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The Condo Paper Chase

Best Practices for Document Management

Article written by Jack Carr, P.E., R.S., LEED AP, Criterium Engineers
Published in Condo Media, October 2014

This month’s Condo Media will be considering the issue of managing all of the paperwork necessary to operate a modern condominium’s operations and maintenance requirements.  Much of this standard document control work can and should be outsourced to accountants; property managers; and lawyers no matter what the size of the condo, but let us also consider the documents falling under a technical heading. 

The first documents typically thought of are the governing documents, namely, the declaration of covenants, conditions, and restrictions; the bylaws and amendments; and the rules and regulations.  Filed articles of incorporation and amendments also come to mind.  These are considered the ‘permanent’ documents. 

The more challenging documents to manage are the ones varying in time of utility or risk exposure.  For this reason contracts for maintenance, landscaping, and management are held onto for seven years after they expire while insurance policies; employment; and bank statements; and tax returns are held for six years.  Here again the professionals working for your association can provide this advice and physical storage, but keep in mind the ultimate responsibility for record archival and retrieving belongs to the association. 

Maine has a larger share of small to medium sided condominiums and home owner associations than other parts of the country.  This demographic and large number of vacation related condos in the state has resulted in more informal property management with many having no professional guidance at all.  It is not unusual to discover a condo’s documents are found in a cardboard box passed down from board secretary to board secretary as time goes on. 

The problem with documents is they are not important, until they are.  Ease of retrieval is as important as the safety of the documents.  Obviously, the best time to implement a document control system is at the beginning of the condo’s life but the next best time, if a system is not in place, is now. 

Unit owners are becoming more familiar with their rights to have access to official records.  Real estate transaction due diligence is becoming more rigorous with potential buyers asking more questions and seeking to review past board minutes and other financial records.  Banks are becoming more interested in maintenance standards; safety violations; renter rolls; and reserve fund planning. 

More importantly, the board needs to have the best information to make informed decisions.  In addition to the legal, accounting, and administrative documents listed above, the document control system must maintain the ‘technical’ or physical records.  These records include copies of the original public offering statement; marketing brochures; construction as-built drawings; project specifications; site plans; and plat, maps, and surveys of the land and units.  Other physical records are the grants, deeds, easement, leasehold, and aerial surveys.  There should be an operating manual listing the vendor, manufacturer, and installer of all common elements. 

Needless to say, many of these documents should be obtained from the developer during the transition to the new owner-managed board.  If these documents were not obtained at that time, the construction drawings are often available from the municipal planning or building department for a nominal printing cost.  As these municipal records disappear in time, the sooner the request is made the better. 

Site drawings; floor plans; building footprint layouts can be invaluable in renovation cost estimating; insurance needs; and reserve fund planning.  Files should be maintained on contractor estimates; fire department inspections; HVAC maintenance reports; engineering studies; and the association’s building committee surveys.  Maintenance logs and a running history of both operational and capital repairs can be invaluable in future maintenance planning. 

So the obvious question is, where to store all of these documents keeping in mind many condominiums do not have a central office for on-site storage.   Traditionally these associations store their hard copy records in a safe deposit box; storage facility; or with a records management company.  Scanning machines are often employed to reduce important documents to manageable CD discs. 

Condos create a great deal of electronic documents, as well, such as  meeting minute text files; presentation spreadsheets and PowerPoints; emails; databases; calendars, etc.  Today’s modern condos are thinking outside the box using Drop Box or other cloud-based storage methods to provide ease in retrieval as well as access for their unit owners.  Condominium websites are continuing to becoming more sophisticated providing up to date information 24/7.  Smart phone apps and inexpensive document control software are leveling the playing field allowing even the smallest condos the opportunity to manage effectively and win the Paper Chase.     

 


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