The Town Hall Meeting, 17 May

they came to praise and to show their support

Six members of the Board were present on this occasion to listen to resident concerns and to hear suggestions for improvement, as well as to learn. As one might expect, veteran members Bob Berman and Kay Dwyer had heard much of it before, while Bob Frank, Mike Dixon, Roz Berman and Barry Friedman were new to the experience. Elaine Berg was away and was unable to participate.

As our newbie Board members basked in the glory of frequent accolades from the faithful, one had to wonder whether this town hall meeting was as much for the benefit of the newly elected Board as it was for those primarily ACE members who gathered on this occasion to show their support for those who were recently elected. Given that Freedom Hall was 1/3 empty may tell us little or a lot depending on one’s point of view. Eventually, though, our newer Board members will come to understand that few residents will have any continuing interest in the governance of the Association.  And at the slightest hint of Board cooperation, tranquility and transparency, even fewer residents will feel the need to show up, let alone to speak up.

Understandably, our newer Board members have a lot to learn about running the business of governing. One important key to that learning process will be how our newly elected members are able to integrate their collective energies with the not so passive, inveterate and titular head Bob Berman, a leader and quite successful organizer of volunteer efforts who has an established history of dedicated and valued service to our Community.

 So apart from the numerous accolades spoken by members of the audience, what did we learn from this event.  Regrettably, I was detained and arrived a bit late and missed a portion of the meeting.  Here are some of the highlights of that two-hour meeting that I was able to attend, along with some occasional commentary of my own.

CC&R Compliance.  A high priority concern to many residents in attendance, the Community and the Board was CC&R compliance, especially with the large number of unoccupied homes, and with that, homes that are not landscaped; homes that are occupied with less desirable elements, some allegedly used for illegal purposes; as well as homes with under-age children and persons who are living in homes that are not age-qualified. Resident were urged to be vigilant and report any potential violations to Christine Wikoff, Enforcement Manager, so that appropriate follow-up enforcement action can be initiated. Christine's number is 614-5859.

Our Association's Attorney.  Some have suggested that our Association’s legal John Leach counsel should go, ostensibly in the belief that his opinions are often contrary to NRS 116, the rules that govern Common Interest Communities like Sun City. While I do not know enough to make that judgment, I would not want the Board rush off and unnecessarily dismiss the former King’s counsel for giving advice the King was looking to receive. Too often, I'm told, attorneys are telling the client what they want to hear, not necessarily what they need to know. Perhaps it is too soon to conclude that Mr. Leach cannot serve the interests of our new elected Board members in a more enlightened manner, albeit in a manner different than he had served the interests of Favil West.

Establish a Governmental Affairs Office.  A resident suggested the establishment of a Governmental Affairs Commission or Office that could serve as the eyes and ears of the Board in matters that affect the interests of Sun City Anthem.  Given the number of jurisdictions, the City, the County, the Airport Authority, and the State Legislature, with bills and ordinances potentially affect our interests, there may be a need for a group of concerned citizens to monitor such efforts, not merely to keep us informed but to inform others on how such proposed legislation may affect Sun City.

Trumpets.  While there was lots of interest in learning about the status of legal action brought by the lessee of Trumpets, S & D Café V, LLC, against the Association, there was little information to convey. As we have learned, the Board is prohibited from discussing a matter currently being litigated. The Board will publish any public documents on their website under the “Documents” menu. [To view a copy of the S&D's initial compliant and S&D's response to the Association's demand to pay rent or quit can be viewed here: 1) Complaint and 2) S&D Response to Association demand to pay rent or quit.]

While many are anxious to see the lessee go, the real and yet unanswered question is at what cost to the Association. Are the terms of the lease effectively frozen in time as the litigation proceeds, thereby precluding the Association from implementing termination or quit provisions? Are homeowners willing to pay a special assessment of, say, $500,000 or $75 a unit, to negotiate our way out of the litigation and search for a new lessee. What should Pulte’s part play in any future settlement, short of our having to go to court. What are the changes of the Association prevailing in court? What are the benefits and costs of settling prior to incurring any substantial litigation costs? Does the lessee want to stay and serve the restaurant needs of the Community or do they want to run with as much as they can out of us? Do we know? Do we even care at this point?

Ask yourself, are we better off by spending, say, $300,000, to “prevail” at court two or three years down the line, allowing that is a reasonable expectation, and even if no money is recovered, or by spending “X” amount now to extract us from what many regard as an unwanted situation?

What’s going to happen? In my opinion, there will be a lot of pressure to arrive at some mutually agreeable settlement prior to incurring any substantial court costs. Some believe that is exactly what the lessee may be counting on. Unfortunately, that may work against the interests of the Association. That prospect, in turn, could result in a settlement that will likely cost the Association a bundle. Such a resolution and the magnitude of any settlement, however, will depend greatly on the degree to which the lessee wants to stay here and the degree we want the lessee to go. I have a sense that the more we want the latter, the more costly it will be for the members of the Association. Very difficult decisions lie ahead.

Trumpets and the Irony of the ACE-led Campaign.   It has not gone unnoticed that the ACE-led campaign against accepting the proposed Amendment to the Trumpets lease contributed greatly to public sentiment and to the legal situation and potential liability faced by our Association. The Trumpets lease Amendment became a key rallying point for the ACE candidates and the many voters who supported their candidacy.

Were those voters in the end unduly swayed, perhaps even mislead, by hype and campaign rhetoric that a vote for the ACE candidates was, in effect, a vote for a get-out-of-the-lease free card. How wrong were we? Those candidates are the same people who are now in control of the Board and are the same ones we must rely on for their judgment in governing the Association and in conserving our scarce resources.

To those resident who are seeking accountability for actions in the distant past may not have to look too far, that is, if they are looking for answers to the legal and financial morass we now find ourselves in. I wonder if ACE accepts any degree of accountability for misleading the Community on this critical issue?

Free Car, Anyone?  Someone suggested that instead of buying a new car, as recently authorized by the Board, the Association should ask dealers for a donated car with a name on the car to advertise the donation and the company, like Henderson Kia or Suzuki, etc. Bob Berman said that was tried a few year back but without any success or interest on the part of car dealers, but Bob said we could look into that prospect again now that we are approaching 7,000 units.

Exercise Classes Cancelled.  In canceling a variety of exercise classes, why, asked one resident, has the Board forsaken the needs of those in need for the sake of a few dollars to pay for an instructor. Is there not a better way to manage the exercise programs offered in a manner that can meet a greater variety of resident needs and at the same time at some acceptable level of cost to the Association?  

Bank Gets an “F” for Reporting Technique.  All are in agreement that the Bank of America’s Quarterly Report to the Board earned low marks for communications, a report, by the way, they are required by NRS to make and bore the heck out anyone in earshot. The Board and the Bank will be working on a more acceptable format for presenting investment and earnings information at future meetings. For those who expressed their disappointment in earnings figures, do not blame the messenger or the Bank since the Bank is merely reflecting the conservative investment criteria that was mandated by the Board and the Investment Committee.

A Badly Needed Cell Tower.  With poor cell phone reception just about everywhere in Sun City, cell phone towers have been popping up here and there to improve reception. With very poor reception in the villages around the third recreation center, it was welcome news that a new cell phone tower would be erected. A project for the Oversight Committee!

The Oversight Committee.  Speaking of the Oversight Committee, here once again is another example of ACE-supported candidates running on pure hype—in this case the proposition that the Board could sunset or close down the Oversight Committee—as one resident inquired, “When are you going to do that?” Here we have an example of a seemingly popular rallying point that was intended to garner your votes but with no substance to support the proposal.

The problem with the hype, of course, was the well known fact that the Board has never had any influence or control over the Oversight Committee. Without getting into the details, that Committee was the creation of the Developer and the core negotiators to implement certain provisions of the 2002 resident-Developer Agreement that addressed numerous changes to Sun City and to the overall Anthem Master Plan. That Committee serves the interests of the Developer and will continue to do so until they leave.

That Information Booth.  In search of another mission, Security Patrol Chief Dave Servello took this opportunity to make a plea for ideas that might attempt to justify the Board’s April decision to transfer use of the Information Booth on Anthem Parkway to the Security Patrol. As I have already maintained, any idea that would entail resident use of the Information Booth site would expose our residents to an unacceptable and unnecessary traffic hazard.

Perhaps I am too naïve as I understood the Board’s decision on the Information Bldg. as serving an entirely different purpose. To me that decision was an effort to preclude the Association from offering that generous space to The Minuteman Foundation, thereby freeing up needed space in the Community Services Bldg., and less to meet a bona fide safety need of the Community.

     
The Security Patrol. As noted by the organizer of the Security Patrol, Bob Berman, the mission of the patrol is safety related and is met by the very generous efforts of our residents who volunteer to patrol our streets. As Bob reminded the audience, there were about 110 Patrol volunteers when there were 2,000 homes and 20 miles of streets to drive. Today, he lamented that there are still only 110 volunteers and nearly 7,000 homes and 60 miles of streets to monitor. As one can readily see from these numbers, there is a crying need for more volunteers to help keep the Community safe. You can help by calling the Patrol at 614-6751. Also, check out the Patrol’s fine article in the April Spirit. Shifts are only 4 hours a week.

Interestingly, some ACE candidates made effective use of the use of the Information Booth/Security Patrol issue. That proposal had been developed not by the Security Patrol at all but as an ACE-candidate initiative, in part as it turned out, to garner candidate support for ACE candidates from an active group of Security Patrol volunteers. While that turned out to be a great campaign strategy for ACE, it did little to benefit the mission of the Patrol. Now, with Bob Frank and ACE candidates effectively in control of the Board, the question is whether reason and common sense will prevail over hype on this somewhat sensitive matter.

Avoiding Toxins. In lieu of using toxins that fill the air to spray for bugs in the exercise rooms, one asked whether there are other less noxious solutions that would not attack our more sensitive seniors? Can the noxious air be cleared from the room in some manner so that it does not present a problem, or do not spray as often, or merely stop spraying and see what develops.

A Business Plan for SCA.  Develop a 5-year business plan for the Association.

Villa Owners. Villa owners continue to argue that their reserve accounts were wrongly ignored in the past by actions of the Association, were under funded as a result, and continue to be under funded by the Developer who they believe owes more than what they have agreed to pay, notwithstanding the Board’s recent settlement on this matter with the Developer. The dispute continues.

That so called "missing" $1.375 million? Bob Frank told an inquirer that the Board will be looking into the status of this potential reserve funding matter. A meeting with with Favil West or Dea McDonald should resolve the matter, although I would not be surprised if Bob Berman was made privy to discussions surrounding this matter.

Board Meetings in Secret. And finally, there was that measured and poignant plea from Senator John Briggs for the Board to heed the intent of NRS 116 and not continue to meet in secret as they have in the past.

The Finance Committee Meeting.

As a result of the unexpected resignation of Committee member Tom Potts, who succumbed to an offer he could not refuse, the FC will be looking for someone with professional accounting experience to fill the vacancy.

Here are a few notes from the May meeting of the Finance Committee meeting.

1. There were 19 Developer closings in April; and if I recall correctly, there were 6 closings in March.
2. The Association should be receiving assessments on 6,943 lots, that is, assuming that all homeowner were paying (see below), which includes a number of unimproved lots on which the Developer is paying. Build out is somewhere around 7,114 lots.
3. What's the status of delinquent homeowner accounts? The news is not at all encouraging. For example,
   • According to Red Rock, RMI’s collection arm, the amount homeowners owe who are in arrears on their assessments (including penalties) is increasing.
   • There are 797 homeowners in past due status, or 12% of our homeowners, a troubling statistic that appears to need closer monitoring and some further explanation.
   • While collection efforts are reported to be “successful,” Red Rock has no measure of what constitutes success. They will attempt to develop such a measure for reporting purposes.
   • The amount in arrears is significant, currently amounting to more than a quarter of a million dollars—and growing.
   • Red Rock is following State approved collection procedures.
   • What are Red Rock's collection procedures? Click here to read Red Rock's collection procedures: Collection procedures  
    

Ron Johnson, 21 May 2007