The CIDA Score is a time sensitive rating that can and will change over time. Changes in the CIDA Score can occur quickly, as in the case of an HOA that did not provide a current reserve study when its CIDA Score was originally calculated, but has since completed a reserve study. In such a case, the CIDA Score for the Association may improve significantly depending on the outcome of the new reserve funding analysis. This can mean a transition from a relatively weak score to an above average score in less than one year.
The CIDA Score is designed to reflect the fiscal and administrative competence of the HOA being rated. The scoring matrix that is used to calculate the CIDA Score is designed in such a way that an average level of managerial oversight should result in a score of 60 or higher.
A CIDA Score above 60 is an achievable goal for any reasonably well managed association, while a CIDA Score above 70 is consistent with an association whose governance and financial management practices are above average. Association’s that earn a CIDA Score of 80 or higher are among the top 3% of all HOAs that have been examined by CIDA since the beginning of 2012.
A CIDA Score that is below average is often indicative of an organization that would benefit from changes in its fiscal policies and/or governance practices. Low scoring HOAs are often involved in litigation or they are self-managed communities that receive little guidance or advice from professionals.
A CIDA Score above 70 means the HOA is doing things right. While there may be issues that keep these Associations from earning an even higher score, they tend to be solvable problems, whereas Associations that receive a CIDA Score below 50 tend to have systemic flaws in their governance model which can make it difficult to achieve a higher score in the absence of significant changes in the governance and administration of the Association. After six years, a CIDA Score of 70 or higher is among the top 15% of the 350+ HOAs that CIDA has examined in five states.
The primary purpose of the CIDA Score is to allow buyers and HOA administrators to compare the score of one HOA to others that have been examined by CIDA. By comparing the score of one HOA to others that have been examined it makes it easier for a buyer to determine where the subject property stands relative to the broader market. The median CIDA Score is currently 56, which means that half of all HOAs CIDA has examined have earned a score of 56 or less. The current median score is slightly below the threshold of 60 which CIDA believes is an achievable score for an average HOA.
A CIDA Score below 40 is a sign of an HOA that struggles with basic governance and management issues. Low-scoring Associations are often smaller, self-managed communities that are unable or unwilling to spend the money to hire professional managers or advisers. HOAs that receive a CIDA Score below 40 may lack in terms of financial reporting or statutory compliance. Many low scoring HOAs do not have a formal reserve study or the study is outdated and of little use to buyers. Associations that receive a CIDA Score below 40 may be involved in litigation or they may have significant amounts of outstanding debt, which are red flags for buyers.
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