P.L. from Connecticut writes:
Dear Mister Condo,
I own 40 out of 68 units at my condominium association. There are 7 buildings with each building having a vote. I own 4 buildings completely and 2 units in another building of 10 condos. We’d like to self-manage. Do I need certifications? Do I need majority vote OK from the others before I cancel the existing management company? Do I need legal docs submitted somewhere telling CT this is what we are doing?
Mister Condo replies:
P.L., with such a substantial investment in play, you may wish to consult with an attorney before you make any missteps. My biggest concern is what do the condo’s governing documents have to say about the buildings. The way you describe each building having a vote, I am led to believe each building is a sub-association of a Master Association. If so, you need to follow the rules of the building’s association as well as the Master Association. Obviously, you control all of the votes of the 4 buildings you own completely. The other three buildings are up for grabs as far as whether or not they will vote with you. Depending on what percentage of votes you need to proceed, you may already have the votes to self-manage. Keep in mind that if there is a contract already in place with a management company, you are bound by that contract. Terminating the contract early can have expensive financial consequences for the association so make sure you know what you are getting into before you simply vote to remove the management company. There are many hybrid models for self-management. If the association will truly self-manage and have volunteer leaders (Board Members) run the association, then no license may be needed. However, if the association is going to place someone in the role as manager, that person would need to be licensed. Even if the association decides to self-manage on its own, it isn’t a bad idea for one or more Board members to get manager training. It’s not as easy as it sounds and there can be great risk to the association’s assets (money in the bank, for instance) if it is handled by someone who isn’t licensed. The state of Connecticut may not particularly care that your association is self-managed or not but you do want to make sure you keep all of your annual filings up to date and that you know who is the association’s Registered Agent. The Registered Agent is the recipient of many tax and legal papers. You wouldn’t want to miss important notifications because the Registered Agent was a former Property Manager with no current affiliation with the association. Other than those considerations, I think you’ll be fine. All the best!