cai summer newsletter

Community Associations Institute / Central Arizona Chapter / www.cai-az.org Summer 2013

Insight and Education for Community Associations

PLUS…President’s Message2013 Tradeshow2013 CAI CAC Event Calendar

The New Market Demand

The Economy is Picking Up… But is it too late to save your community’s most valuable asset?

Creative Thinking and Planning

Back to the Future

ADR: What it is and Why it Matters

Digging Deeper

Bouncing Back

“FREE”* COLLECTIONS

$0 DUEFOR MORE INFORMATION

CONTACT JAVIER DELGADO [email protected]

CARPEN TERHAZ LEWOOD.COM *See ful l Agreement for details

CARPENTER HAZLEWOOD PRESENTS.. .

Summer 2013 1

“FREE”* COLLECTIONS

$0 DUEFOR MORE INFORMATION

CONTACT JAVIER DELGADO [email protected]

CARPEN TERHAZ LEWOOD.COM *See ful l Agreement for details

CARPENTER HAZLEWOOD PRESENTS.. .

Features Departments

Community Associations Institute / Central Arizona Chapter / www.cai-az.org

Summer 2013

Bouncing Back

3Summer 2013

While efforts to insure accuracy are exercised, the publisher assumes no liability for the information contained in either editorial or advertising content.

For advertising and editorial information,please call Valhalla Community Magazines at (480) 634-1708.

Valhalla Community Magazineswww.Valhalla360.com

President’s Letter ...............................4 From the Editor

From the Director ............................... 5 Chapter Executive Director’s Letter

Community Spotlight .........................6 Scottsdale Ranch Invests in the Future

New Members ....................................8 Welcome to the Central Arizona Chapter!

CAI Events ........................................ 10 2013 Tradeshow Spring Night Golf 2013

Myths & Misconceptions .................. 14 Regarding How Your Community is Adapting To This Economic Climate

Public Relations ................................ 16 Public Relations Happenings

Annual Sponsors ...............................24 2013 Annual Sponsors

Diamond Corner ...............................25 Showcase of Top Sponsors

Congratulations Corner & 2013 Committee Chairs ....................26

Calendar of Events ............................28 2013 CAI CAC Event Calendar

The Economy is Picking Up…But is it too late to save your community’smost valuable asset?By Mark Beatty

19

18 The New Market DemandBy Rebecca Herro

Creative Thinking and PlanningBy Suzanne White, CMCA, AMS and Manny San Miguel

20

Back to the FutureBy Brooke Songer, CMCA

ADR: What it is andWhy it Matters

By Bryan Memmot, Esq.

21

Digging Deeper

By John E. Kaye, AMS, CMCA22

18

19

22

www.caicommunityresource.com4

F r o m t h e p r e s i D e n t

Community Associations InstituteCentral Arizona Chapter

2013 BoarD oF Directors

chapter president Josh Bolen, Esq.

Carpenter, Hazlewood, Delgado & Bolen, PLC 480-427-2862 • [email protected]

chapter president-elect Mary Jo Edel, CMCA, AMS, PCAM

PMG Services 480-829-7400 x202 • [email protected]

chapter Vice-president Linda Van Gelder

ALPHA Community Management 623-825-7777 • [email protected]

chapter secretary David Segal

ACE Construction Services 602-840-4500 • [email protected]

chapter treasurer Sean Madigan

Stone Creek HOA 480-545-1212 • [email protected]

chapter Directors Milan Carnes

Verde Groves HOA 937-477-8652 • [email protected]

Lynda Erickson, PCAM Rossmar & Graham

602-616-7322 • [email protected]

Mark Wade, CMCA, AMS, LSM, PCAM Leisure World Community Association


Brian Morgan, Esq., CCAL Maxwell & Morgan, PC


cai central arizona staff Kayte Comes

Executive Director 602-388-1159 • [email protected]

chapter office 1625 E. Northern Ave., Ste. 201

Phoenix, AZ 85020 Tel: 602-388-1159 • Fax: 602-513-7462

[email protected] • www.cai-az.org

community resource committee committee chairs

Jessica Maceyko, Esq. Ekmark & Ekmark, LLC

Vanessa Dreyer, PCAM CCMC

Board of Directors Liaison David Segal

ACE Construction Services

committee members Nicole McConville

Scottsdale Ranch Community Association

Brooke Songer, CMCA Uptown on 27th

Jacob Marshall, CMCA CCMC

Nate Roberts Seamless Services, Inc.

Elaine Anghel, PCAM Tri-City Property Management Services

Lindsey O’Connor, Esq. Carpenter Hazlewood Delgado & Bolen, PLC.

magazine editing subcommittee

Julia Ricciardi, CMCA, AMS Total Property Management

Dawn Engle, CMCA, AMS Planned Development Services

Kerry Lynn Goto, PCAM Great Boards

Ursula Mancuso, CMCA, AMS PMG Services

Kathe Barnes, PCAM Scottsdale Ranch

President’s LetterBy Josh Bolen, Esq., CAI Central Arizona Chapter President

From the Editor...

After (seemingly) endless years of focusing the content of Community Resource on helping communities deal with the economic recession, the Magazine Committee is excited to turn that focus around! There have been many recent positive signs indicating that the local economy and housing market are returning to a period of growth.

The needs and expectations of community associations and industry organizations are changing as the economy bounces

back. Taking advantage of the current economic climate, as well as preparing for the next inevitable downturn, are essential for the long term success of community associations and industry professionals. It is our hope that this edition will provide you with valuable insight and tools for doing so.

Jessica Maceyko, Esq., on behalf of the CAI-CAC Magazine Committee

The state of the Central Arizona Chapter of the Community Association Institute is outstanding as our Chapter continues to grow and flourish. Our Chapter recently won a number of awards at the National CAI Conference. The CAI-CAC Tradeshow was a huge success. The CAI HOA Helpline on News Channel 12 was another positive message to the public about the benefits of our Chapter. The Chapter has a new website, which I highly recommend everyone visit. Finally, it appears that we had a very quiet legislative session as it pertains to community associations.

As a Chapter, we are very proud to see a lot of community associations “Bouncing Back” from some very hard times. While foreclosures, owner and builder bankruptcies and extreme

delinquencies had once plagued community associations, we are beginning to see housing prices rise, home building increase and assessment delinquencies drop. Although CAI-CAC grew during these hard times, we believe that this promising trend will only further strengthen our Chapter.

CAI-CAC, as it did during the hard times, looks forward to working with its members to educate and inform the public about the positive attributes of community associations in the State of Arizona. We continue to encourage everyone to attend CAI-CAC upcoming educational seminars and social events to learn more about CAI-CAC, its people and its benefits. Let’s continue to build better communities through better HOAs.

Hello,I am an Ad.

Valhalla Community Magazines(480) 634-1708

I am also a salesperson in print.

I talk to the 10,000 perspective customers in Community Resource

every issue. How many do you talk to?

The readers are here, where is your ad?

Summer 2013 5

The CAI Annual Conference and Exposition was held May 17-20, 2013, in San Diego, CA. The Central Arizona Chapter has been very fortunate the past three years to have won National Achievement and Excellence Awards and this year was no exception. I am pleased to announce that our chapter won three awards in the large chapter category. We were also the only chapter to win three of the possible five awards.

Additionally, the chapter won three National Volunteers of the Year Awards. The winners of these awards are: Bruce Gran, Linda Van Gelder and Donald Dyekman. Be sure to read more about the winners in the Congratulations Corner, on page 26 and don’t forget to congratulate them - they deserve it!

This is the first time in the history of this chapter that we have won six awards in one year. We also won the most awards of any chapter at this year’s conference!

National Achievement and Excellence Awards provide an opportunity for chapters to showcase best practices and innovative programs. Chapters contribute to the success of CAI and the industry at large through programs for members where they live and work. Chapters, through their hard work, commitment and determination, are an integral reason why CAI is recognized as the premier organization serving community association stakeholders.

The three National Achievement and Excellence Awards won by the Central Arizona Chapter are:

Chapter Management/DevelopmentChapter management or development initiatives and/or tools focused on strengthening the internal workings of the chapter - 2012 Spring Night Golf

MembershipMembership acquisition, retention and/or development efforts that enable CAI to

Typically we respond within 15 minutes.

We have 3 locations valley wide and our foremen & supervisors all carry smart phones,

so we can respond quickly.

Improve your communication and alleviate confusion. Call us today!

�ou �on�t �nd t�at ��oblem �it� us�

Making Management Manageable480-545-0456

[email protected] • www.groundskeeper.com

F r o m t h e D i r e c t o r

Chapter Executive Director’s Letter

expand its membership base – New Member Orientation PowerPoint presentation and execution.

Public AffairsActivities demonstrating the chapter’s role in CAI to the public as the industry’s leading advocate for responsible communities – 2012 CAI and Channel 12 News HOA Help Line.

I am very proud of our committee members and all the other people who volunteer for our chapter; they all work hard to make our chapter successful. Our chapter volunteers are dedicated and enthusiastic and without their support and drive, we could never achieve the goals and objectives set forth in our business plan. Thank you for your tireless efforts!

Kayte Comes, Executive DirectorCAI – Central Arizona Chapter


The uncertain economic climate over the last several years has forced many large scale communities to cut back on expenditures and delay maintenance and other projects. Scottsdale Ranch Community Association was no exception, and although our community was fortunate to not be hit as hard as others, we did have to postpone some previously planned projects and change the course of how we would fund them. Scottsdale Ranch has never done a special assessment of any kind, so when determining that the 30+ year old Community Center facility required updating, the Board and administrative staff considered doing a lower cost special assessment for the very first time. Then, the recession hit and it became clear that residents were not in a position to take on a special assessment and many were trying to just keep themselves above water. The Board postponed the project. In the meantime, we tackled some smaller, necessary maintenance repairs of the Community Center and were able to save and plan for the major remodel project while keeping the assessments down. Last summer, we completely remodeled the interior and exterior of Community Center facility and were able pay for the expenditure in full through the association’s capital improvement and reserve funds.

If the economy has taught us anything, it is that investing in your future and your community is essential and will pay off. Scottsdale Ranch is continuing with this momentum in 2013 and beyond with the focus on being able to renovate where it is needed and use the Association’s funds for projects that will best benefit and protect our residents’ investments in the long run. It has been a very busy year with many major projects completed and, in the works, such as: new monument signage at all major entrances of the community, continued landscape renovations, new subdivision monument signs, administrative office and conference room

c o m m u n i t y s p o t L i g h t

Scottsdale Ranch Invests in the FutureBy Nicole McConville

upgrades and more. The economy will never be certain, but we feel that the best use of our funds is to invest it into the community. We know that keeping the aesthetics of the community up-to-date and common areas pristine will give our homeowners the best return on their investment.

Nicole McConville is the Community Relations Coordinator for Scottsdale Ranch Community Association where she is responsible for the communications, marketing and outreach efforts for the community.

After

Before

After

Before

After Before

Summer 2013 7

CBI Makes Your Life Easier! Whether you’re a Property Manager, HOA Board, or Building Owner, CBI understands the challenges you experience when it comes to property maintenance, construction projects, and repairs to your properties.

CBI is your team of experts guiding you through any aspect of construction/building repairs and maintenance including: forensic inspection services, construction management, and maintenance inspections.

www.cbi4u.com 855 EXPRT4U (397-7848)

Vial Fotheringham provides homeowner associations with the everyday advice you need and can understand. We offer practical answers to your questions, free training, publications, and online resources. Our team helps associations like you proactively and successfully navigate community life. Visit www.vf-law.com.

2450 S. Gilbert Rd Ste 212. Chandler, AZ 85286 Phone: 480.448.1334


n e w m e m B e r s

Welcome to the Central Arizona Chapter!

The Central Arizona Chapter proudly presents and welcomes our new members from March and April.

homeowner/BoarD memBers:Mr. Larry C. McVey Pebble Creek Golf Resort HOA #1Mr. James Bell Shasta Green

inDiViDuaL community managers:Ms. Jennifer Kollings Anthem Community CouncilMs. Lindsay Nicole Bowden Arizona Community Management Services, LLCMs. Leslie Drolshagen Arizona Community Management Services, LLCMs. Susan Massey Belaflora Condominium AssociationMr. Kevin Christoph Young Jomar Association ServicesMr. Peter Giambanco The Crossings at Willow CreekMs. Deserie PerryMs. Joy Graves ALPHA Community ManagementMs. Susan Richards Dobson Ranch HOAMs. Brenda Dozier The Crossings at Willow CreekMs. Minnie Jo Gurule The Village at Apache WellsMr. Chris Teel Vision Community ManagementMr. Crew Johnston Vision Community Management

management companies:Ms. Laurie Roberts L&B Association ConsultantsMr. Chris Layton Right Away Community Management, LLC

Business partners:Mr. Steve Vyrostek Arizona Environmental GroupMr. Matthew Edgar Back to Nature Landcare, Inc. Ms. Deborah Campbell Fastsigns Bell RoadMr. Ben Scalan Galaxy Gate SystemsMr. Brandon Beck Sherwin Williams PaintMr. Clayton Graham Sundance Landscape & Maint.Mr. James Haley TerraPro, Inc.Ms. Rosa Herring Weather Masters, Inc.Mr. J. Bradd Greene Getdocsnow.comMr. Dave Ritchey National Home WarrantyMs. Tamara Martin Anderson Security Agency Ltd.Mr. Joseph Holmes East Valley Disaster ServicesMr. Larry Rudd Mariposa Landscapes, Inc.Mr. Justin Skipton Skipton & Associates, Inc.

CAI MEMBERSHIP APPLICATION6402 Arlington Blvd., Ste 500 • Falls Church, VA 22042

Ph: 1-888-224-4321 • Fax: 1-703-970-9558 • Online: www.caionline.org/join

MEMBERSHIP CONTACT: (where materials will be sent)

Name:

Title:

Assoc./Company:

Address:

City/State/Zip:

Phone:

Fax:

Email:

Select your Chapter: Central Arizona

Recruiter Name/Co. Name:

TOTAL MEMBERSHIP DUES*Community Association Leaders & Homeownersq Individual Homeowner or Board Member $114q 2 Member Board $200 q 3 Member Board $275 q 4 Member Board $345 q 5 Member Board $395q 6 Member Board $445 q 7 Member Board $500 For 2-3 Board Member applications, please list the additional individuals who will receive materials. For applications exceeding three, please contact CAI Customer Care at 1-888-224-4321.

Name:

Address:

City/State/Zip:

Phone:

Fax:

Email:

Name:

Address:

City/State/Zip:

Phone:

Fax:

Email:

Individual Managers $134Management Companies $410Business Partners $560q Accountant q Attorneyq Builder/Developer q Insuranceq Lender/Banker q Reserve Studyq Supplier/Landscaper, etc.Please Specify:q Technology Provider*Membership Dues above include $15 Advocacy Support Fee

PAYMENT METHODq Check Enclosed q VISA q MasterCard q AMEX

Account #:

Name:

Signature:

IMPORTANT TAX INFORMATION: Under the provisions of section 1070(a) of the Revenue Act passed by Congress in 12/87, please note the following. Contributions or gifts to CAI are not tax-deductible as charitable contributions for federal income tax purposes. However, they may be deductible as ordinary and necessary business expenses subject to restrictions imposed as a result of association lobbying activities.

CAI estimates that the non-deductible portion of your dues is 17%. For specific guidelines concerning your particular tax situation, consult a tax professional. CAI’s Federal ID number is 23-7392984. $39 of annual membership dues is for your non-refundable subscription to Common Ground.

Summer 2013 9


The 2013 Annual Tradeshow was held this year on April 12th at Rawhide Wild West Town. Oh, what an event it was, as the theme was “College Daze”. It was a fun trip down memory lane for a lot of us. We recreated dorm rooms, experienced some “revenge” from “the nerds,” played foosball and billiards, enjoyed lots of team spirit and wore a few togas.

With 90 booths, the 268 registered attendees along with numerous walk-ins enjoyed the day interacting with the vendors, playing some fun games, and eating a good lunch with choices of chicken, hamburger or pulled pork.

2013 TradeshowBy Debbie Rudd

c a i e V e n t s

For certification credits and to round out the day, Tim Triplett from Atlanta, GA was the speaker. The class was

titled The Art of Hypnotic Influence and Manipulation and open to all who wished to attend. It did appear as if the class was interactive, fun and interesting.

We ended the Tradeshow with tired feet and raffle prizes. As the excitement of the Tradeshow wound down,

Summer 2013 11

the thrill of possibly winning a prize ramped up. Everyone sat in anticipation of hearing their name called. With hopes, groans, and laughter, the raffle and booth prizes were given to the lucky winning recipients. The following is a list of all the participating vendors and their prizes:

CAI - Central Arizona Chapter Apple i-Pad 16gb Wi-fi

CAI - Central Arizona Chapter Keurig Platinium Coffee Machine

CAI - Central Arizona Chapter $250 Visa Gift Card

American Geotechnical Costco $50 Gift Card

Applied Pavement Technology Hi-Def DVD Player

Brown | Olcott, PLLC Two (2) Diamondback Tickets

Burns Pest Elimination $50 Gift Card

Caretaker Landscape & Tree Management, Inc. $50 Fox Restaurants Gift Card

Castle Reserve Studies $50 Charleston’s Gift Card

CBI Consulting and Construction Management $100 Gift Card - Capital Grille

CCMC Two (2) - $100 Southwest Gift Cards

CLC Enterprise Painting $50 Gift Card

Desert Classic Landscaping Two (2) Diamondback Tickets ($80 value)

DLC Resources, Inc. DLC College Survival Gift Basket: Dinner, Laundry and Caffeine! (Value $100)

Goodwill of Arizona Las Vegas Weekend: includes a gift card for a two-night stay at the Tropicana Hotel and Visa Gift Card. (Value $400)

Gothic Grounds Landscape Apple TV

HomeWiseDocs.com $50 Visa Gift Card

LaBarre/Oksnee Insurance $100 American Express Gift Card

Maxwell & Morgan, PC TV

Minute Bids Samsung Galaxy Tab 2 8GB Wifi enabled tablet

Nautilus General Contractors Tailgating gift pack

Page-Per-Page 1000 Business cards (Value $150)

Paramount Roofing Old No. 7 Gift Basket

Popular Association Banking Two (2) $50 Gift Cards

Puregreen Landscape $50 Gift Card

Union Bank HOA Services| Smartstreet $50 Visa Gift Card

US Bank $50 Gift Card and a Popcorn Factory 3-way Popcorn gift tin

2013 Tradeshow | 12


c a i e V e n t s

2013 Tradeshow cont.

The Best Is Yet To Come! By Heidi Hallquist

On May 10, 2013, CAI Central Arizona Chapter hosted its 4th Spring Night Golf Event. Having never attended before, I really didn’t know what to expect as I pulled up to the golf course. One of the first to arrive, I took a seat in the bar area & grabbed a beer.

I watched as the daytime golfers finished up their rounds and the golf course busily prepared for its next wave of golfers, which included our group. Then people started to arrive until little by little the room FILLED, the line at the bar grew, and the laughter mixed with chatter grew louder and louder.

I know firsthand why the vendors attend these events; we hope to get a little face time with managers. Out of curiosity, I asked a few managers why they took the time to attend this event. Each one had the same reply. Out of all the events they attend all year, this was one of their favorites. I heard stories of years past and crazy shenanigans that brought tears to my eyes, as I was laughing so hard.

If, like me, you have never attended CAI’s Spring Night Golf Event, please do yourself a favor and put it on your calendar for next year!

In closing I’d like to say CONGRATULATIONS to this years winners (yes, through all the shenanigans a little golf is played).

First place goes to: The Groundskeeper Team led by Ken Flynn of Brown Community Management

Second place goes to: The John Wayne Construction Team led by Peter Alesi

And, last but not least; The Most Honest Award goes to John Wayne Construction led by Dave Dillion

Great job golfers! Also, a huge THANK YOU goes out to Scott Haas with Allscape Property Maintenance for being the golf and drink cart sponsor and a huge THANK YOU to Jeni Meyers Temby with Allscape Property Maintenance for being the night glow sponsor for this event. Without our awesome vendor partners, these events would not go on…we really appreciate it guys!

I’m looking forward to seeing all of you next year!

Heidi Hallquist is an Account Executive with Ace Construction Services.

Spring Night Golf 2013

Our final prizes were awarded to the best “themed” booths. Two committee members and random attending managers picked the following booths as the first, second and third place winners. All three winners were awarded CAI credit toward advertising or an upcoming event; and the winners were…

1st Place – Pinnacle Restoration/Universal Protection Service, $250 credit

2nd Place – RenCo, LLC Roofing Contractor, $150 credit

3rd Place – Clean Cut Landscape Management, $100 credit

Now we say so long to another successful Tradeshow and look forward to a new theme, a new venue, and lots of fun at the 2014 Tradeshow!

Debbie Rudd is the Client Relations Director for RenCo, LLC Roofing. She serves as the Committee Chair for the Tradeshow while also serving on the Programs Committee.

Summer 2013 13

CAICAI –– Central Arizona Chapter Central Arizona Chapter

2013 ANNUAL2013 ANNUAL GOLF TOURNAMENTGOLF TOURNAMENT

WWWhhhiiirrrlllwwwiiinnnddd GGGooolllfff CCCllluuubbb 555666999222 WWW... NNNooorrrttthhh LLLooooooppp RRRddd...,,, CCChhhaaannndddllleeerrr,,, AAAZZZ 888555222222666

DDDeeeccceeemmmbbbeeerrr 666,,, 222000111333 888:::000000aaammm RRReeegggiiissstttrrraaatttiiiooonnn

999:::333000aaammm SSShhhooottt GGGuuunnn SSStttaaarrrttt

JJJoooiiinnn uuusss fffooorrr ooouuurrr aaannnnnnuuuaaalll gggooolllfff ccclllaaassssssiiiccc aaattt ttthhheee bbbeeeaaauuutttiiifffuuulll WWWhhhiiirrrlllwwwiiinnnddd GGGooolllfff CCCllluuubbb!!! TTThhhiiisss cccooouuurrrssseee iiisss aaa mmmiiixxxtttuuurrreee ooofff bbbrrreeeaaattthhhtttaaakkkiiinnnggg vvviiieeewwwsss ooofff dddeeessseeerrrttt lllaaannndddssscccaaapppeee aaannnddd

nnneeeaaarrrbbbyyy mmmooouuunnntttaaaiiinnn rrraaannngggeeesss... EEEnnnjjjoooyyyaaabbbllleee fffooorrr gggooolllfffeeerrrsss ooofff eeevvveeerrryyy ssskkkiiillllll llleeevvveeelll...

GGGrrreeeaaattt SSSpppooonnnsssooorrrssshhhiiipppsss AAAvvvaaaiiilllaaabbbllleee

Managers and Board members golf FREEFREE! Talk to your favorite Business Partner today about sponsoring you for a round of golf!

AWARDS & RAFFLEAWARDS & RAFFLE

FFollowollow inging the Tournament! the Tournament!

For more information about the golf tournament, contact the CAI office at 602.388.1159 or info@cai-az.org


?architectural approval (or to deny an owner’s request) merely because the owner is delinquent in paying their assessments. The association would need to carefully review its governing documents to determine whether this type of remedy exists for the association when an owner is delinquent. Keep in mind that many governing documents state that, if a request for architectural approval is not ruled on by the association within a certain number of days, the request is deemed approved. Therefore, the association needs to be careful about failing to act upon a submission merely because an owner is delinquent, and possibly creating an argument for the owner that the failure by the association to act means that the submission is deemed approved. Also, when an association denies a request for architectural approval, it needs to act reasonably and state the reason for the denial. If no provision of the association’s governing documents allows an association to deny the owner’s right to submit for architectural approval merely because the owner is delinquent, and the owner’s submission is in compliance with the provisions of the association’s governing documents, the owner could argue that the association’s decision to deny the submission was unreasonable. The association could consider amending its governing documents to create this remedy.

The information contained in these Myths & Misconceptions is for informational purposes only and is not specific legal advice or a substitute for specific legal counsel. Readers should not act upon this information without seeking professional counsel.

Lynn Krupnik is an attorney with the law firm of Ekmark & Ekmark, L.L.C., where she has been practicing in the area of community association law since 1997. Ms. Krupnik was admitted to the CAI College of Community Association Lawyers, and speaks and writes often on topics that affect community associations.

Elaine Anghel is the Vice President of Management Services of Tri-City Property Management Services, Inc. and has been in the homeowner association industry since 1993.

Myth: A developer has offered the association money to be able to annex his neighboring property into the association, to add more lots into the subdivision. The board can make the decision to annex the property.

Fact: If an association is facing this issue, there are many questions that need to be answered, and the answers should be found in the association’s governing documents: (1) Is there a right to annex property in the declaration? (2) If so, who has the right to annex the property? and (3) Are there any conditions that must be met (such as member approval) to annex property? An association needs to thoroughly analyze with its legal counsel what are the requirements for annexing property into the association and, if it can be done, what practical ramifications exist from such actions.

Myth: With the influx of investor-owners in our community, we can have rules that are more restrictive to investor-owned units than to owner-occupied units, such as not allowing tenants to have pets but allowing owner-occupants to have pets.

Fact: An association’s rule-making authority is usually found in its governing documents. Often the declaration states that an association’s rules cannot discriminate among owners. Furthermore, an association’s rules must be reasonable. Therefore, rarely can an association have different rules for investor-owned units than for owner-occupied units, and any such rules need to be carefully evaluated to ensure that they are in compliance with the association’s governing documents.

Myth: A member of the board has the right to share information regarding homeowners with others in the community, in order to make decisions relative to their lot.

Fact: Board members are held to a certain standard to act as good stewards of the association’s business. If the board has chosen, in accordance with the law, to keep certain information confidential (such as an owner’s personal, health, or financial information), an individual board member needs to comply with the decision of the board and keep the information, as well as discussions of the Board held in executive session relating to such information, confidential.

Myth: The association can prevent an owner from submitting a request for architectural approval if the owner is delinquent in paying their assessments.

Fact: Very rarely does the association actually have the authority to prevent an owner from submitting a request for

… Regarding How Your Community is Adapting To This Economic ClimateBy Lynn Krupnik, CCAL & Elaine Anghel, CAAM, PCAM, AMS, CMCA

m y t h s & m i s c o n c e p t i o n s

CENTR AL ARIZONA CHAPTER

Stop by our office… 1625 E. Northern Ave., Ste. 201 Phoenix, AZ 85020

Summer 2013 15


At the end of 2012, we launched our social media initiative. Do you accidently delete those emails with updates from the chapter? Often you can find the information you’re missing on our Facebook or our more recently launched Linked In Group. Check us out! If you haven’t already done so, be sure to LIKE us on Facebook and JOIN us on LinkedIn!

Central Arizona Chapter of CAI Facebook: https://www.facebook.com/CentralArizonaChapterofCAI?ref=hl

Community Associations Institute Central Arizona Chapter Linked In: http://www.linkedin.com/groups/Community-Associations-Institute-Central-Arizona-4838580?trk=myg_ugrp_ovr

Other happenings…

Our PR Consultant Chuck Montera continues to develop opportunities for our chapter to educate homeowners. On June 4, 2013, ten CAI-CAC volunteers consisting of attorneys and managers participated in the HOA Help Line. The Channel 12 News and AZcentral.com program offers the opportunity for people to call-in or go online and have their HOA-related questions answered. In two hours, the volunteers answered approximately 170 questions with popular questions relating to feral cats, homeowner disputes, mismanaged funds and architectural guidelines. Here are some of the questions we received:

Q1: My HOA wants to read aloud the list of homeowners who have not paid their assessments at an open meeting. Can we do that?A1: The HOA should not do that. Besides the privacy concerns, everyone has to live next to these people. Additionally, if the HOA is wrong and someone has paid their assessments, reading their name at an open meeting could make the HOA liable for slander.

Q2: My home owners association donates thousands of dollars to the Boy Scouts. When I inquired about this policy they said they were allowed to do whatever was best for the neighborhood. The neighbors were never informed about this or asked for approval. Is this legal and if not, what can be done to stop it? I have nothing against the Boy Scouts but do not feel this is what I pay association dues for. A2: Pursuant to statutes and CC&R’s the association should not be using funds for purposes unrelated to the HOA, unless previously approved by the members. An exceptions would be if the Boy Scouts are performing a service for the community or if the funds are coming from somewhere other than the assessments. First step would be to approach the board and ask for explanation and a cessation of the activity. If they do not comply the next step would be to consult with a legal expert.

p u B L i c r e L at i o n s

Public Relations Happenings

Q3: If the HOA Board wants to change anything within the CC&R’s does it require a 2/3 approval from homeowners?A3: Your CC&Rs should have a section in them outlining the requirements for approving an amendment. Arizona State Statutes do limit the maximum approval required to amend CC&Rs to 2/3rds of owners eligible to vote; however your own documents may require a lesser number such as a simple majority. http://www.azleg.gov/ArizonaRevisedStatutes.asp

Q4: How do we get the needed number of votes to amend the CC&R’s?A4: Some tactics used by associations include a door-to-door campaign on top of mailing ballots. Holding a community event to get the word out and bring in the vote. Proxies cannot be used under the AZ Planned Communities Act and AZ Condo Act.

RESOURCES FOR EDUCATION AND INFORMATIONListed below are some sources for information helpful to homeowners, board members and managers.

CAI National website: www.caionline.orgMaricopa County Assessor’s Office: http://mcassessor.maricopa.gov/Arizona Corporate Commission: http://www.azcc.gov/Arizona State Legislature – Arizona Revised Statutes: http://www.azleg.gov/arizonarevisedstatutes.asp

The Examiner.com is a top 100 website reaching 37 million visitors a month with freelancers providing articles sharing their knowledge and expertise in a variety of areas. CAI member Dale Stansel, with Pride Community Management and Co-Chair of the Public Relations Committee, has been accepted as Phoenix Housing Examiner by Examiner.com and his first article, Is your HOA prepared for a disaster?, went live May 23, 2013. Dale also reported on the Barto bill S-1278 that restricts HOA’s established after 2015 from enforcing street parking. To read these and future articles, visit:

http://www.examiner.com/housing-in-phoenix/dale-stansel

http://www.examiner.com/article/is-your-arizona-hoa-prepared-for-a-disaster-1

http://www.examiner.com/article/new-law-restricts-hoas-established-after-2015-from-enforcing-street-parking

Do you have something news worthy “happening” in your community? If so, let us know about it! Contact Brandi Reynolds at [email protected] or at 602-561-1094, so we can get your association the PR it deserves.

Brandi Reynolds,Law Offices of John Chaix

Summer 2013 17

Sales start before your salesperson calls… by advertising in CAI’s Community Resource Magazine.

Call 480.634.1708 to advertise.

I do not know you.I do not know your company.

I do not know your company’s services.

I do not know your company’s reputation.

Now, what is it you want to sell me?


Tractors running, bare dirt being transformed into communi-ties and upgrades to existing amenities-- these are just some of the exciting things that have been taking place over the past 12 months here in the Valley. Three years ago, not that I have to remind anyone, that activity wasn’t happening. For all of us, that meant changing expectations and the reality of doing more with less. Today, as the market continues to regain momentum, we are all challenged with shaping our organizations to meet the new expectations of our clients. Good customer service and providing value are priorities. In order to be successful, we have to treat our clients as more than contracts and numbers; they are partners and we must integrate with their business to help make them successful. More often than not, that means doing things quite differently than others to provide high results that stand out.

One thing that never changed as the market fluctuated was the expectation of excellent customer service. The challenge for companies was to figure out how to still provide excellent customer service while adapting to rapidly changing economic conditions. One way to do that is to invest capital to upgrade processes or deliverables. In this business, that meant investing in communication capabilities to improve client communica-tions; in other words, utilizing new communication technology - like iPhones® and iPads® for field teams. Experience tells me that using smart technology takes some practice, and maybe a couple months or more of training sessions to get teams used to the capabilities of these devices. They aren’t just for Facebook® or Angry Birds®! Adding technology can be well worth the learning curve. Foremen and field managers can receive emails (with photos and GPS coordinates) and calls from clients out in the field during the work day and respond immediately. An additional benefit is greatly improved communication internally, which leads to increased efficiency and then back around again to a better customer experience. An issue in the field can be emailed with a photo and GPS location to the crew, and they can respond and fix the issue – virtually eliminating wasted time and confusion related to the request. In the landscape industry where they are so many small moving parts, this is a big time saver. It means we spend less time trying to figure out the details

of the project and more time working toward the solution, giving our clients faster response and a better experience.

2013 has brought about a lot of optimism in the economy, par-ticularly in the housing market. As the market shifted over 2012, we saw a marked change in the decision making process - lowest price isn’t necessarily the deciding factor. Though pricing has to be competitive, boards are looking for full-service companies that distinguish themselves from the rest of the market through their expertise and experience. By branching out and embracing programs that make a company unique, communities get more value for what they spend and positively impact the relationship between the community and vendor. One of the most expensive things in a community’s budget is water. In landscape especially, the expectation is moving towards tracking it, managing it, bud-geting it for the community, analyzing it and even guaranteeing how much of it will be used each year. Providing and honoring a water guarantee is one of the new aspects of landscape manage-ment. While water management isn’t a practical solution for every company that works with communities, the theory behind it is: finding something that provides value to the community by saving them money and limiting assessment increases!

In the end, all of this boils down to one thing: trust. Whether that is through better customer service or unique solutions to their challenges, your customers have to trust that you are a partner with them. As growth (hopefully) continues, we believe the trend toward high service standards and high quality results will remain a critical priority to client satisfaction. Exceeding those standards, at what is often a lower price point, is the envi-ronment we are all now in. Successfully navigating how you pro-vide your services and how the customer receives them is critical as the Valley housing market continues to change. Balancing service, quality and cost for both current and prospective clients while maintaining the integrity of your business and image is the new market demand.

Rebecca Herro leads DLC’s Client Relations Team. As a member of the DLC fam-ily for the past 5 years, Rebecca’s team supports the needs of DLC’s 25 Commu-nity Partners as well as implementing the company’s growth strategy for future clients.

The New Market DemandBy Rebecca Herro

Summer 2013 19

2. Seal coats & slurryA “seal coat” and “slurry” are different terms that refer to vastly different types of surface treatments. Often, the term “slurry seal” is mistakenly used in place of the term of seal coat. Slurry should be properly designated as a Type I, Type II, or Type III “Slurry” as defined by the International Slurry Surfacing Association.

A lack of understanding here can lead to accepting bids and even going so far as having a surface treatment installed that doesn’t match the condition of the pavement. As a general rule, slurry (which leaves a grainy residue post-installation that residents of-ten find a nuisance) is best installed on asphalt in fair to poor con-dition or streets with higher amounts of traffic or heavier loads.

3. Seal coat standards & new trendsUnfortunately, bids from a contractor offering a seal coat do not have to meet a specific standard to be classified as a seal coat. The bigger problem is there’s also no way to know if a contractor is ap-plying a seal coat to manufacturer recommendations. This would require collecting a sample at the time of application and sending it to a lab to determine if it’s been weakened with the addition of too much water, for example.

The fastest growing trend is away from seal coats to a High Den-sity Mineral Bond (HA5) which has a specification established by the American Public Works Association and carries a perfor-mance guarantee for a minimum of five years. When considering options, do your best to reduce the liabilities associated with mak-ing a decision that ends up costing a community more over time.

4. Seal coat durabilityAccording to an industry trade organization, seal coats are recom-mended to be reapplied every three years. This ends up being a very expensive way to attempt to extend the life of pavement. Again, the trend toward the use of a High Density Mineral Bond (HA5) is driving down the life-cycle costs of pavement ownership when compared to seal coats.

Mark Beatty is the VP of Holbrook Asphalt. Mark sits on national boards focused on the promotion and education of proper pavement preservation.

If your community postponed the maintenance of asphalt road-ways while the economy was down, it could mean that you have accelerated some major asphalt rehabilitation costs.

I’m not sure it’s accurate to explain asphalt this way… but I think you could say that asphalt streets are deceptive. Or maybe it’s more accurate to say that our perception of asphalt streets de-ceives us. Too often, asphalt roads are perceived to be something that will last a lifetime. The reality is that asphalt streets have a limited lifespan unless they are properly and proactively main-tained.

Becoming familiar with the basics of asphalt preservation and be-ing proactive will unquestionably drive down maintenance costs for your community. Test your knowledge on asphalt preservation by answering “true” or “false” to the following questions:

1. _____ If there isn’t cracking in the asphalt, wait one more year to install an asphalt preservation treatment.

2. _____ A “seal coat” and “slurry” are different terms, but reference the same type of surface treatment.

3. _____ A seal coat must meet specific durability standards before being classified as an asphalt seal coat.

4. _____ No preservation treatment is guaranteed for five years.

Understanding the answers to these few simple questions will lower pavement ownership costs. The most effective strategies for managing pavement also minimize the need for road closures that are always a burden to residents.

The answer to each of the questions in this quiz is “false.” Here is why:

1. Low cost strategyOne of the most common reasons an asphalt street or parking lot requires unanticipated reconstruction or costly major rehabili-tation is due to the delay of initiating a pavement maintenance program or simply installing an ineffective surface treatment. The most cost-effective method for preserving asphalt pavement is to preserve the asphalt binder BEFORE oxidative stress leads to deterioration and eventual failure. When we react and install a preservation treatment as we see signs of visible distress (such as cracks), we’ve already reduced the life span of the pavement and added to the cost of maintaining it going forward. To put it simply, the lowest-cost means of preserving asphalt is to “keep a good pavement good.”

The Economy is Picking Up… But is it too late to save your community’s most valuable asset?

By Mark Beatty


In a struggling economy, associations typically take the time to look at where they are spending money and what expenses can be cut back to see where they can provide more cash flow for working capital projects for their reserves and budgets. Coming out of a troubled economy, associations face many challenges.

Lack of attention to proper increases and improper budgeting for future capital improvements can result in deferred maintenance problems that require attention. A properly completed reserve study and strategic plan are vital in order to prepare for the future fiscal and physical plant health of any type of association.

As the economy turns around, associations are making positive changes to reduce their spending, or are spending their money more wisely. As we begin to be more creative in how our asso-ciation dollars are spent, we also become more aware of what we are spending our dollars on. We ask ourselves, “What projects and improvements do we want to undertake, and how should we be investing our funds?”

The turn of the economy has taught us how to make choices on the issues that really matter to us. It has taught us how to save money instead of wasting it. It has made us grateful for what we have instead of complaining about what we do not have. It has made us consider our jobs and evaluate what needs to be done so we can stand out amongst the crowd and become more creative in our approach to the way we do things, handle situations, and spend our money. Many have been able to recognize strengths that they did not think they had and have been able to deal with situations that they thought they may not have been able to get through. This has made us stronger personally and with our clients. With creative thinking and plans, we have been able to service our clients more thoroughly in all areas. There are many creative ways to support our investments as we are coming out of a struggling economy with special assessments and loans with low interest rates for large capital improvement projects that may have been deferred.

How does your association bounce back from a situation in which a capital improvement project has been identified, but there are not enough funds in reserves to pay for the project? In many situations, association money is being wasted in trying to repair the issues. A complete replacement may end up saving

the association in the long run. There are several ways in which an association can finance capital improvement projects. For example, associations can raise regular assessments, pass and collect a special assessment, or utilize a combination of the two, along with obtaining a loan. As a corporation, the association may have the ability to borrow money for these projects, depend-ing on their governing documents. It is a specialized loan – not difficult with most banks, but it has some delinquency hurdles in some communities. Advantages of obtaining a loan include avoiding a one-time lump sum special assessment, improve-ments are completed quickly, downward slide of property values are slowed or eliminated and the association has the potential to save money that is currently being spent with repairs. Disad-vantages include a possible increase in assessments. In addition, interest and loan closing costs are incurred. Homeowner asso-ciation loan terms are generally one to fifteen years, depending on the useful life of the project. Association lenders will look at several aspects of the association during the approval process, including the size of the community, current and past cash flow, delinquencies, the current delinquency policy, a reserve study, financial documents and the overall stability of the association.

Common questions regarding an association loan are usually regarding personal liability, from either board members or the individual homeowners. As a corporation, the association is responsible for the loan, not the board or homeowners. The homeowners still have an obligation to pay their regular and/or special assessments in a timely manner, so only statutory assessment liens exist. When trying to obtain membership approval, it is imperative to build confidence in the community through leadership. The message to the homeowners should include properly identifying the extent of the problem, ensuring the board has reviewed several options and an adequate fix plan has been selected, an assembled team of industry experts have assisted through the process and all options for paying back the loan have been explored.

Suzanne White, CMCA, AMS, is the Director of Business Development at Paramount Roofing and Paramount 911 Restoration and Construction and has worked in the association management industry for 9 years.

Manny San Miguel is Vice President for Mutual of Omaha Bank, Community Association Banking. As a Regional Account Executive, his territories include Arizona and New Mexico.

Creative Thinking and PlanningBy Suzanne White, CMCA, AMS and Manny San Miguel

Summer 2013 21

Unless you have a DeLorean time machine hidden some-where, it is important to recognize the importance of, develop, and implement a strategic plan for the future of Valley com-munities. Year after year, organizations come together for strategic planning, but often walk away validating only what has already trans-pired or is in progress.

Why would a community association need a strategic plan? Too many directors, committee members, management representatives, and affiliate partners are too focused on what is happening today, that what may come tomorrow, next week, or in a few years is completely neglected. This is easy to do. Everyone has a full plate, all the time. Also, board members have short terms on the board, and manag-ers, unfortunately, change all too often. This does not lend to future thinking. However, future board members, future management, and future partners on property are being set up for failure if the time is not allocated on an annual basis to visit, revisit, and measure the old strategy that was (or was not) implemented and put new initiatives into effect by the people who are serving the community NOW.

Take up a meeting or two, gather thoughts from anyone who is involved in the community, and put together a plan that actually has strategy in it. Take on the responsibility of answering the questions, “What must we do to create and deliver quality for our residents?” and “What do we need to achieve?” A good mission and vision state-ment for the community are also necessary to determine a solid future plan. These are not interchangeable items, so ensure you have both in place. An effective document will address what you want for the end result and then have goals and initiatives to go with each of them.

A few things to think about: • Improving partnerships • Maintaining revenue• Fostering community involvement• Maintaining assets • Recognizing and overcoming obstacles

As communities age, they breed different needs. New developments will always get to the place that our old ones are at today. Use that ex-perience and transfer it into the plan. Also, utilize industry tools such as reserve studies and tree management programs. Updated reserve studies will assist you significantly in planning for the future of the neighborhood. A good tree management program will map out each species and provide a budget for the next three to seven years for tree thinning. This expensive, ongoing process is vital to a community. CAI has several partners that offer these services, so speak with a few of them to understand the benefits of these tools to provide physical and emotional health in the community for years to come.

Now that the economy is recovering, it is a great time to draft this working document if it does not exist already. Once this plan has been created, share it with everybody. Let people know what you are doing. Moreover, let people know HOW you are achieving this and WHY, as great leaders always do.

Brooke Songer, CMCA, is a principal member of Uptown on 27th, LLC, a Valleycommunity management firm and holds a BA degree in Communication Studiesand an MBA with a focus in non-profit management.

Back to the FutureBy Brooke Songer, CMCA

With the economy and housing market bouncing back, we are finding that association boards are starting to deal again with a lot more than just foreclosures and short sales. With the return of homeowners comes the return of homeowner and association “issues”. It’s inevitable... association boards and members are not always going to see eye-to-eye. We all know that homeowners don’t often see the association boards as a group of volunteers looking out for the best interest of the community. Rather, homeowners often view the board as the enemy who is out to get them. Because of this, minor issues that should be resolved in a simple manner can become ugly conflicts.

Board members are charged with resolving any conflicts with owners in a way that is in the best interests of the association and all owners at large. Sometimes, in a sit-down meeting with open dialogue, the board and the opposite side will discover their disagreements are actually quite narrow, and the conflict can be easily smoothed over. On other occasions, however, the conflict leads to drawn-out and expensive litigation, where the attorney fees alone can greatly exceed the dollar value of the dispute.

There is a third way to resolve disputes, known as “alternative dispute resolution” (commonly abbreviated as “ADR”). ADR provides for the resolution of a dispute by a disinterested third party in a manner short of going to trial before a judge or jury. Parties usually prefer ADR to a jury trial because it is informal and usually cheaper. ADR is so common that some jurists are concerned that jury trials are disappearing.

Part of the reason ADR is becoming so routine is, though ADR is in some cases voluntary, for many association disputes it is actually mandatory. Under Arizona law, many lawsuits must go through arbitration before they can be tried in the actual courtroom. In other cases, the Arizona Rules of Civil Proce-dure allow for a party to make a motion asking the court to direct the parties to attend ADR. In any event, litigation is usually not the best way to resolve a problem. Consider that even after the litigation is resolved, the homeowner and the board are probably even more at odds with each other than before the litigation began. It’s not enough to simply win a case; the board should be trying to resolve problems for the benefit of the entire community. Although it can not always be avoided, rarely is making an enemy going to best for the com-munity at large.

There are two common types of ADR: mediation and arbitra-tion. While they are easy to confuse because they have similar names, in substance, they are actually quite different. Media-tion is an opportunity to negotiate a settlement of a dispute. Usually, the parties to the dispute gather in separate rooms

aDr: what it is and why it matters

By Bryan Memmot, Esq.

ADR | 23


Whether an owner, prospective buyer, or a mortgage lender, we all seem to be a little more focused about health these days; health as it pertains to not only our bodies, but also everything from the economy to our next automobile. Buyers want to know about the health or condition of the place that they are either interested in purchasing or have just bought. Conversely, sellers want to be able to paint their association in not only a good light, but one that shines brightly.

In the past, to determine an association’s health, I would have reviewed its balance sheet. The balance sheet provides a decent viewpoint of the financial condition of an association. If done well, it can provide enough detail to determine the management techniques used and the direction that an association is heading, as well as alerting the reader of potential red flags. We have all come across many of those red flags, but as we have seen, our industry has changed since the financial and real estate shift.

“The best investment you will ever make” has completely changed. Almost everyone was impacted by the real estate earthquake that hit the nation around 2006. Subsequent trem-ors continued to impact not only our personal lives, but also our very livelihood as managers and professionals in the community association industry. Controls became tighter and rules, regula-tions, and rhetoric shifted on a national level. It appears that the tremors have subsided, and we are adjusting to our new reality – both personally and professionally. Insurance professionals, accountants, reserve analysts, mortgage brokers, bankers, and, yes, even managers, have changed how they operate on a day-to-day basis.

Perusing a balance sheet in 2013 to determine the overall health of the organization is like getting a clean bill of health after hav-ing had your blood pressure checked. But we need to dig deeper into what lies beneath even a somewhat transparent surface. Although many of us are all too familiar with the increase that we’ve seen in outstanding delinquencies at some of our proper-ties, it is no longer enough to merely state a number. Digging deeper requires knowing if there are monthly status reports be-ing provided by the association’s counsel, and whether there are bank foreclosures, association foreclosures, and any bankrupt-cies; and if so, whether they are chapter 7 or 13. Status reports become an important tool that can demonstrate that managers and boards are on the same page.

However, even the best balance sheet can’t tell me the number of rentals in an association, or the trend in rentals over the past few cycles. It can’t tell me if that association is FHA approved. It certainly can’t tell me if this is an association that contains unit owners who can’t refinance, or worse yet, cannot sell their units.

From the balance sheet, I can determine if an association is set up on an accrual or cash based accounting system. Noting that is one thing, but examining and asking the reasons behind why an association may still be set up on a cash system is another. I am not an advocate for cash reporting, but inquiring about the decisions of management to report in a cash environment is desirable and important to the analysis of the figures presented.

What about the financial reporting itself? Digging deeper requires a look at the software that the as-sociation or management company is using. Also, a look at the education level of those produc-ing reports is of greater importance now. I want to know if there is CAI involvement at a local or national level and if staff is working to enhance their education level within CAI by taking courses relevant to their chosen profession. I also want to see that there is a budgeted line item for bad debt – something that previously was not as significant as it is now.

I am a big proponent of reserves studies. I believe they are one of the greatest tools an association has. That said, the existence of a reserve study simply is not enough any longer. It’s a great tool, but it doesn’t do much good unless it is used. I want to see the dollar amounts that the analyst is recommending, the actual amount that was funded for the past two years, and the last time it was updated. I am not saying that I necessarily expect to see that each and every association has budgeted to fund the reserve to the recommended amount or, much less, has actually funded the replacement reserve to the recommended amount. I do want to see, however, that there has been an attempt to utilize the tool and draw conclusions about the useful life of the common and limited common elements of the association and the need to fund for their future replace-ment costs. I’ve seen many associations spend time, energy, and money to have a reserve study performed, only to have that study filed in a drawer somewhere. Yet, when budget time rolls around, questions like “Have you seen the reserve study?” and “Does anyone know if the association has ever updated this reserve study?” seem to be all too common.

As you can see, reporting that there are receivables on an as-sociation’s books is valid and does provide some useful informa-tion, but it’s just not enough. How collectible those receivable balances are is more to the point and reaches further into deter-mining the true health of the organization.

So, when we speak to the idea of digging deeper, who needs to do this digging? Well, it starts with the potential buyer. Buyers are one of the best testers for the ideas, methodologies, manage-ment techniques, maintenance plans, rules and all the other things that we as managers strive to put in place and work to provide to our clients. They are the real testers because, after all, if an owner can’t sell their asset when it’s time to sell, there’s a problem in the chain somewhere. What about banks, lenders, and mortgage companies? It doesn’t serve our clients well if we merely serve to answer the questions being posed by owners’ lending institutions. We put ourselves and our associations in a much better light if we begin the digging first and are then able

Digging DeeperBy John E. Kaye, AMS, CMCA

Digging Deeper | 23

Summer 2013 23

to assess the financial and overall health of the association – before a lender brings forth any of their own perceived short-comings of an association.

The profession in which we work continues to change more rapidly now than ever before. When I look at the changes that have been implemented and continue to change in the real estate market, it would have been hard for me to envision those sweeping changes even five years ago. Lending standards have changed, which alters the way buyers purchase the units that we manage. When buying behaviors change, we need to look into those patterns and see how that may impact how we manage. In other words, when lending standards change, construction slows, rentals increase, and we have no choice but to dig deeper. When the mortgage companies, banks, and title companies begin to dig deeper, it is a sure sign that we, the sentinels of the associations, must dig deeper as well to assure that we are guiding and managing the associations effectively, accurately and responsibly.

We must ask more of our associations, just the same way that lenders are asking more. We can’t ignore the standards and requirements of lending institutions; rather, we must look to them if we are to guide and manage effectively. To do that requires a deeper analysis of the facts within the association. From the insurance policies to the implementation of financial controls, and from the reserve studies to the real estate clos-ings, we sharpen our own skills through the actions of other components or facets of this industry. In doing so, we see paral-lels with those other factors and, theoretically, become manage-ment agents of change rather than of reflection. What about the pitfalls of digging deeper? Digging can be scary territory. Digging does not always mean we will find gold. What if we uncover something that may be better left

in one building, and a neutral attorney (the mediator) moves between the rooms to try and settle the case. The mediator at-tempts to broker a deal between the parties, giving the parties a realistic evaluation of what a disinterested judge or jury will do with the case. However, at the end of the day, if the parties cannot agree to a resolution of the dispute, they can walk away. Mediation is not binding.

Arbitration, in contrast, is like an informal trial before the arbitrator. Lawyers for both sides will usually have the oppor-tunity to make opening and closing statements, call witnesses to testify, and conduct cross-examination. The arbitrator acts as both the judge and jury, deciding all issues of law and fact. At the end of the presentation of evidence, the arbitrator issues a decision to resolve the dispute. Usually, that decision is bind-ing and can be filed with the court so that it becomes an official ruling. While arbitration is typically less formal than a trial, while saving some time and expenses associated with selecting a jury, it can still be quite expensive depending on the com-plexity of the issues, the extent of discovery required, and the amount of money at stake. Arbitration is often the final word in a dispute, so it should be taken seriously.

What should individuals in the community association indus-try know about ADR? First, be familiar with the association’s governing documents requirements with regards to ADR.

untouched? That is the risk of the dig. There may be unfunded reserves under that dirt or there may be more rentals than we really wanted to see. Shovels can be a useful tool, but they have also been known to sever many an irrigation line! Our investi-gations on behalf of the association do not mean we are digging their grave; rather, we dig to identify whether the association is in good working order or to provide recommendations for improvements.

In a world of Yelp®, Carfax®, and itunes®, people are increas-ingly looking to these outside sources to determine where they want to eat, what they want to drive, and the latest trends in music and movies. Someday, our collective digging into the health of the associations may help people determine where they ultimately choose to live, work, and raise their families.

How may our digging impact community associations in the future? How do we help guide potential buyers into the right unit to purchase? And, how do we change a perceived para-digm about association living to help assure that owners who may want to purchase actually can purchase? These are all questions that I believe we should ask – not at budget time, not at quarterly staff meetings, but each day that we come suited up to manage our associations. We must continue to demand more from ourselves and look into the “hows and whys” of what makes a community association great.

Not only do we have to be flexible enough to the idea of change, but we have to be bold enough to effectuate that change by dig-ging a little deeper – maybe even a lot deeper.

John E. Kaye, AMS, CMCA has worked as an accountant in the industry for over 20 years, managing portfolios in both commercial and residential manage-ment. He has worked as a controller in property management, done extensive financial consulting work, written articles for industry publication and owns a financial services company.

Those documents vary greatly from requiring no ADR, to requiring several different types of ADR before the association can file a lawsuit. Second, be familiar with the requirements of the governing documents and the various Arizona laws, or hire legal counsel familiar with those requirements before filing a lawsuit. Third, be aware of ADR programs within the community. Some cities and counties offer free ADR in hopes that small disputes can be resolved without extensive fighting or litigation. An association can use these programs—usually a mediation type program—to resolve their disputes short of litigation. In some instances, the association and owners may be able to participate in these programs without hiring a law-yer. Everyone knows that full blown litigation is rarely the best way to solve these problems, since attorney’s fees can be very expensive and it can take months and years to get something resolved through court. Because most civil litigation cases are settled before they get to court, and therefore will not entail an award of attorney’s fees for the successful party, an association can find itself expending association funds on legal fees rather than the association’s real needs. In short, an association can use ADR as a tool to protect the association’s interests and re-solve disputes in a manner that is hopefully more efficient and less expensive for all parties involved.

Bryan Memmott is the managing attorney for the Arizona office of Vial Fother-ingham, LLP. He has been an attorney for 12 years. His focus is real estate and HOA law, but his background includes spending five years as an officer for the Unites States JAG Department.

Digging Deeper

ADR


a n n u a L s p o n s o r s

DiamonD sponsorsCarpenter Hazlewood Delgado & Bolen, PLCCCMCMaxwell & Morgan, PC

copper sponsorsCBI Consulting, Construction Management & Forensics

goLD sponsorsAlliance Association Financial ServicesCommunity Association Underwriters of America, Inc.Dicks Coglianese Shuquem, LLPDLC Resources, Inc.Holbrook Asphalt Co.Metro Phoenix BankPureGreen Landscape, LLCVial Fotheringham, LLP

siLVer sponsorsACE Construction Services, LLCAmerican Technologies, IncBurdman & ShoreBurns Pest EliminationCaretaker Landscape and Tree Management, Inc.Clean Cut Landscape ManagementDesert Classic LandscapingGoodwill of Central ArizonaGothic LandscapeJon Wayne Construction & ConsultingKasdan Simonds Weber & Vaughan, LLPMutual of Omaha BankNautilus General ContractorsParamount Roofing, LLCPinnacle RestorationPopular Association BankingRed Rock Financial ServicesRenCo, LLCRepublic ServicesRossmar & GrahamSentry Management, Inc.Sherwin Williams PaintTrident Security Services, Inc.Universal Protection ServiceUS BankValley Protective Services

BronZe sponsorsAllscape Property MaintenanceALPHA Community ManagementBlueStar LandscapeBrown Community ManagementButler Hansen, PCGinsberg & Dwaileebe CPAsJomar Association ServicesPMG ServicesTLC-The Landscape CompanyTri- City Property Management

corporate sponsorsCOIT Cleaning & RestorationHome Team Pest DefenseSmartstreet/Union Bank

CAI - Central Arizona Chapter

2013 Annual Sponsors

Valhalla Community Magazines(480) 634-1708

I am also a salesperson in print.

I talk to the 10,000 perspective customers in Community Resource

every issue. How many do you talk to?

The readers are here, where is your ad?

Hello, I am an Ad.

Summer 2013 25

D i a m o n D c o r n e r

The CAI Central Arizona Chapter wants to thank our Diamond Sponsors, whose contributions assist us in preserving, protecting, and enhancing the industry. Our Diamond Sponsors contribute at the top level to our or-ganization and are recognized in each issue by providing helpful information to our members.

Carpenter Hazlewood Delgado & Bolen, PLCAs the economy rights itself, and associations do as well, we as lawyers tend to see clients becoming complacent. Things are getting better, so why does the association need a consistent collection or enforcement policy? Things are better, so why does the association need to increase assessments? The answer is that there are always delinquencies, always violations, and never enough reserves. Consistency, not complacency, is what

Diamond Corner

we need as associations bounce back. The associations with money, and with well-preserved homes and common areas will survive the inevitable next downturn.

CCMCIs your community bouncing back as the market recovers? If so, you may have noticed a subtle shift in thinking. Residents may be less focused on what they need and more focused on what they want. For community managers, this is also the perfect time to conduct a community survey. This will give you the insight you need to realign your priorities, reallocate resources and reevaluate your plan.

Maxwell & Morgan, P.C. The worst of the storm appears to be behind us. Now is the time for boards and managers to evaluate the physical condition of their properties; financial condition of their communities; and forge ahead with a recovery plan. This includes restarting the long neglected painting and repair projects, reinitiating enforcement of the governing docu-ments, and collecting on the judgments obtained during the great recession.


c o n g r at u L at i o n s c o r n e r &

2 0 1 3 c o m m i t t e e c h a i r s

AMS Designations Sun City Grand Community Association Ms. Mitzi Mills

Jomar Association Services Ms. Diana Ebertshauser

Preferred Communities Mr. Robert Herrera

CMCA Designations Total Property Management Ms. Lori Grove

Arizona Community Management Services, LLC Miss Lindsay Bowden

Westbrook Village Association Mrs. Karen Jones

Special Congratulations CAI National Conference Volunteer of the Year Award Winners Award of Excellence in Chapter Leadership – To an individual who has made significant contributions to advancing national-chapter relations and provide support and guidance to the chapter leaders.

Bruce Gran, CMCA, AMS, PCAM Bruce is one of our jet-setting members who conducts business in multiple states. As a member of the Business Partners Council and a trustee, he takes his role as a chapter liaison to heart. Instead of just corresponding with a few chapters,

he is always asking to take on more. He interacts with the chapter leaders, members and chapter executive directors to discuss issues and ideas to improve and strengthen the entire organization. Bruce truly enjoys his opportunities to interact with a variety of chapters and provide a link to the international organization. His efforts and contributions to and for the chapters truly set him apart.

Award of Excellence in Membership – To an individual who has demonstrated leadership by supporting CAI membership campaigns and who is an active, consistent recruiter.

Linda Van Gelder Linda is one of the driving forces behind membership growth in her area. The Central Arizona Chapter has experienced higher than 20% membership growth in the past few years. As a committee member and chair of the chapter’s

membership committee, she always has a smile on her face, greets everyone in the room, and invites the new members in like they were walking into her home. Linda has spent countless hours driving around the valley with the chapter executive director visiting potential and current members to see if there is anything the chapter can do for them and encourage them to take more advantage of their membership. In 2012, she shared her experiences about membership growth in her chapter with chapter presidents-elect as a panelist at CAI’s Annual Conference. Linda’s infectious enthusiasm and dedication has contributed significantly to CAI’s growth.

eDucation Mark Holmgren, Esq. Carpenter, Hazlewood, Delgado & Bolen, PLC (480) 427-2845 mark,[email protected]

Kristine Nau CCMC (480) 726-8080 [email protected]

memBership Linda Van Gelder ALPHA Community Management (623) 825-7777 [email protected]

Toni Rudolph US Bank (602) 257-5355 toni,[email protected]

pcam Mark Wade, CMCA, AMS, LSM, PCAM Leisure World Community Association (480) 832-0003 [email protected]

Jim Welch, CMCA, AMS, LSM, PCAM Mountain Park Ranch Homeowners Association (480) 704-5000 [email protected]

puBLic reLations Brandi Reynolds Law Offices of John Chaix (602) 561-1094 [email protected]

Dale Stansel Pride Community Management (480) 682-3201 [email protected]

LegisLatiVe action Scott Carpenter, Esq., CCAL Carpenter Hazlewood Delgado & Bolen, PLC (480) 427-2800 [email protected]

Angela Potts, Esq. Potts Law Offices (480) 499-5301 [email protected]

magaZine Jessica Maceyko, Esq. Ekmark & Ekmark, LLC (480) 922-9292 [email protected]

Vanessa Dreyer, PCAM CCMC (623) 215-8646 [email protected]

programs Manny San Miguel Mutual of Omaha Bank (602) 690-2136 [email protected]

Lorene Gilbert Clean Cut Landscape Management (602) 326-3903 [email protected]

2013 Committee Chairs


Distinguished Service Award – CAI’s most prestigious award, the Distinguished Service Award is presented periodically to an individual selected for long-standing, extraordinary contributions to the Institute.

Donald E. Dyekman, Esq. CCAL Don Dyekman’s CAI leadership commitments have spanned four decades in national and local positions. He is a national past president, past dean of the College of Community Association Lawyers (CCAL) and has served on numerous

committees over the years. One of the first members of CCAL, Don prepared the case law update materials for the Community Association Law Seminar for more than a decade – a time consuming project of culling case law from around the country to provide Law Seminar attendees with information about interesting cases and trends in our industry. He is highly professional and reliable and is very well regarded by his peers. He is one of the pioneers practicing community association law and set a high bar for ethical and professional standards. His many years of service to the Institute and the industry embody the qualities needed to earn the Distinguished Service Award.

Summer 2013 27

®

TM


Want success?

Advertise in theCommunity Resourcemagazine.

Call 480.634.1708

Call and ask us about our new advertiser

special rates!

c a L e n D a r o F e V e n t s

2013 CAI-CAC Event Calendar

JuLy 11th New Member Happy Hour Meeting Sponsored by: Back to Nature Landcare, Inc. Location: Aunt Chilada’s 7330 N. Dreamy Draw Dr. Phoenix, AZ 85020

18-19th PMDP M-205 Tempe, AZ Location: Sheraton Phoenix Airport Hotel Tempe 1600 S. 52nd. St. Tempe, AZ 85281

august DARK

septemBer 5th New Member Breakfast Club Sponsored by: Metro Phoenix Bank Location: 4686 E. Van Buren, #150 Phoenix, AZ 85008

10th CAI – Central Arizona Educational Lunch Professional Speaker Location: Phoenix Airport Marriott 1101 N. 44th St. Phoenix, AZ 85008

19th PCAM Roundtable Discussion

octoBer 3-6th CEO-MC Retreat Location: Montelucia Resort & Spa Scottsdale, AZ

28-29th CED Retreat Location: Washington, DC

For more information, visit the chapter website at www.cai-az.org or call the office at 602-388-1159.Items in red are CAI National events.

Is your membership current?Contact Kayte Comes at (602) 388-1159 or [email protected].


Summer 2013 29

cai summer newsletter

Documents

editorial information

delgado bolen

cai events

valuable asset

creative thinking

sponsorscongratulations

advertising content

calendar of events