In our lives outside of the house corporation, we all face the challenge of getting consumed with the tyranny of the urgent things popping up that seemingly demand our immediate attention and distract us from focusing on bigger more important tasks.
Inside the world of house corporations, we are volunteers faced with busy lives and plenty of competing time interests. We have limited time to give to our roles serving in the house corporation, yet we face that same challenge as we have in other areas of our lives, the tyranny of the urgent: something breaks, there is a problem in the kitchen, we have a staffing issue, the chapter or university is complaining about something… All our available time is consumed responding to “problems” and we don’t get around to the strategic tasks that will ensure the long-term success of our housing operation. What specifically are the tasks that are integral to long-term success?
At a minimum, every house corporation should be focusing on these five areas:
1. Focus on Safety. We need to be relentless in our efforts to provide the safest environment for the brothers living in the house. Fire safety is one of the items at the top of the list, so making sure your alarm, extinguishers and sprinkler system are tested, and in good working order, is essential. There are many other safety concerns that you need to be focused on as well, including, but not limited to: zero-tolerance for roof access or fire escapes; installation of sprinkler covers; heat sensors in attics; water sensors to prevent water damage over breaks; safety lighting is in good working order; stairwells are cleaned of stored items; and more. We have suggested safety checklists available on the housing website for you to use.
2. Develop a Maintenance Plan. Having a proactive plan for ongoing care and maintenance of the house will not only improve the experience for the brothers living there but can also reduce your long-term costs for repairs and maintenance. This should be a 1-5 year plan that budgets and schedules regular and periodic maintenance items ranging from carpet cleaning, refinishing wood floors, painting, deep cleaning of bathrooms, deep cleaning of kitchen, furnace maintenance, wall repairs, etc.
3. Complete a Reserve Study. Using the Reserve Study Tool on the housing website is another way to help you determine your mid to long-term cash needs. Furnaces and roofs eventually must be replaced, as does furniture and other fixtures. A portion of the cost of replacement should be borne by every brother that lives in the house and factored into your rent cost. But if you don’t know what your costs will be, it is hard to justify adding that to your rent calculation.
4. Create a Plan to Increase Capital Reserves. This of course ties in with items 2 & 3. What we know from our recent surveys is that most of our house corporations do not have enough reserves on-hand. There isn’t a set dollar amount we can share for what is the right amount of reserves because the size/scope of house corporations vary greatly. A very simplified approach to determining how much money you should have on-hand could be to add together: 1, having funds available for a “major repair.” And 2, having funds available to cover six months of operating expenses. But the “real” answer for how much cash you should be accumulating will come from you completing the reserve study.
5. Implement Your Communication Plan. We have previously shared that having regular communications (6-8 communications) with members of your chapter throughout the year is not only part of your fiduciary responsibility as a house corporation, but is essential to future fundraising. As a high percentage of our house corporations will be looking to do renovations/remodeling projects in the near term, it is critical that you start improving your communications now!
Of course, being responsive to maintenance issues is important. However, if that is all you do, you will be letting your brothers down. Ignoring any of the five areas above for too long is going to place your house corporation at a severe disadvantage in the future. Hopefully, the tools that we have developed for each of these areas will make them easier for you implement. And please know that 1848 Housing is committed to supporting your efforts, so reach out to us if you need support.
Steve Bocher
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