mid to late summer. Actually, I think we got the final study. I think it was August 4.

Robert Nordlund: 8:14

So August for December 31 fiscal year end. So that's actually a pretty good sweet spot, because that gives you time to react and have time before all of a sudden you have to cram out the budget in November, that kind of thing. And do you have any idea if this was the first ever reserve study for your association? Sure everybody is I'm pretty sure it is okay. And you alluded to the Rose being 45 years old. Is the association 45 years old? I think we're about

Tim Long: 8:45

maybe 49 now, 4849

Robert Nordlund: 8:48

years old. Okay, so it's not like it was originally apartments for 20 or 30 of those years. It was purpose built as condos, correct? Got it? Okay, so, and it's been the board running the place for ever and ever. Okay, what was your reaction to the news in the reserve study?

Tim Long: 9:04

It was startling. There's no doubt about that. The numbers did that really surprise you. No, I thought it was going to be bad, but I I didn't know the magnitude of that. The numbers were startling, and I felt that it was going to be difficult for our community to to try to do what we had to do based on that report. Okay, so there was a, there was a startled period there, yes, yeah.

Robert Nordlund: 9:38

So you didn't have a management company counseling you about this. It was something that you as the board decided, were the other board members on board with getting a reserve study, and did they have your sense that it might be bad news?

Tim Long: 9:53

In retrospect, I think we were lucky that we got the board to agree to. Do a reserve study. Okay? I was not aware of the history, but it turns out that previous boards had been asked to consider a reserve study, and every time that he unanimously said that they were not interested. Okay, so there was already in this community, this feeling that we do not need a reserve study, and I didn't know that at the time, if I had, I would have worked a lot harder to prepare the ground for the motion to have a reserve study. But I think what happened is we had seven new board members on it, on a board of nine people, and we just had enough new people who were interested were just able to get it approved, but it came with some resistance already built in, and I don't think in the beginning all of the board was really behind it. Yeah, well,

Robert Nordlund: 10:59

one of the numbers you said kind of struck me. Yours is a 66 unit Association. We have nine board members that seems like a pretty, pretty

Tim Long: 11:07

big group. Yeah, it is. The bylaws specified between seven and nine.

Robert Nordlund: 11:12

Okay, and so, like you said, a number of board members had phased out, and you were one of the people who just raised your hand in, as you say, a moment of weakness, and got on the board. Okay, right. So he got the results, and it was, I think you said, startling. And your association had for 40 some years said, We don't need a reserve study. We're doing just fine without it. And you hit a bump in the road with the chip seal a few years ago, you saw another big project coming up. Yours is a townhome Association, so you've also got roofing and painting and other things like that some Okay, so if you're going to get nervous about the asphalt, then oh, gee, what are we going to do about the roof? What are we going to do about the painting? There's all these other things there that were probably in the back of your mind. There also. Okay, so after you and the rest of the board got the reserve study, you were startled. How did you start? Well, like even the treasurer, did the board say, Holy mackerel, what are we going to do here?

Tim Long: 12:19

It was, I think, sort of agreed ahead of time that the Finance Committee, there's three of us on the Finance Committee, would take charge of this whole process, and I on the Chair of the Finance Committee. So there was, there was prior agreement that that that committee would lead the process, and we had also outlined in a document what that process was going to be. So the board had already sort of signed off on on a way we were going to proceed with,

Robert Nordlund: 12:53

okay, and what was that? And then, in this, an outline of where you're going to go.

Tim Long: 12:59

Well, because of the early resistance, it seemed clear to me that the only way we were going to be successful is by engaging the community and winning them over. Couldn't go around them that's that's inappropriate, in my mind, it is a community so it's got to be a community decision, so that our only hope, I thought, was to engage and to win over. So after we received the study, and Chip Monday, who did the study for us, presented it to the board in a Zoom meeting, then we had a series of public presentations where we presented the study to the community. So that the community would understand what was in the report, and we were trying to get the community excited about the report and excited about what it could offer us and what might be able to do with it,

Robert Nordlund: 13:58

so you presented the reserve say to the community. Obviously, that's extra work. You're a board member, not only a board member, you're on the finance committee, so you have multiple responsibilities there. So you said, Okay, let's, rather than just figure out what we're going to do, let's engage the homeowners. And I love that word community. You know, we're in this together. Type of thing

Tim Long: 14:23

at your association. Does the board have the power to say, this is the budget, these are the assessments, or does it need to be approved by a vote of the homeowners? The board can do that? Okay? So the board could have acted up. The board could could have acted on its own. Personally, I just felt that that's just not the way to do it. In the end, I wanted the community to decide. Wanted us to do I wanted not to be their decision,

Robert Nordlund: 14:55

even though you had the power to do that was to engage them again. I find. Fascinating that that was a choice you had, and do you think that came from you being you, or was it you being a homeowner previously and subject to the whims of the board and saying, if I was a homeowner, I would like the board to involve me, at least give give me the courtesy of telling me what's going on.

Tim Long: 15:23

I don't really know. It was just to me that was obviously the way to go to to engage the community, to win them over, to get them involved, and ultimately let them they had to make this decisions.

Robert Nordlund: 15:43

I like that you you chose, just as a human to be courteous, and I think that is one of those things that board members need to appreciate, that you many times you get back what you give out, and it's a reflection of the way you've treated the homeowners that you said, I've got the power to do this, but let's hear what you want to see. This is our community. Is that fair? Fantastic. Okay, well, Tim, that's a great point. We're going to take now a break to hear from one of our generous sponsors. That's where we'll hear more details about the process that Tim went and what they learned from those meetings with the homeowners.

Paige Daniels: 16:23

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Robert Nordlund: 16:54

And we're back here to talk with Tim about his process there. And I just want to share that Tim had a moment, just a moment ago, where he got to a point where he couldn't speak, where he was touched with, well, Tim, maybe you can see it. Say it. You said you were lonely. Being a board member and engaging the homeowners reduced your loneliness, and it helped them see what was going on at the association. Is that, is that fair?

Tim Long: 17:21

Yeah, it's kind of I felt lonely, I felt responsible, and to have the community step up, yeah, to join you, join us and lead us to a solution. Listen. Incredibly rewarded.

Robert Nordlund: 17:46

That's fantastic. Well, because it takes, it took extra time to say, let's involve the homeowners. It took courage to do that. It took commitment. It took curiosity. You know, what are we going to learn here? But I think so much of that is you just saying, I have a choice here, and I can engage the homeowners and get their support. This is our association. The roof's not going to go away, the resurfacing is not going to go away. How are we going to solve these things? And the key word there is, how are we going to solve these things? And I think strategically, you take away the opposition when you get them onto your own team. Is that kind of what you were thinking? Maybe not strategically what you were thinking. But was that a good result?

Tim Long: 18:32

When we started the presentations, they were small group presentations, 10 to 12 people. No, live, okay, in the club, in the clubhouse, good, because we wanted the group to be small so people could interact and say what they wanted to say in and not be intimidated by a large group. So they were small, they were intimate. There was a lot of feedback, and it was extremely positive. And I felt that after the initial series of presentations, there was a good feeling in the community about the reserve

Robert Nordlund: 19:10

study, yeah, even though it effectively lived delivered bad news Exactly.

Tim Long: 19:15

But when we started those presentations, we told the people there that at this point we were not willing to defend the study. We were not willing to question the study. We were merely going to explain the study. And I explained that the reason why we cannot defend or question is because we have not yet done our homework. And I went to the component list, and I pulled out a couple of items from the reserve study, and I said, this is what the reserve study says about these items, but in our community, we are probably going to handle these differently, and the impact financially will be this. So when I say we haven't done our homework, I mean. We have not scrutinized every item in the component list yet, so we will get that done. So today, we're just going to study or explain the report. So I felt that that took away an adversarial possibility in those initial presentations. I didn't want an adversarial climate. I wanted to just have people see the value of the report. Maybe they didn't agree with everything in it, but they could see it's a treasure trove of incredible information. It's a huge resource for us, okay? And that's all we wanted people to appreciate. And I think that happened in that first series of meetings, okay?

Robert Nordlund: 20:44

And then you took advantage of our online reserve calculator to start to make those adjustments and tweak it a bit to make it your own Exactly.

Tim Long: 20:52

We started working through the component list for the big ticket items. We actually met with contractors. I mean, I knew at some point we were going to make recommendations based on the numbers coming out of that study, and I wanted to have as much confidence as possible that those numbers were accurate. They were a good reflection of what we were going to be facing. So we met with contractors and for smaller things, we met with the community. My colleague, Helen Myers, invited community members to her condo, okay, and they would sit around and have snacks and drink wine and have a conversation and talk about the component list and get get their feedback, and they appreciated being included, and many of them were long term residents with institutional memory, and they so much appreciated being part of the process down the road when we had to make the tough decisions, they were On our side. They were advocates for us, because they got included early on in like body

Robert Nordlund: 22:07

in, well, I think that says so much about you, the way you treated them with respect, yeah, and you were ushering in you and the new board were ushering in an era of we, not us versus them. It sounds like we

Tim Long: 22:21

redid that the component list, and then we used Uplanit, which is wonderful software provided by your company, to well, from that, you generate a 30 year work plan, basically, you know, plan that says, okay, in 2026 we're going to take care of A, B, C and D, and it's going to cost 40,020 27 we're going to take care of x, y, z, and it's going to cost 30,000 so at that point, after we had gone through the component list, we had the answers to two crucial questions. One, how much money do we need? And two, when do we need it? And earlier, board members told me their attitude was, hey, we know we need more money. Why do we need a reserve study to tell us we need more money? What they did not know is how much money they needed and when they needed it. And those are the questions. If you don't know those things. How can you do the financial plan? You know,

Robert Nordlund: 23:24

I'm thinking, Can I get you on some of my sales calls in the future?

Tim Long: 23:29

So the next step was, so we, we, we knew what the spending side had to be. So the next, the next issue is, how do we fund our reserves? How do we make sure we have the money we need when we need it? So using your software, we generated several scenarios for how we might go about funding the reserve study or our reserve accounts, and we held another series of meetings with the community, three more meetings, small group meetings. In those meetings, we went over the budget, we went over scenarios so the people could see the numbers, and We asked them what they thought, because I wanted to I wanted them to make the decision, not me, not the board. I wanted them to do it, and that they stepped up big time. That's fantastic. We went through this. We went through scenarios we had set up, and they said, We don't like any of those. Let's try this one. Okay, one we settled on came from the community, and it was for more than I dared ask, but it was, it came from this. Them. That was the crucial thing. Yeah, it came from them, and so they were with us.

Robert Nordlund: 25:09

It was their plan. Yeah, when I think about problem, I think, What's that old adage, a problem shared is a problem halved, but a joy shared is a joy multiplied, and it sounds like you halved the problem. You cut the problem into smaller pieces by sharing it with the homeowners. And then they were on board, and they helped see that, you know, this is going to take some serious business increases. And they were on board supporting the hard work that needed to be done, the hard work, the hard decisions about the assessments need to increase, and that relieved your burden of delivering bad news, because they appreciated that the numbers are the numbers.

Tim Long: 25:54

I think so and so at the October meeting, we announced that at the November meeting we would entertain a motion to increase the dues by 20% and right after the October meeting, we sent out an announcement. This is what we've done so far. These are the scenarios we considered. Here are the 30 year standard tables generated from your software that show the results of those scenarios. This is the one that people like and want to support, and here's what it's going to cost you individually. So we didn't hide any of this. Everything we knew the community knew they had all the numbers, and they had a month's advance notice that the board was going to entertain this motion and make and do a vote. Now there was a little bit of pushback during that month, but not, not a lot. But we were just determined to make this open, to make it so the community knew everything that we knew so they could help make this decision.

Robert Nordlund: 27:19

That's fantastic, and so you came to the November board meeting. You put the motion out there the board, you told me earlier, unanimously, the board of nine unanimously approved the 20% dues increase. It sounds like a lot of that was going straight to reserves. And the reaction of the people in attendance

Tim Long: 27:40

was they applauded. So at that point, we were down to a board of seven. We lost a couple during the year, but the board voted unanimously, and they they all believed in it. And I think after the vote, I just said, thank you not to the board. I said, thank you to the audience, to the community, because they made it happen. And I think they applauded because they believed in this, and they thought it was necessary, and it was important to get the Association on the right course. So I think they were relieved. I think they believed in it. I think they appreciated all the work and effort that went into it. I think all those things went into that applause. I just think that's

Robert Nordlund: 28:34

a template for how to do it. Tim It's just fantastic from every point of view. We get so much, I don't want to say so much resistance, but we get so many clients that say, Boy, that's going to be hard to do, and you and your committee and your board screwed up your courage. Did the communication necessary, invested the time necessary, treated your owners like they were partners in this investment. That is your association. And it's just remarkable what the owners came back with that, yeah, we appreciate this is what it's going to cost to continue to stay here and to have this be a nice place to live, to be the kind of place we want to live in, and that, again, that's, uh, that's why you're here today. Now for people listening, yes, we delivered the reserve study. Reserve say stands as published. But we do have this tool. We call you planet, where we encourage our clients to go in and get their fingers in the numbers and push things around and make it their own. Get get their get invested in the plan. And that sounds like exactly what you, with the approval, involvement of your homeowners, were able to do, and the result is you're going to have the money, enough money at the right time to be able to do what the association needs done.

Tim Long: 29:57

That's our hope, and that's what we're trying to. Do and this, none of this. What would have happened without the reserve study, it set a framework within which we could carry out these discussions. Without that, it just would have been my opinion versus your opinion, uninformed subject. To who knows what, but with the reserve study, the framework for discussion and for investigation was set, and then we worked within that framework. It was it was crucial, this. None of this could have happened. None of it without a reserve study. Yeah. So we are deeply indebted to you guys for providing that for us.

Robert Nordlund: 30:48

Well, we provided it for your association. There's a lot of other reserves day firms across the country that do it for their client base. Kim, I want to thank you for hiring us earlier this year, being courageous to do that. Let me ask you, kind of a closing question, are you going to how long? Well, two related questions, how long is your term on the board?

Tim Long: 31:08

It's a two year term, and then we're supposed to be off for two years. So I have another year to go in after two years off, I'll just see how I feel, and I'll be a little bit older then, and maybe I won't trust myself to be in a position of responsibility. I don't know. We'll have to see

Robert Nordlund: 31:33

well, in a moment of weakness, you may decide to run again. That's my thinking. Again, from my point of view, so much of being a board member is the character that you bring to the table, and we're both going to be a couple years older in a couple years, but I think the character that you brought to the table is absolutely fantastic and is timeless. So I'm looking at the clock here, and it is time to start wrapping this episode from the deep, from the depths of my heart. Tim, I want to thank you for taking the time to join us on today's program. Any final thoughts or words of wisdom to share on your board member experience with our audience today. I don't think so. I don't think I'm that wise. We did what we did here, and it worked.

Tim Long: 32:16

Other associations will have their own dynamic thought find their own way, but I do want to emphasize one more time that the reserve study was crucial, and without it, this never would have happened. So we needed that platform. We needed that framework, and I guess I would just encourage other associations, if, if they haven't had one, and if they're facing challenges, think about what that what a study might be able to do for them to get them started on the right path. Fantastic.

Robert Nordlund: 32:55

Well, we want to publicly acknowledge Tim for performing a thankless job well and for doing an absolutely remarkable job of building community, not causing division through the budget process at his association, we're glad that there are boards like Tim's all scattered around the country, and we're fortunate to have him here to tell his story with us today. We hope you gathered some HOA insights and encouragement from Tim's observations and experience that helps you bring common sense to your common area. Now, reminder, if you match our definition of a board hero, or know someone who does, please reach out to us. We love having board heroes on our program. Our contact details are provided in the show notes. Thank you for joining us. Subscribe to the podcast, and we look forward to having you join us for another great for another great, valuable episode next week.

Announcer: 33:49

You've been listening to Hoa insights, common sense for common areas. You can listen to the show on our podcast website, Hoa insights.org, or subscribe on any of the most popular podcast platforms. You can also watch the show on our YouTube channel. Check the show notes for helpful links. If you like the show and want to support the work we do, you can do so in a number of ways. The most important thing you can do is engage in the conversation. Leave a question in the comment section on our YouTube video. You can also email your questions or voice memos to podcast at Hoa insights.org or leave us a voicemail at 805-203-3130, if you gain any insights from the show, please do us a HUGE favor by sharing the show with other board members. You know you can also support us by supporting the brands that sponsor this program. Please remember that the views and opinions expressed by the podcast do not constitute legal advice, you'll want to consult your own legal counsel before making any important decisions. Finally, this podcast was expertly mixed and mastered by stoke light. Video and marketing with stoke light on your team, you'll reach more customers with marketing expertise that inspires action. See the show notes to connect with stoke light. You. One of.