Monthly Archives: November 2014

Attorney Quashes Rights of Association Members

Does anyone else find it curious that at the RVS Annual meeting on Tuesday, November 18, 2014, when an Association member in good standing made a motion (which received a second) to revise the Agenda (prepared by the Board and the Association Manager) to allow for a longer time period for Association members to ask questions of the candidates running for office, that the Association’s Attorney, Lynn Krupnik, (not a member of the Board, not the facilitator of the Association meeting) stood up and declared that the motion was “out of order”?

When challenged by an Association member that the motion was, in fact, in order since the meeting was being held by the Association and therefore, members have a right to make motions and have them discussed by the whole,  Ms. Krupnik responded again that the motion was “out of order.

When asked to explain in what way this motion was “out of order,” Ms. Krupnik’s only response was that it was “out of order.” No citing of parliamentary procedure rules, no explanation at all. Just that the motion was “out of order.”

Unfortunately, many of the Association members present chose to allow Ms. Krupnik, the Board President, and three of the other Directors to ignore the motion, and continued the meeting with the challenged Agenda.

The Agenda item providing time for Q&A from the audience to Justin Scott, HOAMCO CEO, did not occur, since his presentation went far beyond the time set aside. Ms. Krupnik’s presentation also went beyond the time set aside but a Q&A session followed. Please note, that the candidates’ introduction time of one minute each with no time allocated for Q&A was timed with a stop watch. The other presentations: Warren Thompson from Ranchland Utilities with time for Q&A; Cliff Baldwin from the Finance Committee –  the 2015 Budget with time for Q&A; and reports from the other committees with time for Q&A. But none of these presentations were timed. (with or without a stop watch)

Incidentally, the Agenda item listed for providing time for Q&A from Association resident/owners was cancelled because of insufficient time available, even though there were many voiced appeals calling for that part of the meeting to occur. The former Board President explained that the meeting had run over the time set aside for the meeting, and declared that the room had to be cleared by 9 p.m. Yet the meeting was adjourned at approximately 8:35. Hmm. I guess the President believed it would take all of 25 minutes to clear the room. It is interesting to note as well that the President, being so concerned with following the time frames set aside, neglected to use a stop watch to time the other Agenda items. Hmm, imagine that.

The end result: Another instance of where Carol Thompson, and certain Directors, in collusion with the Association’s attorney and our management company, quash members’ input, silence attempts to inform the Association of critical concerns held by many members, and abridge members’ rights to free speech and responsible representation from their elected officers.

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The Election Fix — Who Cast the Most Proxy Votes in the Board Election?

Someone who isn’t an owner or a resident of Rancho Viejo South. The Community Manager.

How to Fix an Election

It’s really simple. You allow the person who is supposed to be acting in a neutral capacity — collecting the proxies, reviewing the proxies for accuracy, and making sure there are enough proxies for a quorum — to vote the proxies. That’s what happened on Tuesday night. In all previous elections, designated proxies could only be RVS homeowners in good standing.

When an objection was made at the meeting about the community manager being allowed to vote proxies, Association Attorney Lynn Krupnik stated that anyone could be designated as a proxy; the person did not have to be an owner.  Anyone off the street could walk in and attend our meeting and vote on behalf of an owner. That’s interesting because the ballot form requires an address or lot number of an owner. What address did Vince Montoya write in?

What’s wrong with letting non-owners vote? Plenty. RVS owners who are in arrears in paying their assessments are not allowed to vote. Individuals who have no ownership interest do not pay assessments. Let’s say an owner in good standing designates as his proxy (perhaps unknowingly) an owner who is in arrears on his assessment. According to attorney Krupnik’s opinion, since anyone can be a proxy, that person who cannot vote for his own unit, can vote as a proxy for someone else. The attorney’s opinion severs the relationship between ownership/payment of assessments and voting rights. That’s a very bad precedent.

Last year the Board decided to hire neutral ballot counters because they did not believe residents could be trusted to honestly count ballots. Proxy ballots are mailed to HOAMCO; the address is the office of the Community Manager. As the recipient of the proxies, the management company is supposed to act in an unbiased and neutral manner. The Bylaws (Section 2.8) actually require that proxies be mailed to the Association Secretary, who is an owner. Again, this is a blatant disregard for the Bylaws. As a neutral third-party, the community manager’s responsibility is to open the proxies, ensure there are an adequate number to attain a quorum, and ensure that the owners who submit proxies are in good standing.

There is no way the person who is performing these administrative tasks as an employee of HOAMCO should be voting. Mr. Montoya, via his inappropriate e-mail blasts, had made clear his preferences for the Board. Allowing him to cast ballots makes a mockery of the supposed neutral and fair voting process. Mr. Montoya has been rewarded for his unethical behavior with a $9,000 raise starting in January.

The proxies that were submitted without a designated person to vote the proxy were supposed to be used for quorum purposes only. A few of us were watching how the proxies were being handled at the registration desk. There was a pile set aside and we asked the ballot counters if these were the “quorum only” proxies. They said yes.  During the committee report part of the meeting Mr. Montoya brought several proxies/ballots to Jim Kerr, the Secretary, who wrote on them. This was in full view of all attendees.

Then Mr. Montoya went outside to where the ballot counters were. I was outside and saw him with a stack of about 15 stapled yellow proxies and blue ballots, signing the ballots as quickly as he could and handing them to the ballot counters next to him. (See the picture in ELECTION FRAUD.) Could he have put his name in as the designated proxy on the “quorum only” proxies and then submitted a ballot? Could Mr. Kerr have written his name in as the designated proxy on the “quorum only” proxies?  Did the quorum only pile make its way into the counted ballot pile?

Last year it was suspected that something similar occurred and a resident asked to see the paper proxies and ballots, and was refused by former President Thompson and Community Manager Montoya (see Oct 8th comment). I presume the same thing will happen this year.

The Board attorney and HOAMCO, who should be neutral and adhere to professional standards and ethics, willingly participate in this charade. The current Board can serve for life if we let this continue.

Watch this video to see what can happen when a few people have absolute control. The Board in the video approves expenditures after the fact. We already have that. The Board uses intimidation tactics. We have that, too.

http://www.local10.com/news/community-president-buys-car-pays-self-salary-with-neighborhood-money/27853208

In January 2015 our Board will be voting to possibly change Board meetings to quarterly. That would mean that minutes and financials would not be posted for three months. That’s even less transparency than we have now.

Is this the future you want for Ranch Viejo South?

Was the 2014 Election Fraudulent?

This is Vince Montoya, Campaign/Community Manager, next to election “officials”, voting and signing ballots during the election on Nov. 18:

During counting, Vince handled proxies multiple times, and then began voting and writing on them.  Eventually all proxies were counted toward candidates – the “quorum only” stack disappeared.  Election procedures were very different and confusing this year ….

Click on ELECTION FRAUD for more details

 

 

Take a CLOSER LOOK at the Audit

Residents received another message from the Campaign/Community Manager that everything about the 2013 financial audit is “very good news”.  Too bad it’s not true.  Let’s take a closer look.  An “unqualified” audit means that no problems were found in terms of financial practices following GAAP.  That’s good.

The auditor also stated on page 1 that: “An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.  The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.  In making those risk assessments, the auditor considers internal control relevant to the Association’s preparation and fair presentation of  the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Association’s internal controlAccordingly, we express no such opinion . . . . We do not express an opinion or provide any assurance on the information [in the reserve study] because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.”    That’s NOT good.

So what does all this accounting legalese mean?  It means the Auditor couldn’t publish an opinion about whether the Association is being effectively managed by the Board of Directors or not – or whether or not the reserves are properly funded Look at the date on the reserve study: June 2010!  And guess what else?  It was never approved by the previous board, because they had questions about the accuracy of infrastructure estimates and thought they were too low.  We don’t have a current reserve study and the engineering study by Ranchland Utilities won’t be finished until December.  If we have to complete major road repairs in 2015 all at once, it could wipe out our $1M+ reserve in one fell swoop.  (Even if the study were accurate, how can the campaign/community manager say reserves are adequately funded when the numbers add up to $8M plus?)

The audit also lumps a lot of categories together, so even though total expenses might look OK, you can’t see individual line item overruns, and there are several, especially in legal expenditures (over $30,000 in less than 3 years).  Previously, the Auditor presented their report to the whole board so they could review it, ask questions, and take corrective action – that didn’t happen this year and a flawed audit was sent to residents.

The HOAMCO CEO made a fine speech about how dissension in our neighborhood will reduce property values.  News flash, Justin – not taking care of roads, trails, and irrigation systems is what actually reduces property values!  Maybe the new directors will succeed where the previous “malcontents” did not, and convince the ostriches and president to pull their heads out of the … sand.  We need the new reserve study completed, so we know how to properly fund future infrastructure and irrigation maintenance.  We need the board to focus on community solutions instead of spending money on legal opinions and trying to force directors to resign when they ask inconvenient questions!  GO TO BOARD MEETINGS AND ASK QUESTIONS ABOUT SPENDING!  IT’S YOUR MONEY!

REMINDER: ANNUAL MEETING – TUESDAY NIGHT, NOV. 18TH

Many people think the meeting is tonight, Monday. It is Tuesday night, Nov. 18th — registration starts at 5:30 p.m. The meeting starts at 6:30 p.m.

Remember, if you are not going to the meeting and are submitting a proxy, your vote will not count unless you designate someone to vote on your behalf. That person’s name should be written in on page one of the proxy form under “Designated Proxy.” As it is too late to mail in the form, find someone who is going to the meeting and give them your form.

If you want to go to the meeting and need a ride, let us know via a comment here.

 

 

 

Mr. Montoya Channels Mr. Rogers

Yes, let’s all sing along;  “It’s a beautiful day in the neighborhood.” I hope all of you are enjoying the missives from the HOA manager with the subliminal message that all is well in our community and the blissful situation can be attributed to the good deeds of the Board, especially the president. For those of you who have walked our cracked, disintegrating trails lately, please be aware that you are seeing an optical illusion. The asphalt is actually smooth. Just hum, “It’s a beautiful day in the neighborhood,” and all will be well.

The latest communication is about the audit, which Mr. Montoya says merits another gold star for the Board. When I requested a copy of it, he did not respond. And  I know that at least two Board members have not seen the audit. So I wonder how the HOA manager, who is not an accountant, knows so much about it when it has not been reviewed by the Board.

It is the Board that has a fiduciary responsibility to residents, not the HOA manager. It is the Board that should be communicating with us. While we receive lots of budgets, residents have still not been provided the actual year-to-date expenditures for 2014. And while others may be satisfied with Mr. Montoya’s assurance, I want to see a copy of the audit from an objective, qualified third-party firm. My assessment paid for it and I deserve to see the results.  Don’t tell me everything is wonderful. Show me the proof.

 

 

 

Budget misuse by President

It seems the board president is confused about how our budget works.  She believes that all budget line items must be spent by the year end.  This is not how the RVS budget works.  She also believes that she does not need approval from the other board members to spend association money.  Not having an audit in 3 years is irresponsible and she is not doing her fiduciary duty.  I believe she has misappropriated funds and if we continue down this path our reserves will not be adequate to cover future repairs.  Remember, our association does not have city or county services to help cover repairs to our community.  The association pays for everything, to sign replacement to pot hole repairs.  Yes, we have over a million dollars in reserves, but if and when we have to do major road repairs or irrigation repairs, this amount will decrease substantially.  For those of us who plan on living here a long time, we need to be concerned about the future because the current board president is not.