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TammyC3 (New Mexico)
Posts: 102
Posted:
Hello..... again!

144 lots. 1 lot = 1 vote. Less than 15 full time residents totaling 30 votes. Returned Ballots from non residents can be counted on one hand ... er ... finger. 10 residents show up to all annual meetings. 5 are board members.

Developer is still hanging on, 19 years and counting. The Developer holds 49 votes. (30 lots never sold, 19 repossessed). The developer has delivered their votes by proxy (via BoD officer/friend). Recorded 'Release of Control' occurred in 2007, at "108 lots sold". The developer has sold less than 5 lots since 2007.

75% majority to change CCRs. 2/3 majority to amend Articles. Neither mention proxy votes.

The 'new' packet of docs being billed as 'current' docs, includes bylaw amendments that are contrary to statute and (never heard of before) amendments to the CCRs. One interesting CCR change: "The Declaration of Covenants, Conditions and Restrictions for XXX Subdivision provide for the owner of each lot within the subdivision, other than us, to pay the Association regular assessments and special assessments each year ....".
The Board wonders who "us" is!

Directors have concretely determined that the 'amended' bylaws are non-compliant w/6 statutes, and egregious in their attempt to strip landowners of their voice and revenues from the association.

In considering amendments that serve all landowners, we have discussed eliminating voting by proxy.

What pitfalls are there when eliminating proxy votes?

Are considerations for 'in person' or 'resident only' votes a waste of time when CCRs state: 1 lot = 1 vote, 1 class?

Thanks .... again!

Tammy

SheliaH (Indiana)
Posts: 6,964
Posted:
We haven't had a problem with proxies, except getting enough people to return them so we may make quorum for our annual meeting (which didn't have AGAIN this year!)

Here's an article you might read to get some ideas on what to consider - https://www.chicagotribune.com/real-estate/ct-xpm-2013-11-01-ct-mre-1103-condo-living-20131101-story.html

Generally, I like the 1 unit, one vote, as we have in our community, but as you've probably seen from other conversations on this site, there have also been a ton of problems with things like who's counting them, were they sent out and returned in time, etc. There's also an issue with people who may have several units and therefore are in a position to run everything, rending the one unit/one vote person irrelevant. In fact, I believe there are some communities out there which have one vote per owner, period, regardless of how many units are owned. That approach may make proxy voting more manageable.


If it is not right do not do it; if it is not true do not say it. Marcus Aurelius
RichardP13 (California)
Posts: 3,868
Posted:
As long as the developer is "hanging on" the membership is pretty much at their mercy.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Tammy

He who has the votes has the power. The Declarant is in control based on the votes he controls. Your BOD is a mere figurehead.

Proxies are allowed unless banned in Bylaws. They are a way to vote when one will not be at the meeting to vote and taking it away eliminates a method for an owner to vote. Do you really want to do this?
NpS (Pennsylvania)
Posts: 4,216
Posted:
From NM Statute. Not sure this is current. Do any of the forced turnover rules apply to your situation?

§ 47-16-8 • DECLARANT CONTROL OF BOARD
A. Subject to the provisions of this section, the declaration shall provide for a period of
declarant control of the association, during which period a declarant, or persons
designated by the declarant, may appoint and remove the officers and members of the
board.
B. Regardless of the period provided in the declaration, the period of declarant control shall
terminate no later than the earlier of:
1. Sixty days after conveyance of seventy-five percent of the lots that are part of the
development and any additional lots that may be added to the development to lot
owners other than a declarant;
2. Two years after all declarants have ceased to offer lots for sale in the ordinary
course of business;
3. Two years after a development right to add new lots was last exercised; or
4. The day that the declarant or the declarant’s designee, after giving written notice to
the association, records an instrument voluntarily terminating all rights to declarant
control.
C. Subsection B of this section does not apply to a master planned community.

Sikubali jukumu. Read all posts at your own risk.
TammyC3 (New Mexico)
Posts: 102
Posted:
Thanks for the informative link. I'll have to read it several more times ... this quorum thing is completely new to me, and I do not fully understand it.

From Article: "On the positive side, proxies allow greater numbers of owners to participate.".
The only non-resident owner that participates in our election is the developer. For our association, this is not a 'positive'. Apparently, landowners bought land as an investment, weekend getaway spot, or for retirement, not to involve themselves with how their access is provided!! We are an extremely rural community. Road maintenance/grading is association's #1 responsibility and consumes roughly 80% of our budget.

One unit (lot) = one vote in our docs. I just don't understand how the developer 'releases control' and yet still has control, with their 49 votes. That may be 'life', but I feel duty bound to understand if resident landowners that participate in every annual meeting could achieve an equal or greater voice than an out of state developer.

I find one vote per owner intriguing, but owners who own 5 lots are quite proud of their 5 votes. Even if they were inclined to be understanding to the issue, amending the CCRs takes 2/3 majority.
- When it says "2/3 majority" to amend CCRs, would a quorum apply in this instance? Apologies if I am asking silly questions ... {{feeling like I'm 5 y.o.}}

In theory: If we have 144 members, a quorum would be 50%?? = 72. The Developer sends 49 proxy votes to make quorum, and in our case, thereby insures 'majority' vote. Resident members carry 30 votes. Non resident landowners do not participate in any fashion that would assist resident landowners.

- Can proxy votes be used for the purposes of 'quorum', but not to vote?

- Can the 30 'resident' votes achieve quorum without the developer's proxies? Walking out, walking back in = 36 required?

thank you Shelia.

TammyC3 (New Mexico)
Posts: 102
Posted:
I'd like to explore 'pretty much' ... if there's a crack in the facade, I'd like to explore it.
TammyC3 (New Mexico)
Posts: 102
Posted:
CCRs make no mention of proxy votes. Articles make no mention of proxy votes. Bylaws appear amendable re:proxy: "Can be used" or "Cannot be used". "Can be used only for: ______". -Can/should the Board amend bylaws re: proxy.

Owner voting history = 15 residents landowners vote (30 votes). Developer votes (49 votes). Remaining landowners do not return ballots, and are only represented as an expense under "Office supplies."

IMHO, eliminating proxy doesn't eliminate their vote, it requires them to be participatory. If non resident landowners were required to drive the roads, especially in inclement weather, they would be more understanding of how finances are relevant to safety, access and value.

Am I sure I want to do this? Not my decision. I want to come to the board meeting as informed as possible, put the facts on the table and go from there.

TammyC3 (New Mexico)
Posts: 102
Posted:
Oh my! I think you inadvertently put me in check!!

I find that statute in NM's HOA Act - link below

Yes that statute is relevant and current.

- Do I understand correctly ... B. "regardless of period stated in Disclosure" = 'retro active*'?

NMSA 1978 Article 7E - Homeowner Association

Reference: 47-7E-8 - https://www.nmclerks.org/content/files/Homeowner%20Association%20Act.pdf

and then there's 47-7E-9 - - where a spear stabbed my heart!

Me: "Where did I get the idea that 'quorum' was optional?"

Article 8 - Nonprofit Corporations - Reference 53-8-16 - http://www.sos.state.nm.us/uploads/files/Corporations/ch53Art8.pdf - and the spear is thrust deeper!!

{{picking chin off floor}}

- Do I see a glimmer of hope in the word: "percentage"?

re: Developer votes - 30 of the 49 still receive the "developer exception" rate of 1/5 of the "normal" assessment rate.

Directors have suggested:

Full vote = full assessment - requiring amendment to CCRs.

Exploring 'agricultural vs. residential' / warranty deed.

No dues - no vote.

Whether I agree or not, are these suggestions feasible to consider when we know we don't have the votes? Our only ability right now seems to be the possibility of amending the bylaws, in an effort to give involved landowners a stronger impact in our community.

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