Connect Magazine: Issue 1—2017

CAI-GRIE’s mission is to advance the community association industry through positive image, professionalism, advocacy, education and networking.

connect A PUBLICATION OF THE GREATER INLAND EMPIRE CHAPTER OF CAI

ISSUE ONE 2017

IN THIS ISSUE Communication + Unity = Community It’s Time to Spring Clean Your Community Association!

Avoid the “Sticker Heart Attack” of Repairs Checks & Balances: The Checklist Has the Tap Run Dry? Will Prop 64 Allow Marijuana to Smoke Out Our Communities?

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connect A PUBLICATION OF THE GREATER INLAND EMPIRE CHAPTER OF CAI

www.cai-grie.org

OFFICERS

Table of Contents

Jeremy Wilson, MBA, CCAM, CMCA, AMS, LSM, PCAM ........ President Associa-PCM Robert Serdoz......................................................................President-Elect Elite Pest Management, Inc. Linda Cooley........................................................................ Vice-President Rosetta Canyon Community Association Chet Oshiro................................................................................ Secretary EmpireWorks Phil Hakopian, CIRMS..................................................................Treasurer Cornerstone Commercial & Personal Insurance Services, Inc. Dana Mathey, CMCA, AMS, PCAM................................... Past-President FirstService Residential BOARD DIRECTORS

Features 4 Communication + Unity = Community

By Tom Freeley, CCAM, AMS

By Gloria Vizzini, CMCA, AMS

Bob Harvey, CMCA...............................................................Associa-PCM

10 Avoid the “Sticker Heart Attack” of Repairs

Brian Henry.........................................................................Park West, Inc.

By Elliott Meier

George Gallanes, CMCA...................................... Sunnymead Ranch PCA

Pat King..............................................................Solera Oak Valley Greens Hallie Kirkingburg, CMCA...................................... FirstService Residential Valerie Reyes.......................................................Villa Park Landscape, Inc. Christy Towner-Quesada, CMCA........................... FirstService Residential CHAPTER EXECUTIVE DIRECTOR DJ Conlon, CMCA MEMBER RELATIONS COORDINATOR Ginny Aronson-Hoke ADMINISTRATIVE ASSISTANT Elda Pfitzinger-Thomas EDITOR IN CHIEF Brittany Ketchum, Esq..........................................Beaumont Gitlin Tashjian

7 President’s Message

By Jeremy Wilson, MBA, CCAM, CMCA, AMS, LSM, PCAM

8 It’s Time to Spring Clean Your 13 Editor’s Link

By Brittany A. Ketchum, Esq. Community Association!

Adam Armit........................................................................Park West, Inc. Jackie Fromdahl.....................................................Painting Unlimited, Inc.

Departments

14 Day at the Races Photos 15 IE Olympics Photos

16 Checks & Balances: The Checklist

By Toni Burns

19 Has the Tap Run Dry?

By Any Ferrell

22 Will Prop 64 Allow Marijuana to Smoke Out Our Communities?

By James R. McCormick, Jr., Esq., CCAL

PUBLICATIONS COMMITTEE Jeff Baker, AMS.............................................Packard Management Group Chris Branuelas.........................................Rainbow Canyon Villages HOA Linda Cooley...............................Rosetta Canyon Community Association Jackie Fromdahl.....................................................Painting Unlimited, Inc. Kevin Leonard............................................................ Association Reserves

Advertisers

DESIGN & PRODUCTION

All Counties Fence & Supply.......................6 Alliance Association Bank..........................18 AMS Paving, Inc..............Inside Front Cover Beaumont Gitlin Tashjian...........................17 Berg Insurance Agency, Inc.......................24 Cardinal Property Management................18 CBCI Construction......................................6 Elias Bros. Contractors, Inc........................24

Kristine Gaitan....................Rey Advertising & Design/The Creative Dept.

All articles and paid advertising represent the opinions of authors and advertisers and not necessarily the opinion of either Connect or the Community Associations Institute–Greater Inland Empire Chapter. Information contained within should not be construed as a recommendation for any course of action regarding financial, legal, accounting or other professional services and should not be relied upon without the consultation of your accountant or attorney.

Connect is an official quarterly publication of Greater Inland Empire Chapter of the Community Associations Institute (CAI–GRIE). The CAI–GRIE Chapter encourages submission of news and articles subject to space limitation and editing. Signed letters to the editor are welcome. All articles submitted for publication become the property of the CAI–GRIE Chapter. Reproduction of articles or columns published permitted with the following acknowledgment: “Reprinted with permission from Connect Magazine, a publication of the Community Associations Institute of Greater Inland Empire Chapter.”

Copyright © 1998–2017 CAI-Greater Inland Empire Chapter.

Advertising, articles or correspondence should be sent to: CAI-GRIE Chapter 5029 La Mart, Suite A • Riverside, CA 92507-5978 (951) 784-8613 / fax (951) 848-9268 info@cai-grie.org

Epsten Grinnell & Howell APC..................12 Fiore Racobs & Powers APLC...................21 Keystone Pacific Property Management, Inc.....26 Mutual of Omaha Bank............................20 NPG Asphalt................. Outside Back Cover Steven G. Segal Insurance Agency, Inc.....21 Union Bank HOA Services........................13

The Greater Inland Empire Chapter of CAI hosts educational, business and social events that provide the Chapter’s Business Partners various opportunities to promote their companies’ products and services to Community Association owners and managers serving the Community Association Industry. It is expected that all participants in Chapter events — whether they be educational, business or social — will conduct themselves in a professional manner representative of their business or service organization so as not to detract from the experience of others seeking to benefit from their membership in the Chapter.

CONNECT WITH GRIE • ISSUE ONE 2017

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Communication +

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ISSUE ONE 2017 • CONNECT WITH GRIE

BY TOM FREELEY, CCAM, AMS

Unity = Community W

ouldn’t it be great to have the kids getting together and playing at the park? Saying hello to your neighbors as you stroll through the community? You might need to help create this sense of community.

Creating a sense of community has many positives. It helps neighbors communicate and resolve challenges between each other. It helps create a sense of value within the community. It creates a sense of pride of ownership or occupancy. Having a sense of community can help with architectural compliance, reduce CC&R violations, and increase the communication between residents, management and the board.

Here are some suggestions on creating a sense of community.

Get to Know Your Neighbors Simple, right? Not always, so create the atmosphere. Hold a potluck block party and invite everyone. Attend and introduce yourself to people at big community events.

If the community doesn’t have big events, ask the board to create a social committee for the purpose of “getting to know your neighbors” and hold a periodic event. Maybe a winter celebration, spring carnival, or movie in the park. Maybe something simpler like a neighborhood basketball tournament or tennis match. Whatever it is, the point is to use the amenities around you as a way of introduction to neighbors.

Show some respect of your neighbor’s property and pick up after your dogs and keep them on leashes. Don’t be that neighbor!

Always welcome new families into the neighborhood. What better way to start off on the right foot with new residents? Drop off a gift box with a list of your favorite local restaurants and maybe some to-go menus.

Create a Neighborhood Watch Program This is a great way to get to know the neighbors and the neighborhood and help support the entire community. Reach out to your local police department and they would likely be very happy to help coordinate some meetings!

Get Involved in Local Schools There is a reason the most successful schools are the ones where parents are actively engaged. Good schools have successful, if informal, partnerships between the administration, the parents and the communityat-large. Even if you don’t have kids at the school, it’s important to remember that the local school is also a member of the community, and can greatly impact the neighborhood, positively or negatively.

Continued on page 6

CONNECT WITH GRIE • ISSUE ONE 2017

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Communication + Unity = Community Continued from page 5

Coordinate a Neighborhood Yard Sale

Garage sale, tag sale, yard sale… whatever name you choose, this is a good way to clear out your home’s clutter and help your neighbor do the same.

Let your neighbors know when you will be out of town and ask them to contact you or the police if anything is suspicious. If you ask your neighbors, they will likely ask you in turn, which helps to keep the neighborhood safe for everyone.

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ISSUE ONE 2017 • CONNECT WITH GRIE

Celebrate Newborns!

Drop off some goodies for the new parents. After all, their minds aren’t really on properly eating at that moment! Maybe do a little decoration on the front porch for them.

Drive Carefully

Drive through the community like your own kids live there…because they probably do! Kids need to feel safe and secure in their surroundings, and it should start right there in their own neighborhood!

Go Social!

Ask the board to get a Facebook

page! There are many differing opinions on social media and community associations. My experience has always been positive, with very few challenges. Use social media to keep up to speed with the community and to keep the community residents up to speed on the community.

All of these ideas help foster good communication and unity creating what is known as community. This is especially helpful to homeowners so in those instances where they need to address a concern with their neighbor such as dog barking, a fence that is falling down, or other concerns directly affecting their property, there is already a good rapport with that neighbor. This will minimize negativity and conflict and result in the higher likelihood of a speedy resolution to whatever the issue may be.

Effective communication also demonstrates a proactive rather than reactive management style and reflects positively on both the board and management. An important component of effective communication is active listening.

Boards and managers should be aware of the “buzz,” whether positive or negative, among homeowners in the communities they are involved with.

Knowing the hot topics or brewing concerns will allow management to address these issues proactively. Some of these hot topic items come out on social media. Sometimes an article in the monthly newsletter can hit an issue head on and calm the waters regarding a hot-button topic before it gets out of control. These issues may also be addressed at the monthly board meeting in case some of the issues are brought up in open session and allow management and the board to show the homeowners present that they are interested and aware of what is going on in the association.

Lastly, teamwork is the most important part of working together in an ever-changing industry where boards change, homeowners

change, and no day is ever the same.

Teamwork is key to keeping the eye on the prize; the prize being the ability to utilize a collaborative approach when working with homeowners, vendors, management, board and committee members with success as the result.

Tom Freeley, CCAM, AMS is an Executive Vice President at Packard Management Group, is a seasoned professional with more than 20 years of experience in commercial, condominium and homeowner association management. Tom is also an experienced veteran in customer service, managing and leading management teams in high-end luxury associations. Packard Management Group has offices located in San Diego and Temecula.

Whatever your interests are, we have a committee that could use your experience, input and ideas.

Volunteering to serve on a committee is a great networking opportunity and helps the growth and success of our chapter!

Log on to www.cai-grie.org for more information.

PRESIDENT’S MESSAGE 2017 is upon National that address a number us and we of updates and changes. We will are looking be working through the process forward of amending our current bylaws to another to incorporate these changes. spectacular You will notice changes in the year with monthly luncheon; we will be Jeremy Wilson, the Chapter. re-introducing breakfast events MBA, CCAM, CMCA, AMS, LSM, PCAM with Associa-PCM I am and more. By the time you read and 2017 CAI-GRIE honored and this we will have completed Chapter President. privileged to hosting a joint luncheon/trade have been given the opportunity show with the Orange County to serve as the President this Chapter at Disneyland. We will coming year. Thank you all for be setting aside one of our long your support standing events and continued (bowling) and Advancing the involvement in community association adding a new the Chapter. A event or two. industry through: special Thank The theme for positive image, You to our advocacy, education this year is “A community Chapter building and networking. association legends, one volunteer leaders; our business story at a time.” In 2017 we will partners and our managers. We be highlighting positive stories have more than 630 members from the community association now. industry. Big or small, legends 2016 was a wonderful year. can be found all around us. If Please join me in thanking Dana you hear of a positive story, let Mathey, the 2016 board of us know. A small change or ripple directors and the committees for can have lasting effects that can their leadership this past year. be felt and heard for many years 2017 is going to be a great to come. A small story can lead to year. We will continue to work the birth of a legend. hard on events, education and programing with the mindset: “are we accomplishing our established purpose”? “Are we doing what we were created to do”? Questions we have and will continue to focus on.

We have exciting opportunities in 2017. We are now in receipt of new model bylaws from CAI CONNECT WITH GRIE • ISSUE ONE 2017

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It’s Time to Spring Clean Your Community Association!

It’s that time of year again; every year the cycle of maintenance of a well-managed, beautiful community association seems to get shorter and shorter.

Didn’t the community just put the pool furniture away for the winter? Before you know it, the time will be here to put the pool furniture back in place.

S

pring is the time to gear up for a busy summer for your homeowners and recreational use of the facilities. Take a look at the list below and find those sometimes hard-to-plan-for hidden maintenance items. A safe, clean, friendly environment for all homeowners to enjoy is the goal of a deep spring cleaning.

Landscaping

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ISSUE ONE 2017 • CONNECT WITH GRIE

• Replant and trim landscaped areas that have been damaged by frost over the winter. Also, mulch planter beds in spring to hold in moisture and reduce weed growth during the hot summer months.

• Fertilize common area landscaping and trees to provide extra nutrients for the plants and trees to thrive.

• Apply pre-emergent to areas prone to weeds to prevent an influx of weed growth.

• Fuel Modification (clearing the excess brush away from homes) as required by the County where your community association is located. Typically 100-150 feet of clearance is required from the property line of the home and community buildings.

• Remove branches and brush that are in pedestrian walkways or scraping portions of the buildings.

• Irrigation timers can be adjusted by the landscaping contractor to keep the water budget in line.

BY GLORIA VIZZINI

Community Buildings

• Look at the clubhouse and other community association maintained buildings – check the exterior and interior for peeling or faded paint.

• Have a licensed roofing vendor check all the buildings for loose fascia boards, missing or damaged roof tiles/material and extra debris in the roof gutters and drain pipes.

• Remove moss buildup on roofs by cleaning with a solution specific for moss removal.

• Have the community buildings checked for any termite infestation and spot treat if recommended.

• Check the HVAC system in community buildings – clean or replace the filters and make sure the A/C is working well before the weather heats up.

• Replace all fire alarm batteries; it is a good habit to change them in the spring and again in the fall.

• Fire extinguishers should be serviced and recertified.

• Washer and dryers should be checked to make sure that all hoses are clear and lint screens should be thoroughly cleaned of any buildup.

• Inspect and clean any common area dryer vents for built up lint, this can be a fire hazard if not cleared out.

• Check for any leaking faucets or leaking hose bibs.

• Have all the windows washed

inside and out, the window screens cleaned and the garage doors wiped or powerwashed.

• Have all the light fixtures professionally cleaned to remove all the debris and cobwebs that have gathered over the winter.

• Powerwash all exterior siding, start from the top down to keep the dirt from getting on the clean surfaces.

• Inspect the bases of any wooden mailbox posts to assess if replacement is needed. Mailbox posts deteriorate from exposure to wet weather and frequent passes of the weed whacker or lawn mower.

Playground

• Have the annual playground/tot lot inspection completed by a licensed professional.

• Check the surface of the tennis or basketball court to see if the lines need to be repainted or the surface needs repair. Also, check the basketball net and tennis court net to see if there are holes or sagging areas and order new nets.

• Run your hands over the benches and tables where picnics might be held to make sure the surfaces are free from cracked wood to avoid splinters.

strapping on all of the chairs and loungers and have the furniture powerwashed.

• Clean the pool deck to remove all the winter debris and grime, powerwashing all the crevices keeps the pool deck and mastic last longer.

• Have the pool vendor check all the pool/spa equipment, including seals, gaskets and jets.

• Set a date to heat the pool as your community association requires.

• Check all the pool safety equipment and pool signage, see if any replacements are needed.

• Post updated pool license information in the pool area.

• Get proposals if your summer season requires a pool monitor or lifeguard.

Check the community association’s maintenance matrix or governing documents to find the areas of maintenance responsibility for each of the assets in your community.

The weather is changing and the frost is off the ground! Get busy and get ready for a great summer in your community association. Remember, preventative maintenance and spring cleaning will pay off in the long run and keep your community association in the best possible condition.

Gloria Vizzini is a District Manager at Keystone Pacific Property Management, LLC.

Pool/Spa

• Inventory the pool furniture to make sure it is safe and clean. Check the webbing or CONNECT WITH GRIE • ISSUE ONE 2017

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Avoid the “Sticker Heart Attack” of Repairs

By Elliott Meier

BY ELLIOTT MEIER

T

o repair now or to repair later is the age-old dilemma associated with owning or managing a building or community. Sticker shock from contractors is all too common when it comes to receiving a proposal for any type of maintenance or repair work. The goal should be, however, to keep the sticker shock from turning into a sticker heart attack. A sticker heart attack can occur when maintenance is deferred and pushed down the road too far to the point when the only possible cure is a complete replacement of the building assembly. At that point, there is no other alternative to prevent additional costly repairs than to tear out the assembly and start all over again.

The most common culprit for causing this damage is water. Water has a bad habit of finding any opening within an assembly, entering that opening, and spreading out from there. Untreated water damage of a building is one of the many reasons board of directors experience a sticker heart attack.

Let’s take a look at two different buildings and the result of performing routine maintenance and deferring maintenance. Building “A” has undergone periodic maintenance to keep the wood trim sealed and water tight.

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ISSUE ONE 2017 • CONNECT WITH GRIE

Building A There may be some areas where paint is peeling or flaking, but the overall condition of the materials are in good shape.

The cost to make the minor repairs and apply a new coat of paint, while expensive, is certainly within budget.

Building “B” has not undergone periodic maintenance; instead no maintenance has occurred for many years. The

Street A Building B paint and sealant has failed and is peeling off, exposing the raw wood to the elements. The lack of useful paint and sealant allows water to penetrate the wood and start the deterioration process. Since no work has occurred for some time, the wood has started deteriorating. The costs involved with making these repairs are much more significant; not only does the deteriorated wood itself need to be replaced, but the surrounding stucco needs to be removed in order to replace the wood.

The size and scope of the repair for building “B” has doubled or tripled in size compared to building “A.” The cost for repairing building “B” could not only result in a sticker heart attack for the board of directors, but also for the residents of the community if and when they receive the unexpected special Building B assessment letter in the mail.

When it comes to maintenance, most people think about the exterior and interior components of a building. Few people think about the community streets they drive on or the planters they look at. These components also require routine maintenance in order to achieve the maximum useful life of the system.

Let’s compare another two photographs to see what the result can be if routine maintenance is performed.

Street “A” has some minor cracking in the asphalt, but nothing appears to be too major. Street “B” on the other hand has large cracks crisscrossing the asphalt, in a pattern commonly referred to as “alligator cracking.” Alligator cracking is the result of water seeping through cracks in the

Street B asphalt, saturating the underlying material (known as base), resulting in the asphalt moving more than it was designed to move. If caught soon enough, like in Street “A,” the crack can be filled with a tar-like material and the entire street can be covered with a “slurry seal” that will protect the asphalt from water seepage and maintain the elasticity of the asphalt. The result of Street “B,” however, will be a full removal and replacement of the asphalt and base material, providing another source of sticker heart attack for the board of directors and source of inconvenience for the residents when they cannot access their driveways for days at a time due to the streets being torn up.

Continued on page 12

Street B CONNECT WITH GRIE • ISSUE ONE 2017

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Avoid the Sticker Heart Attack of Repairs Continued from page 11

Appellate Litigation Association Counsel Assessment Recovery Construction Defect Construction & Remediation Civil Litigation Commercial CID Developer Transition Dispute Resolution Fair Housing Senior Housing

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ISSUE ONE 2017 • CONNECT WITH GRIE

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There are many more examples of good maintenance habits and poor maintenance habits that can be reviewed. However, the most important thing to remember is that a little bit of sticker shock now can save the pain of a larger sticker heart attack later.

Elliott Meier, Project Manager at Bethco Builders. With a degree in Construction Management from Cal Poly San Luis Obispo, Elliott is an important team member at Bethco Builders and to its clients. Since his 2009 graduation, he has gained valuable experience managing and estimating residential and site improvement projects. Elliott is adept at managing multiple projects simultaneously. His technical skills include Xactimate 27.5, SketchUp, AutoCAD, Primavera, and a variety of Adobe and Microsoft Office applications. Elliott is OSHA certified, Council-certified Microbial Remediator (CMR), and Lead RRP certified.

EDITOR’S LINK In a year that has seen much change, at least one thing has remained constant: our communities in the Greater Inland Empire have continued to adapt, innovate and solve problems. With spring quickly approaching, the challenges facing our community leaders will continue present themselves in new and interesting ways, while we unwaveringly greet them with passion and foresight.

This issue dives into some of these upcoming issues: Proposition 64 and how marijuana use impacts our communities; spring cleaning and maintenance and protecting and managing HOA funds. All of these unique, relevant and pressing topics impact our communities Brittany A. Ketchum, Esq., an associate attorney with differently, but we can be empowered to continue to face them, head-on. This publication will Beaumont Gitlin Tashjian, has devoted her career to also explore some of the critical ways that we can create a stronger sense of community and representing common empower one another accordingly. After all, the community is only as strong as its foundation: interest developments.

She can be reached at you, the members. bketchum@bgtlawyers.com.

I continue to feel honored to serve as your 2017 Editor for Connect magazine. As a member of our community, we invite you to share your stories and innovative ideas that provide the critical foundation for the Chapter. Please contact me if you are interested in contributing content! Your stories not only provide vital magazine content, but give insight into how our Chapter continues to set itself apart.

Surely, your stories will inspire our readers and show why our Chapter lives up to this year’s them: “A Chapter that Builds Legends, One Story at A Time.”

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CONNECT WITH GRIE • ISSUE ONE 2017

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DAY AT THE

RACES CAI-Greater Inland Empire

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ISSUE ONE 2017 • CONNECT WITH GRIE

CONNECT WITH GRIE • ISSUE ONE 2017

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Checks & Balances: The Checklist

By Toni Burns, CCAM

For onsite employees, always ensure receipt books are available and cash payments are counted in front of another person. The envelope should be initialed at the seal and properly coded to the correct account. A good rule of thumb is to also not accept payments while at board meetings.

Boards & Petty Cash

In 2016, according to the Bureau of Real Estate, roughly 52,000 California Community Associations have a cumulative annual revenue of nearly twelve billion dollars.

When it comes to preventative measures against theft, embezzlement and other dishonest acts, some management firms and boards are taking a proactive stance to reduce their liability.

Employees

What is a piece of paper? A piece of paper can tell you a person’s professional objective, their education history, employment history and areas of expertise they may excel in. A piece of paper can also tell you whether a person has a criminal history, if they have a degree or have fabricated that glowing employment history. Completing a thorough background check when hiring new staff for associations may cost money upfront but can save years worth and thousands of dollars worth of headache. Unfortunately, associations and their homeowners can be adversely effected by failure to have a firm initial hiring process.

Accepting Cash

Be sure to establish a “chain of custody” when it comes to accepting cash. While associations should not refuse accepting cash as a form of payment for assessments, ensure your employees and boards understand that there will only be one person handling that cash.

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ISSUE ONE 2017 • CONNECT WITH GRIE

A firm policy on handling petty cash will alleviate frustrations for directors and management. Document in meeting minutes, one director that will be responsible to keep petty cash; petty cash should always be a reasonable amount. It is always important to consult with the association’s CPA before establishing a set cash amount and ensure it is added to your budgeted expenses. Petty cash receipts should turned in at the end of each month, with a petty cash log and remaining cash on hand counted by a representative from management. The director handling the petty cash should be responsible to keep the petty cash logs.

The director or committee member that handles petty cash should have a clear understanding on what the funds can be used for and to know not to pay for any contract services out of those funds, as they are coded differently to the financial statements.

Financial Institutions

Los AngeLes orAnge County InLAnd empIre Kern County CentrAL CoAst

There are several financial institutions that specialize in homeowners associations banking needs. Finding an institution that has strong internal controls is always in the best interest of the association.

Red flags can be as simple as the bank not requiring a set of bylaws when opening the account. Bylaws can require only certain officers be allowed as signers – a bank that doesn’t ask can be putting the association at risk. Some institutions with HOA specialty departments will call when a large reserve check is processed and will confirm the two signers with the management firm, which is great for boards as it narrows the window on mishandling of reserve funds.

Investment account representatives should ask for a set of approved meeting minutes before opening, closing, or transferring investment funds for the association.

Certified Public Accountant

Have you seen your association pull together in amazing ways to build an even greater sense of community?

We want to hear about it, so others can learn from your example. Go make a difference in your community and let us know how you change the world!

Send us a story about how your association is building a sense of community, and be entered in a monthly drawing to win a Starbuck’s giftcard.

Monthly Drawing Giftcard Prize: $5 for a text-only submission and $10 if it includes a picture. You are eligible to win each month until your story is chosen, and you are ALSO eligible to win a $200 prize at the TOPS Awards in December.

Toni Burns, CCAM, is Director of Marketing for Prime Association Services

Email your stories to info@cai-grie.org

A FuLL ServiCe Community ASSoCiAtion LAw Firm General Legal Counsel Governing Document Amendments Enforcement Legal Opinions Contracts Dispute Resolution

BGT Team: Jeffrey Beaumont, Lisa Tashjian, Brittany Ketchum, Tracy Neal, Tara Radley, Calvin Rose, and Christy Gargalis

Is your Community a Legend in the Making?

Always advise your boards to contract with a third party Certified Public Accountant (“CPA”) – that specializes in community associations – to review the association’s financial records at year end. If this is the first time you will be using a certain CPA, you can always check licensing through the California Board of Accountancy.

If the time comes for a forensic audit, ensure the firm you are using can complete the board’s requested scope of work, as not all CPAs complete forensic audits.

While nothing is foolproof, be sure to talk with legal counsel, crime insurance brokers and your CPA if you suspect that money is being mishandled.

Civil Litigation Enforcement Insurance Bad Faith

Assessment Collections Judicial Foreclosure

The Community Association Lawyers 866.788.9998 www.bgtlawyers.com CONNECT WITH GRIE • ISSUE ONE 2017

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Time For New Management?

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ISSUE ONE 2017 • CONNECT WITH GRIE

BY ANY FERRELL, PCAM

drought condition, it is encouraging to see an increase for these key measures.

Prior to the winter rains, many were asking if the wealth of grants and rebates had completely run dry. Has the tap of funds completely been exhausted, leaving communities without the much-needed help to convert and implement landscape conversion projects?

Where Does Our Water Come From?

Has the Tap Run Dry? Accessing the wealth of grants and rebates available for water conservation projects in HOAs

A

collective sigh of relief could almost be felt across Southern California with all the winter rains experienced in December and January. A record rainfall throughout much of the Inland Empire was experienced this past January. Since January 7, 2017, a total of three major storms brought several inches of rain to most of the county and snow to the mountains. It was noted that the rains increased the precipitation level to 167% of average for this point in the season, in accordance with the National Weather Service.

These winter rains are certainly welcome and will hopefully provide the necessary water resources needed. California’s reservoirs are currently noted at 14% more water than their historical averages. Snowpack in the Sierras is also above average, which will help feed reservoirs and increase groundwater supply as it melts throughout the year. While some agencies still state a

Understanding where our water comes from is important to understanding the available resources of grants and funding options. Approximately half of the water supply comes from combined resources from Northern California and the Colorado River. The remaining half comes from local water resources to make up the difference.

Our water is delivered by the Metropolitan Water District (MWD) of Southern California (mwdh2o.com) which is a regional wholesaler that delivers water to 26 member public agencies that are comprised of 14 cities, 11 municipal water districts, one county water authority, which in turn provides water to more than 19 million people. MWD is governed by a representative from each of the agencies that make up the organization. Of the various agencies, the ones that impact communities in the Inland Empire are those serviced by Eastern Municipal Water District (emwd.org), Western Municipal Water District (wmwd.com), and the Inland Empire Utilities Agency (ieua.org). From these various agencies, you would then arrive at your local agencies that bill and service your water services, such as Rancho California Water District (ranchowater. com), Elsinore Valley Municipal Water District (evmwd.com), or through the various city agencies such as the City of Chino, Montgomery County Water District and other similar agencies. Learning of the various agencies and the structure that they operate in, allows one to better understand the resources available.

Continued on page 20 CONNECT WITH GRIE • ISSUE ONE 2017

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Has the Tap Run Dry? Continued from page 19

What Sources Can You Tap?

There are various layers that apply to the water sources for communities. Many offer rebates for sprinkler heads, weather based controllers or soil moisture sensor systems. The key is to spend time online, reading through the materials available through your water bill, and even attending your local water agencies meetings. Following are several online resources to consider: SoCalWater$mart: socalwatersmart.com; Be Water Wise: bewaterwise.com; and Save our Water Rebates: saveourwaterrebates.com.

Be Prepared with Projects

Funding for grants and rebates have a similar cycle like that of the presidential elections. It can be seasonal and it can depend on what gets the most attention at the time.

While the most recent rains are a wonderful sight, it can also mean that the focus on conservation may not be as strong.

Many communities took advantage of the various grants and rebates available in 2014 through 2016 when rebates were flowing steadily as the focus was on debilitating tier charges, brown lawns and water cutbacks. As community association’s budgets were hit hard, it became imperative to look for options.

Now it seems that these rebates are not as readily

available and harder and harder to find. But, they are still there. It is important for board of directors to be ready with projects and ideas. What most agencies are looking for is the impact of the project and how the project will ultimately generate water savings. When looking at projects consider the following: 1. Is the area impacted highly visible? Most agencies look for areas that will create an immediate impact on the community. The more visible, the higher the likelihood of approval.

2. Will there be a significant water savings? The agencies must justify how they are granting funds and as such need to have the best allocation of those funds.

3. Are you implementing low water use irrigation systems or “California friendly,” low water use plants? Look for better irrigation systems, plants and alternatives to reach goals.

4. Consider the use of the landscaped area. Many cities are straying away from the grass parkways and opting for more natural shrubs, as they realize these parkways don’t require grass that consume excess water and the parkways won’t be utilized in the same manner as parks and fields. Understanding the end use of the landscape area is important so that you minimize waste.

Some projects may take longer than others, but don’t give up the fight as there are still options available. When rebate options become available you may not have time to

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ISSUE ONE 2017 • CONNECT WITH GRIE

Member FDIC Equal Housing Lender

call a meeting or wait until the board has quorum to decide on what project the board may be able to vote on.

Instead, prepare and be proactive.

Line up several projects that the board may want to consider when and if, funds become available. Partner with your landscape contractor and come up with ideas that can benefit the community and may be optimal for water conservation. When grants and rebates come around, then you are ready to submit.

Any Ferrell is the General Manager of Environmental Concepts Landscape Management, Inc. A 20-year community association industry professional with several industry credentials, including the Professional Community Association Manager (PCAM) designation and a member of the Greater Inland Empire Chapter of CAI.

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| 21

Will Prop 64 Allow Marijuana to Smoke out our Communities?

Now that certain types of recreational marijuana use are allowed in California, we must ask what effect this will have on communities in California.

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ISSUE ONE 2017 • CONNECT WITH GRIE

M

arijuana is currently considered an illegal substance under Federal law. Despite this fact, 28 states and Washington D.C. have authorized medical use of marijuana. Additionally, eight states have “legalized” recreational use of marijuana. California joined these recreational-use states with passage of the Adult Use of Marijuana Act, or Proposition 64 (“Prop 64”) and modified the California’s Health & Safety Code.

The California legislature cited several reasons for Prop 64, including to: Allow local governments to reasonably regulate the cultivation of nonmedical marijuana for personal use by adults 21 years and older through zoning and other local laws, and only to ban outdoor cultivation as set forth in this act.

Now that certain types of recreational marijuana use are allowed in California, we must ask what effect this will have on communities in California. Thankfully, it really should not have much of an effect.

Smoking tobacco has been legal for years. It might not be good for you, but it is not illegal or otherwise considered a controlled substance like marijuana has been. California labor laws were passed years ago prohibiting forcing employees to endure second hand smoke, which has resulted in bars, clubs and restaurants becoming smoke free.

In fact, some communities in California have followed suit and created smoking bans within the common areas or within the entire community. If your community has already created a smoking ban, your community is in luck. Health & Safety Code Section 11362.3 expressly prohibits any person from smoking marijuana in a location where smoking tobacco is disallowed.

A community with a smoking ban, therefore, can enforce that same ban on marijuana smoke.

BY JAMES R. MCCORMICK, JR., ESQ., CCAL

In November 2016, The U.S. Housing and Urban Development (“HUD”) announced that public housing developments must transition to smoke-free environments over the next eighteen months. HUD cites health of families and prevention of fires as basis for conversion.

These same reasons resonate within community associations and provide excellent support for implementing smoking bans if so desired.

Community support is important in these situations, so make sure your community polls the owners and investigates whether a smoking ban is supported by the community before banning smoking.

Some marijuana users might argue that because they have a medical card or need the marijuana for medical purposes that the association cannot prohibit them from smoking. This claim won’t fly. Because of the Supremacy Clause in the United States Constitution, states cannot make something legal that is illegal under Federal law. Because marijuana is still classified as illegal under Federal

law, there can be no accommodation request made under federal laws. A resident may argue, however, that Prop 64 now permits reasonable accommodation requests under California fair housing laws. So what do we do?

There are two reasons why an association may still prohibit someone from smoking marijuana for medical purposes. Just like tobacco, there are a variety of manners of ingesting marijuana. While someone can argue that they must “smoke” marijuana, a reasonable accommodation might not be required if the person can ingest the marijuana through food or topical applications.

More importantly, regardless of medical uses or needs, someone cannot create a nuisance merely because they have a right to do something. Someone cannot argue they must smoke if that smoke creates a nuisance for neighboring residents.

In fact, such activity might support a lawsuit against the smoker under the nuisance provisions of the association’s governing documents or California law.

Valid nuisance claims can be based on marijuana’s odor and the creation of secondhand smoke. In the 2009 California Birke v. Oakwood case, the court determined that the complaining party had support for their allegation that secondhand smoke was a public nuisance. While that case involved an apartment complex, the close proximity of some of our communities provides factual similarities such that the same analysis would likely apply.

Despite an argument for medical use of marijuana, an association will likely not be forced to permit a “reasonable accommodation” if doing so creates a nuisance for other residents. Because these situations are factually intensive, however, if faced with this situation, please discuss the matter with your association’s legal counsel.

In addition to discussing the physical usage of marijuana, Prop 64 also contemplates growing and cultivation of up to six plants. The new law prohibits placing plants within “normal, unaided vision from a public place.” Presumably this provision is intended to deter criminal element or theft by minors but it also serves an aesthetic purpose for associations. While a community association may prohibit cultivation on association-owned common areas, owners are permitted to cultivate up to six plants within their residence or on their lot outside of view of the public.

If your community pays for electricity or water usage for residents and does not have sub-meters installed, cultivation of marijuana by residents could create additional expenses for the association.

Adoption of reasonable restrictions or installation of sub-meters may be Continued on page 24 CONNECT WITH GRIE • ISSUE ONE 2017

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Will Prop 64 Allow Marijuana...

Continued from page 23

necessary to ensure that those members who increase the cost are responsible for those increased costs.

As you can see, the sky is not falling and Prop 64 will not permit our communities to turn into pot havens.

While there may be issues that crop up, reasonable restrictions should be considered and adopted within the parameters of the new law before those issues arise. Look to your association’s legal counsel for help addressing issues that might come up. While Prop 64 may require modification of restrictions, it likely will have little effect on our communities.

James R. McCormick, Jr. Esq., CCAL, is the managing partner of the Law Firm of Peters & Freedman, L.L.P. and is a member of several CAI chapters in Southern California.

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ISSUE ONE 2017 • CONNECT WITH GRIE

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Please incorporate the following updates to your 2017 Membership Directory Page 12 CIRMS DESIGNEES should read: CMCA DESIGNEES (cont’d)

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Page 92 FIRSTSERVICE RESIDENTIAL (MURRIETA OFFICE) Ms. Kristie Rose, CMCA, AMS, PCAM 25240 Hancock Ave, Ste 400 Murrieta, CA 92562 (951) 973-7526 • Fax: (951) 296-2099 Email: kristie.rose@fsresidential.com

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Page 126 KHATRI INTERNATIONAL INC. CIVIL AND STRUCTURAL ENGINEERS Mr. Dilip Khatri 3579 E Foothill Blvd # 736 Pasadena, CA 91107-3119 (626)475-7660 Email: dkhatri@aol.com Page 139 BERG INSURANCE AGENCY, INC. Mr. Michael Berg, CMCA, CIRMS 1 Orchard, Ste 230 Lake Forest, CA 92630 (949) 830-4590 Email: michael@berginsurance.com www.berginsurance.com

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Page 120 THE NAUMANN LAW FIRM Ms. Elaine Gower 10200 Willow Creek Rd, Ste 150 San Diego, CA 92131 (844) 492-7474 • Fax: (858) 564-9380 Email: elaine@naumannlegal.com www.naumannlegal.com Page 165 SUPERIOR ROOFING Mr. Brandon Ewart 160 S Linden Ave, Rialto, CA 92376-6204 (800) 761-6272 Email: brandon@superiorrw.com www.superiorrw.com

If you have a correction you would like published, please contact the Chapter office, (951) 784-8613 or info@cai-grie.org

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