Quorum June 2016

JUNE 2016

Coachella Valley Community Associations Institute Magazine

The Springs Community Association INSIDE

EDUCATION - BUSINESS PARTNERS 17 CAI’s Educated Business Partner Distinction (EBP) 18 CV Business Partners Show Commitment to

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URGENT CAI-CV CALL TO ACTION TO PROTEST CVWD WATER RATES – SEE PAGE 12

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Managers & Boards 24 Business Loans Made Easy 26 Vendor Contracts -- Bidding Through Negotiation 34 Everything a BP Needs to Know About Working

with Management Companies

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Quorum June, 2016

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BOARD OF DIRECTORS COACHELLA VALLEY CHAPTER 2016

A Full Service lAw Firm

GERARD GONZALES, PRESIDENT Albert Management, Inc.

Providing Practical Approaches in:

TAD BLACK, PAST PRESIDENT Associa OnCall

CC&R Interpretation, Drafting and Enforcement

PHYLLIS HARKINS, CMCA, CCAM, AMS PRESIDENT ELECT Palm Desert Country Club Association

Opinion Letters

LESLEE CICOGNA, PCAM, AMS, CMCA TREASURER Associa Desert Resort Management

Contract Drafting and Negotiation

JOHN WALTERS-CLARK, SECRETARY Associa Desert Resort Management

Civil Litigation

CARDINAL AMBROSE, CCAM, CMCA, AMS DIRECTOR Albert Management, Inc.

Assessment Recovery 73-710 Fred Waring Drive, Suite 120, Palm Desert, California 92260

For inquires contact Jeffrey French www.gbflawyers.com

| 760.346.9310

RHONDA DREWS, CMCA,AMS, PCAM DIRECTOR Associa Desert Resort Management MATT LAWTON, CIRMS, DIRECTOR Prendiville Insurance Agency GEN WANGLER, ESQ., CCAL DIRECTOR Fiore Racobs & Powers A PLC

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JOLEN ZEROSKI, DIRECTOR Union Bank

CAI Coachella Valley Office 41-905 Boardwalk, Suite A-2 Palm Desert, CA 92211 Tel: (760) 341-0559 Fax: (760) 341-8443 Website: www.cai-cv.org CAL LOCKETT Executive Director clockett@cai-cv.org

ARTICLE SUBMISSIONS OR ADVERTISING INFORMATION admin@cai-cv.org

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ATTENTION CAI MEMBERS – THERE’S A PARTY YOU WON’T WANT TO MISS AT THE RENAISSANCE RIGHT AFTER THE LEGAL FORUM! TICKETS ARE AVALABLE AT

C A I - C V. O RG OR CAL L 76 0 -341-0559 4

Quorum June, 2016

The materials contained in this publication are designed to provide our members with accurate, timely and authoritative information with regard to the subject covered. However, the CAI Coachella Valley Chapter is not engaging in the rendering of legal, accounting or other professional types of services. The Coachella Valley Chapter has not verified and/or endorsed the contents of these articles or advertising, nor do we have the facilities or the personnel to do so. Readers should not act on the information contained herein without seeking more specific professional advice from legal, accounting or other experts as required.

CONTENTS FEATURES

10

The Springs Community Association

By Kelly Roseman, CCAM, CMCA, AMS

17

Educated Business Partner Distinction (EBP)

18

CV Business Partners Show Commitment to Managers & Boards

10 9

By Susan Browne Rosenberg, CIH, CIEC, CHMM and CAI-EBP

24

Business Loans Made Easy

17

By Christy Majors

26

Vendor Contracts — Bidding Through Negotiation

18

20

By Jasmine Fisher Hale, Esq.

34

14

Everything a BP Needs to Know About Working with Management Companies

By Fran Mullahy

CHAPTER NEWS

9

CAI-CV Chapter New & Renewing Members

9

Interested in Serving on the CAI-CV Board?

40

Chapter Upcoming Events

24

CHAPTER EVENTS

14

California Legislative Action Committee (CLAC) Advocacy Update

15

A Day at the Capitol

26

By Clint Atherton, CMCA, AMS, PCAM

20

May 13th 2016 Lunch Program "How Did King Arthur Do It?"

27

What Happened in Orlando Didn’t Stay There

By Phyllis Harkins

31

2016 Annual CAI-CV Golf Tournament Wrap Up

By Dan Farrar

Do you have minimum requirements for vendors that require professional certifications and licenses, insurance?

When going out to bid, do you only include vendors you have a relationship with -- or those that have been vetted by your company in some way?

Does someone at your company oversee RFPs to ensure information from various vendors can be looked at “apples to apples?”

Who makes t final decision about vendo recommended t association bo A manageme company execu The manage

No but vendors must complete a vendor packet

Yes

Yes

Yes

Manager and Bo

Prefer scheduled meetings with Dir. of Business Development

No but vendors must pass a third-party compliance process and there is a fee

Yes

Yes, only vendors that pass the compliance process

Yes, Managers often put together a side-by-side spreadsheet

Manager and Bo

Yes; with educational component and scheduled in advance

Yes; less effective than making an appointment

Yes; requires venders are registered with third-party BCS

Yes; handled by third-party BCS

Yes

Yes

Board with recommendation the manage

Yes; breakfast & learns – educational opportunity for managers conducted at weekly staff meetings

Yes; call the receptionist or leave a business card

Yes; vendors with track record and that have passed thirdparty compliance process (fee) may be listed on web-site

Yes

Yes; vendors must pass the compliance process

Yes; both the Community Managers and upper management supporting the managers. Specifications are developed from industry experts

Managers & Boa Directors – Man prepare a matrix the bids for the B to review

Jim McPherson jandwmgmt@aol.com

Yes; schedule ahead and include education

Prefers scheduled meetings

Primary Contact for Business Partners:

Prefers meetings

No; we request

How do potential business partners gain access to your company’s managers & associations?

Who do they call?

MANAGEMENT COMPANIES (alphabetical order)

Albert Management, Inc.

41-865 Boardwalk Avenue, Suite 101 Palm Desert, CA 92211 P. (760) 346-9000 F. (760) 346-9997

Primary Contact for Business Partners:

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Associa Desert Resort Management

42635 Melanie Place, Suite 103 Palm Desert, CA 92211 P. (760) 346-1161 F. (760) 346-9918 42700 Aegean, Suite A Indio, CA 92203 P. (760) 346-1161 F. (760) 346-9918

FirstService Residential 43100 Cook Street, Suite 103 Palm Desert, CA 92211 P. (760) 834-2483 F. (760) 834-2495

Gold Coast Community Management

75178 Gerald Ford Drive, Suite B-1 Palm Desert, CA 92211 P. (760) 202-9880 F. (760) 202.9260

J & W Management Company P. O. Box 1398 Palm Desert, CA 92261 P. (760) 568-0349

Personalized Property Management

Gerard Gonzales gerard.gonzales@albertmgt.com

Do you allow lunch/breakfast & learns?

Do you allow businesses to cold call your company?

Do you have a preferred vendor program?

Yes, breakfast & learns – providing there is an educational component for managers

Not effective, prefers appointments with individual managers

Yes, scheduled with Dir. of Business Development

Primary Contact for Business Partners:

Paula Tapia Dir. of Business Development ptapia@drminternet.com Rhonda Drews, PCAM rdrews@drminternet.com

Primary Contact for Business Partners:

Tamara Snyder, PCAM tamara.snyder@fsresidential.com

Primary Contact for Business Partners:

Lisa Glogow lisa@goldcoastent.com Timothy Peckham tim@goldcoastent.com

CAI-CV.org

Primary Contact for Business Partners:

27 34

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twitter.com/CAI_CV

No

Yes

Yes; operated by Desert Locals Choice

Yes – must also be

Yes

Yes

5

Board with recommendation Manager

Manager and Bo

YOUR AD

HERE admin@cai-cv.org | (760) 341-0559

QUORUM COMMITTEE MEMBERS KYMBERLI TAYLOR-BURKE, CHAIR NPG Nelson Paving, Inc. RODNEY BISSELL, CO-CHAIR Bissell Design Studios, Inc. PHYLLIS HARKINS, CMCA, AMS, CCAM BOARD LIAISON Palm Desert Country Club Homeowners Association CARI BURLEIGH, CMCA, AMS The Management Trust Desert Division ERIN KLINK Pacific Western Bank

760-250-6232

1peggylaw@gmail.com

DEA FRANCK, ESQ. Epsten Grinnell & Howell, APC ERIN FUJIOKA G4S Secure Solutions, USA TIFFANY GOFF Dunn-Edwards Corporation ANTOINETTE HAMILTON Suntrek Solar LISA LYNN, CCAM Albert Management, Inc. FRAN MULLAHY Vintage Associates, Inc. SUSAN BROWNE ROSENBERG Desert Cities Indoor Air, LLC. STEVEN SHUEY, PCAM Personalized Property Management Co. DAN STITES CBCI Construction, Inc. GEN WANGLER, ESQ., CCAL Fiore Racobs & Powers, A PLC

CREATIVE DIRECTOR & GRAPHIC DESIGNER RODNEY BISSELL Bissell Design Studios, Inc. rodney@bisselldesign.com (714) 293-3749

SUBSCRIBER SERVICES

The Coachella Valley Quorum Magazine is a publication expressly prepared for association leaders, managers and related business professionals of the Community Associations Institute. Members are encouraged to submit articles for publishing consideration. All articles accepted for publication in Quorum are subject to editing and rewriting by the Quorum Committee.

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Quorum June, 2016

CONTENTS DEPARTMENTS

8

President’s Message

12

Water Wise

Call to Action Regarding CVWD's Proposed Rate Increases for HOAs

By Cal Lockett

13

CVWD Lifts Drought Penalties, Extends Water-Use Restrictions

By Heather Engel

19

Time Honored Micha Ballesteros

By Phyllis Harkins

23 Charity

28

Animal Samaritans Needs the Valley's Help

By Tiffany Goff

12

13

19

23

Homeowners Association Law Are You Ready for the New FHA/VA Disclosures?

By Laurie S. Poole, Esq., CCAL

29

CAI National

Excerpts From CAI National’s Guide to FHA Certification

36

Platinum Spotlight

Peters & Freedman, L.L.P. Atorneys At Law

28

29

36

CAI-CV.org

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7

FROM THE CHAPTER

President’s Message Gerard J Gonzales, Vice President - Albert Management, Inc., CAI-CV Chapter President

June is here in the Coachella Valley and our official “season” is ending. Although things continue to be busy, summer seems to slow down just enough for all of us to get caught up and start those summer projects.

May was a proud month for our chapter. Our recognition for three awards at the national convention was a huge milestone for CAI-CV. We also signed an agreement to begin running CAI commercials on KESQ Channel 3 TV during prime time news at 6:00 a.m. This is helping CAI raise its visibility as the authority on common interest developments in the Coachella Valley. We also began a major grassroots lobbying campaign for CAI-CV members in the Coachella Valley Water District (CVWD) to protest the agency's proposed water rate increases. CAI-CV members are encouraged to send protest letters and attend the hearing on Tuesday, June 14, at 9:00 a.m., at the CVWD Administration Building. We’ll know how we did after their Public Hearing.

Also in May, we held a very invigorating Educational Program Lunch & Mini Trade Show with industry expert Karen Conlon. A big thanks to the team that put that program together.

June will also be a busy month for CAI-CV members. On Friday, June 3rd, we have an outstanding Manager on the Run (MOTR) program planned for mangers about the collections process. You won’t want to miss this exciting program hosted by Peters & Freedman, LLP. On Friday, June 10, we have two events. Our annual “Ask the Attorney” Educational Program & Mini Trade Show will be at Palm Valley Country Club at 11:15 a.m.

This is a chance for CAI members to pose their legal questions to four of the industry’s top HOA attorneys.

That same evening (June 10) we will offer our End of Season Summer Sizzler, hosted by the Education and Business Partner Committees. I hope you will join us at the Classic Club at 5:30 p.m. for a fun celebration.

CAI-CV will host CAI National’s M202 course on association communications for managers on Thursday and Friday, June 23 and 24 at the Homewood Suites in Palm Desert. On Friday, June 24, we will host The Grease Lightning Summer Bowling Tournament at Palm Springs Lanes at 5 p.m. Find your favorite 50s costumes and join us for a wonderful night of bowling, games and prizes.

CAI-CV is looking for more volunteers to serve on the Casino and Awards Committees. If you have not signed up to volunteer on one of our 15 committees, I encourage you to get involved. This is one of the best ways to meet managers, board members and businesses that support our industry. Call the office for an application.

June marks the summer solstice. The first day of summer means that kids are out of school and hopefully, you will have an opportunity to enjoy some personal time with your friends and families. Be sure to unwind, enjoy the heat and take full advantage of how quiet our summers can be. After all, the new “season” is just around the corner.

Gerard J. Gonzales Vice President - Albert Management, Inc.

C A I -C V MISSION STATEMENT The mission of CAI-CV is to provide leadership for successful development and operation of community associations through information, research and education.

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Quorum June, 2016

CHAPTER NEWS 2016 CORPORATE

SPONSORS PLATINUM___________ Accurate Leak Locators AMS Paving Asphalt MD's Conserve LandCare, Inc. Associa Desert Resort Management EmpireWorks Epsten Grinnell & Howell, APC Fiore Racobs & Powers, A PLC NPG Nelson Paving Pacific Western Bank Peters & Freedman, LLP Signarama Sunshine Landscape Western Pacific Roofing

GOLD________________ AMS Security CBCI Construction Diversified Asphalt Flood Response United Paving Vintage Associates

SILVER_______________ 1 Stop Pool Pros Alan Smith Pool Plastering Artistic Maintenance, Inc. Blue Sky Landscape Coachella Valley Water District Mutual of Omaha Painting Unlimited, Inc. Powerful Pest Management Prendiville Insurance Agency PrimeCo Purified Pool Water Seacoast Commerce Bank Three Phase Electric Union Bank Homeowners Association Services

BRONZE_____________ Adams Stirling, PLC All Counties Fence and Supply Aloha Bin Cleaning Animal Pest Management Association Reserves Bank of Southern California Dunn-Edwards Paints Farley Interlocking Pavingstones Frazier Pest Control G4S Secure Solutions Horizon Lighting Kasdan LippSmith Weber Turner, LLP LaBarre/Oksnee Insurance Agency Pro Landscaping, Inc. Rudy’s Termite and Pest Control, Inc. S.B.S. Lien Services SCT Reserve Consultants ServPro of Palm Springs/Indian Wells Sherwin-Williams Paint Silldorf & Levine U.S. Security Associates, Inc. Universal Protection Service Vista Paint Corporation

CAI-CV Chapter New & Renewing Members RENEWING BUSINESS PARTNERS BIG SKY GATE KEEPER Patrick Ross (760) 346-9090 bigskygatekeeper1@verizon.net Kirkpatrick Landscaping Services Steven Kirkpatrick (760) 347-6926 stevekls@msn.com SUNSHINE LANDSCAPE Carlos Contreras (760) 346-3999 ccontreras2202@yahoo.com UNITED LANDSCAPE Glen Miller (760) 347-6161 glenn@unitedgli.com NEW MULTI-CHAPTER BUSINESS PARTNER UNITED SECURITY SERVICES Bill Palmer (800) 505-1234 Ext. 165 bill@unitedweguard.com RENEWING MULTI-CHAPTER BUSINESS PARTNERS

LAKES COUNTRY CLUB ASSOCIATION Frank Melon (760) 902-2886 fmelon@thelakescc.com SUN CITY PALM DESERT COMMUNITY ASSOCIATION Steven Campbell (760) 200-2224 steve.campbell@scpdca.com SUNRISE COUNTRY CLUB HOMEOWNERS ASSOCIATION Eric Charos (760) 328-6045 echaros@pga.com THE GAFFNEY GROUP, INC. Bobbie Gaffney (760) 327-0301 bobbie@thegaffneygroup.net THE MANAGEMENT TRUST-DESERT DIVISION Grace Paluck (760) 776-5100 Ext. 344 grace.paluck@managementtrust.com NEW VOLUNTEER LEADERS Kevin Odenbaugh

NISSHO OF CALIFORNIA, INC. Sean Lyon (760) 727-9719 slyon@nisshoca.com

RENEWING VOLUNTEER LEADERS Sabina Dorn

RENEWING MANAGER MEMBERSHIPS

SEVEN LAKES HOMEOWNER ASSOCIATION, INC. Silas Dreher

ALBERT MANAGEMENT INC. Jayme Fakehany (760) 347-7749 jayme@albertmgt.com ALDERWOOD RESORT MANAGEMENT Andrew Hall (214) 797-5289 ahall@alderwoodgroup.com

EL PASEO VILLAGE Tamara Sorensen

SILVER SANDS HOMEOWNERS ASSOCIATION Annis Townsend James Mock Jim Philpot Larry McMillian Mark Spencer

DESERT RESORT MANAGEMENT-ASSOCIA Rhonda Drews (760) 346-1161 rdrews@drminternet.com

CAI-CV.org

INTERESTED IN SERVING ON THE CAI-CV BOARD? In accordance with the Bylaws of the Coachella Valley Chapter of CAI, the Annual Election of Directors has been scheduled for Wednesday, October 26, 2016, at 3:00 p.m., in the CAI-CV Chapter office, 41-905 Boardwalk, Suite A2, Palm Desert, CA. 92211. Our Bylaws define the nomination and election procedures for the Chapter. The Nominating Committee is now accepting applications from anyone who is interested in serving on the CAI-CV Board of Directors for the three-year term of January 1, 2017 through December 31, 2019. Contact the Chapter office at admin@cai-cv.org or call 760-341-0559 to obtain a “Nomination for the Chapter Board of Directors Form,” and submit your application no later than close of business on Thursday, July 28, 2016, at the Chapter office. Nomination Forms are also available at WWW.CAI-CV.ORG under ABOUT US, CAI GOVERNANCE. Eligible candidates shall be a member in good standing, have recently served in a leadership capacity on a chapter committee, have regularly attended chapter events, and will commit to attending at least seventy percent (70%) of Board meetings and chapter events during their terms.

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9

FEATURE

The Springs

Community Association

By Kelly Roseman, CCAM, CMCA, AMS

L

ocation, location, location was top-of-mind when Ed Johnson first gazed across an open sweep of 400 acres of desert in the early ‘70s. He envisioned the land becoming the prime mid-point of the then burgeoning north and south ends of the Coachella Valley. If he built a premier community on the right scale -- with style, quality, and beauty – he believed it would become the apex for residents’ vibrant lifestyle. Mr. Johnson’s pioneering vision and high standards are realized in The Springs Country Club and what has become the city of Rancho Mirage.

Across the street from the Eisenhower Medical Center and Sunnylands, The Springs borders Country Club, Morningside, Frank Sinatra, and Bob Hope Drive. The project was built over the decade between 1974 and 1984 and has 817 homes, ranging in size from 2,300 to 3,500 square feet. Many homes are situated on the picturesque 18-hole golf course and enjoy views over several lakes and to the nearby mountains. All homes are within easy reach of one of The Springs Community Association’s 46 pool and spa areas.

Additionally, the Association has a full service Fitness, Spa and Activity Center with state-of-the-art equipment with instructors and trainers. A contract between the Association and The Springs Country Club emphasizes stewardship of the shared property as well as full access for all residents to tennis and golf facilities, dining and social activities in the 48,000 square-foot clubhouse and other community-wide events.

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Quorum June, 2016

"...THEY HAVE BEEN AWARDED RECOGNITION

BY THE CITY OF RANCHO MIRAGE AND THE RED CROSS AND ARE CONSIDERED A MODEL BY OTHER ASSOCIATIONS." The Association Board of Directors has seven members, elected at-large, and more than six volunteer committees ranging from architecture to safety and security. Additionally, management of the Association is in-house. The Association General Manager is Kelly Roseman, CCAM, CMCA, AMS. A 20-member staff assists the GM with daily operations, including maintenance services for the Association’s pools and spas. The Association has developed detailed earthquake and disaster preparedness plans and a survival manual for all residents; they have been awarded recognition by the City of Rancho Mirage and the Red Cross and are considered by other associations as a model for disaster preparedness.

The Springs is an evolving community. In carrying out its duty to enhance and maintain property values, the Board of Directors is aware of the need not only to maintain the Association’s physical assets but also to maintain its competitive position in the market place – just as its developer would have expected. The Springs Board has wide-ranging business experience and is hands-on in its work and commitment to provide more than adequate reserve funds for a community of its scale and amenities.

FEATURE The Springs’ 24-hour central-command center is staffed at all times, as is the main gate on Bob Hope Drive. United Protection Service provides coverage for gate access control (also staffed at the Morningside Drive gate) and roving community street patrols. All security personnel are equipped with body cameras and recorders and are trained in CPR and use of an automatic defibrillator. Each residence is linked by an alarm to the command center.

The Association landscaping services are provided by Vintage Associates. Lake maintenance is provided by The Springs Country Club; roof maintenance and replacement is provided by Western Pacific Roofing. An in-house crew provides painting services; each home is painted every five years on a rotation basis to help maintain property appearances and protection to homes’ exteriors. Again, the contract between the Association and the Club allows for compatible, coordinated application of resources to maintain the total property.

“It is not enough to take pride in our positive reputation – which we do! We work every day to protect our assets, earn that reputation and enhance our residents’ satisfaction and happiness in sharing life in The Springs,” says Association Board President Lillian Kuzmanic.

“The construction of homes at The Springs is solid with a variety of gracious floorplans that have attention to details not found in newer construction. For example, fireplace fireboxes are 4 ½ feet wide; main-room ceilings are ten feet and every room has a window (with sliding door) or skylight; double front doors; 2 ½ car garages and more. An easy and vibrant lifestyle is the focus," said Stephen Spurgeon, Vice President.

Kelly Roseman states, “During my nine years here, it has been personally rewarding to work with so many talented Board members who volunteer many hours and days for the continued success of the community. This success would not be possible without our Association staff members who work as a team and take pride in serving our homeowners’ needs."

Kelly Roseman joined the Springs Community Association in December of 2007. She currently holds her CACM CCAM and AMS designations and is working towards her PCAM. She has served on the CAI-CV chapter membership and education committees for the past several years.

Kelly can be reached at (760) 328-2131 or by email at kroseman@springscommunity.com.

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11

WATER WISE

Call to Action Regarding CVWD's Proposed Rate Increases for HOAs

By Cal Lockett

CVWD. In order to comply with the new Chromium 6 regulations, CVWD must start immediately to build treatment facilities. These facilities will cost CVWD $250 million. Securing the loan requires them to show new revenue sources that will pay the costs of the loan. The proposed rate increases will provide that new revenue. CVWD said if they fail to get the loan, they will not be in compliance with State law. If they are not in compliance, the State could take over and rates may end up being much higher. CVWD has to increase rates now to cover the Chromium 6 treatment mandates.

Why are HOAs paying the bulk of the new rates?

T

he CAI-CV office continues to receive phone calls from associations frustrated with the proposed CVWD rate increases that could go into effect on July 1, 2016. The CAI-CV Board of Directors has initiated a grassroots lobbying effort to protest CVWD’s rate increases on HOAs. CAI-CV is asking homeowners, HOAs and business partners to send CVWD protest letters before the CVWD Board votes at the Public Hearing on June 14, 2016.

If you are interested in participating with this effort, here is some background information that can go to homeowners from HOA Boards and management companies.

CVWD has proposed rate increases across the board for all their customers.

Most of these rate increases are moderate compared to other local agencies.

However, the proposed fixed charges for landscape irrigation are four to eight times the current rate, a huge increase compared to the other proposed rates

12

Quorum June, 2016

and certainly a burden for many HOAs. The CVWD Board will vote on the rate increases on Tuesday, June 14, 2016, at CVWD’s public hearing, at 9:00 a.m., at the Administration building, 75515 Hovely Lane East, Palm Desert. Letters of protest will be accepted and considered up until the public hearing. CVWD’s Board has said it will not impose the new rates if they receive protests from at least 50% of their customers.

According to CVWD, the huge increase is necessary to pay for Chromium 6 treatment mandated by the State.

Why are we not seeing huge rate increases from the other water agencies?

CV WD is in a unique situation compared to Desert Water Agency.

Chromium 6 impacts only water agencies in the mid-to-east Valley. Desert Water Agency has no Chromium 6 in their water and will not need to increase rates to cover the costly treatment facing

Under Prop. 218, CVWD is regulated on how they are able to increase rates.

In compliance with Prop. 218, a study was conducted and the proposed rates are based primarily on usage and infrastructure costs. Landscape irrigation has the greatest impact on CVWD’s water delivery infrastructure.

The bottom line is the cost to supply enough water to irrigate a large area of landscaping at an HOA is four to eight times costlier to CVWD than supplying water to a residence.

CVWD said these rates have been artificially low for years. Landscape watering is the most expensive service for CVWD to provide and places the most stress on their distribution system. They admit that they should have increased pricing previously but didn’t.

Because the formula for determining rates is dictated by State law and Prop 218, they cannot subsidize one user type with another type. They cannot charge residential more to subsidize landscape (HOAs). The proposed pricing has been vetted by CVWD attorneys and they feel confident that the pricing is fair and that it will withstand any challenge in court.

More infor mat ion is avai lable online at: http://w w w.cv wd. org/348/2016-Proposed-Rate-Changes

WATER WISE What can HOAs do to reduce these costs?

The huge rate increases planned for the fixed costs for irrigation are based on the capacity of the meters in the association, not the amount of water that is used. We need to keep in mind that there are also water usage rates (as opposed to fixed costs) that are increasing for HOAs. Additionally, individual homeowners will be faced with their own water rate increases. Together, these increases could be formidable.

CVWD said that the following options exist for HOAs that don’t want to pay the increased fixed costs.

1) Move to well water 2) Convert enough landscaping to desert plants so they can remove some meters using rebates to help defer costs 3) Request an audit to see if there are other ways to lower water usage enough to consolidate meters

What can we do?

Participate in CAI-CV’s grassroots campaign to encourage homeowners and associations to protest the rates.

What do we want to achieve?

We hope to achieve a reduction in the proposed fixed rates for landscape irrigation. At a minimum, we want CVWD to postpone the fixed water rate increase long enough to give HOAs the opportunity to change their meters and/or increase assessments.

Cal Lockett is Executive Director of CAI-CV. He is the former lobbyist for Bank of America and WellPoint Anthem Blue Cross Blue Shield. Cal can be reached at (760) 341-0559 or clockett@cai-cv.org.

CVWD lifts drought penalties, extends water-use restrictions

By Heather Engel

C

oachella Valley Water District’s (CVWD) Board of Directors recently lifted drought penalties while keeping water use restrictions in place.

The move to lift drought penalties, which becomes effective June 1, was in response to the state’s transition to water supply-based conservation targets. This common-sense approach makes more sense to an area like the Coachella Valley that has a strong supply that isn’t tied to users outside the region.

CVWD expects customers to continue managing water wisely based on the important lessons learned during the drought emergency. Even without a state mandate, conservation has always been an important tool in the long-term plan to eliminate overdraft of the Coachella Valley’s aquifer.

The board extended existing water-use restrictions through January and added one specific to community associations. CVWD will continue to enforce these rules and is required to report enforcement efforts to the state each month.

The restrictions include: • No irrigation during or within 48 hours after measurable rainfall.

• Broken sprinklers must be repaired within 24 hours of notification.

• Eating establishments may only serve drinking water upon request.

• Hotels and motels must provide guests with the option of choosing not to have towels and linens laundered daily.

• Applying water to outdoor landscapes in a manner that causes runoff to adjacent property, roadways, parking lots, etc. is prohibited.

• Using a hose to wash an automobile, windows, solar panels, and tennis courts, except where the hose is equipped with a shut-off nozzle, is prohibited.

• Applying any water to any hard surface including, but not limited to, driveways, sidewalks, and asphalt is prohibited.

• Homeowners’ associations or community service organizations cannot block, stifle, or threaten homeowners from reducing or eliminating the watering of vegetation or lawns during a declared drought emergency.

Continued, Page 14

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WATER WISE

Drought penalties were put into place in July 2015, in response to the State’s mandate that CVWD customers reduce water use by 36% compared to 2013. CVWD did not institute an across-the-board 36% requirement, instead tying conservation to the existing water budgets. Customers were asked to limit water use to 36% below their individual water budget or pay drought penalty rates. Following an adjustment by the State, CVWD reduced the requirement to 32%.

Since drought penalties began, CVWD customers reduced water use an average 25% compared to the same time period in 2013. Water agencies are required to continue reporting monthly water use compared to 2013, and if reductions are not maintained the State could revert back to mandatory conservation targets.

It’s important to keep in mind that on June 14, the board will consider proposed domestic rate increases and changes to the water budget structure. Under the proposal, water budgets would be approximately 25% stricter than the budgets that were put into place in 2009, thereby helping promote permanent, long-term reduced water use.

CVWD invested $6.7 million in funding for conservation rebate programs this fiscal year and these programs will remain in place to help homeowners, businesses and homeowner associations reduce water use.

For a complete list of conservation programs, tips for reducing water use and all the water-use restrictions, visit www.cvwd.org/conservation.

Heather Engel is the director of Communication & Conservation for the Coachella Valley Water District.

She can be reached at hengel@cvwd.org or at (760) 398-2661.

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California Legislative Action Committee (CLAC) Advocacy Update HERE’S THE LATEST FROM SACRAMENTO. CLAC’s 2016 Legislative Day in the Capitol was held in Sacramento on April 17 &18 with 100 CAI members. Attendees were briefed on the key bills and then spent the day in the Capital lobbying their legislators.

Representing CAI-CV were Adrian Adams, Esq., CAI-CV’s CLAC Delegate from Adams Stirling, Steven Shuey, PCAM,CAI-CV’s CLAC Liaison from Personalized Property Management and Clint Atherton, PCAM from Outdoor Resort Palm Springs Owners Association, CAI-CV’s Chair of CAI-CV’s Legislative Support Committee. Also attending with CAI-CV were Tiffany Christian from Epsten Grinnell & Howell, Ramona Acosta, PCAM from The Tinnelly Law Group, Cyndi Koester, PCAM from Sunwest Bank and CAI-CV Executive Director, Cal Lockett.

CLAC VICTORIES – AB 1720 AND AB 1799 Sponsored by the Orange County Bar Association, proponents of AB 1720 attempted to overturn the 2013 appellate ruling in the “SB Liberty, LLC” case which confirmed that only members may attend their association board meetings. The bill opened association board meetings to anyone a member invited to attend including attorneys, media reporters, etc. Along with the “boots on the ground” legislative visits by the CAI members visiting Sacramento, CAI members delivered more than 600 letters in opposition to Assembly Bill 1720. Many CAI-CV members who attended CAI-CV's May Lunch Program, sent in letters of opposition. According to Skip Daum, CAI’s Lobbyist, “with YOUR help, CLAC stopped the bill cold in the Assembly Housing Committee.” Skip made a surprise visit to CAI-CV's May Lunch Program to thank members for sending letters.

Another CLAC victory was the passage of AB 1799 out of the Assembly, which allows associations to declare board elections “uncontested” when there are an equal or fewer number of candidates than open board seats.

AB 1799 will avoid spending resources for elections when the outcome is certain. Working together, we can make a difference! Our thanks

EVENTS to everyone at CAI-CV who participated in these successful grassroots lobbying efforts.

A Day at the Capitol

BILL WATCH AB 2362 Provides individual disclosures to owners when pesticides are applied by unlicensed pest control operators. This bill is a bit complex as it also requires that tenants be notified, which is impossible as associations usually have no knowledge of who they are and where they are residing. CLAC is attempting to work around this by requiring signage at the application locations that includes all common areas, play grounds, hallways, and even adjacent areas such as crawl spaces where people are not typically present. An association or its “authorized agent” is tasked to notify persons and place these signs; that agent may include managers but you should consider having the applicator perform these tasks.

AB 918 This bill is a second attempt to improve the notification process to absent or missing owners when foreclosures are occurring.

CLAC is involved in drafting amendments to this bill and will keep CAI members apprised of its status and impact on the industry.

By Clint Atherton, CMCA, AMS, PCAM

T

o the rest of the world, it appeared to be just another day at the Capitol Building. In the slightly too warm day, roses bloomed in the adjacent gardens as Senators and Assembly members bustled into the historic building seeking relief from the sun. Little did anyone know, there were several other things in motion as the seemingly average day was unfolding. Just across the street, as CAI members gathered, a retired Air Force pilot was giving a rousing speech to his “troops” as they prepared to descend upon the Capitol with their mission clearly outlined. As this was to be the last gathering of the group under the pilot’s leadership, he sent them off with an impassioned plea to “win one for the Skipper.” The group made their way to the Capitol building with their collective assignments and worked diligently with the politicians to halt the passage of one pending bill and to support another. All was proceeding as planned until a suspicious vehicle appeared outside the building posing a potential threat. In response, the bomb squad and SWAT team rolled in. In addition, six snipers were placed on upper levels on the exterior of the Capitol building, ready for any and all possibilities.

BUCK A DOOR Fundraiser packets will go out to CAI members in July. CAI-CV encourages CAI associations to contribute to CLAC. For one dollar per door, you are doing your part to support our industry’s advocacy efforts in Sacramento.

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EVENTS

As the drama unfolded outside the building, the stakes felt just as high inside as members of the California Legislative Action Committee (CLAC) and their supporters were meeting with their legislative representatives from throughout the state to discuss two very important pending Assembly bills, AB 1720 and AB 1799. Luckily, the group had spent the last day and half reviewing the proposed legislation and had the opportunity to review and discuss them with colleagues. In addition to learning about these two bills, there was an educational session that took attendees through the process of how a bill becomes a law. Afterwards, attendees were treated to more educational sessions. One session covered social media and how to manage it and the other covered drones and the increasing presence of them in associations, and what the potential issues and solutions may be.

Following these programs and armed with the knowledge from the day, attendees wrapped up the evening with a dinner at the top of the hotel and were introduced to all of the CLAC delegates.

The remainder of the night presented opportunities for conversations with delegates and colleagues throughout the state.

The next morning Skip Daum, CLAC’s Advocate in Sacramento, gave his rousing speech as mentioned above. After more than 20 years, Skip announced that he will retire from the daily grind of politics and settle into his 16

Quorum June, 2016

Arizona Ranch to watch sunsets and kick rocks. Before this and his plea to “win one for the Skipper” he again reminded the crowd of the importance of educating the legislators on the two bills discussed the prior day. AB 1720 originally proposed that an attorney could attend any board meeting and address the board whether the member was there or not. After much protestation from CLAC, the bill was modified to eliminate the word attorney but it was replaced with “anyone.” This was actually worse than the original because not only could an attorney attend, any non-member could attend basically turning associations meetings into public forums. The group was educated why this bill would be costly, intrusive and disruptive to the way associations operate, such as requiring association legal representation at every board meeting and the intimidation factor to volunteer board members while being scrutinized by outside attorneys. In addition, owners have other remedies other than having an attorney present at the board meeting including IDR, ADR, a scheduled meeting with the board and even litigation.

The other bill was actually supported

by CLAC. AB 1799 proposes that associations would not have to hold elections if there are fewer or the same number of candidates running as there are open seats for the board (example 2 candidates running for 3 open board positions). If this were the case, they could be elected by acclimation instead

of the association have to go through the expense of mailing out and receiving ballots.

After the group pleaded their cases to the legislators and their staff, we all headed back to the hotel for a debriefing and to inform Skip how the meetings went. It was very interesting to hear the various responses reported back and gave us an overall sense of how the day went. Of course, Skip took notice of each response and promised to follow up, especially with those legislators that did not seem to readily accept CLAC’s position on the bills.

At the conclusion of the debriefing and the clearing of the mystery vehicle parked in the street (he surrendered peacefully and no shots were fired) we all said our goodbyes and parted ways to our homes in various parts of the state.

Once home, we have been awaiting word of the results for those bills. Through the grass roots efforts of CLAC, participants of the Day at the Capitol and letters sent in by concerned voters, the bills took the path we hoped they would. AB 1720 received only 1 out of 7 votes in committee and appears to be dead. Conversely, AB 1799 passed committee by a vote of 6—1. Looks like a win for the Skipper.

Clint Atherton, CMCA, AMS, PCAM is the manager of Outdoor Resort Palm Springs Owners Association.

Clint may be reached at catherton@orps.com or by phone at (760) 328-3834.

FEATURE

Educated Business Partner Distinction From CAI National

C

AI Business Partners are indispensable to the community associations they support with their guidance, products and services. CAI education helps these businesses and professionals differentiate themselves in the competitive community association marketplace.

Business Partner Essentials is a two-part, online course to help CAI-member product and service providers better understand CAI, community associations and the industry at large. Individuals who pass the course and maintain CAI membership earn the CAI Educated Business Partner distinction, gaining special recognition among thousands of companies and professionals who support common-interest communities—accountants, attorneys, bankers, insurance professionals, landscapers, painters, reserve specialists, software providers and many others.

Course Materials Online webinar with exam. Printable materials and a certificate of completion.

Course Length Approximately three hours, with additional reading materials available.

Tuition CAI Business Partner members: $99 | Nonmembers: $199 MARK YOUR CALENDARS -- The CAI-CV Business Partner Committee will be offering the Educated Business Partner Program LIVE on the morning of Wednesday, September 14, 2016.

CAI-CV members who have completed the Business Partner Essentials and earned their CAI Educated Business Partner distinction are: Micha Ballesteros, Flood Response Tiffany Christian, Epsten Grinnell & Howell, APC

ATTENTION BOARD MEMBERS

CAI-CV AND THE DESERT CITIES HOA COUNCIL WORK TOGETHER TO PROMOTE BOARD MEMBER EDUCATION

The Desert Cities HOA Council is an association of HOA Presidents and Board Members; they have met for over nine years to educate volunteer leaders on HOA matters of common interest. These free of charge meetings are every third Thursday from 10:00 AM to Noon at the Cathedral City Hall.

The June 19th meeting will focus on crime in the valley with gang related crime experts speaking. The July 21st meeting will focus on water district surcharges and recent legal decisions affecting all of the HOAs throughout the Coachella Valley. Future meetings will address reserve studies, financial planning and landscape transitions.

All HOA board members and vendors servicing associations are invited to attend. Please RSVP our secretary, Marilyn Sherman, shermanm_99@yahoo.com so a name badge can be made in advance. If you have any questions, please call our Chairman, Mike Traidman at 760-424-6685 or email at mtraidman@yahoo.com.

Lori Fahnestock, Powerful Pest Management Mallory Graves, SCT Reserve Consultants Michael C. Graves, RS, SCT Reserve Consultants Amanda Gray, Peters & Freedman, LLP Cyndi Koester, CMCA, AMS, PCAM, Sunwest Bank Katy Krupp, Fenton, Grant Mayfield, Kaneda & Litt, LLP Mike Mastropietro, OCBS, Inc. Greg Morrow, Eagle Roofing Products Brett Musgrove, PrimeCo Chet Oshiro, EmpireWorks Susan Browne Rosenberg, CIH, Desert Cities Indoor Air, LLC CAI-CV.org

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17

FEATURE

CV Business Partners Show Commitment to Managers & Boards

By Susan Browne Rosenberg, CIH, CIEC, CHMM and CAI-EBP

A

ccording to the CAI website, “CAI Business Partners are indispensable to the community associations they support with their guidance, products and services. CAI education helps these businesses and professionals differentiate themselves in the competitive community association marketplace.”

Any member of CAI can earn the Educated Business Partner distinction (EBP) by paying a $99 fee and then completing the two-part, online course in Business Partner Essentials. The course was designed to help members better understand CAI, community associations, and the industry at large.

Individuals who pass the course and maintain CAI membership gain special recognition that they understand the special needs of common interest communities. You should plan to spend three to four hours to complete the two modules and the exam questions. I completed the course in January as my schedule allowed over a ten day period.

You can log in and out at any time it is convenient.

Did you know that there are over 309,000 common interest developments around the world? And that nearly 65 million residents in the U.S.A. live in CIDs. The needs of residents and managers in HOAs are very different from homeowners without shared walls and gates.

Currently, there are thirteen CAI-CV

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members in our chapter holding the EBP distinction (see page 17). There are approximately 150 members listed on the national website. http://cai. caionline.org/eweb/DynamicPage. aspx?WebCode=EducatedBP The CAI Educated Business Partner distinction can be used as long as the holder remains a CAI Business Partner member or affiliate. While the distinction can be referenced in corporate marketing materials, it must be clearly associated with the individual who earned the distinction, not their company.

When asked for comments about the program, these Educated Business Partners had the following thoughts: Micha Ballesteros with Flood Response has been a longtime supporter of CAI and had this to say about her experience as an EBP. “I became an EBP in 2012 to learn more about how to be of greater and better service to the managers and the HOAs.” Chet Oshiro with Empire

"I became an EBP in 2012 to learn more about how to be of greater and better service to the managers and the HOAs.”

"Did you know that there are over 309,000 common interest developments around the world?

And that nearly 65 million residents in the U.S.A. live in CIDs." Works said “I thought it would be a good way to set myself apart from my competitors.” Mike Graves with SCT Reserve Consultants said “I think I got it within a year after it was introduced…I did it to show my respect and dedication to the Industry, the community managers, and board members. If anything, it was a refresher to how the industry works. I have been around CIDs for over 20 years - everyone, particularly new members, could benefit from it.”

Amanda Gray, Director of Sales & Marketing for PETERS & FREEDMAN, L.L.P., became an EBP shortly after the designation was introduced. In an email response for this article she said “in fact Micha and I were the first EBPs in CA, at that time there were probably 12 nationwide. I was really excited about having

TIME HONORED

By Phyllis Harkins

“I thought it would be a good way to set myself apart from my competitors.” a designation for business partners. Our managers work so hard towards their education and this was our opportunity to show our dedication to the industry and support of our managers. My success in business is a direct result of the relationships I keep with my clients. One of the best ways to do this is to put yourself in the shoes of your clients and really understand their business and their roles.”

Cyndi Koester, PCAM, Sunwest Bank, SVP, Specialty Deposit Manager and CAI Educated Business Partner

"It is the hope of the Council that our EBPs will provide a degree of assurance to boards and managers of their familiarity with community living and knowledge of the governance and structure of these associations." has served two terms on the CAI National Business Partners Council. She writes that the focus of the Council is “to encourage our business partners to become "Educated Business Partners" (EBPs)... partners who do more than simply pay their dues. It is the hope of the Council that our EBPs will provide a degree of assurance to boards and managers of their familiarity with community living and knowledge of the governance and structure of these associations.

EBPs can state that they are Educated Business Partners in their promotional literature and will get an extra ribbon to wear at shows. Now if that isn’t an incentive I don’t know what is!"

Susan Browne Rosenberg, CIH, CIEC, CHMM, and CAI EBP, is President and Co-owner of Desert Cities Indoor Air, LLC in Palm Desert, CA. Her company assists HOAs in assessing the extent of water damage and mold contamination. She can be reached at 760-9022545 or sbriaq@gmail.com

Micha Ballesteros

W

hen you attend a CAI-CV event, it’s almost guaranteed that you will leave that event with at least one hug from Micha Ballesteros. No one in our Chapter is a stranger to Micha. She is Operations Manager for Flood Response, based in Thousand Palms, and she has earned certifications as a Water Restoration Technician (WRT), Applied Structural Drying Technician (ASD) and Fire and Smoke Restoration Technician (FSRT). Flood Response was recipient of the 2015 CAI-CV Business Partner of the Year award, due in large measure to Micha’s dedication to our Chapter. Flood Response, every year, is a supportive Business Partner of the Chapter; they have, on numerous occasions, provided their classroom facility for Chapter board strategic planning meetings and for MOTR educational events. Micha has spent over 100 hours in her training to provide outstanding restoration service to homeowners and businesses that need remediation after a disaster. During the “Great Valley Flood” in September 2014, Micha did not see her home for many days as she helped countless Valley residents and businesses clean up after the massive flooding from that storm.

Micha has resided in the Coachella Valley for over 30 years, and enjoys as she calls it, “hanging out with my kids, my dogs and my friends.” She has three children, and as she calls them, two “fur babies,” otherwise known as her dogs. Micha is thankful for the many strong women in her life that have encouraged, motivated and inspired her to be courageous and take chances. Micha joined CAI-CV over six years ago to grow her professional network. During her years with our Chapter she has chaired the Bowling Committee and has also served on the Golf, Casino and Business Partners Committees.

During her interview for this Time Honored article, Micha’s comments spoke volumes regarding her service to the Chapter.

In her words, she said: “I greatly appreciate and value the many people who I have been fortunate enough to meet through CAI-CV. I have met many wonderful peers who are friendly and encouraging, and I’ve had the honor of having some of these relationships develop into great friendships as well.

CAI is a wonderful educational and networking resource that has helped me develop both professionally and personally.”

Micha, thank you for all that you do for our Chapter. We are honored to share your story.

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CHAPTER EVENTS

May 13th 2016 Lunch Program "How Did King Arthur Do It?"

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CHAPTER EVENTS

Skip Daum

GUEST SPEAKER

Karen Conlon, MCAM President & CEO, Sequoia Grove Consulting, Inc.

SPECIAL APPEARANCE

Skip Daum

CAI's California Lobbyist

MAY PROGRAM BOOTH SPONSORS 1 Stop Pool Pros All Counties Fence and Supply AMS Paving, Inc. Animal Pest Management Services, Inc. Asphalt MD's Blue Sky Landscape Corp.

Conserve LandCare Dunn-Edwards Corporation EmpireWorks Frazier Pest Control, Inc. G4S Secure Solutions USA Horizon Lighting Inc. Nissho of California NPG Nelson Paving Painting Unlimited, Inc. Peters & Freedman, LLP Prendiville Insurance Agency Purified Pool Water S. B. S. Lien Services Seacoast Commerce Bank Sherwin-Williams Paint Company Silldorf & Levine Strategic Reserves Three Phase Electric Universal Protection Service Vintage Associates, Inc.

SPOTLIGHT TABLE SPONSOR EmpireWorks

PEN SPONSOR Accurate Leak Locators

SEE OUR JULY MAGAZINE FOR KING ARTHUR'S STORY

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21

伀甀爀 匀攀爀瘀椀挀攀猀㨀

∠ 䄀猀瀀栀愀氀琀 刀攀瀀愀椀爀Ⰰ 倀愀琀挀栀椀渀最 ☀ 䌀爀愀挀欀昀椀氀氀 ∠ 䄀猀瀀栀愀氀琀 刀攀洀漀瘀愀氀 ☀ 刀攀瀀氀愀挀攀洀攀渀琀 ∠ 䜀爀愀搀椀渀最 愀渀搀 一攀眀 倀愀瘀椀渀最 ∠ 伀瘀攀爀氀愀礀猀 愀渀搀 䘀愀戀爀椀挀 伀瘀攀爀氀愀礀猀 ∠ 䄀氀氀 琀礀瀀攀猀 漀昀 匀氀甀爀爀礀 匀攀愀氀猀Ⰰ 倀愀瘀攀洀攀渀琀 䌀漀愀琀椀渀最猀 愀渀搀 匀琀爀椀瀀椀渀最

22

匀攀爀瘀椀渀最 愀氀氀 漀昀 匀漀甀琀栀攀爀渀 䌀愀氀椀昀漀爀渀椀愀 猀椀渀挀攀 ㄀㤀㠀㄀℀

㠀 ⸀㌀㔀㜀⸀ 㜀㄀㄀ 愀洀猀瀀愀瘀椀渀最⸀挀漀洀

CHARITY

Animal Samaritans Needs the Valley's Help

By Tiffany Goff

A

s a Coachella Valley resident, you can’t traverse down Highway 111 without seeing something referencing Animal Samaritans. But did you know that without our local resident's support, the shelter and its veterinary services could not function?

Our very own Dea Franck, Esq. of Epsten Grinnell & Howell A.P.C. serves on the Board of Directors for Animal Samaritans and I was lucky enough to spend some time with her recently to talk about her passion… animals. There are hundreds of dogs and cats awaiting a home at their Thousand Palms facility.

Although Animal Samaritans participates in several adoption and fundraising events throughout the year, there is still much that the organization needs.

How can you help? Donations (of all shapes and sizes) are accepted through the Animal Samaritans website at www.

AnimalSamaritans.org/make-a-donation. However, if you cannot donate your money, donate your time. Volunteers are ALWAYS needed; from running and assisting with adoption events, to assisting within the facilities.

Low cost veterinary services are offered at both the Thousand Palms and North Indio locations. I personally utilize these affordable services for my own pets; a 90 lb. pit bull named Rocky, a new rescue, a 4 lb. min pin – chihuahua mix named Eljay, and a scruffy 8 lb. cat named George.

Rescuing a pet is the most rewarding thing many people can offer of themselves. On March 25th I attended the Bianca Rae Foundations hosted event, Gardens to the Rescue, and found our pup Eljay and we couldn’t be happier with how well he fit into our family.

And please remember the importance of spay and neuter services, microchipping, and vaccinating both your cats and dogs; this can save a life! Pricing for most services is posted on their official website.

For more information on Animal Samaritans, please visit their website at www.AnimalSamaritan.org and click on the How to Help tab in the upper right hand corner. You can also find out more about the Bianca Rae Foundation at www.

BiancaRaeFoundation.org. You can also visit their Thousand Palms facility to adopt a pet at: Animal Samaritans, 72120 Petland Place, Thousand Palms, CA 92276.

"ADOPT, DON’T SHOP!"

Tiffany Goff has been on the management side of the industry for 12 years and has recently made the move to Dunn-Edwards Paints Corporation as the Valley’s Property Services Representative. For all of your community re-paint projects, please contact Tiffany at (760) 972-6830, or by email at tiffany.goff@dunnedwards.com, for this FREE service.

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23

FEATURE

Business Loans Made Easy

By Christy Majors

D

o you think obtaining a loan is like getting a root canal without anesthesia? Do you think the loan process is like the slow drip of a faucet that keeps you up night-after-night? As a banker, I can appreciate how daunting the task might seem, and it is my job to help customers through these rocky shoals. Here are a few suggestions to help streamline and make the loan process more tolerable. Consider it my form of lending anesthesia.

PREPARE: Be prepared. Seems simple, but often customers are like the person in the grocery checkout line who seems astounded that payment is expected after all items have been tallied. Being prepared helps make the loan process go faster and the lender’s job easier, two things very beneficial to you. Banking regulations and underwriting requirements frequently change, so even if you have gone through the loan process one or more times before, take note that there are basic items your lender will need in order to consider your loan request. This is true whether you are dealing with your current bank or a new one. Most lenders need:

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1) Current Personal Financial Statement listing your assets and liabilities 2) Last three (3) years of Individual Income Tax Returns with all Schedules and K-1s 3) Last three (3) years of Business Tax Returns if you own a business (this is in addition to the individual tax returns) 4) Year-to-Date Balance Sheet and Income Statement if you own a business 5) Corporate paperwork (Articles, Partnership Agreements, DBA’s, etc.) if you are a business 6) Written history of the business

WHO, WHY, HOW, WHERE, WHEN, AND HOW MUCH: Who is the borrower? You? Your company? The type of borrower will affect the loan structure and loan process.

Why are the funds needed? Do you need to add or replace equipment?

Do you need working capital because your business is seasonal or you have accounts receivable that pay slowly? Are you expanding your business, adding new services, or purchasing a building?

All these factors affect the loan structure and process. For instance, what if you are asking for a line of credit, and through our conversation, discover that you are planning to use it for purchasing equipment? In that case, a line of credit would be the wrong structure. A better structure would be a term loan with amortized payments over a specified period of time.

How will the funds benefit you or your business? The consequences of the loan are the end that justifies the means. So will the funds generate new growth, favorably restructure existing debt, or allow one to take advantage of an important business opportunity? The lender needs to know these things.

Where is the location of the borrower and the underlying transaction?

Location is important. For example, not every lender may be interested in making a loan on a building located in Georgia.

When are the funds really needed?

Timing is everything and the lender needs to know this upfront so it can establish reasonable expectations for everyone involved in the process.

How much do you want, how much equity are you prepared to contribute, and how much security can you provide?

Lenders need to have this information as it is essential in the underwriting and approval process.

BE RESPONSIVE: Communication is essential between you and your Banker. Be as responsive to your Banker as you want her or him to be to you. And even if you have provided all the information mentioned above, expect to receive additional requests for information throughout the loan process. As your loan is underwritten and reviewed, it is not unusual that additional questions arise. Responding in a timely manner will keep the loan process running efficiently. So expect questions and don’t be frustrated by them. It is all part of the loan process.

If you will be traveling, or have a preferred method of communication, make sure to let your banker know. Good bankers are true road warriors adept in mobile communications and reachable at most times. If you have communication expectations from your banker, convey them--but be realistic. So be respectful of each other’s time. A phone call at 11:00 pm to see if a document has been received is probably better handled through email or text message.

THE ART OF THE LOAN: Think of your loan application as literature with a beginning, middle, and end. The beginning is the history of you and your business and the purpose for the loan; the middle is the financial, legal, and business documentation supporting the request; and the end is how the funds will be used and with what projected result. Just remember: we are talking about non-fiction, not fiction.

Christy Majors is Vice President, Desert Cities Business Banking for Bank of Southern California.

She can be reached at (760) 771-3914 or cmajors@banksocal.com.

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25

FEATURE

Vendor Contracts — Bidding Through Negotiation By, Jasmine Fisher Hale, Esq. Contracts are not a sexy topic. Ever.

But they are the backbone of how a community association operates. The difference between a good and bad contract can have long lasting and wide ranging implications. This article will outline recommendations on best practices throughout the entire contract process, from requesting bids through the negotiation, include tips of how to reflect the reasons for awarding a contract in the board minutes, and will provide an overview of the essential terms that boards should look for in all contracts.

While I cannot promise directors and managers will be fully licensed attorneys at the end of this article, I can promise a stronger understanding of how to keep an association’s liability exposure lowered with respect to contracts moving forward.

The first step in any contract process is to request bids from qualified companies. Wrong, the first step in the process is to determine whether the board desires a new service provider. If a board is happy with their existing vendors, unless the governing documents require a competitive bidding process, it’s not mandatory every time a service is requested. Some boards solicit bids for services over 3-5 years, even when they are happy with their service providers, to demonstrate due diligence and transparency to their members, however, this is by no means required or necessary.

Before starting a competitive bidding process, always review the association’s governing documents to determine if there are any restrictions on the board’s

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authority to enter into a contract. Typical limitations pertain to contract duration (e.g. prohibit contracts over one year) and sometimes a dollar amount may apply (e.g. prohibit contracts in excess of $1,000). Because boards can only act within their scope of authority, they need to confirm that they are not violating their governing documents.

After confirming with the governing documents on a board’s right to enter into a contract, a good rule of thumb is to obtain three bids. Understand, sometimes it’s not possible to obtain three bids given the location or type of goods or service requested. As important as the competitive bidding process is, boards need to review the bids to make certain, to the fullest extent possible, they are reviewing apples-to-apples comparisons. Not all bids are created equally and here is where the devil is in the details. Make sure numbers of hours, employees, coverage, insurance, warranties, etc. are similar. When it’s not

reasonably feasible to obtain identical comparisons, make sure the differences are fully understood by the board when they approve the contract.

Upon the association’s receipt of the bids, the board needs to meet and discuss them. Civil Code §4935(a) allows boards to meet in an executive session meeting to vote on contracts. Yes, boards can exclude members from their deliberation process, but they must generally note the outcome of decisions made during a closed meeting in their next open meeting minutes. Because of this, many boards discuss proposed contracts during executive sessions but vote for contracts during an open meeting. Some boards prefer to conduct the entire process in an open meeting. There is no right or wrong way to award contracts, but there are best practices boards should consider when including their vote in the association’s minutes. The minutes should reflect (1) the number of proposals considered, (2) the name and amount of the contract awarded, and (3) a general discussion on why this contract over others was selected because it helps establish a record of the reasonableness of the decision (e.g. the board reviewed 3 bids and selected Sunshine Roofers for $200,000 because they provided a 10-year warranty at no additional cost).

The old adage “penny wise and pound foolish” often applies in how boards review and award contracts. Sadly, I’m routinely requested, after the fact, to review “contracts” that aren’t even contracts. Sometimes I’ll review a bid without any terms or, worse yet, include

EVENTS a document full of punitive terms the board never bothered to read. It surprises boards to learn that simply because the dollar value of a contract was low their association’s financial exposure can remain quite high. Without wanting to sound self-serving, I recommend boards request legal counsel review all contracts. The money spent having an attorney review a contract can help avoid the common pitfalls and ensure the best practices are included in the agreement.

For those boards who insist on doing it alone, the following problem provisions should be removed or limited: (1) durations in excess of the board’s authority, (2) automatic renewals and price increases, (3) prices that are not fixed amounts or guaranteed maximums, (4) verbal promises made by the contractor but not included in the agreement, (5) limitations of liability, and (6) not requiring prior written authorization before allowing additional charges.

As strongly as I recommend against the above provisions, I encourage the following be included in contracts: (1) having a clearly spelled out scope of work, (2) insurance, (3) indemnity, (4) performance deadlines, (5) licenses held by the contractor, (6) warranties, and (7) requiring mediation as a precursor to legal disputes.

Contracts are dynamic documents that, when properly created, will set a community up for success. When poorly executed, a contract can prove costly, land an association in a lawsuit, or subject a board to a recall. Following the recommendations in this article will help boards make smarter choices with their contracts.

Jasmine Fisher Hale is a Partner at the law firm Adams Stirling PLC and has been practicing law for 13 years. She specializes in representing community associations as their general counsel. You can reach Jasmine at (310) 945-0280 or jhale@AdamsStirling.com.

What Happened in Orlando Didn’t Stay There

By Phyllis Harkins, CAI-CV President Elect

D

uring early May, CAI National hosted its annual conference in Orlando, Florida; over 3,000 attendees attended over 30 different HOA educational sessions and heard two amazing motivational speakers.

On Thursday, Jim Knight, formerly a Hard Rock Café director, presented an edgy yet informative talk on how to change your corporate culture; Friday’s session was led by Connie Podesta, an organizational therapist, who spent over an hour on stage regaling us with scenarios of how we should and should not respond in our HOA world.

As part of our Chapter’s yearly certification, the President Elect (“P-E”) is required to attend the conference in order to participate in National’s two day chapter leadership classes. Classes included concepts such as “Congratulations, You’re a Chapter President-Elect, Now What,” “Transformational Thinking, Becoming the Leader You’d Want to Follow,” “Budgets and Reserves,” and a roundtable discussion with all P-Es on their chapters’ experiences. For the most part, the P-E classes were well thought out, organized and productive. And, what I also found beneficial were the discussions with other P-Es from across the country. Patrick, the South Carolina Chapter President Elect, might be over 2,000 miles away from Palm Desert, yet his chapter has the same membership growth challenges that we have. Because I attended the National Conference and met over 40 P-Es, I now have solid networking contacts across the country. As the MasterCard commercial says, that’s priceless.

As part of the Conference, CAI-CV received three awards (featured in our May Quorum) from National President and CEO Tom Skiba. It truly was a thrilling moment to be on the stage and receive recognition for our hard work from our industry peers. Thank you for the opportunity to represent YOU on that stage. And congratulations to Gloria Kirkwood, General Manager of Palm Valley HOA, who received her PCAM recognition at this event.

Next year’s CAI National Conference will be held in Las Vegas from May 3 to May 6, 2017. I encourage all CAI-CV Chapter members to attend this event. What you will learn in Las Vegas about our HOA industry definitely won’t stay there. And you’ll be there to congratulate Steve Campbell, General Manager of Sun City Palm Desert HOA, who recently received his PCAM, and who will be recognized at next year’s National Convention.

Phyllis Harkins, CCAM, CMCA, AMS, is the manager of Palm Desert Country Club Homeowners Association. Phyllis can be reached at (760) 345-2331 or by email at phyllis@pdcca.com.

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HOMEOWNERS ASSOCIATION LAW

Are You Ready for The New FHA/VA Disclosures?

By Laurie S. Poole, Esq., CCAL

A

s you may be aware, California Civil Code development associations should act conserSection 5300 was amended last year and vatively and include the FHA and VA disclosures requires associations to include statements in in their annual budget reports after July 1 2016. their annual budget reports disclosing whether An entire condominium project must be the association is certified by the Federal Housing certified by the FHA for a buyer to qualify for Administration (FHA) and Veterans Affairs (VA). an FHA loan. Certification lasts for two years, at The change to Section 5300 becomes operawhich point the association must be re-certified. tive on July 1, 2016. Annual budget reports VA approval is a separate process, but once VA that are prepared from that date forward will approval is obtained, there is no expiration; need to include the FHA and VA information thus, renewal is not required. Both the FHA as specified: • The statement needs to be The change to Section 5300 becomes in at least 10-point font; • On a separate piece of paper; and • Contain the required language

operative on July 1, 2016. Annual budget reports that are prepared from that date forward will need to include the FHA and VA information.

Note that both disclosures are required to be on a separate piece of paper so they should not be combined into one document.

Since the annual budget report is distributed once a year and is required to be included in the documents provided to prospective purchasers (Civil Code Section 4525(a)(3)), consider also including a statement that the information is current as of the date the annual budget report was prepared.

Although the changes to 5300 regarding the FHA and VA disclosures appear to have been intended to apply solely to condominium projects, the first sentence of the second paragraph of each disclosure (“This common interest development [is/is not (circle one)] a condominium project.”) raises a question as to whether all common interest developments need to include the disclosures in their annual budget reports.

Senate Bill (SB) 944 was introduced in February to remedy this confusion. The bill proposes to delete the first sentence of the second paragraph of both the FHA and VA disclosures (indicating whether or not the common interest development is a condominium project). If SB 944 is passed, the FHA/VA disclosure requirements will only apply to condominium projects.

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Quorum June, 2016

and the VA publish guidelines to assist condominium projects to obtain approval and be listed on their approved lists. The FHA publishes these requirements at: www.hud.gov/offices/ adm/hudclips/letters/mortgagee/files/09-19ml. doc. The VA publishes its requirements for approval at: http://portal.hud.gov/hudportal/ documents/huddoc?id=26-7c16VALH.pdf.

To learn more about these issues and to get your community certified you can attend a “Free Lunch & Learn” session by the Palm Springs Regional Association of Realtors (PSRAR).

PSRAR conducts a free informational session to educate associations about new FHA rules and to provide FHA and VA certification. These sessions will be held on the last Tuesday of every month from 11:00 am to 2:00 pm beginning May 31, 2016 through May, 2017. You can RSVP at www.psrar.org or call (760) 320-6885.

Laurie S. Poole, CCAL has been an attorney with Peters & Freedman, L.L.P. since 1993. Peters & Freedman, L.L.P. has offices in Palm Desert, Encinitas and Orange County. Ms. Poole can be reached at Lpoole@hoalaw.com or (760) 773-4463.

FHA - DISCLOSURE “Certification by the Federal Housing Administration may provide benefits to members of an association, including an improvement in an owner’s ability to refinance a mortgage or obtain secondary financing and an increase in the pool of potential buyers of the separate interest.

This common interest development [is/ is not (circle one)] a condominium project.

The association of this common interest development [is/is not (circle one)] certified by the Federal Housing Administration.”

VA STATEMENT “Certification by the Department of Veteran Affairs may provide benefits to members of an association, including an improvement in an owner’s ability to refinance a mortgage or obtain secondary financing and an increase in the pool of potential buyers of the separate interest.

This common interest development [is/is not (circle one)] a condominium project. The association of this common interest development [is/is not (circle one)] certified by Department of Veterans Affairs.”

CAI NATIONAL

Excerpts From CAI National’s Guide to FHA Certification IS THE FHA CERTIFICATION PROCESS NEW? Condominium certification of some form is required by the different elements of the housing finance system. Fannie Mae, Freddie Mac, FHA, the Veterans Benefits Administration, and the U.S. Department of Agriculture have procedures to verify that condominium associations meet each agency’s respective standards before a consumer uses a mortgage to purchase a condominium unit.

FHA instituted significant reforms to its condominium certification process in 2009, making additional refinements during the past few years. In many cases, FHA has acted to ease pressure points in the certification process that served to discourage condominium associations from seeking FHA certification or renewing an existing FHA certification.

WHAT IS FHA? Established as an independent federal agency by the National Housing Act of 1934, the Federal Housing Administration (FHA) is the world’s largest insurer of home loans. To protect tax payers and homeowners, FHA only insures mortgages that meet the agency’s standards and are originated by FHAapproved lenders. FHA does not lend taxpayer money and does not originate mortgage loans.

WHAT IS AN FHA-INSURED LOAN? An FHA-insured loan is a mortgage loan that meets all FHA credit and property standards, is originated by an FHAapproved lender and is insured by FHA. Borrowers are assessed a onetime mortgage insurance premium at closing and then pay mortgage insurance premiums as a component of their monthly mortgage payments. All FHA mortgage insurance premiums are deposited in the Mutual Mortgage Insurance Fund, which backstops most FHA programs and protects taxpayers from covering mortgage losses. In FHA’s more than 80-year history, taxpayers have never been called upon to pay any FHA mortgage insurance claims.

WHAT IS FHA CERTIFICATION? FHA condominium certification is the process of verifying that a condominium association meets all FHA legal, financial, operational and property requirements. A borrower may not use an FHA-insured mortgage to purchase a condominium unit unless the condominium association has been certified

by FHA and the association is in full compliance with all FHA program requirements at the time of purchase.

DOES FHA CERTIFICATION EXPIRE? FHA certification is valid for two years. Condominium associations may begin the recertification process up to six months prior to the certification’s expiration date. To determine when a condominium’s FHA certification expires or if a certification is still valid, visit https://entp.hud.gov/idapp/html/condlook. cfm. Currently, the FHA condominium recertification process requires applicants to submit all of the materials required for submission for the original certification applicant. To assist your community with recertification, you should keep a copy of the initial condominium certification application.

IS FHA CERTIFICATION IMPORTANT? While FHA certification is not mandatory for condominium associations, there are clear benefits for homeowners and prospective buyers if the association secures and maintains FHA certification.

These benefits include: • A larger pool of potential homebuyers, which increases the value and marketability of units • A larger percentage of owner-occupied units, since FHA will only insure mortgages used to purchase a primary residence For some condominiums, FHA certification is not necessary or practical. For example, if all units in a condominium association are priced above the maximum mortgage amount ($650,000) that FHA may by law insure, there is little need for the association to seek FHA certification. Further, certain types of properties, even if organized under a state CAI-CV.org

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condominium statute, are ineligible for FHA certification.

Examples include time-share properties, hotel or condohotel properties, houseboat condominium communities and condominiums located in a designated coastal barrier zone.

COMMON MYTHS ABOUT FHA CERTIFICATION Myth: FHA-insured loans have a higher default rate Federal government data show that the default and claims rate for FHA mortgages is at a low level. The combined seriously delinquent (90-days delinquent) and FHA insurance claims rate (where FHA actually takes a loss) for new condominium projects (less than 2 years old) is .94% over the past two years.

The combined seriously delinquent (90 days delinquent) and FHA insurance claims rate (where FHA actually takes a loss) for existing condominium projects (more than 2 years old) is only .68% over the past two years. Over the past two years, FHA has had 241 condo loans hit the 90-day+ delinquency standard, but of that number, only 5 loans have gone to the claim point where FHA has actually taken a loss.

Myth: Owners with an FHA-insured mortgage have less equity and are more likely to abandon their homes FHA-approved lenders and mortgage servicers are required to quickly identify and offer assistance to FHA borrowers having trouble making their monthly mortgage payments.

This mandatory assistance includes loan forbearance in the case of long-term unemployment, payment restructuring, and other options to help owners remain in their homes. FHA will also work with financially troubled borrowers to lease their homes to avoid default. FHA foreclosure prevention and loan-loss mitigation procedures significantly reduce the likelihood of foreclosure while encouraging borrowers to remain in their homes.

Myth: FHA certification is cumbersome and costly FHA does not charge a fee for condominium certification or recertification. As an additional encouragement for condominium associations to apply for certification, FHA does not require sponsorship by a lender or that associations use the services of a consultant or attorney when applying for certification. Associations may submit directly to FHA for certification.

Condominium associations that do not wish to manage the FHA certification process often seek out the services of FHA certification consultants or attorneys. These professionals have a wealth of knowledge concerning FHA requirements and can identify and help the association address any potential roadblocks to obtaining FHA certification. See pages 11–14 for a list of project consultants and attorneys who offer FHA condo certification services.

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APPLYING FOR APPROVAL—DELRAP AND HRAP There are two ways a condominium association may be approved for FHA certification. One method is applying through an FHA-approved lender; the other is condominium associations applying directly to the U.S. Department of Housing and Urban Development (HUD). An FHA-approved lender may submit a condominium association for approval through the Direct Endorsement Lender Review and Approval Process (DELRAP). Under this process, the association works with a qualified and FHA-approved lender to obtain certification. Lenders are more likely to submit a condominium association for certification under the DELRAP option if there is a sufficient volume of sales in that condominium community.

Condominium associations may also apply for FHA certification under the HUD Review and Approval Process (HRAP). Under the HRAP option, the association collects and assembles the necessary documentation and submits a certification application to FHA. Associations using the HRAP option often engage the services of an FHA certification consultant or attorney to assemble and submit a certification application to FHA. This is a matter of expertise and convenience for the association—the use of a consultant or attorney is not a requirement for certification under the HRAP option.

The complete guide to FHA Certification may be found at: www.caionline.org/search/pages/results.aspx?k=fha%20 certification.

Don't miss the Palm Springs Regional Association of Realtor's FREE Lunch & Learns on the last Tuesday of every month, from 11:00 a.m. to 2:00 p.m. Call (760) 320-6885 for reservations.

CHAPTER EVENTS

2 016 A N N UA L C A I - C V GO L F TO U R N A M EN T W R A P U P

By Dan Farrar, Golf Committee Chair

A

bright and very early sunrise greeted our more than 120 golfers and volunteers on Friday April 22, 2016.

We were fortunate enough again to have our Annual CAI-CV Spring Cup Golf Tournament at the Springs Country Club in Rancho Mirage. Special thanks go out to their General Manager Dan Cooper, Director of Golf Doug Hart, and Food & Beverage Director Mathew Noto, for rolling out the red carpet and providing us all with a first class experience. From fresh baked muffins in the morning to a spectacular buffet lunch – we ate like royalty. The golf course was in the best shape ever and I was afraid of taking a divot since the grass was as smooth as carpet. We would also like to thank Kelly Roseman from the Springs HOA for their hospitality and coordination.

Our Hole Sponsors are always so wonderful to meet as we cruised around the golf course. In celebration of our local concerts – Coachella and Stagecoach – two of our Business partners really out did themselves. Asphalt MD’s had “Cone-chella” using a varied assortment of traffic safety cones posing as celebrities, painting faces and decorating them with costumes – it was absolutely hilarious and so creative a use for otherwise ordinary traffic cones. Nelson Paving on the other hand staged their booth

like the Wild West with Wanted Posters for many of the CAI Board Members including Phyllis Harkins and Gerard Gonzales. I was glad I was not in range of their six shooter. It was a “no-brainer” to award them both the trophy for best booth.

Of course, we also had excellent food and drinks to try out including AMS Paving’s mexican food cooked to order (winner of the Best Food Booth).

Honorable mention in my book also goes out to Vista Paints and their very unique Micro-Brew Tasting Station. Suffice to say, all of our players were well taken care of throughout the round.

The winning foursome for CAI-CV’s 2016 Spring Cup Golf Tournament was the team from McKenzie Rhody, LLP and included CAI-CV Past President Tad Black with Associa Desert Resort Management, Laidly Gordon from Aldea HOA, Allan Hanson from Priority Lighting and Roger Joles from Sonora Wells HOA. Congratulations Team McKenzie Rhody!

Tad Black and Cameron Bridges were the MC’s for our luncheon and they conducted quite an entertaining live auction raising a record amount of funds, $5,700, for our Chapter. Our high bidder, John Walters-Clark won the 60-inch television courtesy of Western Pacific Roofing CAI-CV.org

and I still don’t know if he was able to make it home with that large of TV in his car. Special thanks go out to all of our business partners and managers who donated a door prize or live auction item.

It is truly appreciated.

Thanks to all who made this a wonderful day of fun including our volunteers and especially our Committee Members – Co-Chair Cameron Bridges (Horizon Lighting), Micha Ballesteros (Flood Response), Dea Franck (Epsten Grinnell & Howell), Julie Frazier (Frazier Pest Control), John Walters-Clark (Associa Desert Resort Management), Mikael Ottoson (Gothic Landscape), Mike Higbee (Three Phase Electric), Martha Fogg, (Desert Falls Property Management), Greg Morrow (Eagle Roofing), and of course our CAI team of Cal Lockett and Ashley Lisza for keeping an eye on the rest of us. We look forward to having you all join us next year!

Dan Farrar, CMCA, is the Chair of the CAI-CV Golf Committee. He is the manager of Ironwood Community Association in Palm Desert and a manager with FirstService Residential.

Dan can be reached at (760) 834-2487 or by email at daniel.farrar@fsresidential.com.

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CHAPTER EVENTS

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CHAPTER EVENTS SPONSORS GOLF TOURNAMENT TITLE SPONSOR Sunshine Landscape

SWAG BAG SPONSOR Flood Response

GOLF TOWEL SPONSOR

Associa Desert Resort Management

HOLE BOOTH SPONSOR

Accurate Leak Locators American Leak Detectors AMS Paving, Inc. Asphalt MD's Automation Pride Bank of Southern California CBCI Construction, Inc. Frazier Pest Control, Inc. Kasdan LippSmith Weber Turner, LLP NPG Nelson Paving PrimeCo Roof Asset Mangement ServPro of Palm Desert Sunshine Landscape United Paving Co. Vantage Point Vista Paint Corporation Western Pacific Roofing Corp

GOLF CART SPONSOR NPG Nelson Paving Peters & Freedman, LLP

GRAND PRIZE SPONSOR Diversified Asphalt Products Western Pacific Roofing

“CAI SPRING CUP” TROPHY SPONSOR

Powerful Pest Management

TEE SPONSOR

U.S. Security Associates, Inc.

BALL MARKER SPONSOR EmpireWorks

FOURSOME PHOTO SPONSOR Accurate Leak Locators

BREAKFAST & LUNCH SPONSOR

Dunn-Edwards Corporation Epsten Grinnell & Howell, APC Fiore Racobs & Powers LaBarre/Oksnee Insurance Agency, Inc. Pacific Western Bank PrimeCo United Landscape Universal Protection Services

MULLIGAN SPONSOR

Bank of Southern California Conserve LandCare Seacoast Commerce Bank Securitas Security Services Universal Protection Services

GREEN SIGN SPONSOR

Fiore Racobs & Powers Servpro of Palm Springs/Indian Wells

CLOSEST TO THE PIN - WOMEN Union Bank

CLOSEST TO THE PIN - MEN Allied Barton Security

LONGEST DRIVE – WOMEN Pacific Western Bank

LONGEST DRIVE – MEN Three Phase Electric

SCHOLARSHIP EVENT SPONSOR SCT Reserve Consultants, Inc.

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FEATURE

Everything a BP Needs to Know About Working with Management Companies Business Partners often ask how best to work with CAI-CV management company members. The Quorum Committee reached out to some of our management companies and asked questions every business partner would like to ask. Our sincere thanks to the management companies for sharing this information. We encourage business partners to use this information professionally and always keep in mind that all business is based on relationships. When meeting with managers and board

How do potential business partners gain access to your company’s managers & associations?

Who do they call?

MANAGEMENT COMPANIES (alphabetical order)

Albert Management, Inc.

Primary Contact for Business Partners:

41-865 Boardwalk Avenue, Suite 101 Palm Desert, CA 92211 P. (760) 346-9000 F. (760) 346-9997

Gerard Gonzales gerard.gonzales@albertmgt.com

Associa Desert Resort Management

Paula Tapia Dir. of Business Development ptapia@drminternet.com

42700 Aegean, Suite A Indio, CA 92203 P. (760) 346-1161 F. (760) 346-9918

Rhonda Drews, PCAM rdrews@drminternet.com

FirstService Residential

Primary Contact for Business Partners:

43100 Cook Street, Suite 103 Palm Desert, CA 92211 P. (760) 834-2483 F. (760) 834-2495

Tamara Snyder, PCAM tamara.snyder@fsresidential.com

Primary Contact for Business Partners:

Gold Coast Community Management

Lisa Glogow lisa@goldcoastent.com

75178 Gerald Ford Drive, Suite B-1 Palm Desert, CA 92211 P. (760) 202-9880 F. (760) 202.9260

Timothy Peckham tim@goldcoastent.com

J & W Management Company

Primary Contact for Business Partners:

P. O. Box 1398 Palm Desert, CA 92261 P. (760) 568-0349

Jim McPherson jandwmgmt@aol.com

Personalized Property Management

Primary Contact for Business Partners:

68950 Adelina Road Cathedral City, CA 92234 P. (760) 325-9500 F. (760) 325-9300

The Management Trust – Desert Division 39755 Berkey Drive Palm Desert, CA 92211 P. (760) 776-5100 F. (760) 776-5111

Steven Shuey, PCAM sshuey@ppminternet.com

Do you allow businesses to cold call your company?

Do you have a preferred vendor program?

Yes, breakfast & learns – providing there is an educational component for managers

Not effective; prefers appointments with individual managers

No but vendors must complete a vendor packet

Yes

Yes

Yes; scheduled with Dir. of Business Development

Prefer scheduled meetings with Dir. of Business Development

No but vendors must pass a third-party compliance process and there is a fee

Yes

Yes; only vendors that pass the compliance process

Yes; with educational component and scheduled in advance

Yes; less effective than making an appointment

Yes; requires venders are registered with third-party BCS

Yes; handled by third-party BCS

Yes

Yes; breakfast & learns – educational opportunity for managers conducted at weekly staff meetings

Yes; call the receptionist or leave a business card

Yes; vendors with track record and that have passed thirdparty compliance process (fee) may be listed on web-site

Yes

Yes; vendors must pass the compliance process

Yes; schedule ahead and include education

Prefers scheduled meetings

No

Yes

Yes

Prefers meetings with individual managers

No; we request BPs make an appointment

Yes; operated by Desert Locals Choice with a performance guarantee. Fee charged for an ad

Yes; must also be qualified through vendor program

Yes; most of the time

Yes

Yes

Yes; there is a fee

Yes

Yes

Yes; lunch & learns

No

No

Yes

Yes; unless specifically requested by the board

Primary Contact for Business Partners:

Kari Martin kari.martin@managementtrust.com Loni Peterson, PCAM loni.peterson@managementtrust.com

Whitestar Management 71687 Highway 111, Suite 102 Rancho Mirage, CA 92270 P. (760) 773-0123 F. (760) 773-5432

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Do you allow lunch/breakfast & learns?

Primary Contact for Business Partners:

42635 Melanie Place, Suite 103 Palm Desert, CA 92211 P. (760) 346-1161 F. (760) 346-9918

When going out to bid, do you only include vendors you have a relationship with -- or those that have been vetted by your company in some way?

Do you have minimum requirements for vendors that require professional certifications and licenses, insurance?

Quorum June, 2016

Primary Contact for Business Partners:

Patrick Belous, CMCA patrick@whitestarmgmt.com

FEATURE members be prepared – don’t “wing it.” Keep your meetings brief. Make appointments when possible. Be ethical. And, if you need assistance, call the CAI-CV office or other business partners for ideas of what works and what doesn’t.

Fran Mullahy is the Manager of Business Development for Vintage Associates and Account Manager for Vintage Landscape. She has completed the certificate program in landscape and irrigation at College of the Desert. She also has over 26 years experience in commercial and association management. Fran can be reached at (760)772-3673 or fmullahy@thevintageco.com

Does someone at your company oversee RFPs to ensure information from various vendors can be looked at “apples to apples?”

Yes

Who makes the final decisions about vendors recommended to an association board?

A management company executive?

The manager?

Manager and Board

Do you require references?

Yes

Do you encourage your associations to go out to bid even if they have a solid relationship with a vendor?

Do you use your own contracts or do you rely on the business partner’s contract?

Do you have rules about managers accepting gifts from vendors?

Do you use the CAI-CV Directory to find vendors?

Not always

Vendor contracts unless job is large enough to warrant legal review by the association’s attorney

Yes; typically no gifts

Yes

Follows CAI Ethics & Professional Duty guidelines; gifts are discouraged unless it’s something all staff can enjoy such as food

Yes

Yes, Managers often put together a side-by-side spreadsheet

Manager and Board

Yes

Yes

Vendor contracts are usually used; however, some associations have their own contracts approved by their legal counsel

Yes

Board with recommendation from the manager

Yes

Yes

Determined by job size

Yes

Yes; all the time

Yes; both the Community Managers and upper management supporting the managers. Specifications are developed from industry experts

Managers & Board of Directors – Mangers prepare a matrix of all the bids for the Board to review

Yes

Periodically yes; may not be every year

Usually vendor contracts if they meet industry standards

Follows CAI Ethics & Professional Duty guidelines; gifts are discouraged unless it’s something all staff can enjoy such as food

Yes; especially for newer mangers.

Yes

Board with recommendation from Manager

Yes

Decided by Manager and Board

Vendor if Board approved

Yes

Yes

Yes

Manager and Board with executive oversight

Yes

Not for monthly service providers unless warranted; PPM values longterm relationships

Determined by job size

Yes; no gifts unless approved by management

Yes; PPM prefers to use local vendors when possible

Yes

Board with recommendations from the manager

Yes

Depends on Board requirements – could be more than three

Yes; our contracts

Yes; uses CACM guidelines. No cash gratuities and nothing valued at $300 aggregate per year

Yes

Yes

Manager and Board

Yes

Depends on size of project – vendors must be vetted first

Usually vendor contracts unless association’s attorney is needed to draw contract

Yes; no gifts

Yes

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2016 PLATINUM SPONSOR SPOTLIGHT CAI-CV

As pioneers in the field of common interest developments, the Law Firm of Peters & Freedman, L.L.P., demonstrates a boundless passion and dedication to its clients. With offices throughout California, the experienced attorneys, paralegals, assessment collection specialists and administrative staff at Peters & Freedman, L.L.P. are committed to providing effective, innovative and comprehensive legal services to homeowners associations.

The Firm provides a full range of services including general corporate counsel work, enforcement actions, delinquent assessment collection and construction defect litigation. The Firm’s expert attorneys are seasoned, credentialed professionals with decades of experience in the field of community association law.

Dedicated to fostering relationships with its clients, Peters & Freedman, L.L.P., is passionate about proactively empowering managers and board members through training programs, education and informational articles. The Firm also provides managers and board members with convenient and easy to use tools, such as its Legal Guide app available for IOS and Android phones.

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Accessibility, innovation and responsiveness are key elements to the Firm’s success. The Firm’s dedication to innovation is exemplified through its 24/7 online access to status reports for all collection matters. These reports, which provide real time delinquency information, are available to both management personnel and board members.

Peters & Freedman, L.L.P., also devotes time and energy to shape the laws governing common interest developments. The Firm’s attorneys provide input to law makers in Sacramento regarding proposed legislation and also monitor Appellate Court opinions.

The Firm is actively involved in CAI, not only by participation at tradeshows and events, but as active participants on committees and as speakers at educational events. CAI offers a wealth of information and provides an opportunity to broaden perspectives in the industry and trends affecting CIDs.

Thank you to Peters & Freedman, L.L.P. Attorneys At Law for their generous support of CAI-CV

CONTENTS

Advertisers ACCOUNTANTS & BOOKKEEPERS BRABO & CARLSEN, LLP................................................... 3

ASPHALT AMS PAVING.................................................................... 22 ASPHALT MD’S................................................................ 25 NPG NELSON PAVING/GOLDSTAR ASPHALT..................... 2

ATTORNEYS FIORE RACOBS & POWERS.............................................. 37 GREEN BRYANT & FRENCH, LLP........................................ 4 GURALNICK & GILLILAND, LLP.......................................... 2 LAW OFFICE OF PEGGY REDMON...................................... 6 PETERS & FREEDMAN, LLP............................................. 39

BANKING MUTUAL OF OMAHA BANK.............................................. 37

CONSTRUCTION CBCI CONSTRUCTION...................................................... 38

ELECTRIC & WATER COACHELLA VALLEY WATER DISTRICT........................... 39

FURNITURE PATIO FURNITURE DOCTORS INC.................................... 38

INSURANCE TIMOTHY CLINE INSURANCE AGENCY, INC..................... 36

LANDSCAPING CONSERVE LANDCARE...................................................... 6 SUNSHINE LANDSCAPE..................................................... 3 WATERRITE - VINTAGE ASSOCIATES, INC....................... 39

PAVING FARLEY INTERLOCKING PAVINGSTONES........................... 3

PEST CONTROL POWERFUL PEST MANAGEMENT.................................... 38

POOL DECK RESURFACING

pick the right tools for your next project.

With community association lending expertise like ours, you’ll get the job done right.

take that to the bank.

Brendan Concannon Regional Account Executive 619-961-6346 Toll Free 866-800-4656, ext. 7480 brendan.concannon@mutualofomahabank.com

CTI OF THE DESERT......................................................... 39

POOL WATER PURIFICATION PURIFIED POOL WATER..................................................... 2

ROOFING WESTERN PACIFIC ROOFING........................................... 39

SECURITY ALLIED BARTON.............................................................. 25

mutualofomahabank.com

AMS SECURITY................................................................ 38

AFN46055_0913

Member FDIC Equal Housing Lender

SECURITAS........................................................................ 3

CAI-CV.org

facebook.com/CAICV

twitter.com/CAI_CV

EQUAL HOUSING

LENDER

37

Answering the call for the ultimate in security services.

760.341.3593 AMSprotectme.com 74-794 42nd Ave. Suite 1 Palm Desert Lic# 944895 ACO 6917

Patio Furniture Doctors Inc. “REFINISHING SPECIALISTS”

We can create a new look with your existing patio furniture for about 1/2 the cost of new!

We are your only locally owned and operated state of the art Please call me any time for your free on-site furniture assessment. I am always in your neighborhood.

Owner/Operator Bill Richardson

BEST PRICES, QUALITY & SERVICE

We can meet or beat any professionally written quote.

patiofurnituredoctors@gmail.com

(760) 328-8999

38

Quorum June, 2016

Water Wise Tips For Coachella Valley residents

Plant a waterefficient landscape.

Desert-friendly plants use 50 to 75 percent less water than grass or tropical plants.

Irrigate efficiently.

Prevent water waste. Repair broken sprinklers CVWD offers a rebate for replacing nozzles with new water-efficient ones.

Find and fix indoor and outdoor leaks.

Download copy of Water Wise at Home: A Guide to Finding Leaks at www.cvwd.org Learn more about CVWD’s rebate & discount program at www.cvwd/org/rebates

As a full service law firm, our services include: • Board Education & Fiduciary Compliance • Governing Document Interpretation • ADR & IDR • CC&R Restatement & Amendments • Assessment Recovery • Writs & Appeals • Litigation – Enforcement & Defense • Construction Defect / Reconstruction • Contract Negotiation

Stay connected with us!

(760) 398-2651 www.cvwd.org

San Diego Area: 760.436.3441 Coachella Valley: 760.773.4463 Orange County: 949.390.2977 www.hoalaw.com

mail@hoalaw.com

Please contact us for a free consultation on how we can help your association!

Contractors Lic. # 235717

WESTERN PACIFIC Roofing Corporation

Since 1949

“Complete Roofing Services” Repairs • Re-roofing Roof Inspection • Maintenance Programs Polyurethane Foam • Built-up • Tile • Patios 3462 La Campana Way, Palm Springs, CA 92262 Phone (760) 416-5877 Fax (760) 320-8912 FIND US ONLINE AT www.westpacroof.com

CAI-CV.org

facebook.com/CAICV

twitter.com/CAI_CV

39

OACHELLA I C VA EY

20

6

CA

LL

1

41-905 Boardwalk, A-2 Palm Desert, CA 92211

ID

01

6

FR AY

, , O CTOBER 21

2

CAI-CV UPCOMING EVENTS

GREEN IS FOR LOCAL EVENTS

SIGN UP AT WWW.CAI-CV.ORG JUNE Manager on the Run (MOTR) (for managers) WHEN: Friday, June 3, 2016 WHERE: Sunshine Landscape, Thousand Palms

TOPIC: Collections by Peters & Freedman, LLP

Business Partner Mixer - End of Season Summer Sizzler (for all members)

WHEN: Friday, June 10, 2016, 5:30 p.m. – NEW DATE!!

WHERE: The Classic Club, Palm Desert

Educational Lunch Program & Mini Trade Show (for all members) WHEN: Friday, June 10, 2016 WHERE: Palm Valley Country Club, 11:15 a.m.

TOPIC: Ask the Attorney

CAI's M202 Course (for managers) WHEN: Thursday & Friday, June 23 & 24, 2016 WHERE: Homewood Suites, Palm Desert

The Grease Lightning Summer Bowling Tournament WHEN: Friday, June 24, 2016 WHERE: Palm Springs Lanes

JULY CAI National’s M304 Course (for managers) WHEN: Thursday & Friday, July 21 & 22 WHERE: Santa Ana

IS THE WORD

Friday June 24, 2016 • Palm Springs Lanes Registration, 5:00 – 5:30 pm Grease Attire Encouraged Email ADMIN@CAI-CV.ORG or call 760-341-0559