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Subject: Out-of-Pocket Expenses for Officers
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Author Messages
RobertC3
(Oklahoma)

Posts:1


03/31/2007 11:15 AM  
If the by-laws don't state one way or another, whether a HOA officer should be reimbursed for put-of-pocket, HOA-related expenses, is it reasonable to expect the HOA to re-imburse him?
As president, I use my cell phone as my primary point-of-contact with association members, and the use has, at times been heavy.
Also, in doing HOA busines, such as visiting City Hall, or meeting with city officials, does this entitle me to reimbursement from the association?
The association was turned over to the residents by the developer just last month, and the officers then were reimbursed for out-of-pocket expenses.
However, since our by-laws make no mention of this, I am at a loss. I thought that reimbursement was both legal and ethical, but now I have some members shouting "foul!"
I want to do what's right, for both the HOA and for myself.

I really need help on this, and fast!
Thanks.
RogerB
(Colorado)

Posts:4896


03/31/2007 2:19 PM  
Yes Robert, out-of-pocket expenses are reimbursed. Provide receipts, when possible, otherwise some associations allow written description of allowable expenses. Prior Board approved charges for such things as extra charges on a cell phone can be allowed.
BradD2
(Florida)

Posts:418


03/31/2007 4:46 PM  
Robert, yes but for things which no receipts exist you will need to have Rules & Regulations or Policies and Procedures drafted for it. The rates of reimbursement will need to be ratified by the board and hopefully all members at the meeting where it is discussed. Create an expense report which your association will use. EVERYTHING has to be documented and entered into your records.

You mentioned mileage that is going to need to have a standard rate decided upon. Some people have cell phone plans which have say 1,000 minutes and roll over; they might not go over this month but will the next and that will eat into the banked minutes. So you might want a reimbursement rate per minute. As an example: $0.35 per mile and cell phone minute.

The Expense Report that I built for our Association requires you to get the signature of two other officers; this adds some accountability.
BradP
(Kansas)

Posts:2640


03/31/2007 6:54 PM  
Robert:

Yes, reimbursement should be expected. I would with your cell phone get prior approval from the board, if they deny I wouldn't use your cell phone for HOA business if you pay for each minute. My cell phone is a flat rate per month so it doesn't matter how much I talk about HOA business it is all the same. I would also discuss the mileage trips you make and see if they are willing to reimburse. There may be another member that is willing to make the trip for free and can do what you do at no cost to the association. I don't get involved with requesting mileage reimbursement, I just chalk it up to part of the job.
MelissaP1
(Alabama)

Posts:4899


04/01/2007 7:47 AM  
Some costs are reimbursable and some not so much. They are expected parts of your job/responsibility. I would NOT charge for cell phone use, gas, mileage, or labor. That's just what you have to do. Example: Going to a mortgage company for a closing and getting a call on your cell phone to not forget to bring something.
However, for office supplies or maintenance items, reimbursement is okay with board approval. Example: If you need to purchase a lightbulb or smoke detectors for the property, that is okay. Approved maintenance items are resonable reimbursements.
My rule of thumb is that if it takes approval from the board to purchase, then it's reimbursable. If I have to ask for an item to be reimbursed, not so much.
Your HOA's insurance may cover your vehicle above your own coverage. Say if your in an accident going to the courthouse on HOA business and have an accident. Your personal car insurance would pay 80% of the accident. The HOA's insurance may pick up the other 20%. Check over the liability insurance about HOA vehicle coverage. Most likely your HOA doesn't have a "vehicle" but that doesn't mean that you don't need that coverage. It just applies to officer's business use of their own personal vehicles for business.
Unless your cell phone is specifically purchased by the HOA for exclusive use of ONLY HOA business, your cell phone use is your own responsibility. If the Cell phone is used for the entire community to use as an official contact number for any board member to access, I would argue that expense could be reimbursed. However, ONLY if it's NOT personally used. Once it is, it may not be tax deductible.
Remember, the HOA is ONLY funded by the owners for the owners. So each reimbursement check you get, comes from EVERYONE's money. (Including your own) So would you be happy to know that your president was getting reimbursed for cell phone use or mileage? I wouldn't be.

Former HOA President
WilliamT
(Arizona)

Posts:489


04/01/2007 8:38 AM  
I only ask to be reimbursed for items that I purchase to be used for repair of items, paint, etc.

I drive a lot of miles and do not ask for reimbursement. Another board member and I who are on the maintenance committee talk on our cell phones quite often and do not ask for reimbursement.

We will also do a lot of manual labor to save the HOA money, and we cannot be paid for that labor. We do it because we know that we can get it done faster and cheaper,and in some cases better than paying to have it done.

We consider it part of the job.



PaulM
(Pennsylvania)

Posts:1347


04/01/2007 3:08 PM  
RobertC3:
As a matter of info, none of our Board Presidents have ever requested resident calls/concerns be made directly to them. Always, the Prop. Mgr. receives calls, relays the problem/concern to the Board and then it is dealt with at a Board meeting.
Lately, they are encouraging all concerns be in writing so a record is kept with the solution/reply to the sender.
From your post, it sounds strange that you are having to deal with City Hall and meeting with city officials.

What kinds of issues require you to do 'business' in this way?
Do you have a Prop. Mgr. to assist with these kinds of issues?


JonD1
(New York)

Posts:1663


04/01/2007 4:01 PM  
I have served on the Board of my property for over 20 years, I have held the positions of Secretary, Treasurer, and now President.

During the course of what I consider doing my job and in some cases over and above my job I have numerous out of pocket expenses all of which I ask reimbursement for.

Recently we needed to replace the cover for our pool the retail cost was $2100 I was able to find and purchase the same cover for $1300 the Board gratefully reimbursed this charge knowing the money that was saved.

I purchase pool supplies below the cost of the pool maintenance company.
Maintenance supplies from the source that saves us the most money. I purchase lawn supplies to reduce costs.

One point I would like to make as a Board member and in this case President I am the contact person for the management company also. I do in fact use my cell phone to make and recieve calls from suppliers, contractors, maintenance people, the property attorney, management company, insurance agent, and a host of other people who need to contact someone for an answer that is needed.I have no problem asking for the costs associated with the charges incurred by the property's business. As a Board member your effort is as a volunteer but under no circumstances should your efforts above those of other Board members and unit owners cost you out of pocket. Most reasonable Boards would appreciate your efforts on their behalf and gladly cover your out of pocket expenses the truth that is the least they should do. Even the phone bill.
JM2
(Oregon)

Posts:439


04/02/2007 9:27 AM  
Hi Robert:

As a former "portfolio" manager for a MC, I haven't seen a lot of requests for reimbursement. That doesn't mean that it would not be proper. You are already donating time & effort (and probably taking on some stress) by being on the Board and being President. Asking for a lot of extra donations (monetary or in-kind) would be unreasonable on the part of the owners.

If you want to be reimbursed, it would make the most sense to get receipts for everything possible, keep a detailed mileage record, etc. and then submit a request once per month. You could include copies you print out for things related to HOA business (charge your cost as best as you can estimate or what it would cost at a local copy shop).

If you are taking a lot of calls on your cell phone, you might consider either bumping up your rate plan with the Board's approval to reimburse the difference (bulk cost for minutes is usually cheaper than running over) or consider asking the Board to provide a cell phone for HOA business, and make sure that you use it only for HOA business (chances are that bumping the rate plan would be a lot cheaper for the HOA).

If people cry Foul! then ask if they would like to provide a cell phone and a car with gasolline & insurance for the HOA business you do... chances are they would not be willing to "donate" the time, mileage, etc. themselves.

J. Patrick Moore, CMCA
BradP
(Kansas)

Posts:2640


04/02/2007 10:25 AM  
I don't think it is unreasonable to ask for cell phone or mileage reimbursement. I do think on some things that are in a gray area that you should discuss with the board before incurring costs and give them an opportunity to find alternative ways. Maybe there is someone willing to do some running at no cost. I can talk 24 hours a day on mine and it doesn't cost me anymore and I don't mind running a couple places once in a while, but that is my preference.
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Forums > Homeowner Association > HOA Discussions > Out-of-Pocket Expenses for Officers



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