HOA Board Meeting Minutes Sept 21, 2017 Present: Wayne Saxon VP, Vivien Valdes-Fauli-Secretary, Terry Morton-5 th Board Member, Attorney Heather Klein Absent: Rey Ortega-President, Mary Prado-Treasurer Deerwood Board met at 4:45 on Sept 21 at the HOA attorney s office, Heather Klein in Sparta NC. There had been several requests by Board members to the President to convene the agreed upon monthly phone conference call, as a meeting had not been called since July 28. Terry volunteered to attempt to organize a call and after several changes received confirmation from all Board members that they would participate in the scheduled call for Sept 21 at 4:45 pm. The purpose of the meeting was to make a decision on the proposed approach to realigning the Board elections to be in compliance with the Bylaws as expressed by Rey in his e-mail and to prepare for the HOA meeting already scheduled for Oct 21 and any other business as required. The time, agenda, responsibilities had not been determined yet by the Board and mailings for the announcement, nominations, etc. needed to go out shortly to meet Bylaw requirements. In addition other actions needed for meeting preparation have not been done. The meeting was called to order at 5:34 by the VP after numerous attempts to contact the President and the Treasurer via phone calls, e-mails, and texts. A quorum was present and the VP chaired the meeting. New Business 1. A discussion was held concerning the upcoming HOA meeting and what was needed. It was decided to start the meeting at 1 PM at the already communicated location(community barn) and date (10/21). Per Terry, this info has been posted on the web site since the July meeting. 2. It was decided to use the 2015 HOA meeting agenda as a draft and that Vivien would use that to provide for the President s and the Board for comment. a. In addition the following items are required from the responsible board members: i. Updated P&L statement (last one provided to the Board was in July and needed revisions and clarifications) (Mary) ii. Updated Balance sheet (last one provided to the Board was in July and needed revisions and clarifications) (Mary) iii. A general ledger of all financial transactions (not yet developed) iv. Status of all maintenance activities (Wayne) v. Agenda for meeting (Rey) draft(vivien)
vi. A discussion followed on the necessary HOA letter draft, review and copying as well as the purchase of envelopes, stamps, a return envelope, nomination forms, proxy forms, etc. These items would be required ASAP to meet deadlines for HOA notifications, nomination returns, proxy returns, and resending of voting forms, etc. All agreed to help Vivien complete these tasks as quickly as possible and shoot for next Tuesday to send out letters. There is concern that all of this may not be completed in time for the votes to be counted at the next meeting. (Terry/Wayne/Vivien) vii. We are depending on the accuracy of the treasure s reconciled list of homeowners/lot owners and status of dues/assessment payments to authorize voting for the HOA. Should there be challenges to this list at the HOA meeting, the challenge must be resolved before the votes will be allowed. (Mary) viii. A purchase of food platters, tables/chairs rental, etc will be available for HOA members. Set up of room. (Wayne) ix. Chair HOA meeting (Rey) x. Check in HOA members and validate voting (Mary/Vivien) xi. Call another meeting of this board to review and resolve any outstanding items from those listed above, etc. (Rey) viii. Web site updates with the meeting additions and updates with the appropriate information from above will be added as soon as they are available and Terry receives them. (Terry) b. Members present had several questions regarding the status of finances and reports. Terry shared the following info concerning review of past years finances. A high level review of beginning bank balances and income for each year back to 2013 shows appropriate beginning of year bank balances and yearly income except for 2016 and 2017 being lower than previous years. There was not a posted 2016 P&L or Balance sheet on the web site for review. (A 2017 draft P&L and Balance Sheet was added in July to the web site with the ones the treasurer provided.) We still do not know the status of the final 2016 P&L and Balance sheet information; however incomes from both 2016 and 2017 appear very low compared to other years. Terry requests that Mary provide this info to the Board ASAP and share her thoughts on accuracy and actions needed based on the review she has been performing since January. All previous years HOA bank statements were purchased earlier this year by Mary. This discussion should include the status and accuracy of the reconciliation of the lot/home owner list information that Mary has been working on. There were several complaints from homeowners earlier this year on errors on past and present billing information and payments. Several people complained that the letters from the Board and attorney
sent out last year were in error and after several attempts at providing past cancelled checks, etc. the errors still existed. People were concerned about the management of their funds. The 2017 board at the first meeting identified the resolution of these concerns as the focus area for this board. An update on the resolution of these items is needed from Mary. Present HOA BB&T Bank balance is $31,628 with a number of invoices outstanding. This amount will be insufficient to complete this year s budget needs and next year s budget needs through June as required. Mary has been asked for present income figures which again appear to be very low at this point but waiting feedback from Mary. c. A discussion was held regarding the status of all previous year s liens and this year s liens for past dues and special assessment past dues. The members request that Mary provide an update on this information as well including her recommended actions on liens. 2017 past due invoices should have liens placed on lots after the Sept 1 date per the Bylaws. To the best of our knowledge there is not a list of all lots which have outstanding liens on them for the entire development. d. Mary provided in August a list of lot/home owners that had open invoices. We know there are still errors on this report. At that time approximately 126/207 lots had overdue invoices-most greater than 90 days. Information on that list generated a number of questions from the board members and it is necessary for Mary to be available to help the Board members understand the answers to these questions and any actions that are needed. 3. Rey s recent e-mail identified that there was a voting discrepancy with the Bylaw requirements (Art V) concerning annual voting to meet V.2. and we needed to identify two positions that needed to be voted on this year even though the members were elected for two year periods. Rey had stated his recommendations on who should be replaced on the board. The members present discussed this with the attorney. There was previously a question when this came up if this should be done in mid-term or wait until next year when all positions would be voted on again. However, in order to meet Rey s request Terry made the following motions: i. The Board should designate the Board positions as BM1, BM2, BM3, BM4, BM5. Positions BM1 & BM2 would be voted on this year(2017) and BM3, BM4, BM5 would be voted on next year (2018); each would be voted on for a 2 year term as required. This would reestablish the rotation to meet the requirements for the Bylaws to ensure that all of the board members would not be replaced at the same time, ensuring some continuity thru transition periods. The motion was seconded by Wayne and the vote was passed by majority.
ii. Discussion on how to meet the need of selecting the present board members to fill the designated 5 positions was held and it was decided (with attorney agreement) that a secret ballot should be done sending all votes to the attorney who would provide the results. The motion was seconded by Vivien and passed by majority present. (Rey s e-mail was provided to the attorney, Mary sent in an e-mail later to the attorney and the members present provided a secret ballot to the attorney. The attorney later provided the results of the vote to the Board Vice President: 2017 BM1-Rey, BM2-Mary, BM3-Vivien, BM4-Wayne, BM5-Terry) iii. Therefore for 2017 positions decided by secret ballot BM1(Rey) and BM2(Mary) positions will be voted on this year and positions BM3 (Wayne), BM4(Vivien) and BM5(Terry) will be voted on in 2018 to reestablish the required rotation. Rey and Mary can elect to run again as incumbents this year to allow the HOA members to officially select the Board members for these positions as required. Wayne, Vivien, and Terry can do likewise in 2018. Please note: No one was removed or voted off the Board. Board voting was to establish a rotation sequence of board members positions to rotate this year and next year with the option of any present member to rerun for their position again-- which will be decided by the HOA members voting. b. Further discussion concerning this issue is that no one present knew how the rotation was messed up. All 5 positions were elected at the 2016 HOA meeting and this seemed not to comply with the 2-3 voting rotation. (NOTE: Further investigation after this meeting, which included reviewing voting back to 2013 revealed that the rotation appeared that it was not being followed. There appeared to be no elections at the end of the 2013 board terms. In addition, two positions in 2016 appeared to be actual resignations and should have been filled by the board to complete the second year of the two year term in 2017. Thus only 3 positions should have been voted on in 2016 instead of all 5. Wayne did run and again and was re-elected as appropriate. However, proper voting was not done in 2013/2016 and so the rotation has been confused. It is not clear if other violations have occurred since the rotation was started with the first board. However, it is necessary that the BM1-5 designations be maintained in the future so the board can stay with the required Bylaw s V.2 rotations and keep track of resignations, etc. Details of this review are available upon request.
4. A discussion ensued about the concern for the difficulties to maintain financial information from board to board such as invoice status, open invoices, etc. and to keep the lot/home owner list up to date with local records such as deeds/ foreclosures, ownership transfers, etc. Each new board seems to struggle with these items and this board has spent the better part of a year trying to accurately reconcile this information and we are not yet sure the information is all correct. Wayne made a motion that Terry pursues a couple of bids with firms to take this tasks on for the HOA so that continuity, accuracy, and correct invoicing/status, lien actions, etc. can be maintained from board to board. This information can be shared with the board for action. The motion was 2 nd and passed unanimously. 5. The members discussed the need for all future boards to post their meeting minutes of each meeting on the web site. Included in each minutes should be a financial summary. A motion will be made at the HOA meeting to require this. 6. A motion for approval of the July 28 draft minutes was made and approved. Terry will revise the web site to reflect the minutes approved. 7. The board members present request that Rey set up another conference call or face to face meeting ASAP to final actions necessary for the Oct 21 st HOA meeting and obtain updated financial info from the treasurer, etc. 8. Motion made/seconded to adjourn meeting and was done so at 6:30 pm. Respectfully submitted Vivien Valdes-Fauli, Secretary