Post by leokeeler on Jan 31, 2016 17:08:18 GMT -7
I just sent this to the GLA Board. I anticipate a strong push back on changes to Covenant 11.06 because it clearly defines the difference in what is to be done by the Members and by the Board doing the business of the Association.
To: GLA Board of Directors
cc: To provide for broader Member awareness, I am sending this to: info@glastonburylandownersforpositivechange.wordpress.com; nghilltopgroup@gmail.com; theirishpossee@gmail.com, glastonburylandownersgroup@gmail.com
During the Project Review Committee meeting, Financial Committee meeting and Community Property Committee meeting Landowners discussed problems that might be resolved during the process to change our governing documents. When asked if the current process was closed and would only deal with issues sent out in October, most of the Board members present indicted it was still an open process.
Since the only information all members have received is the letter in October and our last newsletter, I do not see it as being very open. To help assure all Members the process is open, I am submitting some basic changes addressing what I heard at these committee meetings. I feel a lot more recommendations will be submitted if this is truly an open process.
I have heard numerous doubtful people ask if the Board does not allow our issues and recommended changes to be processed could they be voted on in a Special Meeting. So far I have assured them that could be done but should only be a last resort.
At the February 8th Board meeting, I will ask if everyone has received and read the recommendations below and hopefully have it recorded in the minutes if the process is still open, or if it is closed.
Thank You
Leo Keeler
New Text BOLD, deleted textSTRIKETHROUGH
BYLAW CHANGES
Article II OBJECTS (B)
Purpose of Change: Clearly state the Community of Glastonbury is a residential community and prevent commercial operations from changing that character.
Article II OBJECTS (B) Purposes. The purposes of the corporation are as set forth in the Articles of Incorporation, and more specifically as follows:
To provide for the management, administration, maintenance, preservation and control of parcels, roads, and common properties within the real estate development commonly known as the “Community of Glastonbury” in Park County, Montana, including that property which is subject to and burdened by the Covenants (hereinafter referred to as the “Property” as a rural residential community, and to promote the health, safety and welfare of the landowners and residents within the above-described Property.
Article II OBJECTS (C)
Purpose of change: Clarify that the Bylaws, and the Board of Directors established through the Bylaws, are constrained by the specific language in the Covenants.
Article II OBJECTS (C) Incorporation of Covenants. The Covenants described above are incorporated herein by reference. TheAssociation Board of Directors formed in these Bylaws shall also have such purposes, and shall be limited in the carrying out of its purposes as may be provided in the said Covenants from time to time.
Article VI (E) Vacancies
Purpose of Change: Insure that Members ultimately elect Directors to serve them, not the Board. This will reduce the appearance of the Board promoting electable Members that serve as placeholders, only to resign shortly after taking office and thus enabling the Board itself to elect Directors willing to cooperate with them.
Article VI (E) Vacancies Vacancies in the Board of Directors between Annual Meetings, caused by any reason, shall be filled by a vote of a majority of the remaining members of the Board at the next scheduled Board meeting held before the Membership.a Special Meeting of the Board held for that purpose, even though the members present at such meeting may constitute less than a quorum. Each person so elected shall be a member of the Board of Directors for the remainder of the term of the member whose term he is filling. until the next Annual Meeting and until his successor shall be elected and shall qualify.
COVENANT CHANGES
Covenant 2.03 Binding Effect
Purpose of change: Clearly present that the Board of Directors or Landowners may take action to enforce the covenants
2.03 Binding Effect. The covenants within this Declaration shall and are intended to be binding and enforceable by the Board of Directors or Landowners as hereinafter provided. Upon authorization of the Association’s Board of Directors in each instance,the Association a designated Member of the Board shall have the right of ingress, egress, and inspection upon and of each parcel, excluding the interiors of dwellings used as the residence of the Landowner and no other, at reasonable times and with reasonable notice of at least seven (7) days for the purpose of insuring compliance herewith.
3.08 Cottage Industry
Purpose of change: Strengthen language to assure Cottage Industries are conducted inside structures supporting residential use of the land, and activities do not adversely impact neighboring landowners. Also, to match limitations of the number of workers to 7 employees as in Master Plan 1.7 and the intent to “maintain the residential nature of our community.”
3.08 Cottage Industry. An industry whose labor force consists primarily of family or communal units of less than 7 people workingat within a home or a garage area.
Alternative recommended change to 11.06, currently under review for change.
[GovDocCmte Notes: This section received a lot of feedback in the 2014 survey and in Board meetings requesting the changes to the interest rate, the way it is computed, and the penalty.]
[Lawyers’ input: The current, relatively high interest rate and the compounding of interest could be considered usurious and may not be upheld in court. The Association should change it if we intend to pursue collection of past dues in court.]
(Member recommending change: The current compounding of 1.5% interest equals an annual percentage rate (APR) of 18%. This interest rate is a penalty rate, not a loan rate as Prime (3%) plus 3% (total 6% APR) would be considered. By reducing the interest due amount of delinquent amounts to Prime Plus 3% and making it retroactive, as may be done unless clearly prevented, the current approximate amount of $280,000.00 in collectable past due assessments would be reduced to only $93,333.00
The interest rate of 18% has been used in establishing late payment plans, and, thus, is collectible.
Should there be a desire to assure the interest rate is collectible under State law; it can be tied directly to State law at 31-1-107 which reads
”(1) Parties may agree in writing to the payment of any rate of interest that does not exceed the greater of 15% or an amount that is 6 percentage points per year above the prime rate published by the federal reserve system in its statistical release H.15 Selected Interest Rates for bank prime loans dated 3 business days prior to the execution of the agreement. Interest must be allowed according to the terms of the agreement.
(2) A loan that is not usurious when made, is lawful for the duration of the loan, provided the loan agreement is not substantially changed. This subsection does not apply to loan renewals.
(3) The provisions of this section do not apply to regulated lenders as defined in 31-1-111”
Making major changes to the Covenants, Bylaws not included, may be considered a substantial change to the agreement (Covenants) Members have made with each other. A loan collection expert should advise on this.
Note: Text inBold and Strikethrough is the change recommended by the Governing Doc Committee which would make late assessment amounts a loan, one of over $20,000.00
11.06. Effect of Nonpayment of Assessment. If any assessment is not paid by midnight on the date when due, then such assessment shall become delinquent and shall, together with any interest thereon, become a continuing lien on the parcel which shall run with the land. If the assessment remains unpaid for thirty (30) days after such due date,a five percent (5%) penalty will accrue on the amount of the payment due and the assessment shall thereafter bear interest from the due date at the maximum rate described in State law 31-1-107 Interest rate allowed by agreement, which is 15% in the year 2016. of one and one half percent (1-1/2%) per month, compounded monthly set by the Prime Rate as posted in the Wall Street Journal or its successor as of December 1st of the year preceding the next assessment year plus three percent (3%) per year, simple interest. The obligation to pay any assessment, penalty, or interest of the current Landowner of any property in the Community subject to assessment shall not be affected by any conveyance or transfer of title to said parcel unless waived or agreed upon in writing as approved by a vote of the Members of the Association. The Board of Directors, acting for the Association may bring an action at law against a Landowner to collect delinquent assessments, penalties and interest and/or to foreclose on the lien against the parcel, and there shall be added to the amount of such assessment the cost of collecting the same or foreclosing the lien thereof, including reasonable attorney’s fees.
To: GLA Board of Directors
cc: To provide for broader Member awareness, I am sending this to: info@glastonburylandownersforpositivechange.wordpress.com; nghilltopgroup@gmail.com; theirishpossee@gmail.com, glastonburylandownersgroup@gmail.com
During the Project Review Committee meeting, Financial Committee meeting and Community Property Committee meeting Landowners discussed problems that might be resolved during the process to change our governing documents. When asked if the current process was closed and would only deal with issues sent out in October, most of the Board members present indicted it was still an open process.
Since the only information all members have received is the letter in October and our last newsletter, I do not see it as being very open. To help assure all Members the process is open, I am submitting some basic changes addressing what I heard at these committee meetings. I feel a lot more recommendations will be submitted if this is truly an open process.
I have heard numerous doubtful people ask if the Board does not allow our issues and recommended changes to be processed could they be voted on in a Special Meeting. So far I have assured them that could be done but should only be a last resort.
At the February 8th Board meeting, I will ask if everyone has received and read the recommendations below and hopefully have it recorded in the minutes if the process is still open, or if it is closed.
Thank You
Leo Keeler
New Text BOLD, deleted text
BYLAW CHANGES
Article II OBJECTS (B)
Purpose of Change: Clearly state the Community of Glastonbury is a residential community and prevent commercial operations from changing that character.
Article II OBJECTS (B) Purposes. The purposes of the corporation are as set forth in the Articles of Incorporation, and more specifically as follows:
To provide for the management, administration, maintenance, preservation and control of parcels, roads, and common properties within the real estate development commonly known as the “Community of Glastonbury” in Park County, Montana, including that property which is subject to and burdened by the Covenants (hereinafter referred to as the “Property” as a rural residential community, and to promote the health, safety and welfare of the landowners and residents within the above-described Property.
Article II OBJECTS (C)
Purpose of change: Clarify that the Bylaws, and the Board of Directors established through the Bylaws, are constrained by the specific language in the Covenants.
Article II OBJECTS (C) Incorporation of Covenants. The Covenants described above are incorporated herein by reference. The
Article VI (E) Vacancies
Purpose of Change: Insure that Members ultimately elect Directors to serve them, not the Board. This will reduce the appearance of the Board promoting electable Members that serve as placeholders, only to resign shortly after taking office and thus enabling the Board itself to elect Directors willing to cooperate with them.
Article VI (E) Vacancies Vacancies in the Board of Directors between Annual Meetings, caused by any reason, shall be filled by a vote of a majority of the remaining members of the Board at the next scheduled Board meeting held before the Membership.
COVENANT CHANGES
Covenant 2.03 Binding Effect
Purpose of change: Clearly present that the Board of Directors or Landowners may take action to enforce the covenants
2.03 Binding Effect. The covenants within this Declaration shall and are intended to be binding and enforceable by the Board of Directors or Landowners as hereinafter provided. Upon authorization of the Association’s Board of Directors in each instance,
3.08 Cottage Industry
Purpose of change: Strengthen language to assure Cottage Industries are conducted inside structures supporting residential use of the land, and activities do not adversely impact neighboring landowners. Also, to match limitations of the number of workers to 7 employees as in Master Plan 1.7 and the intent to “maintain the residential nature of our community.”
3.08 Cottage Industry. An industry whose labor force consists primarily of family or communal units of less than 7 people working
Alternative recommended change to 11.06, currently under review for change.
[GovDocCmte Notes: This section received a lot of feedback in the 2014 survey and in Board meetings requesting the changes to the interest rate, the way it is computed, and the penalty.]
[Lawyers’ input: The current, relatively high interest rate and the compounding of interest could be considered usurious and may not be upheld in court. The Association should change it if we intend to pursue collection of past dues in court.]
(Member recommending change: The current compounding of 1.5% interest equals an annual percentage rate (APR) of 18%. This interest rate is a penalty rate, not a loan rate as Prime (3%) plus 3% (total 6% APR) would be considered. By reducing the interest due amount of delinquent amounts to Prime Plus 3% and making it retroactive, as may be done unless clearly prevented, the current approximate amount of $280,000.00 in collectable past due assessments would be reduced to only $93,333.00
The interest rate of 18% has been used in establishing late payment plans, and, thus, is collectible.
Should there be a desire to assure the interest rate is collectible under State law; it can be tied directly to State law at 31-1-107 which reads
”(1) Parties may agree in writing to the payment of any rate of interest that does not exceed the greater of 15% or an amount that is 6 percentage points per year above the prime rate published by the federal reserve system in its statistical release H.15 Selected Interest Rates for bank prime loans dated 3 business days prior to the execution of the agreement. Interest must be allowed according to the terms of the agreement.
(2) A loan that is not usurious when made, is lawful for the duration of the loan, provided the loan agreement is not substantially changed. This subsection does not apply to loan renewals.
(3) The provisions of this section do not apply to regulated lenders as defined in 31-1-111”
Making major changes to the Covenants, Bylaws not included, may be considered a substantial change to the agreement (Covenants) Members have made with each other. A loan collection expert should advise on this.
Note: Text in
11.06. Effect of Nonpayment of Assessment. If any assessment is not paid by midnight on the date when due, then such assessment shall become delinquent and shall, together with any interest thereon, become a continuing lien on the parcel which shall run with the land. If the assessment remains unpaid for thirty (30) days after such due date,