Each year the SMVE board of directors oversees the purchase of goods and services amounting to more than $250,000. In addition, from time to time, there is spending on significant repairs and replacements from the reserve fund. The board has a fiduciary duty to spend these funds responsibly for the benefit of the homeowners in our HOA. This includes careful and responsible selection of vendors.
Within the annual operating budget, approximately 25% of the expense money goes to monopoly companies or government organizations such as Tucson Water and Southwest Gas. But the balance of the money spent on services and materials needed to maintain our community in good repair goes to vendors selected by the board or committee chairs. To insure responsible decisions and careful management of how our money is directed, the board of directors has an established procedure for purchasing and contracts that spells out the criteria for selection of vendors, as well as what approvals are needed for various expenditures. For example, in the case of ongoing services such as landscaping or pool maintenance, the procedure requires that competitive bids be solicited at least every five years and also specifies what contract value thresholds require board approval.
The same is true of major capital expenditures such as road repaving. Also contained in this procedure are criteria for vendor selection, including the need for insurance, any applicable county or state licenses, vendor history with the HOA and more. This guideline can be viewed in its entirety here.
The board takes very seriously its responsibility to spend HOA money wisely. We encourage you to become familiar with the procedures and guidelines we follow.