Fall Forum Notes
October 5, 2020
Board Members present: Chair Tom Mahon, Vice-Chair Gerry Morgan, Treasure Denny Laughery, Secretary Jerry Gardner, and Operations Curt May.
Roughly 108 residents attended the Fall Forum. 10am Session – 25 participants; 2pm – 27; 4pm – 36; 7pm – 20. Participants observed social distancing rules and wore face masks.
Chair Mahon and Treasure Laughery jointly delivered a power point presentation addressing four major issue areas (community safety, by-law amendments, the 2021 budget, and possible rental restrictions). Residents were given an opportunity to ask questions. The questions and responses are provided below grouped by issue area. Similar questions in each issues area are only noted once for brevity.
Community Safety
Tom provided information that did not generate questions.
By-law amendments
Q: With the changes in the by-laws from “75% of the owners voting” to “the majority of the total votes allocated,” how many votes are required to obtain a majority?
A: 50% of 463 homes = 231.5 +1 = 232.
Q: Who is eligible to vote on the amendment?
A: Each household has one vote. Only property owners can vote. Renters may not vote. “Proxy” votes are not allowed. If someone owns more than one property, they can vote based on the number of properties they own (i.e. 5 properties = 5 votes).
Q: What was the impact of the 2015 and 2017 votes?
A: In 2015, changes to the by-laws regarding the number of Board members and Board member term limits were approved by just 24% of voters. In 2017, with 83% of the community voting, changes to the annual assessment and buy-in fees increases failed having not achieved the 75% approval requirement. In both cases, the minority controlled the outcome.
Q: Why doesn’t the ballot say 50% of “homeowners” instead of voters?
A: The ballot is simply a summary of the information included on the salmon colored insert sent to homeowners in the last newsletter. The summary would have been clearer had it reference, “the majority of votes of all owners.” (Note: votes, not voters.)
The full text of the proposed change to the Bylaws is on the back side of the notice for the ballot. It can be found on the salmon colored paper that was distributed with the October Newsletter. That text is also attached to this document.
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Q: Why didn’t the Board use an attorney to draft the amendments?
A: An attorney charges $300/hr. Tom was able to draft the amendment using his skills and knowledge of the issue. Tom did consult Salemtowne’s attorney. The text for the changes was copied from the text of the Declaration article related to amending the Declaration,
“The Declaration and Plat may be amended only by vote or agreement of the owners representing at least 75 percent (75%) of the total votes allocated to all lots and units under provisions of Article II herein.”
The wording in Article VII, Sec. 3(b) is slightly different. The grammar of the existing text was, “in accordance with the provisions of Article II of the Declaration. Whereas, the existing text of the other articles was, “under the provisions of Article II of the Declaration.” The change minimized the amount of text being edited and has the same meaning.
Q: Why wasn’t the Oregon Revised Statute (ORS 94.635) specifically referenced in the wording of the amendment?
A: Oregon statutes are subject to change. This could happen when Salemtowne residents do not want to alter the amendment. And, a statute does not necessarily offer the clarity required by the community.
Q: Will it be easier to make changes to the by-laws with the 50% rule?
A: Yes and no. Any proposed change with require 232 votes in favor by homeowners (50% of 463). Compared to the existing 75% requirement, passage of a change may require fewer votes. However, this assumes that voters will participate. Not voting in an election is the same as a “no” vote. The majority of voters must approve a change.
Q: Can the assessment be changed in a single meeting?
A: Yes, but that would require 232 residents to attend the meeting and all would have to vote in favor of the change.
Q: Which part of Salemtowne’s governing documents does the new “50% rule” effect?
A: Changes to the Covenants, Conditions and Restrictions (CCR) will still require a 75% super majority to invoke changes. The “majority of all owners” rule will only impact Salemtowne’s by laws.
The 2021 Budget
Q: What duties will the “mechanic” perform?
A: The new mechanic will be the #2 person in the chain of command. The mechanic will repair equipment, handle some repairs around the community and free up Jason’s time so he can spend more time working on the golf course. The amount budgeted for this position was increased from $21/hr to $25/hr for a full year in order to attract a qualified candidate.
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Q: Is it possible to see the spreadsheets used to develop the budget?
Yes. The budget spreadsheets will be published as part of the information about a proposed assessment increase.
Q: How much is being budgeted for temporary hires and has that changed?
A: There are 3 seasonal workers. The proposed budget adds seasonal worker hours to address more grounds work.
Q: The budget calls for an $8,000 expenditure for “sanding”. Why doesn’t this expense come from ARF funds instead of Salemtowne’s operation budget?
A: Both the Men’s and Women’s Golf Clubs have contributed to the sanding of the course as well as Friends of Salemtowne.
Q: Did the Finance Committee allocate expenses to the Operations Budget that should be as ARF expense, in order to increase the need to increase the annual assessment?
A: No. Jason, Terry and Denny only budgeted for realistic operations expenses. The committee understands that sanding common areas in the community as well as the golf course may help satisfy homeowner concerns about equality of benefits from this activity.
Q: What is the percent increase in the 2021 assessment over last year’s?
A: 15% ($889 > $1,053) However, as the budget is not yet final, the number may change slightly as final adjustments are entered.
Q: Why was $9,000 earmarked for the ARF from the operations budget? Wasn’t the increase in the home sale transfer fee from $1,500 to $2,500 expected to eliminate the need to budget operations funds for the ARF?
A: The proposed budget does not allocate $9,000 from the operations budget to the ARF. The slide showed the $6,000 additional funds to be deposited to the ARF as part of the overall budget; any confusion was unintentional; the slide has been corrected.
The ARF funds are made up of homes sale transfer fees plus a CPI increase. The ARF account remains underfunded although the amount is significantly less after the increase in the transfer fees. Prior to the transfer fee approval, the ARF fund was about $1 million short. Currently, it is about $150,000 short.
Q: Since Salemtowne has a list of capital improvement needs, why did the Board choose not to initiate a vote to remedy this situation now?
A: The Board wants to determine the community’s desire to change the by-laws (majority rule) first. Allocating additional assessment funds to capital improvement projects, and publishing a list of suggested capital improvements, will certainly be considered.
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Rental homes
Q: Can we see a show of hands of residents willing to eliminate rentals in Salemtowne completely? 2pm session: 2 votes; 4pm session: 2 votes; 7pm session: 2 votes
A: The overwhelming number of Forum participants expressed their support for rental restrictions with appropriate exemptions and exceptions to be determined over the course of the next few months.
Q: With 55 rentals, why can’t Salemtowne work with property owners to hire one property management firm to manage rental properties (qualify renters, monitor compliance with community standards and collect rents)?
A: There is no provision for that in Salemtowne’s Declaration or by-laws. Equally, there may be no legal basis for such a requirement.
Q: Can non-compliant renters be evicted?
A: The Board works with homeowners to make sure renters observe community rules. Currently, there is a moratorium on evictions as a result of the COVID-19 pandemic.
CORRECTION: Additional research found that the Eviction Moratorium only applies to evictions for non-payment. Evictions for cause, such as violations of the rental agreement may still be enforced.
Other
Q: Why does it take one month to get the Board Minutes?
A: Minutes are published after being approved at the next board meeting. This procedure is defined in Robert’s Rules. If you are interested in board meetings, attending the meetings is recommended.
Publishing “draft” minutes has been considered. However, of confusion could result if “draft” minutes are taken to be correct when corrections are needed.
Having the Board approve the minutes earlier than the next meeting by email has also been considered. However, doing so would violate the “Open Meetings” provisions of the Bylaws and state law.
- Gerry proposed a need for more fundraisers like the one used to raise $15,000 for the golf driving cage.
- A suggestion was made to develop a “needs list” which could be used to prioritize projects.
- There is a need to discuss the RV storage area. There were concerns about upkeep and the fact that the spaces are free to residents.
- Curt mentioned that he has received bids to install a drainage ditch along the newly paved road along hole #7. Curt has three bids. The lowest bid is $47,224.
- The dead tree on hole #1 will be removed as soon as workers are available.
