August 10th SOA Special Board Meeting Recap

recap 1

Following is a summary of discussions and actions taken by the Board at the August 10th Special Board Meeting. Attendance was via Zoom videoconferencing only. Approximately nine homeowners signed in. The video/audio recording of the Zoom meeting is available on the SOA website (www.somersett.org) under the “SOA Board and Committees/The Board of Directors” page. The special meeting consisted of three agenda items. Comments follow:

Item 1.  –   Consider and review the management proposals and identify those that the Board wishes to interview.

To start this discussion, the SOA’s Management Consultant, Nancy Kerry, gave a summary report on the management proposals submitted by the following six companies, focusing primarily on cost data.

    • First Service Residential
    • Associa Sierra North
    • CAMCO Nevada Management
    • Eugene Burge Management Corporation
    • The Management Trust
    • Taylor Association Management

To support Ms. Kerry’s presentation, the following cost comparison table was put on the screen for viewing by Zoom conference attendees:

Management Proposals Financial Impact Comparison

Following Ms. Kerry’s presentation each Board Member was chartered with expressing comments that they may have on the individual proposals and to vote for two companies they would like to bring in for interviews. First Service Residential was essentially excluded because the current working relationship and contract is well known by the Board, and therefore, no interview required.  The Board members voted as follows. Note that Board members Capalongan and O’Donnell cast their two votes for the same company.

    • Jacob Williams –  CAMco and Taylor
    • Simon Baker  –  CAMco and Taylor
    • Bill O’Donnell  –  Taylor and Taylor
    • Mark Capalongan  –  Taylor and Taylor

Board Member Williams and Baker’s selection of CAMco was predicated on the desire to interview another large company.

The selection of Taylor by all Board Members was predictable. It has become abundantly clear that the Board wants to transition the SOA to a self-managed (internal) structure. Apparently, to address this eventuality, Taylor has proposed a hybrid structure which would support a transition to self-management. Hence the redundant votes for Taylor by Board Members O’Donnell and Capalongan, who, in doing so, appeared to have no interest in interviewing any of the other five. In commenting, Board member O’Donnell pontificated extensively on why the current professional management model is unworkable, proclaiming self-management as the only viable option for Somersett. It was also apparent that Board President Capalongan had previously evaluated Taylor and had already zeroed in on them as his choice. This raises the following questions: 1)  were any of the other companies interested in or requested to also submit a hybrid approach, and 2) was there really any objectivity present in the evaluation process? Whatever the case may be, Kudos to Nancy Kerry for her diligent work on this issue.

The Summary Report prepared by Ms. Kerry which addressed each of the six companies was contained in the Board Meeting Packet and is available via the following link:    “Review of Management Proposals

The individual proposal summaries for the “chosen” two, along with First Service Residential, are repeated below:

Item 2. —   Review Insurance Proposals

This was not a review of individual insurance proposals by the Board. Rather this agenda item consisted primarily of an agent who specializes in HOA insurance (Ron Wright – Menath Insurance) providing the Board with his take (during a 25 minute dialog) on what they should be considering when renewing the SOA’s insurance policies. He has apparently reviewed the SOA’s insurance policies and opined that we were underinsured in some areas. He also advised that, in his opinion, the SOAs insurance costs would be doubling in the future.  In response to the question if moving to self-management would result in an increase in the SOA’s insurance costs, he advised not necessarily. That added costs such as Workman’s Compensation and Employment Practices Liability were currently being paid for indirectly via FSR’s management fees.

If Mr. Wright submitted an actual cost proposal to the Board, it was not discussed.  It also appeared that, rightfully so given the effort he put into his review, Mr. Wright was soliciting his services.

 Item 3.  –  Approve Brightview’s proposal to extend their contract on a month-to-month basis after September 1st.

The Board approved the BrightView proposal for extending their contract, which expires on August 31st, on a month-to-month basis.  This to provide the Board time to obtain competitive quotes.

Homeowner Comments (SU apologizes for any mischaracterizations of homeowner comments and refers the reader to Zoom video/audio recording for actual statements)

The Board President of The Villages sub association had read into the record his endorsement of BrightView as the SOA landscape contractor. This in response to the Boards apparent dissatisfaction with BrightView’s performance and the decision to go out for competitive bid rather than renew their contract. He praised the quality of BrightView’s services as compared to previous landscape contractors and urged the Board to retain them. In response, the HOA Board President, advised they were not looking specifically to replace BrightView, but to consider other options.

 A Board member of the Vue sub-association stated their satisfaction with FirstService Residential as their community manager. However, liked the idea of self-management but cautioned that we know exactly what we are getting into before we do it, as there is a cost to get in and a cost to get out. He also expressed a concern that while we may be doing the right thing for the current Board, are we doing the right thing for future Boards? This based on the observation that the current Board is well motivated and willing to spend a lot of time on Association management, but this has not been the case for past Boards and may not be the case for future Boards.  In response, the Board President basically advised that if the internal management structure was properly established, that future Boards would function in an oversight role as opposed to the day to day Association management.

5 thoughts on “August 10th SOA Special Board Meeting Recap

  1. Regarding the selection of management option and/or the decision of which management companies to interview SU queries ” was there really any objectivity present in the evaluation process?” A fairly exhaustive review was conducted on all options, much more than just bottom line costs. It all factors into making an informed decision.

    A quote from Neil DeGrasse Tyson: “A proper skeptic questions what they are unsure of, but recognizes when valid evidence is presented to change their mind.”

    A great part of this effort has been to collect valid evidence, to challenge what we think we know, and to arrive at the best decision in light of a comprehensive consideration of available information. If one’s mind is not changed after all the data has been been vetted, tested, and challenged then the decision remaining emerges from the process as the best decision.

    To answer your other question, none of the other companies except Taylor expressed any interest in guiding the SOA toward internal management or effecting a handover at some later date. That was a truly unique aspect to the Taylor proposal. This is something we can propose to Camco during their interview and we’ll see what ideas they might be willing to entertain.

    The interviews will complete all due diligence and the decision on who we contract as our management company will be made at the 8/25 Board meeting. Hope to see you then.

    1. Interesting that not only are they the cheapest but they are also the only company who offered to help with transition to internal management; achieving the desired goals of the 3 board members and the handpicked consultant?

  2. Thanks for the summary. The president of The Vue was actually the individual who spoke at the end praising FSR, not The Village. That said, during a previous board meeting when “the board” was complaining they did not have enough control over FSR, I pointed out that “the board”, as per the HOA documents, has ultimate responsibility for how the HOA is managed, not the management company. What that means is the contracts must be written and managed in such a manner that responsibility is not abdicated to ANY organization. It is the responsibility of “the board” to ensure contracts are written – whether for the HOA management company, maintenance company, etc. to serve the best interests of all homeowners in the community and it is the board’s responsibility to ensure the contracts/activities of the contractor are carried out accordingly. Granted, the current board did not get us where we are with our contracts today but they certainly have the “power” to change the agreements to best meet our collective needs. Clearly that does not mean a contract is put in place and there is no follow-on oversight by the board. That said, I do not freely support independent management of the SOA (or my other association) as I have not seen evidence of a like-type self-managed association the size of Somersett. Without that evidence I truly fear our costs will quickly escalate and issues experienced will expand beyond anything we can imagine.

  3. SU Report

    I have not reviewed the tape/video of the meeting, yet! I would like to parse the homeowner comment at the end, indicating that future Boards may not be prepared to work as hard as the current Board for the homeowners. This to me implies that past Boards have not been as hardworking… I believe that they have worked hard for all.

    Perhaps in the past, the Board (since being homeowner controlled) has ignored community sentiment, and has made decisions that have been costly… think of the James Settlement, the cost of the rockery wall legal escapade, suing the Country Club… Perhaps this has been driven by either pro or anti-Country Club sentiments. We are a “golfing community” and we have to live with our intricately intertwined private club. Non-golfers have rights as well, not to pay for Private privileges!

    The current Board has recognized these facts by striking a balance to acknowledge reality. Now, in these times of economic prosperity, the private golf club is poised to prosper. The 2 golf courses and community centers are highly desirable to purchasers of the remaining houses being built. (And re-sales)! There have been rumors of the Country Club actually buying back their 200 acres, hopefully without the reverter rights, which should rightfully remain with the HOA.

    I believe, that a community of our size, with the right management personnel & structure, can be self-managed. The due diligence currently underway, only confirms this belief. Board’s are responsible for policy, oversight, implementing community future needs, not the day-to-day management.

  4. While listening to the board meeting it did become clear that Taylor was already the front runner for gaining an interview regards new management. The Board members’ attempts to be transparent and open with the SOA members is a smoke screen. The low bid they provided and the favorable terms seem to indicate a ‘grooming’ of what the Board wanted to hear from them. Low costs upfront generally lead to added fees down the road. Regards the insurance company representative who spoke, he mentioned there had been 5 or 6 filings already against the SOA, that would be considered by any new insurance company when quoting for coverage. It would be good to know what these claims constitute.

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