An open letter to the homeowners who bought their townhouses since February, 2014

                    One way or the other, we're going to have to pay it.

$1,300,000! That's what it is expected to cost to replace our roofs, repave our loop drives, and install new fences. That's about $10,000 for each of us homeowners. A Special Assessment is the only way to guarantee that our money will be spent on those projects. If it is raised through the Annual Assessment, there is absolutely no guarantee whatsoever that tens of thousands of dollars of our money will not be wasted and misspent on other things. Gutter cleaning is a perfect example. According to long time Director Judy Kyrala, in the past the cost for gutter cleaning, “...was something like $70 for the fall cleaning as part of the general fall cleanup” Melanie Lashlee and the Board are now budgeting $4,600 for gutter cleaning!

We need a Special Assessment, not arbitrary increases of the Annual Assessment!

As you read the letter, please keep in mind that there are only a handful of homeowners who bought their townhouse since February, 2014, but there are 122 homeowners who are not on the Board. It is on behalf of all of us homeowners that I have been trying to hold the Directors and HOAMCO accountable. And it is all of us who will benefit if we take action, so it is all of us who need to get involved. After all, this is all about your home, your investment, your money.

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On October 31, 2016, I sent the following complaint to the AZ Dept. of Real Estate Investigations Division, which has replaced the Dept. of Fire, Building, and Life Safety in having jurisdiction over HOAs. I sent it hoping that the ADRE would want to use it to prosecute for the various violations, so as to set an example for other HOA Boards and management companies. Unfortunately, that was not to be. I have used every means I can think of to hold the Directors and managers accountable, to very little effect. So, now I'm asking for your help.

The total cost of the projects described below will cost each of us about $10,000. After you've read the complaint, please take a long, hard look at the rest of the postings. I believe we have excellent grounds to sue the Directors (who are insured at our expense) and HOAMCO for substantial damages related to the misuse of HOA funds, fraud, failure to disclose information, willful negligence, etc. But first we need a lawyer, and then we need to remove the Directors from the Board so that they can't use our money against us, but, most of all, you need to get involved. I can't do this by myself; believe me, I've tried.

Article 33-1813 of the Arizona Revised Statutes gives us a clear way to remove the Directors from the Board. Because so much money is involved, we may be able to get an attorney to sue on a contingency basis, so we will risk nothing. However, even if we have to pay the cost of suing, once the Directors are removed, we can form an interim Board which will give us access to the HOA's bank accounts and we will have the means to bring legal action on behalf of the HOA.  No matter what though, we need to consult with an attorney, and, as a group, you homeowners who bought your townhouse after February, 2014 have the clearest grounds to sue; especially for non-disclosure.

I'm posting this before the holidays so that you can discuss it at family get-togethers, if so inclined.

                                                                                                                            October 31, 2016

Dear Investigator:

I am a former Director and Officer of Greenlaw Townhouses Unit Two HOA. On October 15, 2016, I saw the new owner of [****] Eva Loop moving-in and asked her if she had been provided any information about the need for a substantial increase in the annual assessment, or the need for a special assessment. She told me she had only been told that the annual assessment is $115 per month.

A few years ago, at the 2013 Annual Meeting, reconvened on February 18, 2014, at which time the annual assessment was $110 per month, Community Association Manager/HOAMCO's Flagstaff Regional Manager Melanie Lashlee said the HOA is responsible for replacing the roofs and that it would cost $800,000 to do so. She also said that the HOA is underfunded, and yet there is no mention of this discussion in the Minutes of that meeting. (I have included the Minutes [Exhibit A] and a recording [Exhibit B] of that meeting; the “underfunded” discussion starts at about the 19 minute, 30 second mark on the recording.)

That February 18, 2014 annual meeting was held at a location that seats about twelve people. This year's annual meeting can seat “six comfortably”. On October 19, I called HOAMCO and spoke to Debbie. I asked her how many people their conference room seats. Her answer: Six comfortably. We could probably squeeze in a couple more chairs; the table's big enough. Our CC&Rs [Exhibit H] state that we have 126 lots; we actually have 127. (Exhibits C and D are the notices for the 2016 Annual and Board meetings held at HOAMCO's Flagstaff office.)

Earlier this year on May 26, 2016, I emailed the following letter to the Directors, and copied it to Melanie Lashlee. My memory is not perfect, thus $1,000,000 instead of $800,000.

Dear Officers and Directors of Greenlaw Townhouses Unit Two HOA:

$1,000,000! That's how much Community Association Manager Melanie Lashlee said it would cost to re-shingle our roofs. At the February 2014 Annual Meeting, at which everyone who is now on the Board was present, I suggested doing a special assessment to begin raising the money to re-shingle our roofs and repave our loop drives. Melanie Lashlee opposed doing the special assessment even after saying it would cost $1,000,000 to re-shingle.

Over a three year period, 2003-2005, the original wood shingles were replaced with 25-year asphalt shingles at a cost of $363,000, not including any unforeseen expenses; the money was raised with a 5 year $50 per month special assessment. At that time the roofs were less than twenty years old. It's fair to assume that twelve or so years from now, when the shingles will again need to be replaced, a lot of repair work will also be necessary so an estimate of $1,000,000 may be too low.

In addition, our loop drives are about thirty years old so we can expect that before long they will need a lot of work. If memory serves, it has been estimated that a comprehensive repaving could cost $250,000 or more.

Based on the information Melanie Lashlee provided at my request, replacing the fences will probably cost at least $200,000 and take at least 10 years. Item 9 of the HOA's Rules and Regulations, and

Section V(a) of the CC&Rs authorize the expenditure of HOA funds for the maintenance and repair of fences, not the replacement of fences. No matter what Melanie Lashlee may claim, the approval of the Membership is required for any capital improvement project such as installing new fences, and the only mechanism the HOA's controlling documents provide to pay for capital improvements is the special assessment, as President Susan Jennings and Secretary/Treasure Judy Kyrala well know because they were both Directors when the roofs were re-shingled during 2003-2005.

The above raises a question every Member of the HOA needs answered: How does the Board intend to pay for the afore mentioned projects? If the above estimates are correct, the only way to make certain that, when the time comes, the necessary funds are available is to do a 10 year $95 per month special assessment. Director Cindi Sorrentino is a licensed real estate broker so she must understand the importance of full disclosure in real estate transactions. It is long past time for the Board and Community Association Manager Melanie Lashlee to provide full disclosure to the Membership, and especially to anyone who has bought a townhouse since February 2014. Please provide a letter, not just to me but to every HOA Member, detailing how you intend to pay for the afore mentioned projects.

Respectfully,

Bill Lee

(Exhibit E is a Repaving Estimate by then Director and retired contractor, Pat Mount.

Exhibit F is the bids for fence replacement.

Exhibit I is the HOA's Rules and Regulations)

To date, the Board has not responded to my letter.

Prior to the above letter, I wrote to Melanie Lashlee and the Directors on May 10, 2016 asking that they “please cite any passages in the HOA's controlling documents that authorize the expenditure of HOA funds for the replacement of the fencing.” Melanie Lashlee responded, writing: There is nothing in the CC&R’s that calls out fencing for the HOA. The HOA has been doing repairs on the fencing for years within the community . This replacement project is being done to replace the fencing that is literally falling apart due to rotten wood post . This will be a long term rotation replacement project which will increase the property value of the HOA . It will ultimately stop the need to repair the fencing in the community .

The claim that “There is nothing in the CC&R’s that calls out fencing for the HOA” shows just how arbitrary and capricious the management of our HOA is. It ignores the HOA's Rules and Regulations, which were adopted by previous Boards of Directors on which both Susan Jennings and Judy Kyrala were Directors. The Rules and Regulations serve as the HOA's official and binding interpretation of the CC&Rs, Amendments, Bylaws, etc., and are the basis for the Fine Schedule to which all Members are subject. Item 19 of the HOA's Rules and Regulations, states: The Association repairs and maintains the following elements of the Project as prescribed in the CC&Rs Section #V (a): the private streets, all Common Areas of the Project, all front yard areas of all lots (including sprinkler systems) roofs, repairs to fences due to normal wear and tear, fascia and trim, gutters and down spouts (lot owners are responsible for gutter and down spout cleaning) exterior painting siding material and any and all other required items specified in the CC&Rs.

As to the claim that the fencing “ is literally falling apart due to rotten wood post”, Exhibit G is a picture of the first fence replaced on Jeffery Loop; that fence is clearly not “literally falling apart”.

Also, this year and last year, only $1,500 per year was budgeted for the Maintenance and Repair of Fences. To put that in perspective, during the past few years since Melanie Lashlee became the Community Association Manger, three different contractors were paid a total of more than $9,000 for gutter and down spout cleaning even though Items 19 and 20 of the Rules and Regulations state that “lot owners are responsible for gutter and down spout cleaning”.

Furthermore, the claim that the “long term rotation replacement project” will increase property values is patently absurd: for many homeowners the fence replacement project hurts property values. Only the 11 fences on the southernmost block of Jeffery Loop were replaced, which means the other 116 townhouses suffer by comparison, with no guarantee if or when they will get new fences. Also, if the project is completed many years from now, the townhouses with fences that were replaced this year will then have fences that are many years old, so they will suffer by comparison. This could have been brought to the attention of Ms. Lashlee and the Directors if there had been an opportunity for the Membership to comment; unfortunately the Membership was not given the opportunity.

In the past, I have tried various means to hold Directors and managers accountable, with varying degrees of success. For example, I emailed on Sept. 21, and again on Sept. 25, 2015, the following request to Melanie Lashlee:

Dear Ms. Lashlee,

Please include the following statement with the Notice for this year's Annual Meeting/Election of Directors.

In response to last year's Amendment to the Bylaws, and the Special Election to remove Vice President Bill Lee from the Board of Directors, Mr. Lee filed a complaint with the Dept. of Fire, Building and Life Safety. In the Judge's Decision—which can be found at greenlawtownhouses.blogspot.com—the Judge ordered that Mr. Lee be deemed the Prevailing Party, and the HOA was fined $200 and ordered to pay half of the$2,000 filing fee.

Ms. Lashlee responded, writing:

Mr. Lee,

There is no legal requirement for me to include this information on the Annual Meeting Notice . Unless the Board request for this information to be added it will not be included on the notice .

The requested statement was not included on the notice. So, what did I get for my $1,000? Crystal-clear, unequivocal proof that HOA Secretary Judy Kyrala and Community Association Manager/HOAMCO's Flagstaff Regional Manager Melanie Lashlee committed perjury. If you are interested, you can find additional information at my blog, greenlawtownhouses.blogspot.com, which is why I bring this up: I very much want you to take a long, hard look at what's posted there. (For your convenience I have included the 2015 and 2016 postings: Exhibits J and K, respectively) Also, I recorded meetings, saved emails, and kept a contemporaneous record of HOA matters, much of which is posted at my blog.

But this is not about me or my blog. This is about the failure to disclose vital information: $800,000 to replace the roofs; $250,000 to repave our loop drives; more than $200,000 to replace the fences. Knowledge of the costs of these projects, and how the Board plans to pay for them, is of vital importance to the homeowners of Greenlaw Townhouses Unit Two HOA and yet the Board of Directors and the Community Association Manger have withheld this information from the HOA's Membership.

Sincerely,

William P. Lee

2521 Eva Loop

Flagstaff, AZ 86004

928-714-0145

billlee520@yahoo.com

or greenlawtownhouses@gmail.com (I only check the Greenlaw email on Sundays)

PS. Included with this letter are the following Exhibits: All Exhibits are on the included CD.

Paper copies are provided for Exhibits A, C, D, and E.

Exhibit A. The Minutes of the 2014 Annual Meeting (Paper copy included)

Exhibit B. The recording of the 2014 Annual Meeting

Exhibit C. The Notice for the 2016 Annual Meeting (Paper copy included)

Exhibit D. The Notice for the 2016 Board meetings (Paper copy included)

Exhibit E. Repaving Estimate by Pat Mount (Paper copy included)

Exhibit F. Bids for fence replacement

Exhibit G. A picture of the first fence replaced on Jeffery Loop

Exhibit H. The HOA's CC&Rs

Exhibit I. The HOA's Rules and Regulations

Exhibit J. 2015 Blog (Judge Douglas's decision is at the bottom)

Exhibit K. 2016 Blog

Board of Directors

HOA President Susan Jennings <sjennings@flagstaff.littleamerica.com>

HOA Vice President Jon Zimmermann <jonzimmermann2@gmail.com>

HOA Treasurer Cindi Sorrentino <cindi@flagstaffinnovativerealty.com>

HOA Secretary Judy Kyrala <j.kyrala@gmail.com>

HOA Director Barbara Tauritz <btauritz@hotmail.com>

Community Association Manager/HOAMCO's Flagstaff Regional Manager

Melanie Lashlee <mlashlee@hoamco.com> <melanie@hoamco.com  

                  ********************************************

The following are some of the Exhibits. 

Exhibit A. The Minutes of the 2014 Annual Meeting

Greenlaw Townhouse Unit Two

PO Box 30520

Flagstaff, AZ. 86003

Ph 928-214-0901/FX 928-714-0645

ANNUAL MEETING OF THE MEMBERSHIP

Date: Tuesday, February 18^th, 2014

Time: Registration Starts 5:30PM – Meeting Starts at 5:45 pm

Location: Continental Country Club, Main Club House

Upstairs in the Conference Room

2380 N. Oakmont, Flagstaff, AZ.

Minutes

1. Susan called the meeting to order at 5:52 pm

2. Quorum was established and the minutes for the Annual Meeting on November 13^th, 2012 were approved. There were several members in attendance.

     III. HOAMCO Report – Melanie Lashlee, Community Assoc. Manager

                           Melanie reviewed the current financials for the community as of January

2014. The current operating balance showed $ 46,702 and the Reserve account had a current balance of $ 84,099. Total assets of $130,801. HOAMCO was actively seeking any aged owner balances to ensure the community staying in good standing with collections efforts.

This past year the Board completed various projects on behalf of the community. The full scope rotation painting project continued to ensure the exterior of the units are well maintained. The gutters were repaired and cleaned throughout the community. Various landscape projects were completed; irrigation repairs, tree trimming and spraying for aphids and various other projects which will help keep the community looking well-tended. Mailboxes were replaced and posts secured. The entrance signs to each loop were redone and look new. The red curbs were repainted and the streets crack sealed and seal coated.

Members in attendance over all commented they were happy with how the community was looking and being maintained.

                         IV. There were 67 ballots received, meeting the 64 needed to hold the election.                                  Those elected to the Board were Susan Jennings, Judy Kyrala, Bill Lee and Barbra

                         Tauritz. The IRS Ruling 70-604 passed with 54 “Yes” votes and only 6 “No” votes.

                   

                         V. Meeting was adjourned at 7: 25 pm.

Exhibit E. Repaving Estimate by Pat Mount

Exhibit F. Bids for fence replacement

Exhibit G. A picture of the first fence replaced on Jeffery Loop

AZ Dept. of Real Estate Response

                                            **************************************
Today, November 23, 2016, Doug Clark cleaned some of the gutters on Eva Loop. I took a bunch of pictures as evidence to show that we did not get what we paid for. I also sent myself an email with a full description of what I witnessed, to be presented as a contemporaneous record, and to serve as a sworn statement, if we do sue HOAMCO and the Directors. However, to put what I saw in a nutshell, Mr. Clark spent no more than 15 seconds on my roof, and never set foot on the roofs, or cleaned any gutters, at the townhouses west of the alleyway across the street from me. 
I hereby swear that the descriptions of events here and in that mail are true and accurate. That email, was sent to my billlee520@yahoo.com account, and is dated today at 5:27 PM.