In today’s technologically-proficient world, there’s one primary reason why a community association would want to use online voting to elect directors: convenience. Allowing owners to cast a ballot from the comfort of any location increases the likelihood of participation and removes the stress and planning associated with conducting “on-the-spot” elections at an annual meeting.
With a myriad of technology companies available to provide online voting services, and owners and managers more than ready to implement them, why wait?
Obviously, the most attractive answer is don’t wait. But before you press ahead with plans to conduct next year’s elections via the internet, be sure to check state statutes and your association bylaws and rules.
Step 1: Identify the statutes that govern your association meetings.
Several different statutory schemes may be applicable to your association. Asking your legal counsel is a good place to start, or you can check your articles of incorporation to determine the legal status of your association, and then search for the state statutes that are applicable to that type of group. For example, if your association is incorporated as a nonprofit, you would search for the nonprofit corporation code for your state, plus any additional statutes that are specific to community associations, such as a homeowners association act or condominium association act. Many state legislatures have drafted statutes specific to their state; others have adopted a uniform code published by the National Conference of Commissioners on Uniform State Laws.
Step 2: Determine whether your association can make any variations to the applicable statutes.
Before delving into detailed statutory requirements for your meetings, elections, and voting, you first should understand what variations are permitted. What I mean is that you should find out whether you can add language to your bylaws or adopt other rules that allow you to implement online voting even if the applicable statutes don’t allow it.
Figuring out whether variations are permissible can sometimes be tricky. My suggestion is first to look in the table of contents for any section that discusses variations. Sometimes a statute will address this question early on in a holistic fashion. Or you might find individual sections that discuss which of their parts may be contravened or modified in an organization’s governing documents. Either way, having a clear understanding of the extent to which bylaws and rules can add to or change the requirements of a statute will give context to the details regarding how meetings and elections are conducted.
Step 3: Find out whether the applicable statutes allow your association to take actions outside of a meeting.
Once you’ve identified the statutes that apply to your association and whether you can make any variations to them through your bylaws or other rules, you should determine whether they allow actions to be taken outside of a meeting. The first place to look for this information is in the “Meetings” section. Some state statutes actually include a section titled, “Action Without a Meeting.” If the meetings section is silent on whether actions can be taken without a meeting, check the “Voting” section. It may include provisions that describe how to take a vote without a meeting, thus implying that doing so is permissible.
As you identify and review the statutory provisions that apply to actions taken outside of a meeting, you need to keep several important points in mind:
- Make sure you’ve found the statutory sections that apply to membership meetings, not board of directors’ meetings. Often statutory guidelines are quite different for these two types of groups.
- If the statute prohibits action taken outside of a meeting, your association cannot utilize online voting unless the statute allows variations through association bylaws or rules. Note that the prohibition may be implicit if the statute is silent on the matter. Also note that if the statute allows action to be taken outside of a meeting only by unanimous or high threshold vote, or the vote of every person entitled to vote, online voting is effectively prohibited for community associations, where achieving unanimity or the vote of every member is likely impossible.
- If the statute allows action to be taken outside of a meeting, make sure that it also allows online voting—as opposed to simply mail balloting—and that you follow any specific procedures precisely.
- Notably, associations cannot circumvent statutes that prohibit actions taken outside of a meeting by holding a meeting to allow in-person votes and combining those votes with votes cast online by members who did not attend the meeting. Robert’s Rules of Order Newly Revised (11th ed.) expressly disallows this approach, and for good reason:
“The votes of those present could be affected by debate, by amendments, and perhaps by the need for repeated balloting, while those absent could be unable to adjust their votes to reflect those factors. Consequently, the absentee ballots would in most cases be on a somewhat different question than that on which those present were voting, leading to confusion, unfairness, and inaccuracy in determining the result.”
Step 4: Develop an implementation plan that is well-timed and organized for success.
If online voting is an option for your association, make sure you have a comprehensive plan for implementation before you jump in. There’s nothing worse than generating negativity about a new, good idea simply because it’s poorly executed.
If you can’t implement online voting efficiently and effectively this year, you’re better off waiting until next year. Of course, as always, good implementation requires a reasonable, well-articulated timeline, and a solid vendor—one that can ensure the confidentiality of ballots, control access to the voting interface, and provide checks and balances to prevent fraud.
In sum, online voting is certainly the wave of the future for community associations. Before you ride that wave, though, make sure your state permits it, and that you follow any statutory requirements precisely.
Republished with permission. This article was originally published in On the Board in the November/December issue.