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Open meetings required for changes to contracts

Q: The board of directors have recently solicited and received bids for grounds maintenance. The board would like to put our current maintenance company on notice that we will be selecting from the bidders to perform these services in the future and the company selected will begin on April 1. This may or may not be the current vendor. Our management company tells us that we can only make this decision to put the current vendor on notice at an open meeting. If this is true, can you cite the NRS section that is applicable?

A: NRS 116.31085 subsection 2 states that the board of directors may not meet in executive session to enter, renew, modify or terminate or take any other action regarding a contract. This part of the law was modified in 2009 as a board may no longer meet in executive session to discuss a contract with an attorney.

From a practical viewpoint, homeowners often do not honor the confidentiality of the board of directors when the board is discussing the possible termination of an existing contract with a service company of the association. This causes problems for the association especially if the service company tenders their resignation prior to the board finding a replacement.

The new bidding process that was passed in 2009 will add to this problem as it makes the process more difficult with more potential delays.

Barbara Holland, CPM, and Supervisory CAM, is president of H&L Realty and Management Co. To ask her a question, e-mail support@hlrealty.com. To view a power point presentation of the new laws that were recently passed affecting HOAs, visit hlrealty.com, click on press release button on the left side, then click on article title, “The 2009 Legislation for common interest communities.”

 

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