The Economics of Virtual Meetings The passage of AB 648 could mean major money and time savings for boards, along with other benefits. By Rob Buffington
The passing of AB 648 in California represents a pivotal moment in how homeowners’ associations (HOAs) conduct board meetings. This legislation paves the way for the utilization of teleconferencing platforms such as Zoom, offering a more convenient and flexible approach to HOA governance. While the shift toward virtual meetings has gained momentum in recent years, the declaration of a state of emergency during the COVID-19 pandemic raised concerns about the legality and practicality of exclusively virtual gatherings. As California transitions into a post-COVID era, HOAs across the state stand at a crossroads, with some eagerly embracing this change. In contrast, others remain steadfast in their commitment to traditional in-person meetings. The passage of AB 648 signifies a significant milestone in the evolution of California’s HOAs. It acknowledges the evolving landscape of community management and governance and recognizes that technology can be pivotal in modernizing HOA operations. Nevertheless, the response to this change within the HOA community has been mixed. Forwardthinking boards are excited about the opportunities that virtual meetings offer. They see this as a way to enhance community involvement, streamline processes, and ultimately improve the efficiency of board meetings. On the other hand, some HOAs, often constrained by existing management contracts, argue that the physical presence of the manager is indispensable during meetings.
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Vision Winter 2023 | cacm.org
As HOAs begin preparations for the annual financial review, evaluating the economic benefits of virtual meetings is crucial. Among the most tangible advantages of virtual meetings is the substantial savings in time and money. For many HOAs in California, particularly those in major metropolitan areas like Los Angeles and the Bay Area, the issue of traffic congestion makes commuting to in-person meetings a time-consuming and costly endeavor. Consider conservatively estimating that a manager spends one hour on average commuting for each in-person meeting. This encompasses the time spent driving to the meeting location, arriving early to allow for a buffer, addressing post-meeting matters, and the return journey. Now, let’s consider data from CACM’s most recent Compensation Report. The median annual salary for a portfolio manager was $70,000 per year, with onsite general managers earning more. When you factor in benefits and payroll taxes, the hourly cost of a manager’s time is around $50 per hour. If an HOA holds bimonthly meetings and a manager is responsible for 10 properties in their portfolio, the drive time alone costs HOA managers approximately $3,000 annually. It is important to note that these estimates are intentionally conservative. Some managers may face even longer commutes due to traffic congestion. However, the economic benefits of virtual meetings extend beyond time and cost savings. The following section covers several key advantages of virtual meetings vs. in-person meetings.
