How to Pick the Right HOA Vendor

If one thing is consistent throughout HOA community associations, it’s choosing a vendor to perform maintenance on their property. Those responsible are tasked with making sound decisions on behalf of the community – which can be daunting!

 

There are two key items to determine first:

  1. Will you hire a full-time employee/staff to maintain the HOA property? Or:
  2. Will you hire a vendor/independent contractor to complete the work?

 

Some advantages of hiring a full-time employee are that the employee is managed directly by the HOA. By doing so, small or simple projects are easy to complete and no yearly contracts with the employee outlining services. On the other end, hiring your own employee could poses some difficult tasks. Complete background/referral checks, withhold any taxes, the employee can get sick or go on vacation.. This option could have more cons than pros in many situations for you.

 

If you choose a vendor, you would only need to file and provide a 1099 form, which would require less legal reporting. Independent contractors are less of a liability to the association due to the requirement to be licensed and insured, meaning damages or injuries do not fall on the association.

 

If you choose an independent contractor, here are some tips to ensure that the association is protected:

  1. Make sure you require any work be put into writing prior to taking place. This ranges from the basics (work being performed, duration, cost) to renewal costs (i.e. 3% increase per year). This prevents discrepancies between your association and the contractor.
  2. Ensure your board of directors are being transparent through the process. Associations should require at least three bids which gives you insight as to what kind of value you’re getting.
  3. With your three bids, select the bid that gives you the greatest value! The lowest bid will not always provide the “best bang for your buck” and the highest bid does not always ensure “high-quality work.”
  4. Require your vendors provide proof of being licensed and bonded to ensure they are properly qualified. Additional certifications are also great proof that vendors are keeping up with training and learning the most up-to-date, and safest, methods to complete work.

 

With this in mind, take care to research your future maintenance employee or independent contractor. Spending the time from the beginning to ensure you’re covering all bases will save you time, and headaches, in the future.

 

Did you know: The Rahn Companies is a proud supporter and member of the Community Associations Institute of Pennsylvania & Delaware Valley. Click here to learn more about the organization & let us know if you’re interested in attending an upcoming event with us!