Focus Magazine - March/April 2013

Focus

March/April 2013

L.A.’s Premier Source of Information for Community Associations

Excuses, Excuses The New & Improved Davis-Stirling Common Interest Development Act What's Going On With Insurance This Year?

Save the Date:

Annual Golf Tournament

The Ever-changing Industry

June 10

Thursday, May 2, 2013

CROWNE PLAZA LAX

5985 W. Century Blvd., Los Angeles 90045

CAI-Greater Los Angeles Chapter presents

• • • • •

FEATURING Meet & Greet Learning Centers HOA Industry Experts on hand Complimentary Hors d’oeuvres Opportunity to win one of five (5) $100 Cash Prizes during Meet & Greet

(Must be present to win)

• Raffle Prizes

New This Year!

Complimentary Dinner with Educational Presentation, following Meet & Greet for HOA Boards & Managers

SCHEDULE 5:00 p.m.

Learning Centers Open with Meet & Greet 7:00 p.m.

Dinner with Educational Presentation

Event Sponsors

“How to Keep Your HOA Out of Court” Speakers: Sandra Gottlieb, Esq. SwedelsonGottlieb

Lisa Tashjian, Esq. Beaumont Gitlin Tashjian

Admission and Self Parking is complimentary for HOA Board Members and Managers Advance Registration enters you in the Special Prize Drawing awarded at the Dinner (Must be present to win) RESERVATIONS – HOA BOARDPARKING MEMBERS & MANAGERS: COMPLIMENTARY* DESSERT SPONSOR SPONSOR EVENT SPONSORS *HOAInc. Member Guests will pay a discounted Pacific Western Bank Heritage Construction, Inc. price of $20 pp for dinner Anthony Elliot Insurance Agency, Collins Builders, Inc. Please RSVP before April 26 – Dinner Capacity Limited BAG SPONSOR GRAND PRIZE SPONSORS Pacific Premier Bank Phone: 818.500.8636 • Online: www.cai-glac.org • E-mail: joan@cai-glac.org • Fax: 818.500.8638 Gifted — creative marketing solutions CertaPro Painters Ltd. Roseman & Associates APC Marina Landscape, Inc. Name: Securitas Security Services USA, Inc. TABLE WINE SPONSORS Stay Green Inc. Association/Management Company: Beaumont Gitlin Tashjian SwedelsonGottlieb Address: Phone: E-mail: Are you planning to attend the Dinner and Educational Presentation?

yes

no

2013 BOARD OF DIRECTORS Officers Catherine Gemind, CMCA®, AMS®, PCAM®, President Valencia Management Group, 661-295-9474 Matt D. Ober, Esq., President Elect Richardson Harman Ober, PC, 626-449-5577 Katy Krupp, Vice President Fenton, Grant, Mayfield, Kaneda & Litt, LLP, 949-435-3800 Joanne Pena, CMCA®, AMS®, PCAM®, Secretary Horizon Management Company, 310-543-1995 Gregg Lotane, CCAM®, PCAM®, Treasurer The Wilshire Condominiums, 310-446-5333 DIRECTORS Jeffrey A. Beaumont, Esq. Beaumont Gitlin Tashjian, 818-884-9998 Carol Brockhouse, AMS® Rockpointe HOA, 818-341-8860 Tina Chu, Esq. Adams Kessler, PLC, 310-945-0280 Pamella De Armas SAX Insurance Agency, 310-740-4274 Michael Lewis, CCAM®, CMCA®, AMS®, PCAM® Concept Seven, LLC, 310-622-7012 Robert Ridley, Esq. Castlegate HOA, 213-626-0291 Lynn Ruger Warner Club Villas HOA, 818-703-7090 David C. Swedelson, Esq. Swedelson & Gottlieb, 310-207-2207

CHAPTER EXECUTIVE DIRECTOR Joan Urbaniak, MBA, CMCA®

2013 COMMITTEE CHAIRS COMMUNITY OUTREACH Meigan Everett, CMCA®, Gold Coast Property Pros EDUCATION Gregg Lotane, CCAM®, PCAM®, The Wilshire Condominiums FINANCE Jolen Zeroski, CMCA®, Union Bank GOLF TOURNAMENT Teresa Agnew, Roseman & Associates, APC Daisy Vasquez, Securitas Security Services USA, Inc. LEGISLATIVE ACTION Lisa Tashjian, Esq., Beaumont Gitlin Tashjian MARKETPLACE Alan Denison, Stay Green Inc. MEMBERSHIP Larry Hooper, Popular Association Banking MEDIATION SERVICES Matthew Grode, Esq., Gibbs, Giden, Locher, Turner & Senet, LLP PROGRAMS/LUNCHEONS Linda Healey, PCAM®, The Californian on Willshire PUBLIC RELATIONS Darin Sherlock, Marina Landscape PUBLICATIONS Matthew Gardner, Esq., Richardson Harman Ober PC FOCUS Magazine Sherry Branson, Kevin Davis Insurance Services Membership Directory Stephen S. Grane, Alante/MCS Insurance Services Web Site Lynne Collmann, CMCA®, AMS®, Savoy Community Association SATELLITE PROGRAMS Gail Jones, CCAM®, CMCA®, AMS®, PCAM®, Valencia Management Group Craig Phillips, CCAM®, CMCA®, AMS®, PCAM®, International Tower Owners Assn.

SOCIAL Donald Campbell, CCAM®, CMCA®, AMS®, Torrance-Windemere HOA Angel Fuerte, ENDURA Painting Corporation WINE NIGHT Katy Krupp, Fenton Grant Mayfield Kaneda & Litt, LLP Jolen Zeroski, CMCA®, Union Bank

CAI-Greater Los Angeles Chapter

Newsworthy 4 Excuses, Excuses 7 The New And Improved Davis-Stirling Common Interest Development Act 9 What’s Going On With Insurance This Year?

10 Get Your A/C Ready For Summer— The Heat Is Coming 12 “It Happened to Me” 16 CAI-GLAC Makes a Difference!

18 News From Sacramento: 20Th Annual Legislative Day At The Capitol 20 The Business Judgment Rule... And Its Limitations 22 The Affordable Care Act — Let’s Start Preparing 26 Discovery Of Loss Provisions In Fidelity Bonds Present A Trap For The Unwary 28 Consider Ad Hoc Committees

Chapter update 2 Note From the Editor’s Desk 3 President’s Message

NOTEWORTHY 3 Essentials Of Community Leadership Workshop 24 PCAMs Come Together

FYI 32 2013 Upcoming Events 32 Advertisers Index 32 Advertising Information

On the Cover

Rockpointe HOA Photo Courtesy of Roy Freeman, White House Properties

Save the Date: A nnual Golf Tournament June 10

This publication seeks to provide CAI-GLAC’s membership with information on community association issues. Authors are responsible for developing the logic of their expressed opinions and for the authenticity of all facts presented in articles. CAI-GLAC does not necessarily endorse or approve statements of fact or opinion made in these pages and assumes no responsibility for those statements. By submission of editorial content to CAI-GLAC, the author acknowledges and agrees to abide by the editorial and policy guidelines. Copyright © 2013.

All rights reserved. Reproduction in whole or in part without written permission is prohibited. CAI is a national, not-for-profit association created in 1973 to educate and represent America’s residential community association industry.

National Office Address: 6402 Arlington Blvd. #500, Falls Church, VA 22042 Tel: 888/224-4321 • Web Site: http://www.caionline.org

Stay Connected:

130 N. Brand Blvd., Ste. 305 Glendale, CA 91203 Office: 818-500-8636 Fax: 818-500-8638

March/April 2013 | www.cai-glac.org

1

2013 CAI-GLAC Super Sponsors Platinum

S

pring has arrived and as we move into warmer weather many things are kicking into high gear.

The economy is better, and for the first time in a while the housing market is looking much stronger.

As real estate bounces back so does everything else—businesses, jobs and much more.

It’s everyone’s worst nightmare—your house catches on fire. Would you know what to do? It’s a scary event, even for folks like Bill Hatch, a professional emergency service provider. Read his story: “It Happened to Me…My House Caught on Fire.”

The Business Judgment Rule is a very important law that protects board members. Kelly Richardson, Esq. writes about how the rule is applied and when it does and does not come into play.

The ACA or the Affordable Care Act goes into effect January 1, 2014. What will it mean to business owners and associations? Rickey Teems covers many issues which apply to the new law and the various ways it will affect everyone. from the Editor’s Desk

This issue starts off with an article

by Robert Nordlund on the perils of

Note

underfunding reserve accounts. Robert writes an informative and educational piece which faces the realities of what is going on in the association world and how it is not a good idea to hold off on collecting adequate reserves.

Wayne Pariser, Esq. gives us a fresh update on the “new and improved” Davis-Stirling Common Interest Development Act. What trends are experts seeing in the association insurance world? David Jeranko and Stephen Grane write about the latest happenings and trends in the insurance industry.

Fidelity bond policies which cover theft and embezzlement at a homeowners association are extremely important. Thomas Ware II, Esq. emphasizes the importance of paying attention to the loss provisions in the fidelity bond policy.

When would an association need an ad hoc committee? Whenever there are special items that need to be addressed on a short-term basis.

Neda Firouz writes about when these special committees are helpful and how they can engage more members of a community.

Enjoy the lovely spring weather and the interesting articles!

— Sherry Branson Editor

CAI-GLAC does not necessarily endorse or approve statements of fact or opinion made in these pages and assumes no responsibility for those statements. Authors are responsible for developing the logic of their expressed opinions and for the authenticity of all facts presented in articles.

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www.cai-glac.org | March/April 2013

Farmers Insurance Group—Steven G. Segal Insurance Agency, Inc. General Pavement Management, Inc. Pacific Western Bank Payne Pest Management Preferred Commercial Painting, Inc. R.W. Stein Painting, Inc. Seacoast Commerce Bank Wolf, Rifkin, Shapiro, Schulman & Rabkin, LLP Gold Beaumont Gitlin Tashjian Behr Paint Corp/THE HOME DEPOT USA Best Alliance Foreclosure and Lien Services Fenceworks, Inc. Fenton, Grant, Mayfield, Kaneda & Litt, LLP Ferris Painting, Inc. First Bank Nautilus General Contractors, Inc. Popular Association Banking Securitas Security Services USA, Inc. Select Painting Union Bank Silver Adco Roofing, Inc. Association Reserves, Inc. Berg Insurance Agency, Inc. CommerceWest Bank ENDURA PaintingCorporation Milstein Adelman, LLP Mutual of Omaha Bank/CondoCerts Orange Coast Building Services, Inc. Reserve Studies Incorporated S.B.S. Lien Services SAX Insurance Agency ServiceMaster by Eddie South Shore Building Services, Inc. Stay Green Inc. SwedelsonGottlieb Timothy Cline Insurance Agency, Inc.

Bronze Accurate Termite & Pest Control Bethco Builders Boyd & Associates DM Construction Services Dunn-Edwards Paints Horizon Management Company Mission Landscape Services Pacific Premier Bank PCW Contracting Services, Inc. Poindexter and Company, CPAs Professional Services Construction, Inc. QwikResponse Restoration & Construction Reconstruction Experts, Inc. Richardson Harman Ober PC Silldorf & Levine, LLP Stonemark Construction Management The Termite Guy Three Phase Electric U.S. Bank ValleyCrest Landscape Maintenance We thank our 2013 sponsors who have made a substantial contribution to ensure our continued success this year.

Contact the Chapter Office at 818-500-8636 to sponsor a program or an event.

CAI-Greater Los Angeles Chapter

Message

from the President

The Value of Networking

O

ver the many years I’ve spent in this business, there have been plenty of times I’ve felt more inclined to stay holed up in the office than to attend industry functions—too many undone tasks, too many phone messages when I return, unread emails to get through and so on. I can come up with a million excuses for missing an event and none of them are really that good. It usually comes down to my lack of motivation to network.

It’s ironic, really. Because whenever I do attend our chapter’s events, it’s the

networking that inevitably makes me feel recharged, reconnected and re-inspired.

There’s a great energy we get from networking. Learning something new and exchanging ideas can make us feel connected and relevant. Networking also gives us the chance to cultivate existing relationships and the opportunity to expand our networking circle.

I think that one of the best ways to network is at CAI-GLAC’s annual Homeowners Association Marketplace.

Our HOA Marketplace Committee has done an excellent job of fine-tuning the program this year to increase your networking benefits. You’ll now travel a shorter distance to meet more local business partners than ever before because we’re hosting three regional HOA Marketplace events in different locations to better meet your needs.

If you’re a board member or manager living and working in the Westside, South Bay or Long Beach area, you won’t want to miss the Westside Marketplace at the Crowne Plaza LAX

on May 2. Two more HOA Marketplace events will be held this fall in the San Fernando and San Gabriel Valleys to serve the needs of the people living and working in those areas.

Networking strategists will tell you that going beyond the perimeters of your comfort zone to connect with others can be a boon to personal and professional development. Who knows? You might turn a stranger into a contact, or a contact into a connection.

You might just find someone who offers what you need or someone who needs what you offer. When that happens, you open up a world of possibilities, you tap into new networking sources, and you get re-motivated.

The truth is—there is enough value in networking to keep me motivated to come back for more.

Very truly yours, Catherine Gemind, CMCA®, AMS®, PCAM® 2013 Chapter President

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CAI offers a one-day workshop that you won’t want to miss! It gives you the basics that you need to govern more effectively and efficiently. You’ll leave the workshop with new ideas, solutions to problems, handouts for future reference and the knowledge that there are more resources and people to help you with your leadership responsibilities. Course topics include: responsibilities, rule enforcement, maintenance, finance, reserves, insurance and board meetings.

Cost: Cost: $80/Member; $100/Non-member $80/Member; $100/Non-member Next Class: Next Class: April 14,July 201220, 2013 Saturday,

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CAI-Greater Los Angeles Chapter

To learn more about CAl’s newest service and how mediation can benefit you, call the Chapter Office at 818-500-8636.

March/April 2013 | www.cai-glac.org

3

Excuses, Excuses >>> By Robert M. Nordlund, PE, RS

An excuse has been defined as “the skin of a reason stuffed with a lie.”

I

n the process of preparing more than 30,000 reserve studies for community associations across the country over a period of 26 years, there are two board member sentiments we hear most frequently expressed: “We can’t afford the Reserve Funding Plan” and “We’ll worry about that next year.” But no matter how many times a board member may repeat these sentences, it doesn’t mean they are true and it doesn’t mean they are wise. After we look beneath the skin of these two reasons, it may surprise you how differently you feel about these excuses!

“We can’t afford the Reserve Funding Plan.”

Most of us are accustomed to living within our own financial constraints, where there are some things we can afford and some things (like that red Ferrari!) that we cannot. We, therefore, are regularly making choices about where we spend our limited cash. There are, however, two logical flaws to this concept of “affording” when it is applied to reserve contributions in an association-governed community. First, common area repairs and replacements don’t disappear if the Reserve Fund has been underfunded. The claim that you cannot afford the Reserve Funding Plan this year only creates a tidal wave of more Reserve obligations in the future—and to compound the problem, delayed contributions generally result in delayed Reserve projects, so the issue of deferred

maintenance comes into play. Most deferred Reserve projects actually get more expensive when delayed. The truth is, you can’t afford not to adequately fund reserves.

The second flaw is that boards of directors don’t really have a choice in the matter. Board members are both empowered and obligated to operate the association according to state law and their own governing documents. Throughout the United States, boards are empowered to set a budget to collect “adequate” funds from the owners to maintain the physical assets of the association. In the State of Florida, state law specifically obligates board members to propose a budget that includes fully-funding Reserves. Taking matters into their own hands, and deciding not to budget for the needs of the association, exposes board members to personal liability. Owners or future owners might be inclined to file a lawsuit against the board because the special assessment that was levied against them is actually a deficit catch-up strategy from all the years you benefitted financially by keeping association assessments low.

The reality is that underfunding reserves is nationwide problem.

More and more prospective buyers are becoming aware of this issue. In the State of California, the Department of Real Estate took the unprecedented step in September 2012 of issuing a Consumer Warning—warning buyers of homes in associationgoverned communities about the dangers of underfunding Reserves. You can read it yourself in the adjoining sidebar.

“We’ll deal with that next year.”

The problem with this next excuse is that Reserve obligations are not future events. Reserve obligations arise from very predictable deterioration that occurs every day, every week, and every month, over the course of many years. Unlike a fine wine, buildings don’t

Consumer Warning: Underfunded Homeowners Associations

By Joseph Aiu (Statewide Subdivisions Compliance) California Department of Real Estate The California Department of Real Estate (DRE) has issued this warning as a result of the growing number of homeowners associations (HOAs) that do not have sufficient funds or reserves to adequately maintain the common areas in the housing developments for which the HOA is responsible.

This warning will explain the negative effects and impacts of an underfunded HOA, offer suggestions on how to gauge the financial health of an HOA, and discuss some typical causes of an underfunded HOA. Negative Effects of an Underfunded HOA: An underfunded budget may cause unexpected expenses for the owners living in a CID and/or have a deleterious affect on the value or condition of an owner’s property.

If the HOA cannot properly maintain the common areas due to budget constraints, roads, pools, exterior paint, and roofs may fall into disrepair. Moreover, underfunded HOA budgets may create pitfalls for homebuyers who

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www.cai-glac.org | March/April 2013

do not investigate the financial health of the HOA prior to buying into a CID. HOAs facing severely underfunded budgets often must resort to levying special assessments on the owners living within the CID in order to pay for needed repairs or maintenance. Special assessments can run into the tens of thousands of dollars so owners and buyers would be wise to look into the financial health of the HOA to ensure they aren’t exposing themselves to unexpected expenditures and financial problems.

to maintain all the major components of the CID. This summary disclosure document is an excellent tool to determine the long term financial health of any HOA.

How to know if the HOA is Financially Healthy: HOAs are required to produce a yearly budget and to furnish it to the owners in the association. In addition, at least once every three years, the HOA is required to review the major components of the CID that the association is obligated to repair, replace, restore, or maintain, as part of a study of the reserve account requirements, to ensure sufficient funds are, or will be, available to adequately maintain the common areas. Included in the budget documents, the HOA is required to provide a summary of its reserves and whether the reserves are adequate

Typical Causes of HOA Underfunding: Foreclosures are a significant cause of underfunded HOA budgets. Homeowners in foreclosure often do not make their assessment payments. Due to the length of the foreclosure process, the non-payment of assessments may cover a period of 90 days to a few years. Although HOAs have the ability to place a lien against a homeowner’s property for non-payment of assessments, HOA liens are often extinguished at the foreclosure sale because the value of the property is insufficient to pay off all the liens against the property. This is especially true in cases where the value of the property is less than

In addition, the law affords a potential buyer or an owner in an association the opportunity to review the HOA’s financial documents. For a potential buyer, the financial documents may be requested from the seller. For an owner in the association, the financials should be received from the HOA at least annually.

CAI-Greater Los Angeles Chapter

improve with age, so those repair & replacement costs continue to pile up. The monetary value of that ongoing deterioration can be easily calculated and translated to an offsetting Reserve contribution rate. Reserve obligations are as real as any other bill the Association receives. Cultivating a culture of not paying your own bills is not only fiscally irresponsible, but inherently unfair.

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Let me explain: Is it fair to be forced to pay for a new roof to replace one that someone else “used up?” The unwitting victims of deficit-reducing special assessments or bank loans necessitated by underfunding reserves may not all have enjoyed the full life of that component. Some suffer the unfortunate timing of being owners at the very end of the component’s useful life. Many owners are being forced to subsidize the reserve deficit of prior owners who underpaid the cost of maintaining the association.

So what to do?

“It is the greatest of all mistakes to do nothing because you can only do a little. Do what you can.” —Sydney Smith It may be a hard pill to swallow, but boards need to stop making excuses or kicking the problem down the road. You can do the wise thing. You can figure out your current situation by following the Funding Plan—it is one of the key results of a Reserve Study. Then begin to make steps of progress. Not only will you then fulfill your role and responsibility as a board member and protect yourself from liability, but you will keep your association in good shape by being able to make timely repairs and replacements and achieve long-term homeowner satisfaction.

• Save Money with our 3-year plan • Access your Reserve Study Online • See a Video of your results • Free preparation of Disclosure Form 1365.2.5

Call or go to our website for more information, samples or Free bid

800.733.1365

www.reservestudy.com

Robert Nordlund is the CEO and founder of Association Reserves, Inc. with offices in Calabasas and San Diego. He can be reached at rnordlund@reservestudy.com.

the mortgage. The end result is the HOA ends up with less than the projected assessment income, which leads to an underfunded budget.

Inadequate planning on behalf of an HOA board can also lead to an underfunded budget. In instances where a CID or HOA is facing dire economic conditions, an HOA board may succumb to the pressure of its association members and not increase assessments or even reduce assessments and forego on-going maintenance. These types of bad decisions inevitably result in the HOA levying special assessments against the owners to address health and safety issues that arise from neglect.

In addition, reduced care and upkeep of a CID’s common areas result in the inability to sell or secure financing because of the dilapidated condition of the property.

HOAs that rely on inadequate assessment collection procedures usually suffer from insufficient funding to satisfy their financial obligations. For example, homeowners who are not in foreclosure but refuse to pay their assessments may rely on the association’s poor collection process as a way to delay making their assessment payments. This may result in a “domino effect” where other members stop paying their assessments under the rationale that since others are not paying, why should they.

CAI-Greater Los Angeles Chapter

What to be Aware of when a CID has an Underfunded Budget: • Special assessments. Inevitably, underfunded budgets lead to special assessments as mentioned above. This is the common method HOAs use to satisfy financial obligations. While an HOA is limited on how much it can increase assessments — typically 5% per year — a special assessment can be assessed in order to resolve a health and safety issue. This means the entire cost to make a repair can be levied against all its members, or members who are paying assessments.

Special assessments can be tens of thousands of dollars.

into its reserves. In addition, lenders are reluctant to fund loans when an association cannot meet its financial obligations.

Quick Tips for Evaluating the Financial Health of an HOA: • If you are a buyer, demand that the seller provide you with copies of the most current financials for your review.

• If you are an owner, make sure that you are given annual financial reports, especially the delinquency report and those pertaining to the adequacy of the reserve account.

• Inability to sell or declining property values. It can be very difficult to sell a home if the HOA’s assets are inadequate to satisfy its financial obligations.

Buyers will be leery of special assessments and/or increased monthly assessments. Moreover, property values may depreciate dramatically because of deferred maintenance and inadequate funds to satisfy financial obligations.

• If you are a buyer, do a physical review of the property and observe how the common areas are maintained. For example, assess the condition of exterior paint, amenities, roads, roofs, drives, fencing, etc.

• Inability to secure financing. Lenders (subject to underwriting guidelines from Fannie Mae or Freddie Mac) may deny funding loans whenever an association funds less than 10% of its operating funds

Please refer to DRE’s web site, www.dre.ca.gov for additional information on Common Interest Subdivisions, including the brochure Living in a Common Interest Development.

• If you are an owner, be involved with the board and its decisions, especially when you see deferred maintenance of common areas or are subject to special assessments.

March/April 2013 | www.cai-glac.org

5

A

ssociations need not be concerned about the change in section numbers because Section 4235 of the new Davis-Stirling Act expressly permits the substitution of the new section numbers in governing documents simply

by Board resolution, without approval of the members.

In addition to the re-organization, the new Davis-Stirling Act contains a few substantive changes, but they do not affect previous actions. Under new Section 4010, an action taken or a document prepared (other than a governing document) before January 1, 2014 will remain valid if the document or action was proper under the old Davis-Stirling Act. The substantive changes are as follows (with the new section numbers in parentheses):

The New And Improved Davis-Stirling Common Interest Development Act ■ ■ ■ By Wayne Pariser, Esq. ■ ■ ■

As is widely known, effective January 1, 2014, the new and improved Davis-Stirling Common Interest Development Act will replace the current one, which was first enacted in 1985 and has been evolving ever since then.

■ The new legislation, Assembly Bill No. 805, primarily reorganizes the Davis-Stirling Act, making it more intuitive and user-friendly. ■ Instead of being found at Civil Code Sections 1350 through 1378, the new Davis-Stirling Act statutes will be Civil Code Sections 4000 through 6150.

A document required to be delivered to the Association must be delivered to the person designated by the Association. If no person has been designated, the document must be delivered to the President or Secretary. The permitted methods of delivery include electronic means (e.g., e-mail and facsimile) and personal delivery, if the association has assented to those methods. (4035)

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The permitted methods for distributing documents to the membership include — in addition to the previously permitted methods of mail, overnight delivery, and electronic means if the recipient has consented in writing – (1) inclusion in a billing statement, newsletter, or other document that is delivered by one of the permitted methods; (2) posting the printed document in a designated, prominent location that is accessible to all members; or (3) inclusion in the association’s television programming. However, if a member requests to receive general notices by individual delivery, the document must be delivered by mail, overnight delivery, or electronic means if the member has given written consent to electronic delivery. (4045) If there is any inconsistency between the law and the governing documents or between the various governing documents, the priority is in the following order: the law, then the Articles of Incorporation, then the CC&Rs, then the Bylaws, and then the operating rules. (4205) Although the old Davis-Stirling Act required that the operating rules be consistent with the other governing documents, it did not provide for priority amongst the other governing documents.

The written request to hold a special vote of the members on reversal of a rule change adopted by the Board can be delivered to the “association” and no longer need be delivered to the President or Secretary specifically. That vote must be held within 35 to 90 days after receipt of a proper request.

(4365(b)) A new provision clarifies that limits imposed by Davis-Stirling on the regulation of the use of separate interests do not preempt or supersede any other statutory limits outside DavisStirling — e.g., Civil Code Sections 712 and 713, relating to the display of signs; Civil Code Sections 714 and 714.1 relating to solar energy systems; Civil Code Section 714.5, relating to modular or pre-fabricated structures; Civil Code Sections 782, 782.5, and 6150, relating to age restrictions; Government Code Section 12956.1, relating to racial restrictions; Government Code Section 12927, relating to disability accommodations; and Health and Safety Code Section 1597.40, relating to family day care homes. (4700) An Association may authorize the installation of an electric vehicle charging station in a common area, which is not an exclusive use common area, for the exclusive use of an owner only if installation in the owner’s designated parking space is impossible or unreasonably expensive. However, the Association or owners may install an electric vehicle charging station in the common area for the use of all members. An association also may create a new parking space where one did not previously exist to facilitate the installation of an electric vehicle charging station. (4745(g),(h),&(i)) The ballots from any election must be kept by the inspector(s) of election for a full year after the election, instead of the

CAI-Greater Los Angeles Chapter

previously required nine months, before transferring them to the Association. (5125)

Neither disciplinary action nor a monetary charge for damage to the common area can be effective against a member unless the board fulfills the notice and hearing requirements. (5855)

Many of the already-required annual disclosures have been consolidated into an annual policy that must be distributed A director or committee member is prohibited from voting on within 30 to 90 days before the fiscal year end. In addition to discipline of that director or committee member, an assessment the previously-required disclosures, the new Davis-Stirling Act against that director or committee member for damage to added the following: (1) the person designated to receive official the common area or facilities, that director’s or committee communications sent to the association, member’s request for a payment plan (2) the location, if any, designated for If there is any inconsistency for overdue assessments, a decision posting of notices, (3) a member’s option whether to foreclose on that director’s between the law and the governing or committee member’s separate to receive general notices by individual delivery, and (4) the association’s documents or between the various interest, a proposed physical change to discipline policy, if any, including any governing documents, the priority that director’s or committee member’s schedule of penalties for violations of separate interest, or a grant of exclusive is in the following order: the law, use common area to that director or the governing documents (previously then the Articles of Incorporation, committee member. However, this only the fine schedule needed to be distributed and only when it changed). then the CC&Rs, then the Bylaws, and prohibition does not limit any other (5310) provision of law or the governing then the operating rules. (4205) documents that govern a decision in If the fine schedule is adopted or revised which a director may have an interest, after the annual policy is distributed, a which may mean that the governing documents supplement must be delivered to the members individually. may allow the prohibited votes. (5350) Fines must not exceed the amount stated in the fine schedule Wayne Pariser is a partner with Pariser & Pariser, LLP, that is in effect at the time of the violation. The Association a law firm that provides a wide range of legal services must provide a copy of the current fine schedule to any to community associations. He can be reached at member upon request. (5850) wdp@pariserandpariser.com or (310) 552-4908.

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CAI-Greater Los Angeles Chapter

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March/April 2013 | www.cai-glac.org

7

What’s Going On With

Insurance

This Year?

By David Jeranko and Stephen Grane ■ Usually the most frequently-asked question at budget time from community managers regarding insurance concerns overall price. The one phrase we hear over and over again is, “How much is it going up?”

U

sually the most frequently-asked question at budget time from community managers regarding insurance concerns overall price. The one phrase we hear over and over again is, “How much is it going up?” As you all know, insurance premiums have been very stable or even dropped over the past several years on the West Coast. The disasters on the East Coast have had very little effect on us. With that being said, there seems to be a change in the wind because of the terrible disaster back East with Super Storm Sandy costing well over $25 billion to insurers (according to the New York Business Journal quoting Munich Re AG). That price does not even take into account the additional $25 billion of damage to the uninsured. As you can well imagine, this is a big hit to the insurance companies and, even though the damage was back East, it is beginning to trickle down to us on the West Coast. Insurance companies are raising the Total Insurance Value (TIV) up a bit to compensate for the increase in construction cost.

So what can we do to stem this gradual increase in premium cost? Many association managers have been proactive with their associations and have raised the master policy deductibles to eliminate those annoying water claims we all seem to encounter. Also, many associations have changed their CC&Rs so the responsibility goes back to the homeowner on some of these water claims. By successfully managing these deductibles, the losses have dropped off, and with less claims, the bottom line on the premiums will be improved.

Now let’s talk about claims for a moment. Claims can be the biggest heartache or they can be taken care of in a timely, lessstressful manner. How can we make handling these claims less stressful?

First, if it is a water claim that is causing damage, find the source of the problem and turn the water off. Then call your association management company. They will call a restoration company to clean up the mess for you. Once the restoration and cleanup is underway, the manager and the board will

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look at the CC&Rs and determine who is responsible to pay for the cleanup. It could be the association or it could be the homeowner. The CC&Rs will tell you who will pay for what.

We recommend that a claims protocol be set up, so that when a claim occurs, the steps are all in place and approved by the board. This will allow the manager to take the appropriate steps to prevent a water claim from turning into a mold problem if the water is not removed and dried up in a timely manner.

When dealing with claims, it is so important for each homeowner to have an individual insurance policy, such as a Condominium Owners policy, also known as an HO-6.

Having an HO-6 policy will eliminate considerable stress when filing a claim. The main reason for an HO-6 is this example: if for some unfortunate reason there is a covered claim in the residence and the homeowner is not able to live in the unit until the repairs are completed, they will, of course, need a place to live. The HO-6 policy will take care of the extra expenses for them to live at another location. The condominium’s Master Policy for the association will not.

An HO-6 policy helps to provide peace-of-mind for such unfortunate occurrences.

Another benefit of having an HO-6 policy is that, if endorsed with Building Betterments and Improvement coverage, the HO-6 policy will cover the master policy deductible when the homeowner is responsible for the deductible. These master policy deductibles are typically $5,000 to $10,000 nowadays.

The rule-of-thumb as to who pays the deductible has come from a case law that says, “Whoever is responsible for the portion of the building that caused the damage is responsible for the master policy deductible.” An example of this would be, if a water heater breaks and causes damage to the building, and the homeowner maintains the water heater, the homeowner would pay the deductible. If a common area pipe breaks and causes damage to the building and the CC&Rs say that the association is responsible for maintaining the common area pipes, then the association is responsible for the deductible.

In conclusion — yes, there are gradual increases in premiums out there, but both managing deductibles and putting more responsibility on the homeowner will help with the current insurance market changes. With these changes happening in the insurance market it may be a good time (if the association has not done so recently) to carefully review the association’s policies with your agent just to make sure you are getting the best possible value for your association.

David Jeranko (far left) and Stephen Grane (near right) are brokers with Alante Insurance Programs, a division of MCS, Inc. in Irvine. They can be reached at djeranko@mcsins.com and sgrane@mcsins.com, respectively.

CAI-Greater Los Angeles Chapter

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March/April 2013 | www.cai-glac.org

9

GET YOUR A/C READY FOR SUMMER— THE HEAT IS COMING

By Paul Kleeger • Summer is soon approaching, and it is time to start thinking about your air conditioning system. Whether it be home, office or clubhouse, maintenance is essential to keep the equipment functioning at its best throughout the hot summer months ahead. We call this maintenance a “tune-up.”

A tune-up is having your equipment inspected prior to the summer heat. This can alleviate your being on the waiting list when HVAC companies get busy. A precision tune-up consists of checking, some or all of the following, (depending on your type of system):

Your licensed HVAC contractor will have the knowledge of the different types of air filters, and which is the best option for your needs. He may also advise you of the availability of air quality products, ranging from air filtering, air scrubbing or air purification.

• equipment • safety lubrication controls • drain lines • compressor blow-out contactors • filters change• oil levels out • belt adjustment

There are other maintenance issues of concern. Check the circuit breaker for your equipment to be sure it is not old and weak. If your thermostat requires batteries to operate or requires a backup battery, then the batteries should be changed out at least every year. Please remember to tell your service tech to replace the batteries, as this is often overlooked. Your service

• freon levels • head pressure • suction pressure • equipment operations

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Orange County 949.476.3789

Los Angeles 310.207.2207 California 800.372.2207

San Francisco 415.762.1889 CAI-Greater Los Angeles Chapter

tech should also let you know when your indoor and outdoor coils need to be cleaned. Let your tech know of any strange noises or smells that you have not heard or smelled before.

Since most tune-ups do not include the duct system, you may want to have your HVAC contractor check the duct system, to look for any air leaks. Properly-running equipment isn’t efficient if the cooled air is leaking out into the environment instead of cooling your clubhouse or office. Your contractor will let you know of any other issues that need to be addressed.

You, as the consumer, have the most important role in keeping your system running efficiently and keeping your environment comfortable. Thermostats and their settings are within your control. Setting your thermostat too low will require the air conditioner to run constantly. This will result in the coil icing up, which could cause damage to the equipment. We recommend, when the heat is extreme, that you leave your thermostat at your desired temperature and set the fan setting to “on.” To do this, push the fan button until it appears on the thermostat screen. Switch the fan setting from “auto” to “on,” or if you have an older thermostat, simply switch it on. This will help maintain an even temperature throughout the area. When the heat wave ends, set your fan back to the auto setting. There is a benefit to keeping your fan running at all times; it will filter the air constantly causing less dust in your environment. This will raise your electric bill a little, but you will save time on less dusting of your furniture.

(Note that not all thermostats work on all systems. They are as individual as the homeowner and the system. If you are looking to change out your thermostat and you buy one from your local hardware or big box store, it may not fit your application and you have wasted your money. Simply discuss your needs with your HVAC contractor and they will install the right one, the first time.)

There are so many variables that contribute to the ambient temperature of your environment, and things that you can do to make it more comfortable. Check your air registers /grills to make sure they are fully opened. Be aware of windows and their treatments; keep them closed as the sun shines in. Make sure that your attic is ventilated to release the heat load (there are thermostatically-controlled ventilators and solar-powered available now). Proper insulation of attic and outer walls—all contribute to keeping you cool.

For your best experience, you need a good HVAC contractor.

Talk to people you trust, be leery of the online rating sites, as they require contractors to pay them to belong. Make sure that your contractor is licensed by the California Contractors State License Board. You can check the license status at www.cslb.ca.gov. Remember—always ask for a license number and make sure it is current.

Paul Kleeger is the president of NuAir Services, Inc. in Chatsworth. He can be reached at nuairservices@att.net.

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CAI-Greater Los Angeles Chapter

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March/April 2013 | www.cai-glac.org

11

“It Happened to Me” My House Caught on Fire...

A True Story

bad news. Before you actually answer, you ask yourself… WHO would be calling at 12:45 in the morning? With over 20 years of being on call both while owning my own emergency service company and now with ASR Construction, it comes with the job… it is what we do, and we respond when needed 24 hours a day.

As my phone rang and I picked it up, I saw the name “Jessica” on the caller ID. This is when I knew the 12:45 a.m. call was not going to be good news… Jessica and her husband Dave were the tenants in my rental home in Oxnard.

By Bill Hatch As Director of Operations for ASR Construction, specializing in fire, water and reconstruction and with over 20 years of experience working with clients who have had major losses due to water and fire damage, I thought I had seen enough to understand what they were going through and how they felt. Now I am on the other side of it… and was I ever wrong! January 11, 2012, was the night that would forever change how I would work with clients who are dealing with a major losses. From here forward I can truly say, “I know what you are going through and I understand”— because it happened to me… my house caught on fire!

The Call January 11, 2012 12:45 a.m.

When your cell phone rings at 12:45 a.m. it is usually a wrong number, or real

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But this is not like any other rental home; two months prior it was my family’s home. The last 15 years I put everything I had in to it; I met my wife while living here; our engagement party was there… and our children started their lives there.

We had just moved to a new home a few months before. I had been a landlord for just a few very short months.

As I stared at the phone and hit the answer button, a shaky female voice on the other end responded, “Bill…, this is Jessica… your house is on FIRE.” It took me a moment to respond. I can’t even remember exactly what I said to Jessica except that I was on my way. I got dressed, grabbed a jacket and my camera and I was out the door!

The Drive Over As I was driving the 15 minutes to my former home, I called Jessica back to make sure everyone was OK. I found out that all three smoke detectors went off.

She, her husband and two kids living in the home all got out, were safe, and the fire department was on-scene. I again made sure everyone was OK and told her I would be there in a few minutes.

So many things went through my head during the drive over. Was it my fault? Did I do or NOT do something in my 15+ years of living there? Was

it my furnace; was it my stove, their dryer… What? As I approached my old neighborhood I could see the smoke, lights, fire trucks and firemen. It was like a scene in a movie and I was right in the middle of it.

On Scene Nothing was familiar. I had driven up and down that street thousands of times and I didn’t recognize it. I had to park about a block away due to all the emergency response vehicles. As I walked to my former home, the air was thick with smoke, making me choke. The sound of chain saws cutting through the new roof was deafening—and what I saw put a lump in my throat. The garage door was torn open and off its tracks; nothing inside was recognizable; six firemen were on the roof with sledge hammers and chain saws; two others were flooding the freshly-cut openings with hundreds of gallons of water and foam. At first glance it looked as if only the garage was damaged, but I knew once I saw them flooding the house—whatever the fire didn’t get, the polluted soot-filled water would, and everything would have to be removed.

As I turned to my left I saw my tenants next to their car in their pajamas wrapped in blankets with nothing but socks on their feet. They were all very shaken but OK. The kids were asleep in the car, like nothing had happened.

I could not imagine what they went through and the fear they must have felt. It had once been my home. It could have been my family.

Dave (the tenant) told me they had gone to bed and he was awakened by an alarm. After searching the house, he realized it was coming from the garage. Once the interior door had been opened, he saw smoke and flames and the other two alarms in the house went off. He was able to get everyone out in plenty of time.

The smoke detectors that I installed saved their family from potential injury or worse. I cannot stress enough the importance of installing smoke CAI-Greater Los Angeles Chapter

detectors. According to the California Health and Safety Code Section 13113.7, there must be a smoke detector placed outside each room in the hallway where a person sleeps. Smoke detectors can be battery operated unless the room is newly constructed. If the room is constructed after August 14, 1992, the smoke detector must be hardwired with a battery backup. Smoke detector regulations can be reviewed with the local department of building and safety.

About a half an hour later, the American Red Cross showed up and assisted them by getting them hotel rooms for a couple days and getting their kids into a warm bed.

On the Fire’s Destruction Before going to bed Jessica recalled putting clothes in the washer and in the dryer at 9:45 p.m. It was a cold night and the furnace was on as well. The washer, dryer, furnace and hot water

heater were all side-by-side in the back corner of the garage, and this was where the fire started. The entire garage caught on fire and then went up a vent chase right into the upstairs attic where it destroyed everything above the second floor ceiling. Once the fire department put out the fire in the garage, they thought they were finished and it was just a small garage fire, until they saw smoke pouring out of the second floor attic vents. This is when the real damage happened—this is when the ceilings were ripped down, holes were punched in every upstairs wall, and toilets and cabinets were ripped out while trying to find and vent the fire.

About an hour after the fire was out, I was allowed inside to see the damage.

What I saw was heartbreaking!

Everywhere I looked I saw destruction — the bathrooms I built, the tile I set and the carpet I installed — all destroyed. My tenants were allowed in as well, so they could try and find their wallets, car keys, clothes that could be

saved and anything that they needed for the next couple days.

Once the investigation was done for the evening and the fire department were finished hosing and foaming everything down, they packed up and little-by-little everyone started to leave. The American Red Cross left, as did the large trucks with the flood lights. Everyone was gone except me. The fire department could not close up the garage because the garage door was destroyed so Continued on page 14

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March/April 2013 | www.cai-glac.org

13

“It Happened to Me” My House Caught on Fire...

Continued from page 13

everything was wide open… I couldn’t leave it like this. At 4:00 a.m., I called our on-call emergency service manager, and he dispatched one of ASR Construction’s emergency service crews for board-up service to secure the house. Then I went to get my truck.

I drove it into the driveway with the headlights shining at this black hole that used to be my garage, alone, in darkness and silent… I waited and this is when it all hit me… This was real!

On Recovery and Rebuilding After our crews arrived and were finished with board up and tarping the roof, I couldn’t go home yet because there was still so much to do. Instead, I went to my office and went into work mode. This was my home, but now it was my job to get things done and this is how I was going to deal with it. Board-up was done and the site was secure. I had already called my insurance company and filed a claim. I had to get temporary power to the house for the refrigerator, (nothing worse than a fridge full of rotting food after a few days) and the upcoming demo of the home. I scheduled the electrician for temporary power and had a storage container delivered for my tenants’ belongings that could be removed from the home and saved. Once the sun came up, I had a crew go over with our dump truck and, with my tenants’ approval, we cleaned up all the debris from garage that was piled in the driveway by the fire department.

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In the hours following, the fire department continued their investigations; I contacted an industrial hygienist to have the house tested for asbestos because the home was built in 1979-80 and we needed to get a report prior to demolition later in the week; the insurance adjusters made contact and I had our emergency response crew go on-site and determine how much of the house was now water-damaged as well. Crews used Infrared cameras and moisture meters that can “see through” walls and determine just how much is wet and document it all with pictures without being destructive.

When the adjuster arrived later in the day, he was shocked at how much was already taken care of because he normally deals with loss victims who do not know what steps need to be taken or even have a plan.

I didn’t think I had a plan either, but being in this business, I just knew what needed to be accomplished and I just went into that mode—it was how I was going to deal with my loss, and I wasn’t ready to just stop and think about what had happened.

In the following days, the investigation was complete and the cause was still undetermined. It was classified as accidental and was either the furnace or the clothes dryer. The next step was to rebuild, and as I wrote this, we were still waiting on engineering, city permits and funds to be released so the rebuild could start. To see the completed rebuild go to: http://www.facebook.com/ MyHouseCaughtOnFire.

Advice to Others, What You Can Learn From My Loss and My Past Experience zPrepare z and educate children about fire and its dangers to prevent tragedies. A prepared child is more likely to escape unharmed. Set off smoke alarms so children know what they sound like, what they mean, and what to do! zDevelop z an effective escape plan and practice it at least twice a year.

zDon’t z leave burning candles unattended, especially near flammable or combustible materials. zIf z a fire starts in your home, get out and stay out. As you escape, close all doors between you and the fire. zOnce z you’ve escaped, call 911 from outside the home. It is dangerous to stay inside to make the call. zPlace z smoke alarms outside each sleeping area, inside any room where the door is typically shut, and on every level of the house, including the basement. zLeave z batteries in smoke alarms.

Nuisance activations caused by cooking can be addressed by moving the alarm farther away from the kitchen, not removing the batteries! zIf z a fire starts in your home, get out and stay out. As you escape, close all doors between you and the fire. zHave z a plan, an Emergency Response Plan, for your home, your family and your association if that’s where you live. What to do, where to meet etc. zClean z your dryer and your vents of all debris; it can be fuel for a fire. Most household fires start due to a clogged dryer vent. zDon’t z run clothes dryer or the furnace while you sleep. zPlace z Fire Extinguishers near kitchen and other areas in your home. Keep them up to date. zIf z you rent, purchase renters insurance, it’s only a couple hundred dollars a year, a very small price to pay. Many times you can bundle it with your auto insurance policy and the cost will be minimal… So please check it out, I will never rent the house back out without proof of renters insurance…

I have seen too much loss!

Bill Hatch is the director of operations at ASR Construction with offices in Ventura and Los Angeles. He can be reached at bill@asr-construction.com. To see the complete rebuild of his home from start to finish, go to http://www.facebook.com/MyHouseCaughtOnFire

CAI-Greater Los Angeles Chapter

Current Sponsors Title Securitas Security Services USA, Inc. Wolf, Rifkin, Shapiro, Schulman & Rabkin, LLP Lunch Beaumont Gitlin Tashjian Souvenir Photos Accurate Termite & Pest Control Championship Pacific Western Bank Preferred Commercial Painting Putting Contest Taylor Roofing & Painting Beverage Cart Behr Paint Corp./THE HOME DEPOT USA Urban Tree Care Contest Hole Sponsor Alliance Environmental Group, Inc. Landscape Development, Inc. Nautilus General Contractors ValleyCrest Landscape Maint.

Meet & Greet Hole Sponsor American Technologies, Inc. Boyd & Associates CertaPro Painters Ltd. CommerceWest Bank Har-Bro Emergency Service & Restoration Hi Tech Painting & Decorating, Inc. Jon Wayne Construction & Consulting Reconstruction Experts, Inc. S.B.S. Lien Services South Shore Building Services, Inc. ServiceMaster by Eddie The Termite Guy Vista Paint Corporation Club Pro First Bank

CAI Golf Tournament Monday, June 10, 2013 Woodland Hills Country Club 21150 Dumetz Road Woodland Hills, CA 91364 Prize Supe for the be rh deco ero-the st rated me tee!

SCHEDULE Registration Shotgun Start Putting Contest Lunch 19th Hole Dinner, Raffle, Awards

8:00 a.m.

9:00 a.m.

During Play 11:00—1:00 p.m.

2:30 p.m.

4:00 p.m.

ENTRY FEE/ REGISTRATION $200 per player—18 holes Includes green fees, cart, goodie bag, box lunch, dinner and awards/prize drawings.

$55 Dinner & Social Only Includes dinner and awards/prize drawings.

Register online at www.cai-glac.org or Mail check to: CAI, 130 N. Brand Blvd., Suite 305, Glendale, CA 91203

CAI-Greater Los Angeles Chapter

March/April 2013 | www.cai-glac.org

15

CAI-GLAC Makes a C

AI-GLAC’s clothing drive during the months of February and March 2013 proved to be a complete success with industry-wide support. Well Suited for the Job was thrilled with the great quantity of donations received. All contributions made were presented to the founder of the organization during CAI-GLAC’s March 20 Educational Luncheon.

Community Outreach Committee Chair Meigan Everett and Committee members Angelique Madrigal and Janet Nelson, met with Janet Lavender, founder of Well Suited for the Job, and some of her clients (success stories) at the downtown store to take an inside look at the organization.

In the early 1990s, Janet Lavender found herself homeless, living in shelters, and in need of clothes suitable for obtaining employment. With a degree in business and minor in marketing, Janet was confident that if she could look like she could handle the job, she could successfully communicate her skills and gain employment. At the time there was no service that provided assistance in this manner in Los Angeles. Janet had to contact friends and acquaintances to borrow clothing for her interviews.

Experiencing this need for individuals in transition, Janet decided to help her community and started Well Suited (originally Dressed for Success). Janet found her passion through her hardship. Though she initially focused her efforts on helping women she lived with from the shelter, her organization has now helped over 100,000 people and counting. As this number increased, Janet also expanded her focus and now carries clothing for children as well.

Her services can be compared to a personal shopper. Men and women visit her store to be fitted and advised on appropriate fits and styles. In addition to clothing, Well Suited provides

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monthly networking events for their clients. Educational presentations are given on work ethics, financial planning and time management techniques. These services provide encouragement, resources and camaraderie for individuals that have overcome all odds.

One success is Aletia Delosangeles who was devastated when the youngest of her four children was diagnosed with a brain tumor. Juggling her career and numerous doctor appointments required to treat her daughter was overwhelming, forcing her to leave her position of 10 years. Once her daughter’s health improved, Aletia needed to re-enter the workforce. With the encouragement of her former husband and the volunteers at Well Suited, she interviewed with Transitional Subsidized Employment (TSE) and shortly thereafter, was hired by the organization where she is now helping women in the same situation she once experienced. In her words, “When life changes, you need to just put in some effort to make changes too.”

No one can relate to that more than Joyce Ford. After 17 years of committed service to an insurance company, she was disheartened by the company’s ultimatum to her to relocate and keep her position or accept a small severance package and remain local. With her two children thriving in their academics and extracurricular activities, Joyce knew that relocation was not an option. She took up real estate work for several years until the market crashed. Since then she has been seeking employment. Now involved in the TSE program, she is ready to make her way back into the workforce.

During our outreach visit to Well Suited, Joyce tried on several prospective outfits. Two of which were donated just the day before at the CAI March Luncheon. A lightweight black skirt and matching mock sweater, the other was a white

CAI-Greater Los Angeles Chapter

Difference! pant suit with a navy pin-striped double breasted jacket that fit her as though it had been tailored. She smiled at the other women in the store, and they nodded in approval. She ran her hands over the fabric. As she spoke, she buttoned the jacket and walked over to the mirror and deliberated logically on the most suitable ensemble. “Even when I was going through difficult times, I never doubted that things would improve and that it was all going to be just fine in the end,” says Joyce. A truly positive outlook seems to have paid off, as her children are now graduates and she is moving ambitiously toward a new career. It was clear that Well Suited lifts these women’s spirits and gives them a small boost of confidence in knowing that they can afford appropriate interview and work attire.

“Everything happens for a reason” says Shatara Wynn, 24. Shatara is a Certified Nursing Assistant with four years of experience in the field. She has been out of work since giving birth to her seven-month old son, Alijah. Poised and articulate, she sits for a photo and shares her career goals: “I want to be a RN (Registered Nurse). I am passionate about reaching that goal.” The youngest of the four women interviewed and she, too, had such an optimistic outlook for the future.

Though there is no shortage of “circumstances” here, there are no victims to be found at Well Suited on this Thursday afternoon. Just smiles and lighthearted chatter fill the store, even by the energetic and colorful “Queen Ra.” One would never guess the life challenges that she has conquered. Once working in New York, she was dealt financial and emotional blows after the 911 attacks. She found herself depressed and living near poverty in Los Angeles. She had heard about the Well Suited organization but was hesitant to reach out for their help. Eventually she stopped in and met Janet and learned about this wonderful program. After re-recreating herself, CAI-Greater Los Angeles Chapter

Queen Ra is now a successful Blog Talk Radio Host living in Jamaica and traveling the world. She makes a conscious effort to lend a helping hand to women looking to make positive changes in their lives.

“Watching our CAI-GLAC industry donations get sorted, hung and displayed and shortly thereafter selected by women was truly rewarding. Our sole purpose for this outreach event was to make a positive impact, just as Janet Lavender set out to accomplish.

It’s not very often that an individual has the opportunity to see items they donated actually reach the hands of someone in need.

Being a part of each step of this gave Meigan, Janet and I genuine gratification,” commented Angelique. “The most powerful aspect was having the opportunity to speak with these individuals and gain an understanding of who they are. While moments like this don’t come along every day, it certainly plants a seed of passion in our hearts to continue our efforts to be a part of something good and much larger than ourselves. It’s poignant, humbling and enables us to connect with others and if we are lucky, we are changed by these humanitarian experiences, becoming better versions of ourselves.”

Despite the fact that the need for help is endless, humility must be met with generosity and empathy. Janet Lavender has succeeded in this undertaking, and the CAI Outreach Committee is elated that so many wonderful individuals in our industry generously contributed and succeeded in this undertaking as well.

Written by Meigan Everett, Gold Coast Property Pros, Angelique Madrigal, Ross Morgan & Company, Inc.; and Janet Nelson, First Citizens Bank. For more information about Well Suited, call Janet at 818-844-7869. To be get more involved with the Community Outreach Committee, please check the Chapter calendar for upcoming events, or contact Meigan Everett at meverett@gcppros.com.

March/April 2013 | www.cai-glac.org

17

news

“legislate.” They are often very happy to get the input we have to give them, and they take it seriously… If a constituent takes the time to come all the way up to Sacramento to tell them what they think, they want to listen.

from sacramento

20th Annual Legislative Day At The Capitol What’s Going On in Sacramento April 28th & 29th, 2013?

By the CAI-CLAC Public Relations Committee You might have heard about the Legislative Day at the Capitol that happens in Sacramento every spring where people in the HOA (or Common Interest Development [CID]) industry meet up to educate their legislators about bills that may affect how homeowners associations are able to function in the State of California. Many legislators (especially this year) are new, and have never had any formal training on exactly how to

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But what exactly happens during this two-and-a-half day event? Like any good gathering of folks, it starts with a party!

The California North Chapter of CAI hosts a Monte Carlo Night (on Saturday, April 27th this year) which is a perfect chance to mingle with everyone who has come in from out of town, while enjoying food, drinks and some casino-style gambling. It is a relaxed atmosphere in a unique setting and a great way to kick off the event.

Sunday (April 28th) is the day when the delegates (there are two from each California chapter), the liaisons and the Executive Directors get together to discuss the legislation that impacts our industry, and the delegates vote to take positions on the bills. Everyone not involved in the delegate session has the opportunity to attend education sessions from 11am to 5pm. Here is the line-up for this year’s educational events:

11am – Welcome to Sacramento!

How a Bill Becomes Law Sabine Liedel from the Management Resource Center will lead us through what to expect out of the Legislative Day experience, going over the agendas for each day and explaining each item. She will also talk about the process of a bill becoming law and our involvement in that. This session is specifically tailored for first-timers.

12pm – Lunch and Roundtable This year we are pleased to have sponsors who will be paying for lunch for the people attending the education sessions. While we eat, Betty Roth from Sunnymead Ranch POA will conduct a Roundtable, getting stories from the participants about what brought them to the event as well as any experiences they have had (both positive and negative) regarding the implementation of new law within their associations.

1pm – How Government REALLY Works Get the cash you need today.

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Join John MacDowell from Fiore Racobs & Powers as he brings video from behind the scenes at a legislator’s office to give you a view into the REAL workings of a legislative office.

2pm – Many Faces of a Bill Baydaline & Jacobsen LLP will be speaking to us on a more advanced level about the language of a bill, how it changes through the process and some of the interesting behind-thescenes details about bill language in Sacramento.

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3pm – The Davis-Stirling Rewrite It becomes law in 2014, so we wanted to give you an opportunity to hear more about implementation, as well as some of the areas that will be changed in a clean-up bill (already!) to the recodification of the Davis-Stirling Act. Kelly Richardson from Richardson Harman Ober will lead you through it and get your questions answered.

4pm – Hot Bills with Skip Daum!

This VERY popular session has been moved to later in the day to accommodate travel for many attendees. It is the biggest hit every year, so be sure to attend! You will be given the lodown on the bills that affect our industry so you can better understand how your associations may be impacted.

After the education sessions on Sunday, we all convene to the Dine with the Delegates dinner to get a chance to mingle with the delegates, liaisons and Executive Directors that were busy taking positions on bills all day.

Monday morning (April 29th) we make sure that you are brought up to speed with changes in Federal law as well as bill briefings on the bills you will be talking to your legislators about later that day. During lunch we honor the volunteers who have made a difference in the California Legislative Action Committee (CLAC) as well as the California chapters that have gone above and beyond in their support of CLAC.

CAI-Greater Los Angeles Chapter

And at 1:30 pm we all march across the street to the capitol building to educate our legislators about the bills that matter most to us.

Be a part of our “voice” in Sacramento. Help a legislator see, maybe for the first time, how their decisions can impact millions involved in HOAs in ways they never thought of.

You really can make a difference in the quality of community association life throughout California.

To find out more about the 20th Annual Legislative Day at the Capitol, visit www.CAICalif.org and look under “Upcoming Events.”

March/April 2013 | www.cai-glac.org

19

Courts have also held in many cases that the association board has a certain amount of discretion in its decisions, if it follows the BJR. However, that discretion is not unlimited, as other court precedents have shown.

Lambden, Termites and Discretion

The Business Judgment Rule… and Its Limitations By: Kelly G. Richardson, Esq. n volunteer board service, a very important concept, the Business Judgment Rule (hereafter, “BJR” for brevity purposes), protects directors from personal liability if it turns out the board’s decision was a mistake.

I

Courts have ruled many times that they do not wish to micro-manage the association, and that so long as the BJR is followed, courts will defer to boards.

One of the main cases enunciating this rule was the State Supreme Court’s ruling in 1999 in Lambden v. La Jolla Shores.

The homeowner in that case complained that the board made a bad choice in using spot termite treatment instead of fumigation. In that opinion, the Court ruled that so long as the board follows the BJR, “…courts should defer to the board’s authority and presumed expertise.”

This judicial deference is essential for boards to be able to govern their properties without being continually in litigation whenever a neighbor disagrees.

This deference includes the decision to pursue or not to pursue enforcement litigation, confirmed in the 1977 Beehan v.

Lido Isle Community Association decision, in which the appellate court supported the board’s discretion, after a BJR deliberation, to decide not to sue a member who had violated an architectural rule.

The Board’s BJR Discretion is NOT Absolute — Limits A number of cases have shown where a board’s discretion is not supported by the BJR. In these cases, the board argued that the court should be deferential in its review of a decision, but the court found each time that the BJR did not allow the board to do what it did… or didn’t do.

The Law Controls, not what the Board Says — Dover In 2010’s Dover Village v. Jennison, the issue was whether a leaky sewer pipe under a condominium was “exclusive use” or pure common area. The characterization of the area would

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CAI-Greater Los Angeles Chapter

determine whether the HOA or the member was responsible for repairs.

The HOA argued that the court should follow Lamden and defer to its characterization of the pipe, but the court said “(t)here is an obvious difference between a legal issue over who precisely has the responsibility for a sewer line and how a board should go about making a repair that is clearly within its responsibility.” The court ruled it common area.

Board Discretion Is Not to Ignore CC&Rs — Ekstrom In 2002, a dispute arose at the Marquesa at Monarch Beach HOA. The CC&Rs had a height limit on trees, and the board tried to defend leaving the palm trees by invoking its BJR discretion, and claiming they were entitled to some exemption from the limit. The appellate court in 2008 concluded: “The Board’s interpretation of the CC&Rs was inconsistent with the plain meaning of the document and thus not entitled to judicial deference.”

CAI-Greater Los Angeles Chapter

Board Discretion Is Not to Ignore Law — Ritter In Ritter & Ritter v. Churchill Condominiums, the board argued that the BJR should require a court to respect its decision to try to force a homeowner to repair a building code violation (a previously undiscovered hole in the floor separating levels of a high-rise residential tower). The higher court in 2008 disagreed, quickly upholding the trial court’s findings against the HOA.

Board Discretion Is Not To Do Nothing — Affan Over a six year period, a condominium owner suffered repeated sewage floods coming from common plumbing. Each time, the HOA repaired the damage but never repaired the problem causing it. When Affan finally sued, the HOA argued that the BJR protected the HOA. In Affan v. Portofino Cove HOA, the appellate court in 2011 rejected the argument, noting that although “(t)here may be some rare situations in which

an association’s decision to do nothing deserves judicial deference… the Association’s inaction was not the result of any deliberative process.”

Boundaries Board discretion under the BJR is not unlimited. A board cannot ignore the law, its documents, or the problem. That kind of judgment is NOT reasonable, nor business-like.

Kelly G. Richardson is Managing Partner of Richardson Harman Ober PC, a law firm specializing on common interest development law. Kelly can be reached at krichardson@rhopc.com.

March/April 2013 | www.cai-glac.org

21

The Affordable Care Act — Let’s Start Preparing The campaigning that dominated every television station? Over.

The election that seemed to have America balanced on a powder keg? Over.

But in the aftermath of the election and a Supreme Court ruling, as we are all well aware, what waits for us on the horizon is the implementation of the Affordable Care Act (commonly referred to as Obama Care or the ACA) effective January 1, 2014, that will require all employers to offer adequate medical coverage to their employees. ▶▶▶By Rickey Teems There are still numerous questions regarding exactly what the ACA will fully entail once it is finalized. How much coverage will be needed? How much financial responsibility is placed on the individual or on the employers? Will this coverage include team counseling for the Lakers’ fragile spirits? HOWEVER, there is one thing we can all be certain of, medical coverage is not and will not be free, so expect to see a financial impact and plan ahead!

Speculations are endless as to how the ACA will affect our country. Economic experts from the world over are offering opinions, but the purpose of this article is not to give some grand Nostradamus prediction, but rather to start helping you and your community prepare now for the inevitable. Below are five key points to begin considering and discussing with your HOA Boards

as soon as possible so you can utilize the time we have left in 2013 to best position your property and its budget strategy accordingly.

1. COST: What will be the cost of medical coverage and the extent of coverage required? Actual costs may vary from company to company. It is possible that larger companies with more employees may be able to leverage their size and obtain less expensive plans, but we’ll have to see. Cheaper may be great when it comes to a pair of designer heels on sale, but not necessarily when you are talking about health and medical coverage so review your options to get the most benefits you can for as little as possible.

2. STAFFING: How many employees do you have? Differentiate between those you employ directly and those that are contracted.

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For those directly in your employ, determine if a) they already have private insurance from another source and b) what coverage options you could provide if they don’t. You don’t have to purchase anything now, but begin to get an idea of how the potential costs will impact your budget and possible homeowner dues. Why will this likely affect your dues? The answer is because the majority of contracts in the HOA world do not currently provide funding for contracted staff to have medical insurance—and with margins being low and competitive everywhere these days, I assure you that there is not enough profit in your current rates for any service provider to simply absorb these new mandated costs without passing on a rate increase of some sort, while others are even considering the possibility of just closing their doors and going out of business. As such, when the ACA kicks in, it is a foregone conclusion that most, if not all of your contracted service providers will be requiring a rate increase to cover the added cost of this medical insurance mandate—so plan ahead.

3. CONTRACTORS: Begin talking with your association’s regularly-contracted service providers, such as valet, engineers, janitorial, security, landscaping and the like. See what types of medical plans they have and what costs might be expected with current staffing levels and possible ways to restructure staffing or implement technology to potentially offset some of the medical cost increases. For our security clients we are leveraging our size and best practices to roll out various options to help them keep costs under control.

4. COMPLIANCE: Understand the consequences. Not only are there potential penalties and fines for those that fail to comply, but in California the threat of a lawsuit by an employee is always just one eager attorney away. While I AM security, I’m not here to report anyone for non-compliance, just nudging you a little to emphasize that this is a pretty serious deal that you don’t want to “overlook.”

5. KNOWLEDGE: Take some time to read up on the Affordable Care Act to better understand the facts, not just the talking points. Unfortunately some of the news we watch or websites we visit can be a little biased when it comes to any information regarding politics. Find a trustworthy source from where to extract information.

Whether you wanted the Affordable Care Act or not, it is coming and coming fast! Stay ahead of the curve and do the necessary research to ensure your community is operationally and financially prepared. Don’t be like my Lakers this year and think success naturally happens. Plan, prepare, and position yourself to be ready when this new legislation takes place.

Rickey Teems is a branch manager and 12-year employee of Securitas Security Services USA Inc. Rickey specializes in high rise and residential properties, and has been active in CAI since 2005. Rickey can be contacted at rickey.teems@securitasinc.com

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March/April 2013 | www.cai-glac.org 23 12/22/11 7:26 AM

PCAMs Come Together

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I

n March the Chapter Board of Directors hosted a luncheon for managers who

have earned the Professional Community Association Manager (PCAM) designation.

The group honored Tracie Blankenship and Erik Mendez, two managers who recently received this designation. ■

CAI-Greater Los Angeles Chapter

March/April 2013 | www.cai-glac.org

25

Discovery Of Loss Provisions In Fidelity Bonds Present A Trap For The Unwary ▶▶▶By: Thomas M. Ware II Embezzlement is one of the most significant, and yet often overlooked risk, facing homeowners associations. The composition and operation of homeowners associations makes them peculiarly vulnerable to theft. The directors are not professionals, but rather lay volunteers.

Typically, there is no training required as a pre-requisite for serving on a board of directors. Most board members either do not have time to adequately review, or do not understand, the Association’s financial statements. Because of these and other factors, board members often unduly rely on any director or manager who appears to be willing and able to manage the homeowners association’s finances. On top of these factors, “non-profit organizations are particularly vulnerable to embezzlement for various reasons, including… a higher level of trust than that found in most for-profit businesses.”

See, R. Stone, Vision Magazine (Spring 2004), Protecting Your Community Association From Fraud, p. 10.

Fidelity or Crime Loss insurance coverage thankfully provides valuable protection to a homeowners association against such a risk by insuring it against monetary theft by its directors, officers, managing agents, and employees. However, to reap the benefit of such protection, a homeowners association must not delay in reporting a suspected theft to its insurance carrier. Dilatory reporting can constitute grounds for denial of the claim.

Homeowners associations, and even attorneys not familiar with fidelity bond claims, often are not aware of the stringent reporting requirements that are typically found in fidelity or crime loss policies. The failure to comply with these notice obligations may provide the carrier with a defense

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CAI-Greater Los Angeles Chapter

to the claim. It is not unusual for fidelity policies to have short windows of time during which to submit the claim.

For example, many such policies require the homeowner association to report the claim “within 60 days from the discovery loss” and to file a detailed proof of loss “within 120 days from the discovery of loss.” Thus, in order to preserve such claims, it is critical for homeowners associations to understand what “discovery of loss” means in this context.

It is well established that mere suspicion of a theft does not constitute “discovery of loss.” See, Gulf USA Corp. v. Federal Ins. Co. (9th Cir. 2001) 259 F.3d 1049, 1059. A fidelity carrier, nonetheless, may very well deny a claim if they can present an argument that a “reasonable person” would have assumed that a theft had occurred more than 60 days prior to submission of the claim, even if the insured subjectively did not discover the claim until much later.

On its face, “discovery of loss” would seem to imply the time when the Association subjective discovers facts constituting a theft, i.e., realizes an actual loss from such dishonest activity. The problem is that your insurance carrier may attempt to assert that the Association’s “discovery of loss” and, hence, its duty to report the claim, accrued prior to the Association’s subjective discovery of theft. While this seems counterintuitive, insurance carriers are attempting to define “discovery of loss” in the policy as an “objective” discovery rather than subjective.

Homeowners associations and their attorneys often delay filing fidelity claims until the forensic examination is completed. A forensic investigation into whether the Association suffered a loss or determining the amount could take months depending upon the scope of the accounting period being examined. Such a course of action may result in the carrier denying the claim for failing to timely notify of it of the claims. The Association should not place itself at the mercy of such arguments. If the Association believes that a theft has occurred, it should promptly notify its fidelity carrier of the claim even if it has not yet ascertained the amount of damages caused by the theft.

For example, modern commercial forms of fidelity insurance contain language the same or similar to the following:

Thomas M. Ware II is a partner in the law firm of Kulik, Gottesman & Siegel, LLP. He can be reached at tware@kgslaw.com.

Discovery of loss occurs when you first become aware of facts which would cause a reasonable person to assume that a loss covered by this Policy [i.e., theft] has been, or may be incurred even though the exact amount or the CB Ad 2-2013 AH.pdf 8:29:00 details of -the loss may1 2/7/2013 not than be AM known.

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March/April 2013 | www.cai-glac.org

27

Community managers and boards of directors have many tasks. There are a number of things that are pressing but tedious and require a significant amount of time to accomplish. When you have homeowners who want to be involved, a great way to get participation is by suggesting that homeowners join committees based on topics in which those homeowners are interested.

There are the association’s regular committees, and then there are ad hoc committees. Regular committees are the longstanding committees where Committee Members continue to work on projects regularly. Ad hoc committees are limited-time committees formed to specifically handle special projects.

Some examples of regular Committees and the suggested function of members are:

Consider Ad Hoc Committees ● ● ● By Neda Firouz, CCAM®, CMCA®

● Social Committee Members could plan the community events. This committee is key to creating a friendlier living environment while planning fun community events. In turn, member participation in social events actually results in members obtaining more information on what is going on in the community. ● Budget / Finance Committee Some associations find this committee useful for just a few months each year during the budget preparation process. The

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CAI-Greater Los Angeles Chapter

committee members generally review the reserve study, offer guidance and feedback to the board of directors regarding the reserve study, and either review the budget draft as prepared by the manager or board, or prepare the initial draft of the budget to provide to the board. At some associations, the committee members work year round, reviewing the financial statements and providing feedback or comments to the board with respect to the association’s finances. ● Rules Enforcement Some homeowners are very concerned with governance and enforcement. Committee members can work with a designated board member to determine the level of enforcement. Alternatively, committee members may accompany the community manager during site inspections.

8/13 5:04 PM Page 1

● Security / Safety At associations with camera systems, anyone who has operated the system knows that it is very time consuming to pull footage to find an incident. Committee members can offer assistance in reviewing and burning camera footage when necessary. Members of this committee could also form a Neighborhood Watch, get city officials involved, reach out to Senior Lead Officers from the community’s local Police Station, etc.

Some examples of Ad Hoc Committees would be: ● Policy Revisions If a community needs to revise board resolutions, such as Rules and Regulations, a committee could be formed for the sole purpose of working on the revisions. Once done, the committee would present the final document and the committee’s recommendations to the board of directors, and the committee would then be disbanded. ● Design Committee A community may be undergoing some design changes, such as new carpet and wall coverings for the hallways. Chartering a design committee could give homeowners the task of researching various styles, but it also gives more members an opportunity to participate in an important aesthetic issue that everyone has to live with. Once the project is completed, the committee would no longer be in existence.

Sometimes, it is challenging to get homeowner involvement, but knowing your residents and their areas of interest gives you an advantage of being able to call on specific people to help.

Neda Firouz is the president of HOA Organizers, a company specializing in community management. She can be reached at info@hoaorganizers.com.

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March/April 2013 | www.cai-glac.org

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welcome

New CAI-glac Members!

As of April 15, 2013

BUSINESS PROFESSIONALS CleanCierge.com Environmental Restoration Services FRESHCO Painters Khatri International Pacific Premier Bank PooPrints by BioPet Vet Lab Precision Concrete Cutting Ruume, Inc. Streamline Building Corporation

RECRUITER Meigan Everett, CMCA® Mike Marienthal Donald Campbell, CCAM®, CMCA®, AMS® CAI National Deborah Schneider, CMCA® CAI National CAI National CAI National CAI National

MANAGEMENT COMPANIES Bali Management Group, Inc.

CAI National

COMMUNITY ASSOCIATIONS 1323 Carmelina Avenue Assn.

CAI National

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COMMUNITY MANAGERS Jerson Barcelon Seabreeze Management Company, Inc. Cheryl Ciofalo Regatta Seaside HOA Vicki Egan Seco Canyon HOA Renee Espinoza Bali Management Group, Inc. Sabrina Fuentes Blair HouseHOA Lindsey Marvin Related Management Company Omar Pacheco Plaza Towers Condominium Assn.

Debra Pasquerette Gramercy Place HOA Ivonne Perez Ross Morgan & Company, Inc.

Shanne Ho, CCAM®, PCAM® Shanne Ho, CCAM®, PCAM® CAI National Deborah Schneider, CMCA® Henry Basile Tim Bowman Michelle Underwood, CCAM®, CMCA®, AMS®, PCAM® CAI National Annette Abernethy

CAI-Greater Los Angeles Chapter

Our Thanks to Renewing Members!

As of March 31, 2013

BUSINESS PROFESSIONALS Adco Roofing, Inc. Advanced Painting, Wood Repair & Wrought Iron Alan Smith Pool Plastering, Inc. Alliance Association Financial Services AlliedBarton Security Services, Inc. Anthony Elliot Insurance Agency Association Reserves, Inc. BELFOR Property Restoration Beaumont Gitlin Tashjian Best Alliance Foreclosure & Lien Service BuildingLink California Waters, LLC CAM Services Centurion Group CertaPro Painters Ltd. CINC Systems Coinmach Corporation Colarossi Painting, Construction & Rain Gutters Community Archives Debra L. Sheppard & Associates, A PLC Eliot Katzovitz Insurance Agency Empire Painting & Construction Eric S. Little State Farm Insurance Agency Fenceworks, Inc. First Citizens Bank Forensic Analytical Consulting Services, Inc. GetDocsNow.com Gothic Grounds Management Graham Insurance Grup, Inc. Har-Bro Emergency Service & Reconstruction HCI Systems, Inc. Hi Tech Painting & Decorating, Inc. HOA Elections of California, Inc. Howett Law Kasdan, Simonds, Weber & Vaughan, LLP Kulik, Gottesman & Siegel, LLP La Rocque Better Roofs, Inc. Landscape Development, Inc. Law Offices of Daniel B. Spitzer Levitt Group Architects Marina City Club COA McGuireWoods, LLP Marina Landscape, Inc. T. Chulak & Associates Michael T. Chulak & Associates Milstein Adelman, LLP Mink Condominium Management & Consulting MTECH Exterminator Company Mutual of Omaha Bank/CondoCerts

CAI-Greater Los Angeles Chapter

Mulholland Security Centers, Inc. Orange Coast Building Services, Inc. P.W. Stephens Environmental, Inc. Pacific Vista Landscape Services, Inc. Park West Landscape Management Parking Concepts, Inc. Patio Guys PCW Contracting Services, Inc. Personal Touch Cleaning & Maintenance Professional Services Construction, Inc. Rodent Pest Technologies, Inc. QwikResponse Restoration & Construction R.W. Stein Painting, Inc. Restoration Management Company Seacoast Commerce Bank Servpro of Redondo Beach-Manhattan Beach Silldorf & Levine, LLP Sky Security Services, Inc. South Shore Building Services, Inc. Stan Smith Associates Steve Little State Farm Insurance Agency Steve Reich Insurance-Farmers Insurance Group Steven G. Segal Insurance Agency Stonemark Construction Management SwedelsonGottlieb Taylor Roofing & Painting The Judge Law Firm Community Association Lawyer The Termite Guy Three Phase Electric Union Bank ValleyCrest Landscape Maintenance Vinyl Concepts, Inc. Vista Paint Corporation Western Area Security Services, Inc. Western Magnesite COMMUNITY ASSOCIATIONS Bordeaux HOA Briarwood Community Center Escadrille HOA Doverwood HOA French Quarter HOA Golden Colonial Owners Assn.

International Tower Owners Assn.

Mira Verde HOA North Gardner HOA Sandside Villas HOA Tarzana Woods Owners Assn.

The Colony at Westwood HOA Villa Vallarta HOA Village Green Owners Association

COMMUNITY MANAGEMENT COMPANIES Accell Property Management, Inc., AAMC® Concept Seven, LLC Encore Enterprises, Inc. Gold Coast Property Pros Manhattan Management Corporation Miller & Desatnik Management Co. National Property Management Group, Inc. Ontrack Asset Management Pacific Real Estate & Management, Inc. Prime Association Services Property Management Solutions, Inc. Property Resources management Ross Morgan & Company, Inc. AAMC® Safeguard Equities, Inc. COMMUNITY MANAGERS Christine Albrecht, CMCA®, AMS®, PCAM® Valencia Management Group James Altschuler Karen Ansell, CMCA®, AMS® Omni Association Management Nels Atha, CMCA®, AMS® Management Professionals, Inc. Denise Bergmans Condominium Administration Co. Anda Bewhite, CCAM®, CMCA®, AMS® Harris Properties Bea Blessley, CMCA® Jenkins Properties Management, Inc. Donovan Bowes, CCAM®, CMCA®, AMS® National Property Management Group, Inc. Steven Chamberlain, CCAM® Harris Properties Robin Choppe Choppe Property Management Group Kate Clancey, CMCA®, AMS® Valencia Management Group Alyson Clark HOA Organizers, Inc. Matt Davidson, CCAM® Action Property Management Robert Davies, CMCA® Montana HOA Roman Esparza, CCAM® Beven and Brock Stacy Gerowitz, CCAM® Wilshire House

George Gral, CCAM®, CMCA®, AMS®, PCAM® Encore Enterprises, Inc. Elvin Hidalgo, CCAM®, CMCA®, AMS®, PCAM® Century Park Place HOA Gail Jones, CCAM®, CMCA®, AMS®, PCAM® Valencia Management Group Lindsey Knoten The Ritz-Carlton Residences Candi Kocher Four Seasons HOA Donyelle La-Key, CCAM®, CMCA®, AMS® Condominium Administration Co. Gary Ledbetter Los Feliz Towers HOA Evelyn Lifton, CCAM®, CMCA®, AMS®, PCAM® The Brentwood at Kiowa HOA Sasoon Mananian Spectra Associates, Inc. Erik Mendez, CMCA®, AMS®, PCAM® Ross Morgan & Company, Inc. Ruth Moffitt, CMCA®, AMS®, PCAM® Valencia Management Group Fernando Morales, CMCA® Sea Colony II HOA Paul Policarpio Cabrini Villas HOA Barbara Powell, CMCA®, AMS® Preferred Association Management Bob Prescott Rommel Rivas, CMCA® Property Management Professionals, LLC Barabra Schwartz, CCAM® Glen Towers Owners Association Bonnie Stoeppelman, CCAM® Sharp HOA Management Michael Sukey, CMCA® Brookside Village HOA Michelle Underwood, CCAM®, CMCA®, AMS®, PCAM® Plaza Towers Owners Association Alexandria Spargo, CCAM®, CMCA® Management Professionals, Inc. COMMUNITY ASSOCIATION LEADERS Lawrence Kraines, Esq.

March/April 2013 | www.cai-glac.org

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Advertisers Index 7 Animal & Insect Pest Management, Inc. 5 Association Reserves, Inc. 23 Berg Insurance Agency 28 Cacho Landscape Maintenance Co., Inc. 27 Collins Builders, Inc.

2013 Upcoming Events April 2013 2 South Bay Evening Program for HOA Boards and Managers – 7:00 p.m. Location TBD 11 San Gabriel Valley Evening Program for HOA Boards and Managers – 6:00 p.m. Location TBD 12 Chapter Board of Directors Meeting – 8:30 a.m.

Chapter Office, Glendale

13 Essentials of Community Leadership Workshop – 8:15 a.m.

Location TBD

17-19 CAI National Conference, San Diego, CA

13 Pacific Western Bank 30 Poindexter & Company, CPAs 26 Popular Association Banking 26 Preferred Commercial Painting 25 R.W. Stein Painting, Inc. 30 Reserve Studies Inc.

19 Farmers Insurance Group – Steven G. Segal Insurance Agency, Inc.

24 Sandra Macdonald Insurance

29 Ferris Painting, Inc.

11 Seacoast Commerce Bank

23 First Bank

20 Select Painting

30 First Bank

10 SwedelsonGottlieb

32 Gayle G. Gould, CPA

21 Timothy Cline Insurance Agency, Inc.

22 Hi Tech Painting & Decorating 28 Milstein Adelman, LLP

9 Ross Morgan & Company, Inc.

29 Witkin & Neal, Inc.

18 Mutual of Omaha Bank/ CondoCerts

24 Educational Luncheon – 11:30 a.m.

Skirball Cultural Center, Los Angeles

28-29 CA Day in the Capitol & Community Plus Sacramento

May 2013 2 Homeowners Association Marketplace (Westside) – 5:00 p.m.

Crowne Plaza LAX, Los Angeles

9 San Gabriel Valley Evening Program – 7:00 p.m.

Pasadena Senior Center, Pasadena

16 Educational Luncheon - 11:30 a.m.

Skirball Cultural Center, Los Angeles

17 Chapter Board of Directors Meeting – 8:30 a.m.

Chapter Office, Glendale

June 2013 04 South Bay Evening Program for HOA Boards and Managers – 7:00 p.m. Regatta Seaside HOA 10 Annual Golf Tournament – 8:00 a.m.

Woodland Hills CC, Woodland Hills

14 Chapter Board of Directors Meeting – 8:30 a.m.

Chapter Office, Glendale

Advertising Information Dimensions & Rates:

Artwork must not exceed the exact dimensions of that size ad.

For more information, call the Chapter office: 818-500-8636.

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Ad Dimensions

Members

Non-Members

⅛ page

3½" wide x 2" high (Horizontal)

$200

$400

¼ page

3½" wide x 4¾" high (Vertical)

$300

$600

½ page

7½" wide x 4¾" high (Horizontal)

$425

$850

Full Page

7½" wide x 10" high (Vertical)

$800

$1,400

Payment: Rates are subject to change without notice. By credit card, check or cash.

Minimum three-insertion contract. Rates subject to change without notice.

Advertising Sales: Please contact the Chapter office for advertising specifications and deadline information at: 818-500-8636.

19 Educational Luncheon – 11:30 a.m.

Skirball Cultural Center, Los Angeles

27 Valencia Educational Breakfast for HOA Boards and Managers – 8:30 a.m. Bridgeport HOA Clubhouse, Valencia

July 2013 12 Game Night – 5:00 p.m.

CenterPointe Club, Playa Vista

19 Chapter Board of Directors Meeting – 8:30 a.m.

Chapter Office, Glendale

20 Essentials of Community Leadership Workshop – 8:15 a.m.

Location TBD

32

www.cai-glac.org | March/April 2013

CAI-Greater Los Angeles Chapter

Help BUILD CAI-GLAC And Reward Yourself by Recruiting New CAI-GLAC Members in 2012 Help BUILD And Reward Yourself by Grand Recruiting New Prize Members in 2013

3-day/2-night Weekend Getaway on the Central California Coast

RULES

GrandContest Prizeruns for 12 months and is The Build CAI-GLAC Recruiter designed so that3-day/2-night current CAI members earn valuable prizes for Weekendcan Getaway sharing the benefits of CAI membership with friends and colleagues.

The Build CAI-GLAC Recruiter Contest runs for 12 months and is designed so that current CAI members can earn valuable prizes for sharing the benefits of CAI membership with friends and colleagues.

The following rules apply to the campaign: Members in good standing can compete to recruit new members and earn points RULES toward the Grand The following rules applyPrize. to the campaign: • M embers in good standing can compete new members and earnfor points toward the To receive credit, you must be listed to as recruit the CAI member responsible Grand Prize. recruitment on the printed application form submitted, or be identified •T o receive you must be listed as reports. the CAI member responsible for recruitment on throughcredit, CAI National membership the printed application form submitted, or be identified through CAI applicants National membership All completed applications and membership dues for qualified must reports. be received at CAI between January 1, 2012 and December 31, 2012.

• All completed applications andGrand membership to be counted toward the Prize. dues for qualified applicants must be received at CAI between January 1, 2013 and December 31, 2013 to be counted toward the Grand Prize.

THREE CONTESTS...THREE THREE CONTESTS … THREE PRIZES PRIZES

RECRUITER-OF-THE-MONTH RECRUITER-OF-THE-MONTH The month will be Themember memberwho whohas hasrecruited recruitedthe themost mostnew new memberships memberships in in the the previous previous month recognized at the next luncheon and awarded a FREE LUNCH. In the case a tie, will be recognized at the next luncheon and awarded a FREE LUNCH. In the of case of a arandom drawing will determine the winner. tie, a random drawing will determine the winner.

GRANDGRAND PRIZE ($1,000 value)value) PRIZE ($1,000 Member wilI receive receive Memberwith withthe thehighest highestnumber numberofofpoints pointsas asofofDecember December 31, 31, 2012 2013 wilI the Grand Prize.

In cases where there are two or more members with equal points, the Grand Prize. In cases where there are two or more members with equal points, those thosenames nameswill willbe beput putinto intoaabowl bowland andrandomly randomlydrawn drawn to to determine determine the winner. winner.

Pointswill willaccrue accruefrom fromJanuary January11through throughDecember December 31, 31, 2012 2013 for Points for the the Grand GrandPrize.

Prize.

Membersearn earnpoints pointsbased basedon onthe themembership membershipcategory. category.

Members • SLIDING SCALE POINT SYSTEM CAN GIVE YOU AN EDGE. SLIDING SCALE POINT SYSTEM CAN GIVE YOU AN EDGE. Participating members will receive: Participating members will receive:

One(1) point for each business partner member recruited in a category ★ One (1) point for each business partner member recruited in a category already existing in already existing in Directory, the 2012 Membership Directory, the 2013 Membership Two(2) points for a business partner in a sector of business not yet ★ Trepresented wo (2) pointsinfor business partner in a sector of business not yet thea Chapter, represented in the Chapter, Two(2) points for an individual HOA board member or community ★ Tmanager, wo (2) points and for an individual HOA board member or community Three(3) points forarecruiting a management manager, Three(3)and points for recruiting management company. company.

RECRUITER RAFFLE RECRUITER RAFFLE

2012 recruiters (except the Grand Prizewill winner) go into a raffle AllAll 2013 recruiters (except the Grand Prize winner) go intowill a raffle drawing helddrawing in early January (when all the2013 2013 results win anresults Evening held in2014 early January (when are all in) theto2012 areOut in)on to the winTown an ($500 value).

Evening Out on the Town ($500 value)

Current Sponsors:

AMARR Studios, Inc.

Concrete Hazard Solutions

DM Construction Services

Ronald S. Stone, CPA PhD

CAI-GLAC

PRSRt StD U.S. Postage

130 N. Brand Blvd., Ste. 305 Glendale, CA 91203

PAID

San Bernardino, CA Permit #1

Change Service Requested

Order Your 2013 Condominium Bluebook Today!

Price: $26.00 per copy, tax and shipping included.

Order copies online at: www.cai-glac.org.

Join us for…

h c r a e S r a t S ! ! t h g i N e m a G

You won’t want to miss this hilarious evening of summer fun!

Friday, July 12, 2013 5:00 p.m. – 9:00 p.m.

The CenterPointe Club 6200 Playa Vista Drive, Playa Vista 90094 • Scavenger Hunt • Speed Networking • Karaoke $50 per person includes: taco bar and one drink ticket • Sign Up for Speed-Networking • Get Ready for the Human Scavenger Hunt • Warblers — Come for Karaoke

3 Games, Margaritas, Taco Bar, Great Prizes!

Visit www.cai-glac.org to sign up for sponsorships and this event.

SCaVeNGeR HUNT SPoNSoRS

Nautilus General Contractors, Inc. Pacific Western Bank Seacoast Commerce Bank ServiceMaster by eddie Steven G. Segal Insurance agency, Inc. NaPKIN SPoNSoR

South Shore Building Services, Inc.