Operation of Associations

Annual Report: reports filed with state agencies as mandated by statute. Incorporated Associations file (fee and form signed by an officer or director) with the State Corporation Commission by the last day of the month incorporated and file (fee and form signed by director, officer or managing agent) with the CICB. If registration with the CICB or the SCC is not current a disclosure packet may be deemed unavailable.

Association Complaint: a written complaint filed by a member of the association or citizen pursuant to an association complaint procedure. An association complaint shall concern a matter regarding the action, inaction, or decision by the governing board, managing agent, or association inconsistent with applicable laws and regulations.

Association Complaint Procedure: the written process adopted by an association to receive and consider association complaints from members and citizens. The complaint procedure shall include contact information for the Office of the Common Interest Community Ombudsman in accordance with § 55-530 of the Code of Virginia. An appeal process, if applicable, shall be set out in an association complaint procedure adopted by the association, including relevant timeframes for filing the request for appeal. If no appeal process is available the association complaint procedure shall indicate that no appeal process is available and that the rendered decision is final.

CICB Registration: completion of a form, as prescribed by the CICB, and payment of an applicable fee based on the number of units/lots within the association and a percentage of an association’s collected mandatory assessments. This generates a certificate with a registration number and expiration date to be included in an association’s resale certificate or disclosure packet.  

Board of Directors: the executive body of a property owners’ association, or a committee which is exercising the power of the executive body by resolution or bylaw. 

Capital Components: those items, whether or not a part of the common area/common element/limited-common element, for which the association has the obligation for repair, replacement or restoration and for which the board of directors/executive organ determines funding is necessary. 

COI: Certificate of Insurance that documents an insured’s coverage as of the date requested.

Common Area: property within a development which is owned, leased or required by the declaration to be maintained or operated by a property owners’ association for the use of its members and designated as common area in the declaration. 

Common Expenses: all expenditures lawfully made or incurred by or on behalf of the association, together with all funds lawfully assessed for the creation and/or maintenance of reserves pursuant to the provisions of the Association’s Governing Documents.

Contract: an agreement for services and compensation between named parties.  Terms of service(s), compensation, liability, and termination should be clear and understandable.

EIN: Employer Identification Number issued by the IRS. This is needed to open an account with a financial institution and is included on annual report submitted to CICB.

Electronic Transmission: any form of communication, not directly involving the physical transmission of paper that creates a record that may be retained, retrieved, and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a recipient through an automated process. 

Fidelity Bond: a blanket fidelity bond or employee dishonesty insurance policy insuring the unit/property owners’ association against losses resulting from theft or dishonesty committed by the officers, directors, or persons employed by the unit/property owners’ association, or committed by any common interest community manager or employees of the common interest community manager. Such bond or insurance policy shall provide coverage in an amount equal to the lesser of $1 million or the amount of reserve balances of the unit/property owners’ association, plus one-fourth of the aggregate annual assessment of such unit/property owners’ association. The minimum coverage amount shall be $10,000. The executive organ/board of directors or common interest community manager may obtain such bond or insurance on behalf of the unit/property owners’ association.

Future Common Expenses: common expenses for which assessments are not yet due and payable. 

Governing Board: the governing board of an association, including the executive organ of a condominium unit owners’ association, the executive board of a cooperative proprietary lessees’ association, and the board of directors of a property owners’ association. 

Governing Documents: collectively, the applicable organizational documents including but not limited to the current and effective (i) articles of incorporation, declaration, and bylaws of a property owners association, (ii) condominium instruments of a condominium, and (iii) declaration and bylaws of a real estate cooperative, all as may be amended from time to time.  Association governing documents also include, to the extent in existence, resolutions, rules and regulations, or other guidelines governing association member conduct and association governance.

Institutional Lender: one or more commercial or savings banks, savings and loan associations, trust companies, credit unions, industrial loan associations, insurance companies, pension funds, or business trusts including but not limited to real estate investment trusts, any other lender regularly engaged in financing the purchase, construction, or improvement of real estate, or any assignee of loans made by such a lender, or any combination of any of the foregoing entities. 

Lot:  (i) any plot or parcel of land designated for separate ownership or occupancy shown on a recorded subdivision plat for a development or the boundaries of which are described in the declaration or in a recorded instrument referred to or expressly contemplated by the declaration, other than a common area, and (ii) a unit in a condominium association or a unit in a real estate cooperative.

Management Services:  (i) acting with the authority of an association in its business, legal, financial, or other transactions with association members and nonmembers; (ii) executing the resolutions and decisions of an association or, with the authority of the association, enforcing the rights of the association secured by statute, contract, covenant, rule, or bylaw; (iii) collecting, disbursing, or otherwise exercising dominion or control over money or other property belonging to an association; (iv) preparing budgets, financial statements, or other financial reports for an association; (v) arranging, conducting, or coordinating meetings of an association or the governing body of an association; (vi) negotiating contracts or otherwise coordinating or arranging for services or the purchase of property and goods for or on behalf of an association; or (vii) offering or soliciting to perform any of the aforesaid acts or services on behalf of an association.

Meeting: the formal gathering of the executive organ/board of directors/committees established pursuant to the Association’s Governing Documents where the business of the association is discussed or transacted. 

Minutes: the official record of actions taken by a Governing Body at a meeting.  Approved minutes from the past six (6) months from Board or Member meetings are to be included in resale certificates/disclosure packets issued. 

Officer: any member of the executive organ/board of directors/committee or official of the unit/property owners’ association.

Registered Agent: is a resident of the Commonwealth and either an officer or director of the corporation or a member of the Virginia State Bar, and whose business office is identical with the registered office or one or more natural persons at the office of the registered agent upon whom any process, notice or demand may be served and shall continuously maintain at least one such person at that office. Whenever any such person accepts service, a photographic copy of such instrument shall be attached to the return. The sole duty of the registered agent is to forward to the corporation at its last known address any process, notice or demand that is served on the registered agent. 

Record of Complaint: all documents, correspondence, and other materials related to a decision made pursuant to an association complaint procedure regarding an Adverse Decision.

SCC: State Corporation Commission.  A quasi-state agency where Articles of Incorporation are filed and annual reports are submitted to maintain an entity’s corporate status.

Stormwater Management: anything associated with the planning, maintenance, and regulation of facilities which collect, store, or convey storm water.