SOA Board Treasurer Resignation

As the result of an action taken by the SOA Board at the October 14th meeting, Simon Baker resigned his position as the SOA’s Treasurer (however, not as a Board Member). Following, published with the permission of Mr. Baker, is a copy of his resignation letter:

“Dear fellow members of the SOA Board,

When I ran for a seat on the SOA Board of Directors last year, I had no agenda.  My desire, having recently retired as the Corporate Treasurer of Fox Entertainment Group, was to use my 20 years of experience in running large corporate treasuries to try to benefit the Somersett community.  I was duly elected to the Board and then elected by the Board to be Treasurer.

Last week, I presented the proposed budget for 2021 to the homeowner community.  As you know, that budget called for a modest $2 increase in the assessment for the General Common cost center.  At last night’s Board meeting, the Board voted to overturn the recommendation of its Treasurer and the recommendation of the Finance Committee and to keep the General Common assessment flat.  If you recall, the General Common assessment was raised by $13 in 2019.  The reason for this is because prior Boards had failed to set adequate assessment rates in an environment of rising costs and the SOA was consequently running dangerously short of cash.  Now that the SOA is on a better financial footing, the Board has voted to continue the mistakes of the past and risk having to have further large catch up increases or special assessments in the future.  Many areas of Somersett are now 15 years old and maintenance costs are only going to increase.  In addition, the SOA still has $5.5m in debt and hence my recommendation was to take some initial positive steps to start attacking this level of debt.  It is deeply disappointing to me that the Board ignored this recommendation.  This came on the same day that I was also troubled by the Board’s blanket approval of bonuses for First Residential staff and the Board’s apparent indifference to my request for greater transparency in the cost structure of First Residential, a vendor that accounts for a substantial portion of the SOA’s total annual expenditure. 

As a consequence of the above, it has become clear to me that the Board does not value my experience.  It is the ultimate vote of no confidence when a Board overturns the budget recommendation of its Treasurer. Therefore, effective immediately, I am resigning from my position as Treasurer and my participation on the Finance Committee. I will continue to serve on the Board and will await the outcome of the upcoming Board election, where three of the five Board seats are up for election.  Should the future Board determine that they would value my contribution as Treasurer, I will reconsider my position at that time.

Sincerely,

Simon”

6 thoughts on “SOA Board Treasurer Resignation

  1. Scott’s stepping down as Treasurer is an outstanding example of professional ethics – good for you Scott. What is wrong with this HOA Board ? “Bonuses” to First Residential ? That is unbelievable. That is our money and out of line to be giving bonuses when we are in a crisis and MILLIONS of people have lost their jobs. Every other organization is cutting back, holding firm on raises if any at all, laying off people, reorganizing. This is NO time for bonuses whatsoever. And a $2 increase is nothing … we are always better off increasing costs a little at a time, Scott is right about that. Good for you.

  2. I fully support Simon in his decision to step down, $2 is a nothing increase but it yields over $72K annually to pay down debt. No budget proposal is acceptable if it doesn’t sufficiently address debt and debt service. We, the residents of Somersett are the shareholders and we hold our shares without dividends as corporate shareholders would receive. When Simon ran for the board we voted for him as we both came from management roles in large, multi-national organizations and understand how the real world works. We knew Simon was of the same mindset. As an association of homeowners we should not be carrying debt greater than $1M at any time. The fact that previous boards racked up debt to the tune of $5.5M is obscene.

    1. Vincent – the Somersett Debt…

      We owed then declarant $2 million for the Canyon 9 – (loan 2006)
      We owed the declarant $4 million for the TCTC – (loan 2006)
      Fortunately Sierra Canyon was blessed with a “free” Aspen Lodge Clubhouse from Pulte – sometimes good to have your own sub-PUD!.

      We Borrowed $2.5 million to “buy” the land under the championship golf course
      We forgave the Declarant ~ $1 million in what he owed to the General & Common Reserves at the time of turnover (as a part of the Golf course land purchase)
      We Borrowed $3.5 Million to fix the walls (~$670K for fixing up the Championship Golf Course).

      So our borrowings literally on behalf of the private Golf Course are just over $4 million … is this too much?

      Please tell me…

      Time to contact the builders active in Somersett for monies to either shore up the private golf course, or reduce our debt! They benefit by being able to charge an extra 15% or so for their new houses based on the resident supported (Bailed out?) private Country Club.

      1. There have been far too many sweetheart deals in the development of Somersett, some might call it graft or corruption. The point is the SOA is stuck with a variety of bad deals (contractually) and it need to be cleaned up. I am fully aware of the ridiculous sums outlined above and will will never litigate our way out of these deals. People don’t realize that the last couple years we have budgeted $750K for legal fees.
        As I said in my post, debt must be addressed along with the cost of that debt in any budget, this is a concept that Congress doesn’t see to understand.
        Anyone who believes that a $2 increase to monthly dues is going to break them had better get out of the line at Starbucks.

  3. Unacceptable the BOD does not approve the budget. In the budget preparation there are at least 3 open Finance committee meetings and the Directors can attend any meeting they wish. If they had proper diligence in performance of their Board duties they would have attended all of those meetings in advance and voiced their displeasure with the proposal by the committee. The budget is the #1 priority of the BOD to allocate our resources properly. Waste of time and a slap to those volunteers who worked for months to put together a financial plan for the upcoming year.

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