Following is a recap of topics discussed and/or approved at the April 14th Somersett Owners Association (SOA) Board of Directors (Board) Meeting, held via a Zoom Video Conference with Association members. The reader is referred to SU’s previous post of April 11th, 2021 “April 14th SOA BOD Meeting” for a copy of the Meeting Agenda and supporting information derived from the Board Meeting Packet, which is available on the SOA website (www.somersett.org) under the “SOA Board and Committees/The Board of Directors/2021 links. The following recap references the Board meeting agenda items.
2. Homeowner Comments on Agenda Items (paraphrased with apologies for any misstatements)
- Two owners submitted written comments on Agenda Item 7.c. “Discussion and Consideration of SOA Management Consultant” in which they expressed their concerns and questions not only on the hiring of a Consultant but on the self-management issue in general. Rather than paraphrasing their comments, their submittals may be read by accessing the following link: Homeowner Comments on Agenda Item 7.c.
- A homeowner affected by Item 6.b. “1880 Dove Mountain – Common Area Slope Repair” expressed concern over why the scope of the project has changed from a lot stabilization project to an erosion mitigation project which addresses only 10 feet of the 50 foot slope. The original successful bidder of the project, which was cancelled due to bidding issue raised by the Board, has apparently declined to rebid because of an opinion that the erosion mitigation solution is not sufficient to stabilize the slope. Owner requested and was granted a meeting with the Board to further discuss.
3. February 24th, 2021 BOD Meeting Minutes – The minutes of the February 24th Board meeting were approved with no amendments.
4. Committee Reports – No Committee reports were submitted
5. Financials – The reader is referred to the Board Meeting Packet for the 30+ pages of SOA financial data. The February 2021 financial statements were approve.
6. Unfinished Business
6.a Legal Updates – It was reported that the SOA has been named as a co-defendant in a new lawsuit by Preston Homes. This over a rockery wall constructed by Ryder Homes has affected their development. No explanation or apparent reason as to why the SOA was also included in the lawsuit. It was also confirmed that oral arguments on the appealed Somersett Development Company Rockery Wall lawsuit will be held on May 4th.
6.b. 1880 Dove Mountain, Common Area Slope Repair – Board member O’Donnell advised that the Board has reached out to Parsons Walls for an integrity assessment and rebuilding of the Rockery Wall on the affected slope. Also with Geotech to determine if the slope is actually moving. Board member Hanson questioned if Parsons Walls was affiliated with Parsons Brothers Rockeries, a defendant in the SOA Rockery Wall lawsuit. No definitive answer was provided.
6.c. Snack Bar Update – Board member Williams provided a progress report wherein he advised that the lease agreement with the Peavine Taphouse, the City of Reno permits and plumbing contracts have not yet been finalized but are moving along with no anticipated problems. Read off the posed menu items, which were extensive. Speculated that the project would come in under budget.
7. New Business
7.a. Irrigation Head Replacement Proposal – The Board approved a BrightView proposal in the amount of $67,000 to provide and replace 1675 existing spray heads along the Somersett Parkway between Roundabouts 5 and 6. Approval based on water conservation benefits.
7.b. Snow Removal, Additional Locations and Pricing – The Board approved adding snow removal responsibility on Association maintained sidewalks to BrightView’s existing snow removal contract. BrightView has estimated the additional cost at $10,000 to $15,000 for each event.
7.c. Discussion and Consideration of SOA Management Consultant
The Board approved the hiring of Somersett owner Nancy Kerry at $6,000/month to provide consulting services on Association management options (i.e., Professionally or Self-managed). Motion was passed on a 4:1 vote with Board member Hanson voting NO.
The Board President started off the discussion by introducing Ms. Kerry and having her present her proposal, experience and qualifications (an unusual event as SU cannot ever recall a proposed SOA vendor doing so), as well as his reading of a letter of recommendation from a previous employer. Board member O’Donnell, after what he defined as mis-information, asked Ms. Kerry to address the term “conflict of interest” as it pertained to her. After a lengthy response in defining what a conflict of interest was, she did not believe one existed. Board member Baker further addressed the conflict of interest issue by stating that if the Board elected to adopt the self-management option there may be an expectation that Ms Kerry would apply to be the paid General Manager of the Association. She responded by stating she was not currently licensed to do so, but if licensed in the future she would most likely apply for the job, but on a competitive basis.
Board member Hanson’s dissent was based, among others, on the following issues: 1) an open ended unwritten contract with no defined deliverables or schedule, 2) an objection to the “sole source” approach with no consideration of interviewing other more qualified candidates, and 3) her lack of experience in the HOA management arena. He described the process as un-professional and un-ethical.
In response to Mr. Hanson’s objections Board members Capalongan, O’Donnell and Baker strongly defended the sole source approach citing “the best person to do the job” (O’Donnell) and timing constraints (Capalongan and Baker) associated with the expiration of FirstService Residential’s management contract.
8. Board Member Comments – None offered
9. Homeowner Comments (paraphrased with apologies for any misstatements)
The following comments all related to Agenda item 7.c.
- An agreement with Board member Hanson that other consultants should have been considered, that there may be others in the Community that might also be very well qualified. Also disagreed on the timeliness issue and disregarded the notion that we must act promptly or be locked into FSR for another three years. That negotiations to extend FSR’s contract be considered while the self-management issue is investigated, or if we have issues with the current contract to negotiate changes. In response the Board President advised that if the FSR contract is not re-signed, it will automatically renew on a month to month basis. To which the owner responded then why the rush to self-management.
- A comment on why the need to hire a consultant and an expressed opinion that all the Board’s dialog was nothing more than smoke and mirrors to support their predetermined decision to transition to self-management, regardless of what Ms. Kerry comes up with. That if her report does recommend self-management, for self-interest considerations, she be precluded for applying for the General Management position. In response Board members Capalongan and O’Donnel disputed the premise they were rushing into things, that there was a lot of work to be done, and advised they were applying the proper due diligence in investigating the transition to self-management.
- The Board was elected based on their competency and backgrounds and therefore, we have to have confidence in what is being proposed and that they are going down the right pathway. Supported their discovery process in assessing the Association management issue, stated the Board is making an excellent first step, and criticized the previous Board in not doing so by just rubber stamping the FSR renewal contract without any discovery.
- A former Board member, with consulting experience, also questioned the process employed in hiring Ms. Kerry and supported some of Board member Hanson’s objections. He disagreed with Board member O’Donnell’s characterization that it would be embarrassing to hire a Consultant (Ms. Kerry) then fire after a short time. That in reality, the life of a Consultant is always one of uncertainty as to the length of time of engagement, and that the customer establishes the set of needs and requirements the Consultant works to. Felt that the Board was giving short shrift to the scope of work and finding the right participants to help us get to the right decision. In a response to a question by Board member O’Donnell as to whether the previous Board had looked at self-management or the FSR contract, the reply was that the Board at that time was looking into re-negotiating the FSR contract to include some performance based initiatives aimed at improving FSR’s customer service. This was not carried to completion due to concentrating on overriding financial issues.
- A concern over FSR’s performance and willingness to extend their current contract given they are under the gun from the current Board regarding performance and the perceived opinion the Board has already made up their mind to transition to self-management, this despite their assurances to the otherwise. Also, questioned, after such a short time on the Board, how they have come to this conclusion. Opted for more time to listen to homeowners.
- An expressed opinion that the Board has already made up their mind to transition to self-management but are presenting it as if they have not. What is the point? Also, a comment that this issue has only reached a fraction of the community.
A question on where the $1M to pay down the Association debt came from. Response by Board Treasurer Baker was that $500K was in the budget for this purpose and the Association saved $800K in operational costs due to the COVID lockdown.
SU Note: There was a lot of dialog between individual Board members and owners with regard to the transition to self-management and the process the Board has and will be pursuing. Needless to say there was a lot of questions, controversies and Board responses, a good portion of which is not captured in the preceding meeting notes. Therefore, the reader is encouraged to access the audio recording (video tape not available) on the Somersett website under the SOA Board and Committees/Board of Directors tabs. For some reason, the video recording of the April 13th Town Hall meeting on Association Management and the PowerPoint presentation used by the Board. is not yet available on the SOA website. Given the common knowledge that these meetings only attract a very small percentage of owners (lapproximaely100 combined these two cases), and the significance of this initiative, it is confusing as to why an owner survey was not conducted as was done for the Snack Bar and Special Event initiatives.