September 22nd SOA Board Meeting

BOD Agenda 2

Following is the Agenda for the Somersett Owners Association (SOA) Board of Directors (BOD) Meeting to be held at The Club at Town Center (TCTC) at 5:30 PM on Wednesday, September 22nd in the Canyon View Room. Attendance may be either in person or via Zoom videoconference. Zoom log-in instructions are contained on the Meeting Agenda under “Join via Zoom”

September 22nd BOD Meeting Agenda

The Board Meeting Packet for the September 22nd Board meeting is available on the SOA website (www.somersett.org) under the SOA Documents/Board Documents/2021 page link. Some extractions from the Board Packet are included in the following Agenda Item comments.

Comments on Agenda Items follow:

3.  August 25th and September 8th, 2021 Meeting Minutes

The reader is referred to the Board Meeting Packet for the SOA draft meeting minutes, However, for a more complete recap of these meetings, the reader is directed to the following SU posts:

September 8th SOA Special Board Meeting Summary
August 25th SOA Board Meeting Recap

4.  Committee Reports

4.a.  Budget & Finance – No information contained in the Board packet. The Board Treasurer, Simon Baker, usually provides a verbal update.

4.b.  Communications – See the following link: Communications Committee Report

4.c.  Strategic and Facilities – See the following link:  Facilities Committee Report.  (Note: This is now just a Facilities Committee with a new Strategic Planning Committee having been formed, but not yet included as an Agenda item).

4.d.  West Park Garden – See the following link: Community Garden Committee Report

4.e.  Community Events – See the following link:  Events Committee Report  (Note: report contains an updated Calendar of Events)

4.d.  General Manager – The reader is referred to the Board Meeting Packet for this multi-page report providing information and updates on: 1) AGC activity, 2) Community enforcement data, 3) Owner communications, 4) TCTC events and club usage data, 5) Maintenance projects, and 6) BrightView landscape reports.

5.  Financials

The usual 30+ pages of Association financial data. The reader is referred to the Board Meeting Packet on the SOA website for details.

6.  Unfinished Business

6.a.  Legal Updates – The following quote from the September 10th SOA Attorney letter to the Board regarding the Rockery Wall lawsuit: “On August 25,2021, the Nevada Supreme Court’s Judgement and July 29, 2021 Opinion was filed in the lower court. On September 7, 2021 the Nevada Supreme Court filed its Remittitur returning the case to the lower court. To date the opposing parties have not filed a memorandum if costs”. Not sure what impact this filing has on the SOA, as it has been previously reported that, in light of the SOA loosing its appeal, no more legal funds would be spent and that the SOA was not responsible for reimbursement of any of the Defendant’s legal fees.

6.b.  1880 Dove Mountain – No supporting information contained in the Board Meeting Packet for this long lingering hillside stabilization project. Perhaps just an impromptu update discussion.

6.c.  SOA Management Consultant Update – Usually consists of the SOA Management Consultant, Nancy Kerry, providing a status report on the SOA management transition process. Will most likely include items from the following report:

Transition Coordinator Update, September 10, 2021

6.d.  Agreement with Village Management Software (VMS) – The Management Company ,Taylor Associates, contracted for by the SOA as part of the Transition process, utilizes VMS Accounting and Project Management software to carry out their business. Since these functions will eventually be ported over to the SOA, a separate agreement with VMS is required. For those interested, a copy of the proposed Agreement (at a cost of $1580/month) is available via the following link.

Village Management Software Agreement

7.  New Business

7.a.  Receive and Open Landscaping Bids and Proposals – It is anticipated that the Board will be opening bids from Brightview, Reno Green and Reliance Grounds Management.

7.b.  Review and Approval of 2020 Audit – For a reading of the SOA’s 2020 financial audit report (all 40 pages of it) by Hilburn and Lein CPA’s, the reader is referred to the Board Meeting Packet available on the SOA website. The report contained the following Opinion: “In our opinion, the financial statements referred to above present fairly, in all material aspects, the financial position of Somersett Owners Association as of December31, 2020, and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America.”

7.c.  Review and approval of Common Area Easement – This item apparently involves the SOA granting a permeant Easement of SOA common area property to the owners at 1772 Fairway Hills Trail. That is, a parcel of SOA land adjacent to the rear of their property. This “for the purpose of fencing in the Easement and installing landscaping, a patio, and other improvements in the Easement Area for the sole use of the Dominant Tenement”. Sounds like the owners at 1772 Fairway Hills Trail want to add 1,062 sq. ft. To their back yard. If this is the case why not sell it to them? A description (picture) of the property in question and a copy of the Grant Deed is available in the Board Meeting Packet on the SOA website.

7.d.  Approval of Common Area Turnover from Ryder Homes – Ryder Homes has apparently sufficiently completed their SBE development to warrant turnover of common areas to the SOA. Hopefully the SOA will do the proper inspections and review all documentation prior to acceptance. A description of the areas to be turned over are contained in the Board Meeting Packet available on the SOA website.

7.e.  Review and Approval of SOA Management Staffing and Transition Plan – An item of significant interest to all Somersett owners. The submitted Transition Plan identifies responsibilities, actions and schedules associated with the following focus areas: Project Management, Financial Systems, Information and Security Systems, Organization and Staffing and Community Engagement. Also, included are proposed salary schedules and a recommendation to hire Unique HR as the SOA’s HR and Payroll Services provider. This is the first mention of Unique HR as a SOA vendor and no cost data was included within the Board Meeting Packet. SU does not believe that any competitive proposals were obtained. See the following link for a copy of the SOA Transition and Salary Plan:

SOA Transition and Salary Plan

7.f.  Review and Approval of Consulting Agreement with Lorrie Olson – At the previous Board meeting a recommendation was made by the SOA Management Consultant, Nancy Kerry, to employ Ms. Olson to assist in the transition process, as there is much to be done in a short period of time. Ms. Olsen has extensive HOA management experience and has served as the Community Manager for the Caughlin Ranch HOA. Following is a copy of the proposed Agreement, compensation is capped at $1500/week and would be based on Board approved work completion.

Agreement for Consulting Services

7.g.  Proposal to Install Divider Netting between Courts – To prevent balls from intruding on adjacent courts, installation of a screened divider between the SOA’s two tennis courts has been recommenced by the Facilities Committee, with a budget not to exceed $3,000.

September 8th SOA Special Board Meeting Summary

recap 1

Following is a summary of items discussed at the September 8th Special Board Meeting (see: “September 8th SOA Special Board Meeting Agenda”).

Note: Given the early termination (October 31st, 2021) of FirstService Residential’s (FSR) management contract with the SOA, there is an urgency in completing the transition process to SOA self-management. Hence the Board will be holding these Special Meetings in addition to the regular monthly business meetings.

Item 3.a.  Update and Discussion Regarding Transition

The SOA Management Consultant Nancy Kerry provided a verbal update on the SOA management transition process, which addressed the following areas: Project Administration, Accounting, Organizational Structure (staffing) and Homeowner Engagement. Salient points made were as follows:

  • A tentative timeline for the transition has been developed (not yet published, SU will provide when available). A transition team consisting of Ms. Kerry, Board members, a Taylor Association Management Company (Taylor) representative and perhaps some unnamed homeowners, will be meeting every Tuesday to address the transition timeline and corresponding action items. Owners who feel they have some expertise in this area and would like to volunteer their services are encouraged to contact Ms. Kerry or a Board member.
  • Taylor is taking the lead on migrating the SOA’s accounting data from FSR over to the system used by Taylor. They have done this before with FSR and expect to have completed the migration by early October, with the actual switchover occurring on October 31st.
  • Organizational items underway include generation of a proposed SOA Organizational Chart, an employee budget and staffing considerations. With regard to staffing, those permanent FSR employees who may wish to stay on within the new organization have been assured a position, either in a similar or new capacity. Interviews with FSR employees have been completed with most wanting to stay on (this does not include the SOA Community Manager, Ryan Fields, who will remain with FSR). Offer letters are being prepared, but there is an issue with regard to the provision of employee benefits. Give the October 31st deadline, it may be difficult for the SOA to secure all that is required if they transfer in as direct SOA employees. An option here would be for them to become Taylor Management employees (who already have benefit plans in place) on an interim basis. Another option discussed involved the SOA hiring them directly while picking up their employee costs for extending their medical benefits via the Federal “Cobra” plan, which would only be through November and December of this year.
  • Ms. Kerry recommended to the Board that they bring onboard a Ms. Laurie Olsen to assist in the transition process, as there is much to be done in a short period of time. Ms. Olsen has extensive HOA management experience and has served as the Community Manager for the Caughlin Ranch HOA. No Board action was requested at this time regarding Ms. Olsen, as a formal proposal for such will be submitted at the next Board meeting.
  • Regarding Homeowner engagement, there will be series of communications on the transition process advising Homeowners what to expect and when. On the subject of assessment payments, the October payments will be made as usual through FSR, but the November payments will be via a different avenue.
  • A comment was made that all the FSR office equipment, including IT items, are owned by the SOA. Therefore, no budget allotment required in this regard. FSR proprietary or confidential programs or data would be removed from the IT equipment prior to turnover.
  • In response to Ms. Kerry’s update, Board member O’Donnell expressed a concern over Ms. Kerry and Ms. Olsen being able to handle the workload they would be facing, and that the Tuesday Transition Team meeting also address not only Ms. Olsen’s employment, but others (e.g., Administrative Assistant and Club Manager) as well. This in light that the SOA is also facing Board elections and Budget ratifications in the same time frame.

Item 3.b.  Ratification of Agreement with Taylor and Associates

The Board approved an Amendment to the Taylor Association Management agreement which simply added a couple paragraphs emphasizing the SOA intention, with Taylor help, to move toward self-management.

Item 3.c.  Agreement with Village Management Software (VMS)

Apparently the Board has made the decision to utilize the Village Management Software suite of products for managing the Association, which is the same software package used by Taylor Associates. However, the VMS agreement was not completed at the time of the meeting, so action was deferred.

Item 3.d.  Payroll Processing Discussion and Possible Agreement

Board member O’Donnell commented on the implementation of a SOA employee Payroll Processing System (wages, taxes, Workman’s Compensation, health care and other benefits), and what employee data would be required. Data that would most likely require a FSR release to obtain from those FSR employees transferring over. Apparently Board member O’Donnell has past experience (as a computer/software company owner) in this area and does not consider this a complex issue to address. In this regard, Mr. O’Donnell was tasked to head the effort for seeking out potential Payroll Processing Companies for the SOA. The overriding issue being timing.

Item 3.e.  Review and Approval of Lap Pool and Spa Resurfacing Proposal

This was a holdover item from the previous Board meeting due to the uncertainty as to whether resurfacing of the lap pool was really required by the Washoe County Health Department for the 2022 season. It was determined that this was not the case for the lap pool, only the two Spas. Therefore, it was decided to reissue a request for proposal to resurface the two Spas only.

Item 4.  Homeowner Comments

A Homeowner requested clarification on the following from Ms. Kerry’s presentation

  • Will all full time FSR employees who want to transfer over be offered a job? The answer was yes.
  • How was Village Management Software (VMS) selected and did we look at other companies? The answer was that VMS is the accounting software employed by Taylor and we will migrate it over to the SOA during the transition process, in addition to any other VMS required software modules. However, a separate agreement with VMS will be required, which is expected to be ready for the next Board Meeting. SU assumes other alternatives were not considered.
  • Will Ms. Olsen be employed as a consultant or SOA employee? The answer was that in the absence of a near term payroll processing system, Ms. Olsen would initially be hired as a consultant. However, given that her employment is expected to last for several months, perhaps as a SOA employee sometime in the future.
  • Will the SOA be issuing any formal request for volunteers to aid Ms. Kerry and others in the transition process? The answer being that no formal requests will be forthcoming, but would not turn down assistance from those with relevant experience who may wish to help out. Also, a comment from the Board that the FSR Community Manager, Ryan Fields, has and continues to be, a very helpful participant in addressing transition issues.

An owner expressed concern over the practice of mailing election ballots via the US Postal Service, and whether or not this resulted in a problem with timely delivery to those non-resident owners. Also, an opinion that emailed ballots would be more efficient and is a permitted process under Nevada Law. In response, the Board advised (via SOA Attorney opinion) that email balloting for Board elections was not permitted under Nevada Law.

SU Note: Following is the Nevada Statue that SU believes to be applicable regarding Board elections. Note that it does not define “mail” as being via USPS. Could it be interpreted that “mail” also includes electronic mail? Perhaps a deeper look is in order. However, another issue here is that whereas all physical addresses for owners are available, email addresses are probably not.

NRS116.31034.8.  If, at the closing of the prescribed period for nominations for membership on the executive board described in subsection 5, the number of candidates nominated for membership on the executive board is greater than the number of members to be elected to the executive board, then the association shall:
(a) Prepare and mail ballots to the units’ owners pursuant to this section; and
(b) Conduct an election for membership on the executive board pursuant to this section.

A Sierra Canyon owner commented on the Transfer Fees the Association collects on the resale of a home within Somersett. Wanting to know where the money goes and offering an opinion that the transfer fees being based on the value of the home, that with escalating home values, they appear to be excessive and can the Board do something about it? The ensuing discussion by Board members revealed the following:

  • For resales, the transfer fees are 0.1% of the selling price. (example, for the median home price of around $700K, the transfer fee would be $700.
  • The transfer fee monies go into two buckets, one to the Management Company (as a revenue generator) in accordance with their contract (not sure on the FSR contract, but a $400 amount was mentioned) and the other into the Common Area operating budget. A reading of the Taylor Agreement states a transfer collection fee of  $325.
  • Board member O’Donnell expressed the opinion that transfer fees should be cost neutral. That is, only assess what the actual cost is for updating the SOA owner databases with the new owner information, which he felt would only be a nominal amount. Board Member Capalongan made reference to the governing documents, which under Article III, Section 15 of the CC&R’s state:

Section 15. Transfer Fees.  Initially after a Unit which has reached its Assessment Threshold, when a transfer of ownership occurs, a transfer fee shall be charged to said initial transferee by the Association. The initial transfer fee for each Unit is presently FOUR HUNDRED AND NO/IO0THS DOLLARS ($400.00) and is subject to adjustment by the Board, After the initial transfer, all subsequent transfers of a Unit (e.g., resales) shall cause a transfer fee in an amount equal to one-tenth of one percent (.1%) of the sales price for such Unit, based on the gross sales price for such re-sale as disclosed in the Declaration of Value filed with the Washoe County Recorder in connection with such sale, to be charged to the transferee by the Association. The Board may set different transfer fees of uniform application to all Units, Those transfers exempted from transfer tax under Nevada Revised Statutes 375.090 shall also be exempt from all Association transfer fees; and bulk transfers of five (5) or more lots at one time to a single entity shall also be exempt from all transfer fees, The imposition of such transfer fees is intended for the purpose of providing a continual source of capital to the Association for the purpose of enhancing the Association’s financial capabilities in meeting its obligations in maintaining and improving Common Areas in a manner in keeping with the first-class nature of the Subdivision over time.

Given that Homeowner assessments will no longer be collected by FSR after October 31st, a owner questioned how assessments that had been paid in advance would be handled. Response was that this was not an issue, as FSR would apply the appropriate credits into the new (Taylor) accounting system.

Board Member Ad-hoc Comments

Board member O’Donnell wanted to, on behalf of the Board, thank all our volunteer Committee members for their hard work and that the Board would  be relying on them heavily during the transition process.  Also, reiterated that those owners who wanted to assist in the transition process and/or serve on the Transition Committee (i.e., subject to the requisite qualifications) submit their applications. This suggestion did not appear to get overwhelming support from the Board President. Perhaps a “Too many cooks spoil the broth” concern.

Note:  The above summaries paraphrase what SU derived from the Meeting. For complete and actual dialogs, the reader is referred to the following videoconference link:

https://drive.google.com/file/d/1kiNyNiiu4P1vHM3syRVLrmoIAQbeWp8r/view

September 8th SOA Special Board Meeting

Specialeeting

The Somersett Owners Association (SOA) has called for a Special Meeting of the Board of Directors (Board) to be held at 5:30 PM on Wednesday, September 8th in the Canyon View Room at The Club at Town Center (TCTC). The primary purpose being to discuss and take action on items associated with the transition from a professional to self-managed Association. That is, as formally approved at the August 25th Board meeting (see SU post of August 28th – August 25th SOA Board Meeting Recap). Meeting attendance may be either in person or via Zoom videoconference. Zoom log-in instructions are available on the Meeting Agenda following “Join Zoom Meeting”.

September 8th SOA Special Board Meeting Agenda

The Board Meeting Packet was not yet available on the SOA website at the time of this posting. However, SU fully expects that one will be published prior to the meeting. For this, the reader is referred to the SOA Documents/Board Documents/2021 page link on the SOA website (www.somersett.org).

Agenda Items and Comments follow:

1. Update and Discussion Regarding Transition – Since the SOA Management Consultant, Nancy Kerry, has been chartered with overall management of the transition process, SU anticipates that Ms. Kerry will be providing a status update on what has transpired since the August 25th Board Meeting.

2. Ratification of Agreement with Taylor Management – At the August 25th Board meeting, the Board voted to accept the Taylor Management proposal to contract with the Association on a “hybrid” basis while transitioning to a self-managed structure. It would appear that an Agreement has been reached.

3. Agreement with Village Management Software (VMS) – Given that the SOA is moving to self-management, a suite of HOA property management tools will require purchasing by the SOA. From this agenda item it appears that the Board has decided to go with Village Management Software (check them out at www.villagemenagement.com), which is also the software utilized by Taylor Management. Without access to VMS’s pricing data, SU is not sure whether or not Competitive quotes will be required.

4. Payroll Processing Discussion and Possible Agreement – Unknown what Payroll Service Companies the Board is considering (i.e., to accommodate SOA direct employees) and whether it will include HR services as well. Same comment as for Item 3 above regarding pricing and competitive quotes.

5. Review and Approval of Lap Pool and Spa Resurfacing Proposal – This is a tabled action item from the August 25th Board meeting (See SU post of August 28th – August 25th SOA Board Meeting Recap – third bullet under New Business), wherein the Board needed clarification from the Washoe County Health Department as to whether or not resurfacing of the TCTC Lap Pool was required for the 2022 season. Note that although several vendors were requested to submit quotes, only one was received in the amount of $39,700 for the Lap Pool and $15,605 for the two Spas.