 This is Think Tech Hawaii. Community matters here. And welcome to another rousing episode of the Condo Insider, everything condo, condo ownership, condo management, we talk about it all. I'm your host Scott Shirley today and I'm very pleased to announce that we do have a special guest with us. And doing my research for this particular program I realized we haven't really touched on base in our condo discussions on one of the very most important things at a condo association and that's the community manager. So today's episode is going to be on the role of the community manager and I am pleased to announce that we have somebody I've known for a number of years even before we started working together, Steve Farago is our guest today. And would you like to tell everybody what your title is and what you do? Well I am a community association manager at Associate Hawaii here in Honolulu. I also am a director of management services meaning there's a team of seven different individuals who work under me that are community managers. And of course as I said we've known each other for a number of years but it was just recently that we realized we've been doing this for about the same amount of time. Since Captain Cook came. Yeah I believe that's what it was and back then we had this strange thing called paper and pencil that we actually worked with. I just want to remember that. Yeah I do too. So one of the things that we're going to go over today with whatever time we have and that of course is the role of a community manager. What they do, what their responsibility is. So first question to you is does every community association need a community manager? Well first of all they have to know what their governing document states. There are some by-laws that require that they must have a professional community or managing agent and if so they indeed must do that. There are a few independent condominium associations for example who don't require such an agent but it's rare. In general it's a good idea for many reasons. Well and like you said some don't and I've discovered over the years most of those are very small complexes and they just do what is called self management. And what they might do on top of that is hire an accountant to do the fiscal side of it all. But one issue that's come up and Richard and I have actually discussed it before in our discussions under 514B is there is a bit of confusion on the term managing agent. Would you like to explain what our statute says in regards to that? Sure. 514B number three states that the managing agent is a person retained as an independent contractor for the purpose of managing the operation of the property. That's the short version of the answer in the statute. So one of the issues that comes up and it's people misunderstand that term managing agent and over the years of teaching courses on condos and things I've talked about this frequently in that the term managing agent in the statute is actually referring to the management company not an individual person. But there's a confusion there because they say managing agent. But it really means the company. And so in the company there's actually people who work under that as the you can call them account executives. I prefer the term community managers that just sounds nicer. It does. It's sort of like when I was in radio I wasn't a DJ. I was an on air talent. You still are. But you had mentioned as well that that's an important understanding under the bylaws as well is that it'll dictate whether or not you have to hire a managing agent to manage the property. Indeed. Besides dictating that the bylaws also spell out what duties the managing agent can have. The board of directors can delegate the responsibility of running the property which is ultimately theirs. The board's responsible to run the association because they're elected to do so. They can hire agents one of which is a managing agent who has a real estate license as a broker and can therefore serve in that function and hire community managers to assist based on what the bylaws allow them to assist with. And of course clarify it right off the bat. The community manager is not the resident or site manager. That's another one or another category of person who's working at the property. So you're hired to do a condominium association. What do you do? Well first of all again you have to look back at all the responsibilities that the board of directors has in terms of managing the property. Some of those are maintenance related obviously. So the managing agent can assist with that. Suppose you need a vendor to help fix the fans on the roof. The agent might get proposals from valid licensed vendors to do that. Prepare those proposals. Give them to the board to assist the board in their selection. There could also be the resident manager that you mentioned. That the board has a manager who just resigned. The community manager might put an ad in the paper or Craigslist or whatever. Assist in the interviewing and give the board some names that they can choose from. The responsibility of the community manager are almost infinite but the board in conjunction again with the bylaws determines what the agent does. And that aside one of the other big jobs that you do is attend the board meeting. And generally speaking our role as a community manager at a board meeting is not running the meeting. That is the board's duty. What else do you do at the board meeting? Well first of all Scott I'd say that what you do at the meeting begins with your preparation for the meeting. You better be prepared right? So every board there's a board packet it's called that goes out and in that packet there's a notice to have a valid board regular meeting. The notice must be posted so you must send that out to the resident manager say to post on the bulletin board into the board member so they have notice of the meeting. Then there's an agenda. There's the minutes of the last meeting. There's the financials for the last month that are going to be reviewed. There's your own report if you have one a written report might be the resident manager's report a report from the attorney on collections correspondence from owners delinquency collection all the various things that the board needs to discuss. A packet has to be prepared and then when you come to the meeting you're prepared to assist them with each of those items. And you know one of the other duties going back to this issue of posting the notice one of the things we have to do is keep up with what the legislature has done. And Richard and I actually discussed it on a recent show that now the requirement on that meeting notice is you must indicate what is going to be discussed at that meeting because you know part of the testimony on that particular bill was well if I knew the building was going to be painted pink I would have shown up and so now they're requiring you to put what's going to be discussed at the meeting so owners can determine themselves whether or not they want to be there to discuss that particular item. I did actually have a board owner in the training session say but if we put what's on there people will show up. Well I think that's the idea. Imagine that. Well one of your other roles let's say at the board meeting is also to remind the board of legal issues like what the legislature just did and we have to do things differently now or what the statute says. Correct. You can elucidate on that if you want to. That's that's a very important point for example a lot of boards in the past might have been reticent to give out documents to owners feeling that an owner might be using that for some nefarious purpose or whatnot or maybe they're just afraid of them or want to maintain control which is understandable but owners have rights too. That's right. So the legislature changed those requirements of what kind of documents must be made available. So that's an example of something you have to bring to the board's attention. It's a change in their thought or the famous assistance animal idea that you're so fond of. A lot of people feel again some resistance to that on occasion. They have to understand what the law requires of them in that regard. And myself I've attended a number of board meetings with our other community managers on that issue alone. I think I actually attended one with you. You did. You know I might want to bring that point up as well in that not only are you a community manager you are a condo owner yourself and you serve on the board of your own condominium association. Either you would think I knew better. Yeah exactly. Well I have to admit that I did a role of president on my condo association for two years. And again I knew better and that's why I created for board members the 12 step program to get out of that. So we'll talk later. All right. I'm sure I could use it. Now there has been a lot of concern coming up legislatively wise even discussion at the real estate commission in regards to are these people who do association management are they trained. Do they need to be licensed and that's been actually bubbling to the surface for the last few years. And I know the people you and I work with are actually very well trained. Can you explain where they can get some of this training. Well there's various sources of training. Certainly there are certain kinds of classes people take even in classical education such as accounting business management things like that that are of great use to people. At the same time specific type of training for our industry often comes from the professional organizations such as Community Association Institute Irem. Yes. The Institute of Real Estate Management eight CCA Hawaii Community White Council of Community Associations. All these organizations offer seminars classes that and publications or online publications that can be of assistance to the manager to become more educated in what we do. Yeah. And you know and a lot of these also have designations that go along with them. So it's not just going in for a day seminar and boom you've got the training some of them require you to go to multiple training sessions and once you've completed that and past exams you actually get a designation related to what you are doing. What are some of those. Well for example C.A.I. its first basic designation is for a Community Association specialist basically CMCA it's called and then there's AMS but the most famous one is PCAM or Professional Community Association Manager. It's quite an arduous type of undertaking where you take about 10 different courses and then you do a case study at a property that's quite detailed in terms of the analysis of all aspects of running an association and then if you pass luckily then you become a PCAM. And we do have a number in our office that have the PCAM designation and not only do they take that education but in order to continue to have that designation they have to continue education as well just like the realtors have continuing educations that they're mandated to do every two years. So it's not people just walking in off the street and say I want to do this for a living. Actually I'm not sure how many people actually wake up and say I want to do this for a living. Didn't you think that when you were a child. I was told what I was going to do for a living and that's why I do this I don't know anything else. You know another issue that comes up and I've been very aware of it and we will talk more about it in just a minute is the idea that community managers must be licensed like real estate agents and that has been an issue especially for the last two or three years that has been discussed at great length and we'll talk about that a little more when we come back from our short break. This is Think Tech Hawaii raising public awareness. Ted Rawson here folks you're a host on where the drone leads our weekly show at noon on Thursdays here on Think Tech and we talk about drones anything to do about drones drones remotely piloted aircraft unmanned air christmas whatever you want to call them emerging into Hawaii's economy educational framework and our public life. We talk about things associated with the use the misuse technology engineering legislation with the local experts as well as people from across the country please join us noon on Thursdays and catch the latest on what's taking place in the world of drones that might affect you. Welcome back to the condo insider everything about condos you ever wanted to know. And again our guest today is Steve Farragault who is a professional community manager and what before we went to break we were just discussing this issue of licensing. And so just as a little background that you're aware of but our audience may not be is a couple times there has been attempts to require a community manager to get a real estate license. The first attempt was going to require anybody who works at a management company have a broker's license which when you think about it the person who answers the phone and that's all they do now has to have a broker's license and things like that it didn't make sense plus you have to get one license first before you get a real estate broker's license you have to go through a period of time with a sales license first. Then we also have to realize the fact that what you and I do in community management is completely different than what happens with the typical real estate agent. So this issue has been coming up and you and I and Richard Emory have had this discussion and that is what would be a better way to handle the situation because we're getting the education. We're getting certification. Why not just register everybody. What do you think of that. Well I think that's a good idea. Certainly one of the great things about our industry is that a person can bring a variety of expertise to the industry so that they're not just this or that or the other. The idea though of being registered would be a way to keep track of all the people who are doing this particular job and their notification information and whatnot. I think it's a good idea. Well and as you briefly mentioned at the beginning of the show the requirements under statute for a management company is there must be a principal broker. But beyond that the people who are actually going out and sitting in board meetings helping with the minutes advising the boards do not have to be licensed. In our case most of our people are very well educated and have certifications as well. So this is a tough business to be in. And just to give you an example this morning I got contacted by one of our community managers that he thought that the owner was being unreasonable wanting to know right then and there on the phone call where is the water line and exactly how many feet is it from my sink. And why don't you know that. I don't know why he didn't know that. So in the mood I was in today I commented back that. Oh that's nothing. I had an owner call me up during hurricane a cell to complain that the gutters weren't working right. You know it was a hurricane I don't think they were designed to accommodate the water from a hurricane but that's just an example of what we deal with on a daily basis. What can you add in the regards of tough business. Well it reminds me of my very first experience my first day on the job. My boss sent me out to my new property and I'm walking around with great pride and inspecting and this gentleman comes out and he says please can you help me. And I said how can I assist you. He said my toilet's clogged. OK. Can you come and fix it. I said no no that's not what I do. I tried to explain to him. Well what do I pay you these fees for. You should come in and fix my toilet. So I went back to my boss and he explained. These are the kind of questions you'll get but no we don't clean toilet. I mean it feels that way sometimes but no that's not part of what we do and the other big misconception I think is we just work an eight hour day. Yeah. I don't think there is such a thing as an eight hour day in this business. No it's one of the things about the business for sure. Most community managers put in a full eight hour day in the office maybe going out to properties during the day as well. And as often as not they have meetings at night. I have a meeting tonight myself for example. So you drive to all parts of the island or a neighbor island even perhaps and you go to a board meeting some of which are several hours long as you know that's why you prefer that five hour energy drink. So you might be there for many many hours and then the next day you still got many other things to attend to. Well you and I come from a period of time where if we had to do something we picked up the phone and called that person. Well that doesn't work that way anymore. And so a lot of things we're dealing with on a day to day basis is just an overload of emails. And I don't know what you can say to that but I know some of our community managers say oh I average between a hundred and seventy and three hundred emails a day. That's about right. Yeah. Yeah so you know I do pine for the good old days of just a telephone maybe a pager you sort of did have a life afterwards. And you even remember when you got a letter in the mail imagine that. Oh yeah really open the letter and you would read it. You had a day or two to write a response and get it in the mail and that's predominantly how you communicate. Well I still get comments because I came from a generation where you actually sat down and wrote a thank you note. Not a thank you email but a note. And I had somebody call me goes I've never gotten one of these before. A handwritten note. So our industry is changing and part of that is there's a lot of common misconceptions as to what we do. As you pointed out you don't go and unclog toilets. Generally. What other kind of misconceptions do you think. We get saddled with. Well I think lots of people think that the community association manager again dictates to the board or depending on their acts to grind ought to dictate to the board. Exactly how things are to be done. But they don't understand that we're just an agent we're just an advisor. You can lead a horse to water but you can make him drink as the old saying goes. So the conception that the things that the board does we're responsible for and we should have made them do something else is not the case. Well it's how many times of you and I and other people have dealt with that. You raised my maintenance. Right. Well no we don't. Well your manager was mean to me. I don't have a manager. But this idea that were responsible for raising that maintenance. You know it's based on the budget that the board approved. And that's what raises or lowers. I thought although I've never seen a lower to maintenance. I heard it once. Once. Yeah I think maybe once. And suddenly we're to blame. We're the ones getting the nasty phone calls or the nasty emails. Like when you write the violation letter about their dog barking or some hugely annoying thing that's going on in the property. It's all your fault that you wrote this to them. Well my favorite in regards to violations is the response. Sometimes we get back. So we send them a notice about their dog barking or not picking up after your animal. And usually it comes back with why am I getting this when the other people aren't. Well the key there is is how do you know the other people. You know we do their mail. I told one owner we don't put a poster board up in the lobby that says these are the people who got violation notices this week. So just because you got one don't assume nobody else didn't get one too for whatever their violation was. Right. So we do this. There are misconceptions about what we do but there's also a misunderstanding about the different types of services that we may do as well. True. There we already talked about that there are a few self managed properties. But even then a board of directors has a menu basically of choices in terms of how they engage a managing agent. Right. Fiscal you mentioned earlier is basically you collect money and pay the bill. Keep the books. That's about it with fiscal management. There's various levels of what we call full management as well. Some management companies including the one we work for associate why actually are able to assist further by providing a staff like for maintenance and resident manager things like that. So whatever services a management company provides that's what determines the level of the contract. And as you know I just recently finished up a three week program on training of resident and site managers at the office. And it made me realize maybe our job isn't that bad when you consider what happens with the resident manager who's on property in some cases 24 seven. So yes we can drown our sorrows with each other but then we have to think of the poor resident manager as well. So before we end up our program today one of the things is asking you what you think a good community manager should be. Well it's pretty amazing that a good community manager needs a large variety of skills. And part of that I would be I think not doing justice to the community manager role if I didn't talk briefly about the great advantages of such a job. I mean that you get to meet so many different kinds of people in society. You get to meet very many types of vendors and people in politics and you have a range of people that you meet that you don't often have in a normal kind of job. So that's tremendous benefit. And so you have to like to meet people. You have to like people. So if you're the guy who doesn't like people at all this is not the kind of job for you because you're going to deal with a lot of people and you need to have a sense of good customer service patients good listening skills handle adversity and the anger that might come at you well and understand most people are not really personally attacking you. They're frustrated. Yeah. And if you can figure a way to assist them that's a good thing. You have to have common sense be down to earth kind of person and tolerate uncertainty. Because lots of times owners are asking you what's being decided what's happening. It's a process many times that takes weeks or months. And so you have to be able to tolerate that have to be good with deadlines and good verbal and written communication skills a positive view and strong personality assist as well. I think a good demeanor like yourself does real well in this business. Thank you. Well we didn't get to go over everything which is not untypical of this program. But I again would like to thank you for joining us today and like to thank everybody who joined us here today on the condo insider in the role of a community manager and be sure to tune in next Thursday for everything you never or ever wanted to know about condominium living here on the condo insider.