5 Tips for Handling Special Assessments With Residents

Toy house on top of a stack of bills representing special assessments on top of a desk with a keyboard

HOA Special Assessments: How to Deliver the News to Residents

A special assessment is an unexpected charge for all residents of a community that isn’t part of the expected association dues. It comes in response to unforeseen and unbudgeted needs from circumstances such as weather-related damage, infrastructure repairs, and shortfalls in the budget from unpaid dues.  

As a property manager or leader of an HOA, you may find yourself having to make special assessments. Your governing document may make allowances for them, but often you will encounter pushback from residents. How can you ease the blow? Learn the best ways to handle special assessments when the time comes.  

Key Takeaways:

When dealing with special assessments, it is important to communicate clearly and effectively:

  • Be transparent
  • Give plenty of notice
  • Work with an expert
  • Offer flexible payment terms
  • Be patient

Why are special assessments necessary?

While homeowner’s associations often do a good job of managing costs, circumstances may arise that warrant a special assessment. The reasons a special assessment might be necessary include: 

  • Weather-related damages
  • Infrastructure improvements
  • Emergency repairs
  • Budget shortages as a result of unpaid dues
  • Capital improvement projects

Even with the above circumstances, HOAs should strive to keep special assessments to a minimum. Consult your governing document or an HOA attorney if you have questions or concerns about the legality of a special assessment. While most governing documents allow them, there are limitations. There may be certain procedures to follow when instating a special assessment, and sometimes an assessment is subject to a vote. 

Steps to take when addressing a special assessment with residents

As you develop a resident communication plan for addressing a special assessment, remember to communicate clearly with your residents. Here are five tips for informing residents about special assessments. 

1. Be transparent

Homeowners will want to know where their money is going. It is important for residents to understand why the extra expenses are necessary and if they are appropriate. The more information you can give, the better. Share charts, photos, or other data on the charges that have been compiled. Depending on the reason for the special assessment, it may even be appropriate to share a plan on how to prevent the issue from happening again (as in the case of an infrastructure upgrade or a repair). 

2. Give plenty of notice

Providing homeowners with as much notice of the forthcoming special assessment as possible will give everyone time to adapt to the coming changes. Residents will appreciate ample time to make any necessary adjustments or address any issues they might have. The bigger the expense, the more time you should allow for residents to process the information. If you’re unable to give residents as much notice as you would like – which may be the case with an emergency or weather-related repair – be sure to explain to residents why the issue must be addressed as quickly as possible. 

3. Work with an expert

It may be best to enlist the help of an expert rather than try to field all questions yourself. Consider working with an architect, electrician, or another specialist who can walk residents through the proposed changes or repairs and answer questions. The specialist may be able to answer questions in person at an HOA meeting or draft a written communication that can be disseminated to all residents. You will take some pressure off of yourself and may even give others the chance to understand the special assessment more thoroughly by working with a professional. 

4. Offer flexible payment terms

Residents will appreciate having adequate time to pay for a special assessment and, as a result, may be more compliant. Offering payment plans or other financing options to residents can go a long way in softening the blow of unexpected charges – especially if you were not able to give a lot of notice. You may still have problems collecting from certain tenants, however, even with flexible payment terms. If this is the case, there should probably steps you can take as an HOA manager. Consult your HOA’s governing document for further assistance. 

5. Be patient

Understand that residents need time to process information about a new charge and will likely have several questions. Making residents feel that their voices are heard and that their concerns are being taken seriously will help smooth things over. Residents will appreciate having their questions addressed in a timely and thorough manner, even if they arise several days after receiving the news. 

If you follow the above steps, you will be on your way to responsibly managing your special assessment in a manner that benefits you, as well as the residents. Special assessments may be unavoidable at times, but they do not have to be cause for serious conflict. 

The role of vendors in special assessments

HOA managers in the midst of a special assessment should make sure they’re working with trusted vendors. A vendor can make or break a project (and a budget). 

Our VendorSmart platform and complimentary services make managing vendor compliance and sourcing vendors for your projects a breeze. We tailor our solutions and services to match your management company’s needs. Contact us today to find out how we can help you with your property management and vendor needs.