Homeowners associations sometimes struggle to get people to participate in meetings and vote on agenda items. Residents are busy with their schedules, after all. This is where proxy voting in HOA communities comes in. What is it, and what precautions the board must take? Let’s find out.
What is Proxy Voting in HOA Communities?
Every association has HOA voting rules, which indicate whether proxy voting in HOA communities is allowed. A proxy is an authorization from a homeowner or board member that appoints someone else to represent them at a meeting. The proxy acts as their agent and makes the vote for them.
State law and the governing documents typically indicate who can be appointed as a proxy. However, homeowners may typically assign anyone as their representative. Homeowners should appoint someone trustworthy to ensure they do not vote against the homeowner’s wishes.
More often than not, homeowners appoint their spouses, neighbors, or friends as proxies. Depending on the community’s rules, homeowners may appoint more than one person as their proxy. Moreover, the rules may indicate when a proxy is allowed and when it is not.
How Do Proxies Work?
The homeowner or board member must designate their proxy in writing. Homeowners associations may create community-specific templates that residents can use to ensure uniform information submission.
In addition, HOAs should have a standard process for establishing proxies. Residents should know to whom to send the form, what information is given, and how the proxy should vote. Furthermore, it’s important to note that designation forms should not be reused. Homeowners should create a new one for each meeting the proxy attends.
Proxy voting forms should be clear and detailed. Generally, they should contain the following information:
- HOA name and address
- Details of the meeting, including the time and date
- Clear identification of the proxy holder
- Type of meeting (e.g. special meeting, board meeting, or annual meeting)
- Whether the proxy will be used only to establish a quorum or if the representative will vote on the owner’s behalf
- Authorization that the proxy may attend the meeting in the owner’s stead
- Date and signature of the HOA member and proxy holder
How Long Do Proxies Last?
In California, proxies last for 11 months. However, the proxy may be revoked or have a set expiry date outlined in the designation form. At most, California proxies can last three years from the execution date. Proxies have full force and effect until they expire or are revoked.
HOA members may revoke proxies by doing the following:
- Providing written notice of the revocation to the Inspector of Election
- Executing a later-dated proxy before the vote and giving it to the Inspector of Election
- Attending the meeting and requesting a voting ballot before the ballot is distributed to the proxy holder
- Delivering a ballot to the Inspector of Election before a ballot is distributed to the proxy holder
In addition, proxies are not revoked by the proxy giver’s incapacity or death unless notice of such incapacity or death has been given to the HOA before the votes have been counted.
Types of HOA Proxies
There are two types of HOA proxies:
- Directed Proxy. The directed proxy holder may only vote on the homeowner’s behalf on specific topics and issues. Homeowners may dictate how the proxy holder votes on each issue based on the homeowner’s instructions.
- Non-Directed Proxy. The non-directed proxy holder may vote on all issues on the meeting agenda. Homeowners do not dictate how the proxy holder will vote so that the representative will vote at their discretion.
In addition, homeowners should follow state law and the governing documents when designating their proxies. In California, homeowners must follow strict guidelines when designating a directed proxy holder.
Which Type of Proxy is Better?
Each type of proxy has advantages and disadvantages. For one, directed proxies allow homeowners to vote exactly as they intended without influence from the proxy holder’s emotions. However, they can also be detrimental, as the proxy holder will vote according to the homeowner’s instructions regardless of any new information presented.
For instance, the proxy holder may be instructed to vote for Candidate A in the elections. They cannot cast a different vote even if someone brings up Candidate A’s misbehavior, violations, or fraudulent actions.
Meanwhile, non-directed proxies allow for more flexibility. Nonetheless, they might not always vote according to the homeowner’s wishes. Undirected proxies must exercise discernment and vote at their discretion, which isn’t always favorable to the original owner.
Are Proxies a Good Thing?
Proxy voting in HOA communities can be beneficial. While there is potential for abuse, the benefits may sometimes outweigh the disadvantages. Firstly, proxy voting is useful if the HOA has trouble obtaining a quorum. Allowing proxies allows the board to conduct regular meetings and move things forward without waiting for most members to attend.
In addition, proxy voting allows busy community members to participate in meetings. Some residents may want to be more active in their community but lack time. Proxy voting gives them a chance to make their voices heard. Proxies can represent homeowners and provide the board with more input and feedback.
How to Prevent HOA Proxy Abuse
Allowing proxy voting in HOA communities can sometimes lead to abuse. In some communities, prospective board members may collect fraudulent proxies from absent homeowners to secure their vote and position on the board. This allows them to continue to run the community and even engage in illicit activities.
How do you prevent proxy abuse? Here are some precautions to keep everyone accountable and ensure that proxy voting is always fair.
1. Prevent Fake Proxies With Watermarks and Codes
It’s not uncommon for homeowners and board members to create fake proxy documents. This usually happens when they know some other members don’t plan to attend the meeting. They create fake proxy designation forms and sign the homeowner’s name.
To prevent this, homeowners associations may place watermarks or serial numbers on each proxy form. This way, HOA members and directors cannot replicate the form themselves. The serial number can also indicate whether a form has already been used or is a new one.
2. Thorough Verification of Proxies and Records
Homeowners associations can avoid fraud by thoroughly verifying proxies and applying the rules equally to all homeowners. HOAs often require residents to designate a voting representative.
For instance, a rental property owner should designate an employee or officer as the voting representative. Make sure to keep an accurate record of people with the right to vote. It’s also helpful to enforce provisions that a person can only sign a proxy if they have voting power.
When a proxy does attend a meeting, HOA board members should confirm that the proxy isn’t being utilized for a member at the meeting.
3. Establish Rules
Proxies are easy to manipulate and forge. Establish rules that can minimize illicit activity. Board members should make copies of the original designation form and give them to the proxy holder. The person who will vote on their behalf must attend the meeting in person and verify their identity. Moreover, they should cast a ballot for the vote to count.
It may be wise to produce multiple copies of the designation document. This ensures the proxy votes the way the owner wants. HOAs can also provide colored ballots for proxies to easily assess the proxy’s vote.
In addition, proxies usually cannot be transferred. Hence, if the original proxy holder designates someone else as their representative, the HOA may disallow the vote or disqualify it. Nevertheless, it’s best to consult an HOA attorney before proceeding.
4. Consider Alternative Voting Methods
Proxy voting in HOA communities is often used when homeowners cannot attend the meeting. However, it’s not the only option HOAs have when they’re struggling to get people to vote. A good alternative is to have people vote electronically or by mail. This way, HOAs can avoid proxy abuse entirely.
Frequently Asked Questions
What’s the Difference Between Proxies and Absentee Ballots?
While proxies grant meeting attendance or voting authorization to someone else, absentee ballots allow homeowners themselves to vote through a form without attending the meeting.
What is a Proxy for Quorum?
A proxy for quorum allows the proxy holder to be counted toward the meeting’s overall attendance so the HOA can meet quorum requirements. As a result, all the discussions and votes within the meeting will be valid, preventing delayed decisions or wasted time.
How Many Proxies Can Someone Hold?
It depends on state law, the governing documents, and the meeting rules. In some cases, homeowners may assign separate proxies for different votes (e.g., one person may be designated for elections while another may be designated for amendments).
An Important Part of Decision-Making
Proxy voting in HOA communities is vital for several reasons. It allows community members to participate in meetings they otherwise could not, and it helps the HOA obtain a quorum more easily. Nevertheless, HOAs must be vigilant and establish rules to prevent abuse.
Personalized Property Management offers expert HOA management services to communities in Southern California. Call us now at 760-325-9500 or send us an email at info@ppminternet.com for more details!
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