J & N REALTY, INC.

Transparency Does Not Bite

California Laws Require Openness  

I. Board Meetings – Civil Code 1363.05  

A. Notices and Agendas  

B. Rules of Conduct  

C. Open Forum  

D. Regular Board Meeting Minutes  

II. Access to Records  

A. Accounting Books/Records – Civil Code 1363 (f), 1365.2, Corporations Code 8330, 8333  

B. Procedure for Providing Access  

C. Cost of Preparation/Production of Records – Civil Code 1365.2  

III. Annual Disclosures – Civil Code 1350.7, Index – Civil Code 1363.005  

A. Assessment and Reserve Funding Disclosure Summary  

B. Pro Forma Operating Budget or Summary  

C. Assessment Collection Policy  

D. Notice Assessments and Foreclosure Form  

E. Insurance Coverage Summary  

F. Access to Board Meeting Minutes  

G. Owners’ Right to Alternative Dispute Resolution  

H. Internal Dispute Resolution  

I. Approval Process and Appeal Process for Architectural Changes  

J. Written Notice of Lien – Secondary Address  

K. Schedule of Monetary Penalties for Violation of Governing Documents Rules  

L. Reserve Funding Plan  

M. Financial Review (or Audit)  

N. Annual Update of Reserve Requirements  

IV. Special Issues that Require Communication/Disclosure  

A. Litigation  

B. Special Assessments  

C. Use of Reserve Funds for Other Than Designated Purposes  

V. Legal Repercussions from Failure to Provide Access to Records – Moran v. Oso Valley Greenbelt Association  

RULES OF CONDUCT FOR BOARD MEETINGS  

1. Monthly board meetings are held on the [third Monday] of the month. Notice of all meetings will be posted.  

2. The agenda and supporting documentation and attachments (“board meeting packet”) will be delivered to the board members at least three business days prior to the meeting. Board members are expected to read their board meeting packet and ask questions of management, staff or other board members prior to the meeting so that when they come to the meeting, they are ready to make decisions.  

3. Committee meeting minutes or reports must be submitted in writing at least one week prior to the board meeting so that reports can be included in the board meeting packet.  

4. Board meetings will begin with the President conducting an open forum so that homeowners and residents can communicate with the board. Homeowners will announce their name and address. Time limits will be imposed. If a member wishes to place an issue on the board meeting agenda, a written request must be submitted to the manager more than one week prior to the meeting. The board can add any issue to the board meeting agenda at the beginning of the meeting if the homeowner/resident’s issue requires immediate attention. The board may delegate the matter to management or committee for further research or resolution of a problem.  

5. After the open forum, owners and residents are welcome to stay for the meeting as spectators, not as participants. Owners/residents make speak if recognized by the president and a majority of the board members vote to allow that individual to speak.  

6. Audio taping will be used only by the recording secretary, if necessary. Tapes will be erased as soon as the official minutes have been approved. Video taping shall not be allowed. If secret taping is discovered, the individual will be asked to surrender the taping device until the close of the meeting.  

7. The president will call the meeting to order at the scheduled time or as soon as a quorum is present. Meetings will end on time. Unfinished business will be deferred to the next meeting.  

8. Corporations Code Section 7211 (8)(b) states that “An action required or permitted to be taken by the board may be taken without a meeting, if all members of the board shall individually or collectively consent in writing to that action. The written consent shall be filed with the minutes of the proceedings of the board. The action by written consent shall have the same force and effect as a unanimous vote of the directors.”  

RULES OF CONDUCT FOR OPEN FORUM  

The Open Forum will be conducted between [ time allotted ] at each board meeting. Due to the time required for the board to conduct corporate business, owners and residents will not be permitted to address the board during the business portion of the meeting. However, the board encourages the owners and residents to listen and become familiar with the issues facing the community association. The board wishes to thank the owners/residents for their cooperation during the business meeting.  

1. Owners/residents are welcome to address the board only during Open Forum.  

2. Individuals wishing to address the board will register at the beginning of the meeting so that the president can adjust the time limits according to the number of people who wish to speak.  

3. When called on by the president, please identify your [unit/address number] and state your question or information with as much detail as you believe necessary but as briefly as possible. Please respect the time limits.  

4. The board may take all matters under submission and may not respond to your request immediately. If further research is needed, the board may refer the matter to committee, to management or to a board member to research, resolve or report back to the board at a future time.  

5. Please be respectful at all times. The board will treat the members and residents with respect and they deserve and expect the same from each other. The president may close the open forum if order is not maintained. By majority vote, the board may adjourn the meeting due to unruly behavior.  

Transparency in governance  

• Owners have a clear understanding of the association’s goals and priorities.  

• Openness promotes good relationships between the board and other owners.  

• Openness promotes respect for the association and its board members.  

• Communication is key component of transparency.  

• Transparency means an environment of openness.  

Why Do Boards Hide?  

• Fear of letting owners in on “the truth”  

• Fear of losing control  

• Abusive owners  

• Do not want to be bothered  

• Do not want to spend money for meeting site  

• Do no t want to spend money for meeting site  

• Sending emails is easier than conducting business in an open meeting  

• Conflict arises when owners feel that they are being shut out or ignored.  

• Conflict causes board members and other potential leaders to retreat from participation.  

• Unresolved conflict can result in board recall  

• Unresolved conflict can result in board recall, litigation.  

California laws require openness and disclosure: 

·         Common Interest Development Open Meeting Act 

·         Annual Budget Annual Year-End Financial Reports and Disclosures 

·         Annual Election  

Board Meetings – Civil Code 1363.05  

• Board Meeting Notices and Agendas Must Be Posted Four Days Prior to the Meeting  

• Members’ Right to Attend Board Meetings Except Executive Sessions of the Board 

Executive Sessions of the Board  

• Members’ Right to Address the Board in Open Forum  

• Members’ Right to Obtain Minutes of Board Meetings  

Accommodations for Members  

• Translation of Information  

• Allowing Member to Bring Translator to Board Meetings  

Methods of Keeping Control of Meetings  

• Rules of Conduct for Board Meetings  

• Rules of Conduct for Open Forum  

• Using a Timed Agenda  

Members’ Access to Records  

• Accounting Books and Records – Civil Code 1363 (f), 1365.2, Corporations Code 8330, 8333  

• Cost of Preparation/Production of Records – Civil Code 1365.2  

• Adopt a Procedure for Providing Access for Inspection of Records and Obtaining Copies of Records  

Annual Disclosures – Civil Code 1350.7 (Index), Civil Cd 1363 005 Code 1363.005  

• Assessment and Reserve Funding Disclosure Summary  

• Pro Forma Operating Budget or Summary  

• Assessment Collection Policy  

• Notice Assessments and Foreclosure Form 

• Notice Assessments and Foreclosure Form  

• Insurance Coverage Summary  

• Disclosure of Owners’ Access to Board Meeting Minutes  

• Owners’ Right to Alternative Dispute Resolution  

• Procedures for Internal Dispute Resolution  

• Approval Process and Appeal Process for Architectural Changes  

• Written Notice of Lien – Secondary Address  

• Schedule of Monetary Penalties for Violation of Governing Documents  

• Reserve Funding Plan  

• Annual Financial Reports (Review or Audit)  

• Annual Update of Reserve Study  

Special Issues That Must/Should Be Communicated/Disclosed to Membership  

• Litigation  

• Special Assessment  

• Use of Reserve Funds for Any Purpose Other Than Designated Components in the Reserve Study/Funding Designated Components in the Reserve Study/Funding Plan  

• Rely on the Advice of Legal Counsel  

• Legal Repercussions from Failure to Provide At d 

• Access to Records  

• Moran v. Oso Valley Greenbelt Association