From the Summer 2020 Issue
The Impending Deadline for Transitional General Licensees
The RCM Advantage
There have been many articles, conference sessions and blogs about the current and future shortage of condominium managers. The impending deadline for Transitional General Licensees to complete the transition and obtain their General License has created a fear that many experienced managers will choose to walk away from the profession rather than complete the educational requirements. This possibility raises concerns that have a variety of possible solutions.
There is no doubt that the condominium industry will be stronger if we can prevent the loss of 100-200 experienced managers, but that should NOT be done by extending the deadline or making exceptions to the standardized requirements.
One solution – and I believe the most positive and important one – is for us, as an industry, to learn to use the Limited Licensees that are entering the profession.
When the licensing structure was announced, many looked at the Limited License as the regulatory equivalent of the property administrator. This view needs to change, and condominium boards (especially for smaller condominiums) can benefit from the value that those learning and gaining experience managing condominiums can deliver.
That value is tempered by the added expense that condominium management service providers will incur in order to supply the necessary oversight, training, and mentoring for Limited Licensees. Much has been made about the services that Limited Licensees cannot provide, including responsibility for responding to records requests, managing requisitions from unit owners, signing status certificates and authorizing purchase orders for over $500 from operating accounts. However, there are still many services that those gaining the necessary experience for their General Licence can provide such as:
- Preparation for board meetings
- Reporting to board members at regular board meetings
- Maintenance of corporate records
- Presentation of financial statements
- Preparation of variance reports
- Undertaking property inspections
- Enforcement of rules – including documenting violations and correspondence to owners
- Supervision of staff and contractors
There are challenges that we face in fully realizing the benefits of Limited Licensee. The $500 spending limit imposed on them is too restrictive in my view. This unnecessarily low threshold does not offer valuable protection to unit owners, given the industry standards that have evolved over time. Standard management contracts place a limit on non-emergency expenditures by management on behalf of a condo, with expenditures that exceed that limit requiring board authorization. The current $500 limit is not even enough to authorize the painting of a wall, a drywall repair, or the purchase of office supplies. I believe that giving a board the authority to set these limits provides greater flexibility for the condominium and allows the level of responsibility to be set by those who have worked on developing their skills and those of the manager.
While managers and condominium management service providers will benefit from the development of future managers, board members and owners must face the reality that a potential shortage in experienced General Licensees will affect the cost of those managers. This means that there is great potential value in Limited Licensees who are working hard to establish themselves in a new career path.
Note to Supervising Licensees: Working with Limited Licensees gives you an opportunity to mentor a new generation of managers. Give them responsibility, hold them accountable, teach them as they gain experience on the job and be open-minded if they have innovative approaches to problem-solving.
One of the advantages of the new license requirement is the ability to attract young talent to our profession. Those that choose condominium management as a career are the future managers, and while we all agree that practical experience should be part of the training for a full general license, we need to find a path that allows those gaining that experience to contribute to the industry.
Dean McCabe, RCM, ACCI, AIHM is president of The Meritus Group and vice-president of ACMO. He can be reached at firstname.lastname@example.org.