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April 2012

Coachella Valley Community Associations Institute Magazine

CoMMunIt y SpotlIght

Oasis Country Club Homeowners Association

insideCongratulations! You Are on the Board! Now What?Mold In The Desert?HOA Loans. A Sound Option That Makes Financial Sense

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your hoA CAn be our next Cover

April 2012

Coachella Valley Community Associations Institute Magazine

CoMMunIt y SpotlIght

Oasis Country Club

Homeowners Association

inside

Congratulations! You Are on

the Board! Now What?

Mold In The Desert?

HOA Loans. A Sound Option

That Makes Financial Sense

no Cost to youeverY COver HAS A STOrY.

TeLL uS YOurS!MuST Be CAI-Cv MeMBer

IN gOOD STANDINg

ContACt WeNDY At the CAi-Cv offiCe

(760) 341-0559 [email protected]

www.CoachellaValleyCAI.org 5Quorum April, 20124

Community spotlight

10 Oasis Country Club, Palm Desert Happy 25th Anniversary!

By Tony Brunner

feAtures

21 Congratulations! You Are on the Board! Now What?

Expectations and Duties of an Effective Board Member By Sue Anderson

22 Mold In The Desert? Don’t Be Deceived, There Is Mold All Around Us

By Greg & Barbara Masters

26 Commercial Insurance for Associations

Insurance Market Update for 2011 and a Look Ahead to 2012 By Sarah Davis

28 HOA Loans. A Sound Option That Makes Financial Sense

By Cyndi Koester, CMCA, AMS, PCAM

35 Paint is Paint. Or is it? What Makes a Quality Exterior Paint

By Gina Roldan

36 Fronds & Flowers Tips to Make Palm Tree Trimming and

Summer Flower Planting Easy By Jay Powell

ChApter news

43 Have You Heard? By Wendy Van Messel

44 CAI-CV Chapter New & Renewing Members

45 Advertisers Index

ChApter events

24 February Monthly Program What’s in the HOA Insurance Market for 2012?

48 Schedule of Events

38 CAI Casino Night It’s the Year of the Dragon

BOArD OF DIreCTOrS COACHeLLA vALLeY CHApTer 2012

rOB WINkLe, preSIDeNTWestern Pacific Roofing

NeNA ruTHerFOrD-MILWArD, CMCA, AMS preSIDeNT - eLeCT

Desert Resort Management

ArT COuLTer, pAST preSIDeNTPalm Valley Homeowners Association, Inc.

CHrISTINA BAINe DeJArDIN, eSq.Peters & Freedman, LLP

CYNDI kOeSTer, pCAMMutual of Omaha Bank/CondoCerts

gLOrIA kIrkWOOD, CCAMPalm Valley Homeowners Association, Inc.

grACe pALuCkThe Management Trust, Monarch Group Division

krISTIN BerrYHILL-HOOD, CCAMMerit Property Management Inc.

MICHAeL WALker, CMCA, AMS, pCAMPGA West Residential Association

MIke MASTrOpIeTrOOrange Coast Building Services

pATrICIA SMITH, pCAMVeneto Homeowners Association

CAI Coachella Valley Office 41-905 Boardwalk Suite A-2

Palm Desert, CA 92211 Tel: (760) 341-0559 Fax: (760) 431-8443

Wendy Van Messel, Chapter Executive Director E-mail: [email protected]

Website: www.cai-cv.org

ArTICLe SuBMISSIONS Or ADverTISINg INFOrMATION

CAI-CV Chapter Executive Director, Wendy Van MesselE-mail: [email protected]

Editors: Dionne Petitpas and Paula Tapia E-mail: [email protected]

The materials contained in this publication are designed to provide our members with accurate, timely and authoritative information with regard to the subject covered. However, the

CAI Coachella Valley Chapter is not engaging in the rendering of legal, accounting or other professional types of services. The CV Chapter has not verified and/or endorsed the contents of these

articles or advertising, nor do we have the facilities or the person-nel to do so. Readers should not act on the information contained

herein without seeking more specific professional advice from legal, accounting or other experts as required.

CONTeNTS

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Homeowners Associations• • • Audits • • •

• • • Reviews • • •• • • Tax Returns • • •

• • • Compilations • • •• • • Special Projects • • •

(760)568-554443-585 Monterey Ave., Suite 4, Palm Desert, CA 92260

www.CoachellaValleyCAI.org 7

CONTeNTS

Quorum April, 20126

depArtments

8 President’s Message

9 From the Editors

14 CLAC News Sacramento Deadline Passes New Legislation

Affecting Community Associations By Skip Daum

16 CAI National The “REO” Speed Wagon

New Policy Annoucements From Freddie Mac May Impact Community Associations By Staff Writer, CAI

18 About CAI Membership Has Its Benefits

The Many Reasons To Be A CAI Member By Steven Shuey, PCAM, CCAM

19 Time Honored Member Wayne Carlsen

By Pat Smith, CCAM, PCAM and Shelly Ruegsegger, CMCA

32 Homeowners Association Law The Festivals Are Coming!

The Festivals Are Coming! Preparing Your HOA For Coachella and Stagecoach

By Jeffrey A. French, Esq. and Holly L. Amaya, Esq.

33 Coffee Talk

40 Water Wise Safe Drinking Water is Everyone’s Priority

By Steve Bigley

42 Technology Today Cyber Liability What Does It Really Cover?

By Carol A. Fulton, CIRMS

43 Welcome Aboard REVCO Solar Engineering Inc. and

Patricia Moeller, CCAM By Shelly Ruegsegger, CMCA

eDITOrIAL BOArD

eDITOrS

DIONNe peTITpASThree Phase Electric

pAuLA TApIAPacific Western Bank

COMMITTee MeMBerS

gINA rOLDANVista Paint

JAY pOWeLLPWLC II, Inc.

LAurIe S. pOOLe, eSq.Peters & Freedman, LLP

LeSLee WILLIAMSThe Management Trust, Monarch Group Division

LeSLeY FINCH, pCAMLindsay Management Services

SHeLLY ruegSegger, CMCAPersonalized Property Management

STepHANIe OTerOOffice of Stephanie Otero, CPA

STeveN SHueY, pCAM, CCAMPersonalized Property Management

STeveN J. TINNeLLY, eSq.Tinnelly Law Group

Sue ANDerSONUniversal Protection Service

TIM BLOOMBrite & Clean, Inc.

TONY BruNNer Country Club Remodeler

CreATIve DIreCTOr & grApHIC DeSIgNer

rODNeY BISSeLLBissell Design Studios

The mission of CAI is to provide the leadership for successful development and

operation of community associations through information, research and education.

CORRECTION: In the January issue, the name of Richard Welsh of Leak Point was incorrectly spelled in the WELCOME

ABOARD section. We apologize for this misspelling.

SuBSCrIBer ServICeSThe Coachella Valley Quorum Newsmagazine

is a publication expressly prepared for our Association leaders, managers and other related professionals of the

Community Associations Institute. Authors are encouraged to submit articles for publishing consideration. All articles accepted for publication in the Quorum are subject to

editing and rewriting by the Publications Committee.

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Quorum April, 2012 www.CoachellaValleyCAI.org8 9

FrOM THe eDITOrSpreSIDeNT’S MeSSAge

Here we are in April already, as this year flies by. This is a busy month with Good Friday on April 6th and Easter is on Sunday April 8th. Spring time is a wonder-ful time of renewal as the spring flowers are blooming in all their glory. The desert is especially beautiful this time of year; make sure to stop and take some time to enjoy it.

The Business and Education Expo was a big hit on March 20th. It was held at Heritage Palms Country Club and everyone enjoyed our guest speaker Dr. Esmael Adibi from Chapman University. Following Dr. Adibi’s informative talk, everyone enjoyed mingling with our great Business Partners in the Expo Hall. Thank you to Expo Chair, Cyndi Koester with Mutual of Omaha Bank/CondoCerts and her committee of Louise Stettler with Epsten Grinnell & Howell and Nathalie Ross with Adams Kessler, PLC for their time and effort on behalf of the chapter.

CAI-CV values education for all our members and this month our Homeowners Essentials class will be held on Thursday, April 12th at Palm Valley Country Club. This class is also known as “Board Boot Camp” as it is a time for newer board members to get a bet-ter understanding of the new role they have just taken on and for more seasoned board members to have the opportunity to be reminded of what can become rou-tine. Please make sure you encourage as many Board Members to attend this program as it is a very benefi-cial class.

While on the subject of education, on May 17th – 19th we will be holding an M100 Class locally here in the Valley. The M100 is designed for newer Association

President’s Messagerob Winkle, Western pacific roofing Corporation CAI-Cv Chapter Board president

From the EditorsDionne petitpas, Three phase electric paula Tapia, pacific Western Bank

Well, Spring is almost here and we’ve all “sprung forward” as well, so we feel right at home with an issue on, what else – Spring Cleaning!

We have dedicated this issue of QUORUM to a variety of topics that you’ll find helpful in getting some spring cleaning done in your community. By cleaning, we don’t mean dusting off that hard to reach shelf, or tackling that overstuffed closet. We mean… painting, mold, landscape, new legislation, new boards, and even improvements facilitated by a HOA loan. These articles are all relevant to getting a fresh spring start.

Gina Roldan’s article “Paint is Paint. Or is it?” dem-onstrates that there is more to “What Makes a Quality Exterior Paint” then we might have previously thought. Mold is not something we like to hear about but it is a reality. Greg Master’s article “Mold in the Desert” outlines ways to find the source of the mold and how to fix it. Beautiful landscaping is ever present in our valley. For tips on making palm tree trimmings and summer flower planting easy, check out Jay Powell’s article on “Fronds & Flowers.”

Welcoming new officers to a board of directors is a constant process that Associations go through. If you’ve just been selected to serve on the board of directors of your Association, take a look at Sue Anderson’s article, “Congratulations! You Are on the Board! Now What?” to get an overview of expectations and duties of an effec-tive board member. One of the issues you may face as a board member is helping your Association make a decision on funding large projects. In the downturn of

Managers and offers a practical overview of association management and is a must for achieving a CMCA des-ignation. The CAI-CV Board of Directors realizes that the expense of continuing education can be a deterrent to some and therefore offers a very generous scholar-ship program to those managers that want to grow their career. For more information about our scholarship program, contact the chapter office.

At last year’s Strategic Planning session it was deter-mined that CAI-CV needed to work more on promoting the good our chapter has to offer. With that in mind, I would like to thank our newest committee, the Mar-keting Committee, for their hard work in promoting CAI-CV. Chair Lori Albert with Albert Management Inc. and Co-Chair Nathalie Ross along with the help of the committee, have jumped out of the gate and are developing a good strategy for our chapter. The Membership Committee, lead by Jerod Pannell with Conserve LandCare and Co-Chair Louise Stettler are also working closely with the Marketing Committee on increasing, as well as maintaining, our membership. If you know someone who could benefit from our Asso-ciation please put them in contact with the CAI office.

Thank you to all our volunteers for their commit-ment to the chapter, we couldn’t do it without you! Hope to see you all at Indian Canyons Golf Resort for our Annual Golf Tourney on Friday, April 27th, always a great time.

our economy you may think these choices are lim-ited. Cyndi Koester’s article on “HOA Loans” answers the frequently asked questions when it comes to HOA lending.

Legislation is also getting a fresh start with new legislation being introduced. Skip Daum’s very infor-mative article “Sacramento Deadline Passes” details three of the thirty new Bills affecting community associations.

Celebrating its 25th anniversary this month is our featured community spotlight, Oasis Country Club in Palm Desert. This beautiful community is looking forward to a wonderful 25 more years and is well on their way with the improvements made and continued commitment to excellence.

We hope the full array of articles in this month’s issue of QUORUM will help make “Spring Cleaning” an easy task for your association.

Best,

Oasis Country Club, Palm Desert Happy 25th Anniversary!By Tony Brunner, Country Club Remodeler

oasis Country Club Homeowners Association is located on 153 acres of fee land off Hovley Lane East

between El Dorado and Oasis Club Drive in Palm Desert, California.

Construction started in 1985 and involved a succes-sion of 3 developers, Weyerhauser, California Community Builders, and Canaan Construction. Final build out was in 1999. The Oasis Community is currently celebrating its 25th Anniversary.

The community is comprised of 662 condo and PUD units laid out amidst a beautiful 18 hole executive golf course. Facilities include a 22,369 sq. ft. clubhouse, three tennis courts, four pickleball courts, a Ted Robinson designed 18 hole putting course, putting green, driving range, practice bunker, 3 lighted tennis courts and 18 pools and spas. Oasis is among the few clubs in the Coachella Valley where the homeowners also own the clubhouse and golf course.

The homes at Oasis range from single bedroom condo units of 775 sq. ft to 3 bedroom single family homes of 1,805 sq. ft in a variety of more than 20 floor plans. As of this writ-ing there are 29 active listings on the MLS ranging from $149,000 to $389,900. In 2011 Oasis properties sold in the range $155,000 to $400,000.

There are slightly more full-time than part-time resi-dents. There is also a high percentage of renters that come back year after year due to the affordable golf and dining amenities at Oasis. In fact, they become more like mem-bers than guests. Most of the new Oasis owners come from Canada, Washington and Oregon.

What homeowners like most about Oasis is its well maintained, satisfying 18 hole executive course; its friendly people and staff; the well landscaped grounds; competi-tively priced homes, and the very active men’s and women’s golf clubs and smaller golf groups. The Men’s and Ladies Golf Clubs each have two days a week for play. People who play the Oasis golf course say that it is the best Execu-tive Course in the Valley. It is also one of the few courses that allows walking. The Club does not shut down for the summer and the year-round residents appreciate the fact that there continue to be activities for them to enjoy. Oasis owners are very active in Club activities and enjoy monthly parties, brunches and golf events throughout the year.

Regular annual events are activity highlights at Oasis. Each new season opens with a Dinner/Dance to welcome the snowbirds back into town. It is followed by a cocktail party the next day. The Annual Oasis Fashion Show is in March, when owners and their guests enjoy a luncheon of

fashion and food. Raffle money from this event is donated to the Arnold Palmer Prostate Cancer Center. The event features the Art Bowman Classic, the proceeds from which also go to the Arnold Palmer Prostate Cancer Center. Art Bowman was a long time Oasis homeowner and golfer.

The Annual Oasis Pro Am is in April. This is when golf professionals from around the Desert and their guests join Oasis owners for a fun filled day of golf and prizes. Then there is the Memorial Day Tournament with the Marines, when single Marines are invited and picked up from the 29 Palms Marine Base for a day of golf and lunch.

Although Oasis is its own world, it is within walking, driving or golf cart distance of two major grocery stores, three large pharmacies, several local restaurants, strip malls, beauty salons, dry cleaners, copy centers, and doc-tors. It is only 1-1/2 miles from the I-10 freeway.

Here are some of the Oasis homeowners in their own words:

Jim Schmitz (25 year owner): “The thing that makes it is the people. The togetherness of the people, Board and staff working toward making The Oasis a better place to live.”

Virginia Rapp (15 year owner): “We live in Oklahoma in the summer and after visiting a relative at Oasis in 1996, we toured some homes with no intention of buying. However, at the end of the day we had done just that. We have never had a reason to regret that quick decision and have since purchased a larger home just down the street from our first home. After living at The Oasis for 15 years, we still consider this property to be one of the best maintained, most economical and friendliest locations in the Coachella Valley.”

Dennis Benoit (recently bought in 2011): “As we drove through the front gates of Oasis Country Club, it was like driving into Paradise. The grounds and the golf course were beautifully manicured and in pristine condition and the view of the mountains were second to none. The whole complex was so clean and well kept. We were so impressed with the friendly residents and the friendly, smiling staff always ready and willing to help us. We felt ‘at home’ imme-diately and we were sure that this would be our ‘home away from home’.”

The five member Oasis Board of Directors benefits from the efforts of a number of extremely active and devoted committees: Architectural, Events, Finance, Golf, House, Landscape, Marketing, Security and Emergency Prepared-ness Oversight.

Says Janice Tippin, Board President “While celebrating our 25th anniversary, our Board is mindful of the fact that we have to be looking forward to the next 25 years. In order to be successful we must be willing to change and continue on the path of constant improvement. We are committed to


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encouraging excellence in our administration, our staff and ourselves in order to enhance our members’ and guests’ experience at Oasis Country Club.”

The Board has recently completed a three year reno-vation of the Clubhouse, which included remodeling the men’s and ladies’ locker rooms, lending library, updating the pro shop, expanding The Grille Room, and upgrading the dining room and lounge facilities.

The pool areas and larger common areas are being Xeri-scaped and a re-landscaping project is under way to help with aging shrubs. The Association has assisted some 40 owners with Xeriscaping in front of their units.

We recently launched a new and improved website (www.theoasiscountryclub.com). Homeowners can make tee times and dining reservations online, along with check-ing of their statements. This illustrates one of the benefits of the homeowners also owning the golf course and club-house facilities. Centralization of management avoids confusion. Whether a golf course sprinkler or a common area sprinkler is hitting one’s unit, the phone call goes to the same place.

Oasis Business Partners include Sunshine Landscape, Boyd & Associates, Valley Pools, Foster & Sons Pest Con-trol, Diversified Roofing Services, Inc., First Bank, Peters &

Freedman, Brabo & Carlsen, Asphalt MD’s, and Time War-ner Cable. Business Partners also include the Oasis onsite real estate office which is operated by Desert Homes with Tarbell Realtors. Of the six agents in the office, five are also Oasis homeowners.

Oasis directly employs its administrative staff of five experienced personnel. Association Manager is Eve Weber. Says Eve, “Our homeowners are a delight. They are friendly, willing to help out and a pleasure to work with. This community is a better place because of the members, staff and business partners! We are a friendly, unpreten-tious community with people from all around the world who enjoy all the amenities The Oasis has to offer. From people who love to golf to people who love to putt, from people who play tennis to people that play pickleball. Throw in bingo, bridge, mah jongg, bunko, karaoke and a multitude of dining activities and you have what it means to be home at The Oasis Country Club - - a community for all.”

Tony Brunner is with Country Club Remodeler, a high quality, affordable remodeling contractor serving Coachella Valley homeowners. You can reach him at (760) 772-4300 or at

[email protected].

GURALNICK & GILLILAND, LLPATTORNEYS AT LAW

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CLAC NeWS

February 24th was the last day for new legislation to be introduced into their respective houses in Sacramento.

On last count 2,791 Bills have been introduced and are being dissected by our dedicated lobbyists, Skip Daum and Ron Kingston. Out of the approximately thirty (30) Bills that seem to affect community associations there are a few that really stand out.

AB 561 (Corbett) is BACK. This is the second year this Bill has been floating around Sacramento, and it is worri-some. The premise behind the Bill is to get the money that is collected in delinquent assessments to the HOA as fast as possible. That sounds great! The problem comes when an association is not willing or able to spend any more money collecting on a particularly difficult account. Many Boards feel that turning the account over to a debt collector who knows the best ways to collect on delinquent accounts is the most productive way to go, but AB 561 will severely curtail that practice. These “professional” debt collectors are providing a service, and as such, they expect to be paid for it. HOAs want to “cut their losses” and are willing to take a percentage of what is brought in on accounts that they have practically given up hope on. If AB 561 passes, the only way the debt collector would be paid would be if they collected MORE than the assessments due the HOA. Practi-cally speaking, that doesn’t happen, which means the pro-fessional collectors would have to work for free, or the HOA would have to pay them out of the assessments collected by people who ARE paying their assessments. The point of using the professional collectors was to stop throwing good money after bad while still acknowledging the Board’s fidu-ciary duty to collect assessments. While this Bill may look good on the surface, it severely inhibits a board’s ability to do their due diligence. We have attempted to bottle this bill up in the Assembly and have succeeded thus far.

Sacramento Deadline Passes

AB 2273 (Wieckowski) – Timely Recordation after Trustee Sales. Problems arise after a foreclosed property is sold at auction. Mainly the problems come from banks that are not willing to take responsibility for the assessments and maintenance of the property, and therefore delay the recordation of the property into their name. Technically, they OWN the property (they bought it at auction) but they don’t record that transfer officially, so no one knows. The HOA continues to bill the previous homeowner (who was just foreclosed upon), asking THEM to continue to main-tain the property and fining them for any failure to do so. Why should the person who just lost their home be required

to pay assessments and maintain the property? The simple answer is: they should not be. The language of this Bill (in effect) is that the Bill “would provide that an owner of a separate interest shall, within 30 days of transferring title, provide to the association’s board secre-tary, agent, manager, or designated representative, a copy of the owner’s deed or other document transferring title to the purchaser of the separate interest and a written notice of the purchaser’s mailing address.” CAI’s California Legislative Action Com-mittee is working alongside Assem-bly member Bob Wieckowski and the County Bar Associations (who initiated this measure) in promoting this Bill and possibly amending the

language to provide additional incentives to comply with the law once enacted. Requiring timely recordation is the first step in holding banks responsible for obligations they have as part of the foreclosure process.

SB 1244 (Harman) – Notice of Default Notification. The California Civil Code has many requirements regarding how someone defaulting on their loan needs to be noti-fied of the filing of a Notice of Default (the first step in the foreclosure process). Senator Harman has introduced a Bill that makes the notification of a non-paying unit

New Legislation Affecting Community AssociationsBy Skip Daum, CAI’s Legislative Representative in California

For most of us of a certain age, the question “How much REO do you have in your portfolio?” was usually

answered in terms of the number of eight-track tapes. Of course with the advent of the housing crisis, this term, which references Real Estate Owned or bank-owned property, has become the benchmark of distress for communities across the country. Now important policy announcements by the federal government will turn loose a veritable “REO” speed wagon on community associations across the country and we need to be prepared for the potential impact.

Bad metaphors aside, mortgage giant Freddie Mac issued a policy bulletin (2012-2), which allows unem-ployed borrowers to seek forbearance on their mortgages for a period of six to twelve months. The Federal Housing Administration (FHA) offers a similar program. Freddie Mac has also extended authority to lenders it works with to offer up to six months of mortgage forbearance as part of this program. CAI expects Fannie Mae to follow Freddie’s lead on this issue.

Community associations should remind residents that loan forbearance offered by FHA, Fannie Mae, Freddie Mac or on behalf of any lender does not apply to association assessments. CAI also encourages all associations to work with troubled borrowers to avoid any instance of assess-ment delinquencies and to preserve the ability of owners to remain in their units. Boards may want to consider adding this information to delinquency notices to ensure the board is aware of any residents who are in a forbearance program. Foreclosing on such owners may invite federal regulation of association enforcement powers.

Other plans for REO properties include the Fed-eral Housing and Finance Agency’s bulk sales to rental

program. Under this program investors have been invited to bid on pools of properties owned by Fannie Mae, Fred-die Mac and FHA. One condition of this program is that the properties be rented for at least a year after purchase. While this program will help clear out the backlog of REO proper-ties clogging the market, it also creates potential problems for community associations. First, as condominium asso-ciations know, FHA limits the number of rental units to no more than 49 percent of an association. It also requires that no more than ten percent of any condominium association be owned by a single entity. Thus, a bulk sale may result in an association being disqualified from some federal mortgage programs. Beyond that concern, there is the issue of the bulk seller obtaining a sizeable ownership share or even a majority of units within the community. This will create a host of governance issues and impact the rights on existing owners.

There is good news as well. The Office of the Comptrol-ler of the Currency (OCC) issued a policy bulletin outlining the responsibilities of lenders in foreclosure. That guid-ance (embodied in OCC Bulletin 2011-49) provided notice to

The “REO” Speed WagonNew policy Announcements From Freddie Mac May Impact Community Associations

lenders who foreclose that they are responsible for payment of community association assessments. CAI survey data indicates that more than three out of four REO properties do not pay required assessments. Thus the federal actions here will help force lenders to live up to their financial commitments.

As part of our ongoing Mortgage Matters program, CAI is working to protect homeowners in community associa-tions and to ensure access to fair and affordable mortgage products for all current and potential community associa-tion residents. You can follow our work and share your thoughts at www.caimortgagematters.org and on Twitter at @CAIGPA. CAI will continue to monitor and participate in shaping changing federal housing policies to ensure the perspective of community associations is heard.

CAI articles are researched and written by a team of professionals with the CAI National Headquarters. CAI provides information and education to community associations and the professionals who support them. For additional information, visit them at www.caionline.org.

By Staff Writer, Community Associations Institute

Of course with the advent of the housing crisis, this term, which references real estate Owned or bank-owned property, has become

the benchmark of distress for communities across the country.


CAI NATIONAL

Quorum April, 201216

CLAC NeWS

cai MOrTgAgeMATTerS

owner more reasonable. The text of the Bill states, “The board shall provide notice by personal service in accordance with the manner of service of summons in Article 3 (commencing with Section 415.10) of Chapter 4 of Title 5 of Part 2 of the Code of Civil Procedure to an owner of a separate interest who occupies the separate interest or to the owner’s legal representative, if the board votes to foreclose upon the separate interest. If after reasonable diligence the notice is not able to be personally served on an owner of the separate interest who occupies the separate interest, the association may post a copy on the owner’s separate interest in a manner most likely to give actual notice to the party to be served and mail a copy of the notice by certified mail and first-class mail to the owner at the address of the owner’s separate interest. [The italics are the new part.] At first blush, it looks like it simplifies the process for HOAs a bit. And, as usual, the California Legislative Action Committee will keep an eye on its progress and let you know any changes made, and our official position, once taken.

And that is only three of the thirty. We have a lot of work to do in the coming months. To keep abreast of the situation,

check out our blog at caiclac.wordpress.com and sign up to be notified automatically when new posts occur. That will be the best place to find out what is going on in the world of HOA legislation in California.

Be sure to join us for our Legislative Day in the Capi-tol, set for April 15-16. For more information, please visit www.caicalif.org and look under “Upcoming Events.”

Skip Daum is our veteran Legislative Advocate for CAI’s California Legislative Action Committee and may be reached at [email protected]. More information on the

Legislative Day in the Capitol can be found at www.caicalif.org.

have you given thought about the benefit of your CAI membership lately? You may not have thought about

it, but a lot of what you find out is likely a result of your being a member of CAI.

Every month, the local chapter holds a great educational program and networking breakfast or lunch. It is a nice getaway from the normal day-to-day workload, and a way to socialize with friends in the industry. You can go back to work with a tidbit of knowledge you didn’t have before. About 150 of your colleagues attend these events.

Periodically, the chapter holds business partner expos that do just that, they expose the offering of the busi-ness partner to the membership. These are few and far between, but they sure provide manager and board mem-ber education!

At the national level, there is an annual conference where over 500 of your colleagues attend from around the country. This year it is being held in Las Vegas, May 2nd through May 5th. This venue is close enough to be an inex-pensive educational getaway. These are busy days filled with educational classes that will surely be good career builders.

Membership Has Its BenefitsThe Many reasons To Be A CAI MemberBy Steven Shuey, PCAM, CCAM, Personalized Property Management

Wayne Carlsen has lived in the Coachella Valley for about 26 years. He was born and raised in a small farming community in Southern Minnesota. He has been married to his wife Jan for 18 years and has a 31 year old son who lives in Oregon and

has just returned from a tour of duty in Iraq.Wayne has a B.S. in Accounting from Mankato State

College in Minnesota. Wayne relates that “his first employer in Minnesota taught me that the way to get ahead in the CPA world was from a strong work ethic, long hours, and hard work.”

In his leisure time, Wayne enjoys going to the gym and riding his Harley in the mountains. He has a great

Time Honored member WAYNe CArLSeN

By Pat Smith, CCAM, PCAM, Veneto HOA and Shelly Ruegsegger, CMCA, Personalized Property Management

interest in modern technology so just about everything he reads is digital. His music interests range from Classical to Rock, and on his IPAD is the book, The Art of the Steal. His favorite saying is “nothing is free.”

Wayne has been a member of CAI for approximately 20 years and served on the Board of Directors as the Treasurer for several years and was also Chair of the Finance Committee.

Wayne has been in business for 37 years. Over the years his business has expanded and he now provides services to approximately fifty primarily large associations. His firm, Brabo & Carlsen, LLP CPA’s provide accounting, audit and tax services to Community Associations, country clubs, other nonprofit organizations and construction contractors.

Wayne can be reached at (760) 320-0848 or [email protected].

Both the Government and Public Affairs Committee (G&PA) at the national level and the California Legislative Action Committee (CLAC) at the state level, work hard for the community associations and our career paths. The laws are constantly changing and these two groups help keep us informed of those changes. GP&A developed a website called Mortgage Matters that educates us as well as lenders, real estate agents, and our government. GP&A also posts a “tweet” on Twitter every day with news of what is going on. If you don’t subscribe to Twitter, you might want to give it a try, if for nothing else but this one CAI benefit.

There are many more benefits! If you have a favorite that I haven’t mentioned, send us a message and let us know. CAI is here for you – enjoy the benefits.

Steven Shuey is a certified professional community association manager. He serves on the National Faculty of CAI and a past board member of the APCM. Follow him on Twitter at www.twitter.

com/@IslandMgr or email him at [email protected].


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Congratulations, you are now officially a board member in your community. What can you expect and what does it take to be an effective board member? Most likely the first step will be a meeting with the property manager who will spend an hour or two going over the details of your new role as well as the nuances of the community. Most communi-ties will also have an orientation meeting in which there will be an update of the committees so new board members can determine which committees they will be assigned to. It is customary for each committee to have two board members in its membership. The board will take a look at the abilities and preferences of the new board members to determine who should be placed on the appropriate com-mittees. Also during the orientation meeting, new board members will be given the Bylaws, CC&R’s and Rules & Regulations of the community. It will be the responsibility of each board member to familiarize himself/herself with these documents.

Perhaps the greatest time commitment will be attend-ing monthly board meetings. These meetings consist of not only the regular sessions open to all homeowners who wish to attend, but also the executive sessions where items such as contracts and legal issues are discussed. These meetings are often lengthy so it is important to devote at least one day a month for attending these meetings. Please remem-ber there is also the preparation for the meetings. Board member packets will typically be distributed 5-6 days prior to the actual meeting in order for members to have enough time to prepare.

As mentioned above, board members are required on each committee. That board member will serve as a liaison and will not have voting power on the committee. The head of the committee is there to represent the board and to act as a conduit for the free flow of information between the board and the committees for whom you are a liaison. It is important to make sure the committee’s questions are

answered as well as keeping the board informed of the committee’s actions. Most of these committees meet at least once a month so it is important to plan time for these meetings as well.

Being on the board can also mean making tough deci-sions. The primary role of the board is to conduct the

business of the Association and that means being able to develop and enforce policies and procedures. Many times, enforcing these policies and procedures may not be the popular thing to do! Board members are required to step outside their immediate circle of family, friends and neighbors to make decisions based upon the greater good of the community. Although this can be difficult at times, the experience of being on the board can also be one of the most rewarding volunteer experiences for an individual.

What are some key traits of an effective board member? The following are a few characteristics of successful board members:

• Diligence in reading the governing documents.

• Always prepared for board meetings.

• Professional demeanor.

• Welcomes and participates in education and training.

• Constantly seeking ways to promote effectiveness on the board.

Perhaps one of the most appreciated characteristics found in successful board members are those people who are acting in good faith and are not joining in order to promote personal agendas. Art Coulter, seasoned board member at Palm Valley Country Club, states, “The board is always looking for someone who wants to serve for the benefit of the community and not for a personal agenda.” Art also encourages people thinking about joining the board to first get involved on a committee in their community. This is a great way to get an idea of the time commitment involved as well as getting to know others already on the board!

Sue Anderson is the Sales & Marketing Manager for Universal Protection Service in Palm Desert providing security solutions for gated communities throughout the Coachella Valley. She can be

reached at (760) 505-3412 or by email at [email protected].

Congratulations!

You Are on the Board!

Now What?

By Sue Anderson, Universal Protection Service

If you are currently on a board within your association or a homeowner interested in learning more about board operations, please consider attending the

upcoming CAI Essentials Class (“Board Boot Camp”) being held on April 12th. For more information,

contact the CAI Office at (760) 341-0559.

expectations and Duties of an effective Board Member


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not even know it is there. It may be that only when respiratory problems are starting in children or in people whose immune systems are compro-mised that the owner starts searching for answers. Homes that are most at risk for roof leaks and mold are those with a flat roof. A drive through desert communities will reveal many, many homes with flat roofs. Talk to the owners of these homes, and you will find they are very aware of the neces-sity of keeping their roofing in good condition.

Let’s, for a moment, consider a real-istic scenario: Homeowners return

from a glorious three-week vacation, open the door and are greeted with soaked carpeting and mold creep-ing up the walls. A rain deluge over-whelmed frail roofing, a plastic water pipe in the wall cracked, the water line to the refrigerator came loose, a toilet tank overflowed, or the dishwasher line burst, are among the possible culprits, and there are more. Plus, this can happen in a new home almost as easily as an old one.

What’s the first thing to do? First, determine the source of the water. If it isn’t obvious, call a plumber. He may not be the final solution, but he can determine where the water is coming from. If the source is identifi-able, there are a couple of next steps: if the water is still f lowing, turn it off, tracing the water all the way back to shutting down the main valve to the home. A broken hose can be replaced. A broken line will require a plumber. If the water source is no longer flowing, then it is likely that it didn’t come from a broken pipe or water line. It is likely a leak from an outside source. While it may be necessary to call a contractor to repair the source of the leak, like a roof leak, it is also time to call a mold inspector to determine the severity of the problem. Based on that evaluation, it may be determined that the water damage may be an Association issue, and the Association manager should be contacted. Insurance may cover water damage, but may (explicitly) not cover mold. Pull out your homeown-er’s insurance policy and search for water damage and mold coverage.

A caution: select a mold inspector separate from a company specializing in repairing mold damage to avoid being told that the damage is greater than it actually is. While a mold problem truly can be a “supersized” and costly project should black mold be detected behind drywall, there are many instances where a poten-tially severe problem can be handled

Mold In The Desert?Don’t Be Deceived, There Is Mold All Around us

quickly and efficiently before it becomes a huge problem.

Developing a mold allergy usually doesn’t happen overnight, and most situations such as coming home from vacation and seeing water damage doesn’t automatically mean mold. But a mold allergy does, however, come from mold exposure. It takes daily exposure to even low levels of mold spores in the air to create a problem. But once you get it, “it keeps on giving.”

Like many other allergies, it can make your life miserable. If you see mold, and do nothing about it (“it’s only a little”), you may pay, pay, pay. The outdoor air always has mold spores, sometimes many of them. For example, where trees shed their leaves in the fall, and fallen leaves are raked into piles, mold goes to work on them immediately. Disturb-ing those piles sends choking clouds of mold spores into the air. But in any climate the ambient mold spore level will vary with the time of day, the temperature, the wind speed, the humidity, and the season.

When mold is cleaned up and the damage repaired, make sure there is a certificate or report that the homeowner or association can keep as proof that the mold has been professionally taken care of, and that no mold remains. As a property sale inches along through escrow, this question can pop up. If no record exists, it can trigger an extra expense for a mold investigation.

So, do desert dwellers need to be concerned about mold? The answer from The Prairie Home Companion: “You betcha.”

Greg and Barbara Masters are the owners and operators of Masters Environmental. They can be reached at (760) 200-2900 or by email at [email protected].

Southern California and the Palm Springs area in particular, has relatively low humidity, rivaling the Sahara Desert (average yearly humid-ity is 25%). But when a desert down-pour finds a damaged roof or a roof where the flashing has been ineptly installed, the stage is set for mold growth in the house. If the water is not dried out immediately, mold will be seen growing in a week. Add high temperatures and high humidity, you will be raising a full mold crop in less than a week.

The mold may not be easily detected, and the homeowner may

By Greg & Barbara Masters, Masters Environmental


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A. Carol Fulton, CIrMS LaBarre/Oksnee Insurance Agency

B. Sarah Davis Regional Underwriting Manager, Philadelphia Insurance Co.

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CHApTer eveNTSFeBruArY MONTHLY prOgrAM

What’s in the HOA Insurance Market

for 2012?

• Possible rate increases in 2012• Updates on earthquake coverage• Coverage changes that could affect you• The right type of Workers Comp Insurance for you• Have enough D&O Coverage?

For example - Our insured has a building with an insur-able value of $500,000. He has purchased an insurance policy for $350,000, with an 80% coinsurance clause. Six months into the policy, a fire erupts and causes $60,000 in damage. By applying the coinsurance formula, we see that the insured was required to have $400,000 of coverage ($500,000 X .80), so:

350,000

X 60,000 = 52,800 400,000

Because the insured did not meet his coinsurance requirement, he has become a partner in the loss to the tune of $7,200 + deductible.

Insurance to value can be determined by professional appraisals, by the Marshall Swift Boeck Commercial Build-ing Valuation System (MSBVS), Professional appraisals or a contractor’s estimate. Valuations are based on type of materials used in construction, CC&R replacement require-ments, square footage, etc.

Three things can occur if properties are underinsured:

• Theinsurerisleftwithoutsufficientpremiumcol-lected to pay for the more severe losses or the fre-quency of small ones that will occur

• Ifeveryinsuredpurchasedlessthanenough,thenrates would have to be significantly higher

• Themajorrisktotheinsuredisthattheywouldnothave insurance protection for a catastrophe, and that could severely impact their existence and ability to pay claims.

Overall in the industry, claims are on the rise. We have seen a significant uptick in property claims due to CAT events that I have already described, but we have also seen heavy claims activity in other lines as well , such as crime. Some recent examples have included maintenance supervisors skimming $17K from money generated by coin operated laundry machines; during a large scale renova-tion project a property manager altered checks intended for an approved contractor to the name of a construction firm owned by her husband for a total of $156K in losses; in another instance, an accountant for a country club used the clubs online banking to pay his personal debts out of the clubs account then manipulated the financial documents to cover his tracks for 8 months with the loss ending up at $75K before the club discovered the issue. Can your asso-ciation afford NOT to carry the right amount of coverage? No one thinks these types of losses will happen to them,

until they do. These three losses occurred on accounts with a 0% loss ratio with PHLY and all were discovered within three months of this presentation. Anytime that the economy dips as dramatically as it has over the past few years, insureds are at a higher risk for crime and GL claims to occur to supplement individuals who feel they have no other options to turn too.

One last issue that I wanted to address with all of you is the recent changes to the Davis-Stirling Act. The Davis-Stirling Act is a comprehensive body of law governing common interest developments that became known as the Davis-Stirling Common Interest Development Act.

priority Changes in 2011 include:Carbon Monoxide detectors are required in every

dwelling unit where the home has a gas burning furnace, cook stove, water heater, wood burning stove, and fireplace or attached garage. Condos and townhomes must install them by no later than January 1, 2013.

Electric Charging Stations – HOA’s are prohibited from unreasonably restricting the installation of electric vehicle charging stations. Members who place charging stations in common areas are responsible for costs associated with maintaining and repairing the station as well as costs for damage to common areas and adjacent units resulting from installation and maintenance of the station. This new statute does allow individual owners to use or occupy com-mon areas contrary to existing statutes and case law. The association must approve the installation of the charging station if the owner agrees to (1) comply with architectural standards for the installation, (2) engage a licensed con-tractor to install the station, (3) within 14 days of approval provide a certificate of insurance that names the associa-tion as an additional insured under the owners liability policy, (4) pay for the electricity usage.

In all, 2011 was a volatile year for insurers due to signifi-cant CAT and loss events in addition to property rates being at the lowest peak in the market. This resulted in insurers ending the year with combined ratios over 100% on aver-age and the reinsurance market levying heavy increases against US property/casualty carriers depending on the placement of their book and the insurer’s accumulation of CAT prone insureds based on new modeling software. This volatility has lead to increased reinsurance and primary rates in the market and will continue until the market evens out with losses and rates so that insurers can once again show profitability.

Sarah Davis is the Regional Underwriting Man-ager for Philadelphia Insurance Companies, responsible for 18 underwriters and raters. She can be reached at (949) 330-2389 or by email at

[email protected]

wind and storm surge hazard models farther inland (in some cases more than 100 miles inland) which had a major impact on insur-ers whose nationwide book included Texas and mid-Atlantic regions. Since most

US reinsurance treaties renewed on January 1st with an expected 7-30% increase depending on the company’s book of business, many companies took higher attachment punts in order to manage rate increases for their clients. Over-all US reinsurance rates rose the highest percentage with Europe remaining relatively flat and the Asia market being the most volatile. The Asia reinsurance market has over a 1000% loss ratio due to CAT events, but since reinsurance treaties renew much later in the year, it is too early to pre-dict how much their increases will affect the overall market. In all, for property & casualty insurers, the average com-bined ratio (profitability – losses and expenses/premium) which is the highest since 2006 according to BusinessInsur-ance.com.

In order to consider what’s coming in 2012, you must look to the reinsurance market first since increases in reinsurance pricing leads to increased primary rates, most dramatically for CAT prone accounts. Insurers that previ-ously took low attachment points to manage expenses will likely be underwriting more conservatively since it is now their own companies’ money on the line instead of the reinsurer’s money. Overall, the insurance industry has realized that rates have fallen below what is adequate in the market and that risks being assumed need more rate to produce adequate returns and therefore are more accept-ing of the need to change. The overall property market is beginning to adjust but we are only at the beginning, more rates will be needed to reach rate levels that are adequate for exposures.

One way that insurers are evaluating their property book of business is by looking at ITV (Insurance to Value). 98% of fire losses are partial losses which provides insureds with strong incentive to cover their property only up to the values of their expected losses. However, since rates are promulgated on full value insurance, this tendency is a major problem for property insurers. ITV is the basis for rate development and is how insurers ensure rate adequacy. One incentive for insurers to insure to value is the coinsur-ance clause attached to your policy. This insures proper ITV and also results in a lower rate/unit for your property. Coinsurance is calculated based on Did/Should x Loss.

The most unusual year on record for insurance claims in the last decade was 2011. As of June 30, 2011, claims had reached the highest level per year on record globally due to an extraordinary accumulation of severe natural casualties such as earthquakes, tsunamis, floods and tornados. By June 30th, globally the world had accumulated more than $265B in economic losses and $60B in insured losses which was 4 times the national 10-yr average. In the US that attributed to $27B in economic losses and $14.7B in insured losses just through June 30, 2011. This was a 162% increase over YTD 2010 losses. Experts have predicted that 2011 will become the 5th or 6th most expensive year in history for insured catastrophic losses in the US.

If you look at the last 21 years of insured losses, 3 of the most catastrophic events have taken place in the last 18 months; including the Japan quake/tsunami, the 2011 Spring Tornado storms; and the New Zealand quakes. While it may seem that these losses are far away from your association, there is a major impact on individual accounts because of these events. In addition to these losses, there were also a few changes in the modeling of how insurers would look at potential losses that has an effect on indi-vidual account pricing and insured capacity. RMS 11.0 came out early in 2011 which significantly increase PML’s (Probable Maximum Losses) for insurers relative to US wind events. This revised modeling software pushed both


FeATureFeATure

Commercial Insurance for AssociationsInsurance Market update for 2011 and a Look Ahead to 2012

By Sarah Davis, Philadelphia Insurance Companies

www.CoachellaValleyCAI.org28 29

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Quorum April, 2012

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1. Can an incorporated asso-ciation borrow funds from a bank?

Yes. Due to the loan collateral requirements, non-incorporated associations would find it signif-icantly more difficult to obtain a loan.

2. Advantages of borrowing:a. Downward slide of property

values slowed or eliminated. Structural problems, which must be disclosed to poten-tial buyers, will retard the sales process and lead to falling home prices. Rapidly improving the appearance and eliminating structural integrity problems can slow or eliminate falling home values.

b. Needed repairs/improve-ments completed quickly. By borrowing the money, total needed funds become available for use much faster than through the traditional special assessment process. Passing a special assessment will give the board of direc-tors the power to collect the money. There is still the difficulty of collecting from those homeowners who do not have the ability to pay.

c. Reduced financial impact on homeowners. By participat-ing in the loan, homeown-ers avoid having to make a lump sum special assessment payment. Homeowners can pay their share over time to reduce the impact on their personal finances.

3. Disadvantages of borrowing:

a. May increase monthly assessments. A special or increased assessment may be implemented to support the loan. Allocating portions of the reserve contributions can offset some or all of the increase.

b. Interest costs incurred may be high. This depends upon the loan structure. However, construction savings may significantly reduce the final effect on the association’s total construction costs if done over a longer period of time.

4. How is the loan secured?Assignment of association assets that may include but are not limited to monthly assessments. No liens are placed on individual units by the bank.

5. Vote of approval may be required.You need to refer to the legal documents of your community to determine what type of vote is required for a loan in your com-munity. If they are silent, then some banks will still require that the Board of Directors be directly empowered to assign association assets by a vote of your membership. The vote is considered important because:

a. The membership has explicitly given the board of directors the power to assign association assets.

b. Membership has been noti-fied of the board’s potential action and had an opportu-nity to discuss the process in an open forum.

In most cases a special assess-ment is necessary for the asso-ciation to fulfill their commit-ment for the loan payment. In this case, the membership vote is usually the majority vote of a quorum. You need to review your legal documents to confirm this requirement.

Voting on a loan and/or special assessment now falls under Civil Code 1363.07. You will need to consult with the asso-ciation’s attorney to make sure the association meets the legal requirements.

6. Types of loans available to HOAs:a. Repair/Replacement of worn

out major components such as roofs, fences, decks, paint, sidewalks, asphalt, etc.

b. Improvement of association facilities such as new pools, sauna, clubhouse, play-grounds, perimeter gates.

c. Litigation support for defect testing, experts, attorney fees.

7. General loan parameters you will see:a. Term: normally one to ten

years. Most projects only have a 10 – 15 year life span.

b. Fixed and variable interest rate programs available.

By Cyndi Koester, CMCA, AMS, PCAM, Mutual of Omaha Bank/CondoCerts

Many community associations are faced with the decision on

funding large projects within their asso-ciation. Unfortunately, they don’t have enough reserve funds to pay for them or they do not wish to deplete their exist-ing reserves in case there is an emer-gency in the future. Usually, Special Assessments are the only way to fund these projects for your communities. Placing placing Special Assessments on your members may in turn cause your community to have a higher delin-quency rate as many are unable to pay such a large sum so your projects are placed on hold as you do not receive all the funds in a timely manner, contrac-tors are not able to hold the price while you raise the funds.

For example, now that you identi-fied the cost of your construction proj-ect, what are the homeowners’ options to meet their portion of the associa-tions funding requirement?

a. Pay Cash - earning interest rates on investments is gener-ally below borrowing interest rates. Remember that Uncle Sam usually takes his share of your earned interest.

b. Borrow funds that are secured on real property - such as a second mortgage or equity line of credit. Gen-erally, you will receive some tax deduction benefit (check with your CPA).

c. Participate in the com-mercial loan that your homeowner association has received. Interest rates are reasonable and can be fixed over the loan term. No personal information will be required nor is any lien placed on your unit by the bank.

d. Credit cards - would nor-mally be the worst option of all due to high interest rates, zero tax benefit and faster payoff schedules. (Unless you have some special pack-age for earning points for free airfare and prizes!).

There are other alternatives! In today’s times many associations are allowing their members to make their own financial decision. They

A Sound Option That Makes Financial Sense

HOA

are giving them options on how to pay their Special Assessments. Associa-tions are now obtaining an HOA loan. This allows the association to com-plete their projects in a timely manner and usually be able to obtain a better cost from contractors because now they are not waiting for the income to finish the projects, homeowners are able to make their own financial decision on whether they want to pay the full amount of the Special Assess-ment or pay the Special Assessment monthly through the HOA loan.

Where to start? A board should bring in their experts. You need to communicate this information to your members well in advance. Hold several Townhall meetings and allow your experts to explain this informa-tion to your members. This makes the members feel that you have taken them into consideration while making a difficult decision that will finan-cially impact your members.

Listed below is information on how a HOA loan works and what you need to know.


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c. Loan Origination Fees: anywhere from zero to 1% on committed loan amount.

d. Rate: interest you pay on the loan normally based on Wall Street Journal Prime or T-Bill plus points.

e. Application fee: $0 to $1,000 (typically refunded if loan is declined).

f. Verify if there are prepay-ment penalties for paying before the term ends on vari-able rate loans.

g. Structure: initially a “non-revolving” line of credit during construction phase of six months to two years. The line of credit is converted to a variable or fixed rate term loan when construction is completed.

h. Some financial institutions require the association to place 100% of their reserve funds in their financial insti-tution during the duration of the loan.

8. Loan amounts available:a. It is not recommended that

an association obtain a loan for less than $50,000.00, as it is not financially in their best interest due to costs involved.

b. Maximum amount depends on the size of the community.

9. Approval period:Usually, it will take up to 30 days from the receipt of all required documents for the loan to be approved. Normally loan docu-ments are completed for signing within one week of receipt of the commitment letter from the bank.

10. What does the commercial lender look for to approve an HOA loan?

a. Size: How large is your asso-ciation? Associations under 25 units will find it more dif-ficult to receive a loan as they have fewer units with which to spread the loan payment.

b. Cash Flow: Can your associa-tion assessments cover the loan payment and continue to fund other reserve items?

*c. Reserve Study: Is your reserve study current, prepared by an experienced company, and appear to properly plan for your future needs?

*d. Delinquencies: Are there many units or just a few units with large amounts due? Over 10% of the membership delinquent should be cause for concern in getting the loan approved.

*e. Delinquent Policy: What is the structure of your assess-ment delinquencies? Do you follow your collection policy for delinquent assessments? Are you diligently collecting dues or are you letting mem-bers fall behind?

f. Financial documents: Are your financial statements reviewed or audited by a CPA? Do they correlate well with your bank statements?

*g. Stability: How stable is your association? Are you suing each other? Is there an attempt to recall the Board of Directors? Is the owner occu-pancy ratio more than 70%?

h. Management: What is the management company’s experience in common inter-est development manage-ment? Is the management company a member of CAI, ECHO, or CACM? Does the management company staff carry professional desig-nations such as PCAM or CCAM?

*i. Cooperation: How coopera-tive are you in working with the lending officer? Does the loan officer feel comfortable with the relationship? * = Key points

When selecting a financial institu-tion for a loan, your association should follow the same process as they would for any other type of business partner the association is considering. The board should set up meetings with the local financial institutions and dis-cuss their options. A loan is a major decision for your community and you need to make sure that the board and its members understand the terms and conditions.

Cyndi Koester is the AVP, Southern California Region-al Account Executive for Mutual of Omaha Bank/

CondoCerts. You can reach Cyndi at [email protected] or (866) 800-4656, extension 7494.

Scan our qr code and send your question now!

Coffee Talk

Business Partners, Board Members, Homeowners, Managers – do you have questions about community associations? Draft your questions and submit them to the Quorum and we’ll get the answers from industry professionals. Simply complete a survey form when attending one of the monthly CAI programs, or email questions to [email protected].

Thank you to our CAI-Cv members who shared some insightful and thoughtful answers. This month’s question comes from the Coffee Talk staff.

QUESTION FOR A MANAGER

FROM A HOMEOWNER: When I was first in the business, I got a call from a homeowner to please cut down the tree outside her dining room window. So I sent the landscapers out there to remove the tree. Fortunately the owner was home. I received a fran-tic call yelling at me to STOP THEM! She wanted the tree trimmed, not removed. People ought to listen to what they’re saying. Cut it down, indeed!

Story Submitted by Sharron Badham, CCAM, PCAM, Hideaway Owners Association, Desert Resort Management

FROM A NEW OWNER IN A PLANNED COMMUNITY: “Does the Association pay for water, and if so, do they pay for the cold water AND the hot water?”

AN OWNER AT A HEARING REGARD-ING HIS UNLEASHED PET: The Board explained that pets must be leashed and droppings must always be picked up, to which the owner replied indignantly, “My dog doesn’t poop!” The newest Board member, an elderly

lady, tipped her glasses to the end of her nose, looked the owner squarely

in the eye, and asked, “How on earth do you prevent it?”

What amusing things have you encountered while serving in the CID industry?

CALL FROM AN OWNER IN A RETIREMENT COMMUNITY: Mrs. S explained that their dirty garage was packed with junk and they could not open the garage door. Nagging her husband to clean it had been unsuc-cessful, and she asked me, as the property manager, to send a violation letter to their home, requiring that the garage be cleaned out. The letter was sent and one month later, a grate-ful Mrs. S called to say thank you.

CALL FROM A BOARD MEMBER: On a miserably rainy day when the only calls I received were about leaking roofs, a Board member called; “Please send the handyman here right away, and promise not to laugh when I tell you why.” When I promised, he continued, “We buy green bananas by the bunch, then hang them on the water heater to ripen. This morning they fell behind the water heater and I can’t get them out.” When I called the handyman, we all had a good laugh!

Stories Submitted by Joy Simcic, Lindsay Management Services

We all have such funny stories to share, so let us know YOUR funny stories!

HOMeOWNerS ASSOCIATION LAW

It’s April in the Coachella Valley, which can only mean one thing: the arrival of the Coachella and Stage-coach music festivals. These events, both venued at the Empire Polo Club in Indio, will f lood desert communi-ties for three out of the four weekends in April (with the revelry sure to bleed into the weeks between). And while the concerts are sure to bring with them an increase in noise and traffic, there are ways communities can plan for the onslaught.

First, association boards should carefully review, together with legal counsel and management, their community’s governing documents. Specifically, boards should pay par-ticular attention to provisions regard-ing short-term rentals, nuisance, quiet enjoyment, and parking, as these subjects typically generate the most complaints during music festival sea-son. Boards may also wish to dispatch several directors, and, if applicable, homeowner committee members, to be on guard for, and document, viola-tions during the festival weekends.

According to manager Iyad Khoury, MBA, CMCA of Avail Property Man-agement, communication to home-owners is crucial to ensure a com-munity is well-prepared for Coachella and Stagecoach. Khoury recommends that associations send multiple letters to homeowners prior to the events to remind them of the applicable provi-sions of the governing documents regarding short-term rentals, quiet enjoyment, and parking, among other subjects.

“The Board and management should emphasize that each owner is responsible for their guests’ behavior, and should recommend to all owners that guests read the association’s rules and regulations,” he says.

If short-term rentals are not per-mitted in a community, the board of directors may wish to provide secu-rity with a roster of registered owners and tenants to aid in the screening process. If short-term rentals are found to have occurred in violation of the community’s CC&Rs, a due process hearing should be held with the responsible homeowner to dis-cuss the violation and, if applicable, impose disciplinary action to bring the property into compliance with the governing documents. Boards should also consider “tuning up” fine sched-ules to create economic disincentives for owners considering short-term rentals.

With a little planning, associations may be able to avoid incidents like one that occurred during last year’s festivities at a community Khoury manages.

“We had reports of intoxicated people jumping from the rooftops into the pools at 2 a.m.,” he said. “We had reports of tents being erected in back-yards to sleep more people. Drive-ways were turned into campgrounds, [and] security patrols reported people attempting to disassemble the arms on gate operators to push the gates open.”

To that end, community manager Dayton Dickey, CCM, of Personalized

Property Management, recommends that associations increase security patrols within their communities from the Thursday evening prior to each weekend until the following Monday morning. If communities are gated, the association may employ round-the-clock guards to screen visitors and watch for suspicious activity.

If homeowners decide to flee the desert during festival weekends, they should take appropriate precautions. Specifically, owners should be warned against leaving valued items of per-sonal property in yards or on patios, as they may be taken or defaced. Own-ers should also ensure all exterior lights are in good working order, and all vehicles should remain locked and parked in garages or in driveways.

While these festivals bring business and entertainment opportunities to the area, they also bring some nega-tive side effects that can be mitigated by associations and their boards via some pre-planning and consultation with management and other profes-sionals.

Jeffrey A. French is a partner at Green Bryant & French, LLP, in San Diego and Palm Desert. He can be reached at

(619) 239-7900, extension 118, or by email at [email protected].

Holly L. Amaya is an associate with Green Bryant & French, LLP, in San Diego and Palm Desert. She can

be reached at (619) 239-7900, extension 114, or by email at [email protected].

The Festivals Are Coming!The Festivals Are Coming!

By Jeffrey A. French, Esq., and Holly L. Amaya, Esq., Green Bryant & French, LLP

preparing Your HOA For Coachella and Stagecoach


COFFee TALk

Or is it?


FeATure

Paint is Paint.

I have heard all too often that “paint is paint.” This statement is very far from the truth. A lot of time and money goes into making a quality exterior paint. So what makes the difference? There is a quick rule of thumb that can be used to compare exterior paint to determine the quality of the product. This rule of thumb can be universally applied throughout the paint indus-try and is supported by Rohm and Haas, one of the largest manufactur-ers of paint resins and ingredients for the paint manufacturing industry, through their Paint Quality Institute. Here are some of the key elements that separate “quality paint,” from well, just “paint.”

Volume Solids: In laymen’s terms this is the actual part of paint that is left on the substrate after it is applied and dries. There are many ingredi-ents that go into a bucket of paint that interact together to give the paint hide, brushability, adhesion, flow, color retention, scrubbability, etc. After the liquids have evaporated out, what is left on the surface are the sol-ids which form the paint film. Simply put, the higher the volume solids, the higher quality the paint. A premium quality exterior paint will contain between 38% to 42% volume solids.

The higher the volume of solids (which are the more costly ingredients in paint) the higher priced the paint is. More solids allow the paint to cover

better because it dries to a thicker film which contributes to increasing the life of the paint job. Even though higher volume solids paint costs more initially it can be less expensive to use because the hide is better and the amount of square footage that can be covered is greater than a lower volume solids paint that has a less expensive price tag. Better hide cuts down on multiple coats to achieve solid coverage, and labor is reduced to apply less of the product.

Resin or Binder: The gold stan-dard for exterior paint is 100% acrylic resin. There are other resins that are found in exterior paint (vinyl-acrylic, modified acrylic, etc.) but they are less expensive versions of 100% acrylic and do not have the overall characteristics that make 100% acrylic the gold standard. The 100% acrylic resin has superior color retention, adhesion, resistance to blistering, cracking and scrubbing and promotes better flow, leveling and film build.

The key comparison standard to look for or ask about is, “what is the amount or percentage of 100% acrylic resin contained in a gallon of paint?” Unfortunately, a manufacturer can state that their product contains 100% acrylic resin but the real question is how much? The less the volume solids in a paint, the less the 100% acrylic resin that paint will contain.

As in most cases…more is better. Pigments: This is the ingredient

in paint that provides color and hid-ing power. The best known and most expensive pigment is TiO2 (Titanium Dioxide) which provides paint with exceptional whiteness and hiding power.

In summation, when you are look-ing for a quality paint look for the above key points which should be in the manufacturer’s Product Informa-tion Sheets contained on their web site. If this information is not avail-able then you need to question why the manufacturer does not have this valuable information available to its customers. That answer might be found in the fact that almost all paint manufacturer’s purchase their resins and raw materials from a handful of companies such as Rohm and Haas or Dupont, so no one manufacturer can really boast, and be truthful about it, that they have a product that is so superior that it will outlast the compe-tition by years and years. The key dif-ferences are the quality of ingredients and the quantity of quality ingredients found in the paint. Many manufac-turers overprice their products with the idea that the naïve buying public will equate a high price with a quality product which is not necessarily true. Exterior painting it is a very big invest-ment and is something you have to live with for some years and should be taken seriously. So compare products and do your homework to get the most premium product for the most com-petitive price, and please remember that the old saying “paint is paint” is not always true.

Gina Roldan is a Property Services Representative with Vista Paint. They offer quality, affordable, earth-

friendly coatings. Gina can be reached at (951) 454-2500 or by email at [email protected].

By Gina Roldan, Vista Paint

What Makes a quality exterior paint

FrONDSOne of the chores we all dread most is annual Palm Tree Trimming. The mess, the noisy chainsaws, and sched-uling can be a hassle. The first thing you can do to make this process go more smoothly is plan in advance. You should start your scheduling as early as your business partner will put you on the schedule and that means now. There are just too many Palms to trim in the small window that is considered palm tree trimming season. Here is the best time to trim each particular type of palm to make sure you abate fruit development.

Date Palms depending on the weather can be trimmed as early as May. Target your Date Palms for May but if we have a cold spring your palm tree trimming contractor might tell you they are not ready yet. It is suggested that you still get on the schedule. Date Palms trimmed late in the summer when you have mature dates can be a nightmare to deal with. When the pods are cut and the dates fall they can stain hard-scape and the dump fees due to the weight of the debris is very costly.

Washingtonia robusta (thin trunk Mexican Fan Palm) should be tar-geted to trim in June to abate fruit development.

Washingtonia filifera (fat trunk Cali-fornia Fan Palm) produce fruit later than the Washingtonia robusta so should be done separately, usually in July. This can be a little tricky as there are hybrids that can be confused for one or the other. The key is once the palms have fully developed pods and they have begun to flower these palms are ready to trim and the chance of having to go back because they were not ready yet is slim. Again an expe-rienced Palm Tree Trimmer can take away the guess work for you.

Things to look for in selecting a Palm Tree Trimming Contractor are a C-27 Contractors License and the Certified Arborist credential which means they are a student of the busi-ness and have passed an extensive test of their knowledge of trees. The test is given by the International Society of Arboriculture.

FLOWerSSummer Flower Planting: another chore that the earlier you select what you want to plant and order the mate-rial the better off you are. The real-ity is there is no perfect flower that will withstand our summer heat 100 percent of the time. My best recom-mendation based on trial and error planting and maintaining several varieties of flowers over the last 20+ years is to plant a mix rather than one or two types of summer flowers. The reason this seems to work better is the fact that no matter what you do, you are going to have some die when you have potential day time temperatures that can exceed 120 degrees. When you plant a mix with different colors and growth characteristics, in most cases if you have a couple die usually some-thing else will fill in and you have les flowers to replace. Here is a mix that we have had good luck with: Celosia, Zinnia, Salvia, Melampodium, Vinca, and Dianthus. Lastly, a rich organic mulch and proper irrigation will help to insure the best results.

Jay Powell is the Director of Sales and Marketing for PWLC II, Inc., a land care management company

located in Palm Springs. You can reach Jay at (760) 323-9341 or by email at [email protected].

By Jay Powell, PWLC II, Inc.

Tips to Make palm Tree Trimming and Summer Flower planting easy

Fronds & Flowers


FeATure

&ATTORNEYS AT LAW

PETERS FREEDMAN, L.L.P.

A FULL SERVICE LAW FIRM Experience you can rely on People you can trust

encinitas offi ce desert offi ce 760 436 3441 760 773 4463

www.hoalaw.com • [email protected]

74-040 Highway 111, Suite L200Palm Desert, California 92260www.ConserveLandCare.com

760-343-1433Lic. # 958748

Technologically Advanced Water Management

Practices

Environmentally Friendly Landscape Management

Programs

Water EfficientLandscape Conversions

Design & Installation

Water Audits & Cost Effective Solutions For Tiered Water Rates

It’s the Year of the Dragon

- CAI-CV 2012 Casino Night -

Quorum April, 2012 www.CoachellaValleyCAI.org 3938

CHApTer eveNTSCHApTer eveNTS

Casino Committee

Texas Hold’em Winners

The 2012 “Year of the Dragon” Casino Night held on February 24th at Palm Valley Coun-try Club was a resounding success. Nearly 170 members and guests of the CAI Coachella Valley Chapter attended the event ready to have a great evening of dining, gaming, and social-izing. Music certainly helps create the overall atmosphere and our DJ, Chris Henson of Chris Henson Productions, kept the night lively and fun with popular music from the past three decades.

The Palm Valley Country Club staff helped to keep the night running smoothly. From the bartenders and servers to the catering staff to the valet attendants, I’m sure we all can agree that the service was superior. The catering staff put together quite a delicious spread of food, which included chicken lettuce wraps, spring rolls, duck dumplings and chicken, beef and pork satay.

Throughout the night, you heard overjoyed shouts from the players at Roulette, Craps and Blackjack tables. Casino Del Sol’s dealers knew when to help new players and challenge the experts, which made for an exciting night of gaming for everyone.

The Texas Hold’em Tournament started at 7:15 p.m. with over 35 contenders competing for either the $250 second place prize or the $500 first place prize. It turned out to be another nail biter! The final two players battled it out admirably, but it was Ron Winkle of Western Pacific Roofing who had the final winning hand against runner-up Ray Giraud, guest of Sunshine Landscape. Congratulations to both of you! Another winner from the tournament was Art Milward, husband of Nena Rutherford-Milward from Associa/Desert Resort Manage-ment, who won the Texas Hold’em Bounty prize provided by Pacific Western Bank.

The night wound down with some fabulous raffle prize drawings. Thanks to our raffle prize sponsors, we had over 20 prizes to give away! The table was filled with gift cards, gift baskets, bottles of different spirits and other great prizes. The Grand Jackpot prize, a Sam-sung Galaxy Tablet provided by Terminix, Palm Springs, was won by Erica Gilly of The Lakes Country Club. Of the proceeds from Casino Night, $200 was donated to the Educa-tion/Scholarship Fund and $155 was donated to CLAC.

Leslee Williams, AMS, CMCA, CCAM, The Management Trust, Monarch Management Division


WATer WISe


CHApTer eveNTS

to massive levels of chromium-6 (above 20,000 parts per billion) during their lifetime showed an increased risk of developing cancer. Results of rodent studies are com-bined with uncertainty factors and default assumptions to perform the public health goal calculation when results of human health studies are not used. While this calculated “no risk” level serves as a goal, it may not be feasible to achieve due to technical or economic reasons.

A public health goal is not a regulatory standard nor is it a boundary line that defines a “safe” level of a contami-nant. Instead, the purpose of the goal is to provide scien-tific guidance to regulators to develop a drinking water standard. Technical and economic feasibility must be taken into account in setting the standard, a process that is expected to take two to four years for chromium-6.

Recent research has been published that calls into ques-tion some of the assumptions used to calculate the Cali-fornia public health goal for chromium-6. This continuing research is part of a process used by the state to raise and lower public health goals when new information support-ing a change is produced. The Environmental Protec-tion Agency has announced it will consider this new and pending research before completing its risk assessment of chromium-6 in 2014. It is important for officials involved in determining public health goals and drinking water stan-dards to consider new information when it becomes avail-able to ensure the best science available is used to weigh any potential harm from ingesting minute levels of chro-mium-6 against the need for ratepayers to fund expensive new treatment technologies.

The new research supports a finding that only very high levels of chromium-6 in drinking water – over one thou-sand times above the levels found in the Coachella Valley

– will cause cancer. It’s a bit like going out in the sun. We know that too much exposure to the sun can cause cancer but that doesn’t mean that going out in the sun one time will cause a little bit of cancer. It takes exceeding a thresh-old, a certain level of exposure, for damage to occur.

Residents can be proud to know CVWD is a national leader in efforts to identify and test technologies to remove chromium-6 from drinking water. These technologies are new and currently only being used in California. This research will help state regulators evaluate the costs and benefits of establishing what would be the first chro-mium-6 drinking water standard in the US.

CVWD has developed a research project proposal and has requested matching funds from the Water Research Foundation to complete research to identify and evaluate chromium-6 removal technologies that would be effective for representative water quality conditions throughout the Coachella Valley. This research project is expected to take two years to complete and would provide important infor-mation that will be needed if the state establishes a new drinking water standard for chromium-6.

If California regulators act to further control chromium levels in drinking water, CVWD is taking steps now to be prepared to comply with the new standard.

Steve Bigley is the Environmental Services Man-ager for the Coachella Valley Water District. He serves on chromium workgroups nationally for the American Water Works Association and the Water

Research Foundation and he is the Vice-Chair of the Associa-tion of California Water Agencies’ Safe Drinking Water Subcommittee. You can contact him at [email protected] or (760) 398-2651.

Safe Drinking Water is Everyone’s Priority

You may have heard about the issue of chromium-6 in groundwater. Recent media reports about the topic have generated some questions and discussion.

The reason this topic is in the news is that the state of California recently established a public health goal for chromium-6 of 0.02 parts per billion. The public health goal represents the level of a contaminant in drinking water below which there is no known or expected risk to health. The public health goal for chromium-6 is the “one in a million” risk level calcu-lated from studies that found only rodents exposed

This event could not have taken place without the dedication and generosity of our wonderful sponsors:

• ChipSponsor: Sunshine Landscape

• CardSponsor: Verizon Enhanced Communities

• GrandJackpotSponsor: Terminix, Palm Springs

• PitBossSponsor: Pro Landscaping, Inc.

• BlackjackTableSponsors: AMS Paving, Inc., Asphalt, MD’s, Epsten Grinnell & Howell, Leon’s Landscaping & Tree Services, Inc., LPC Landscape & Irrigation Management, O’Connell Landscape Maintenance, Rotolite, Inc., Universal Protection Service

• RouletteTableSponsor: Western Pacific Roofing

• CrapsTableSponsor: Flood Response

• TexasHold’emTableSponsors: Green Bryant & French, LLP, Pacific Western Bank, Peters & Freedman, LLP, Seacoast Commerce Bank, Time Warner Cable

• TexasHold’emBountySponsor: Pacific Western Bank

• ValetSponsors: Nelson Paving & Sealing, Western Pacific Roofing

• EntertainmentSponsors: Fiore Racobs & Powers, Pinnacle Landscape, Rey Insurance Services, Sherwin-Williams

• FoodSponsors: Fenceworks, Inc., LaBarre/Oksnee Insurance, Patrol Masters, Powerful Pest Management

Our committee was privileged with two wonderful co-chairs, Jeff Grady of Sign-A-Rama and Gloria Kirkwood of Palm Valley HOA/Associa/Desert Resort Management. Both of you led us through the planning of a wonderful event that set the bar very high for next year. It’s definitely going to be a tough act to follow! To the Casino Night Com-mittee members: Gerard Gonzales of Albert Management Inc, Sue Anderson of Universal Protection Service, Micha Ballesteros of Flood Response, Jamie Saldivar of Desert Resort Management, Tad Black of Gothic Grounds Man-agement, Louise Stettler of Epsten Grinnell & Howell and Lori Fahnestock of Powerful Pest Management, thank you for all of the time and energy you dedicated this year. Everyone on the committee was vital to making sure that this event was a success and we can’t thank you enough for all that you did to make the night a true success. .

Leslee Williams, AMS, CMCA, CCAM, is with Monarch Management Group, A Division of the Management Trust. You can reach her at (760) 776-5100 or at

[email protected].

Here are some key facts to know:

• Chromium-6occursnaturallyinCoachellaValleygroundwater sources.

• CoachellaValleyWaterDistrict(CVWD)hasbeen testing for and reporting to domestic water customers the level of chromium-6 in drinking water since the year 2000.

• AlldomesticwaterdeliveredbyCVWDmeetsstate and federal drinking water standards established to ensure your water is safe to drink.

• California’sdrinkingwaterstandardforallformsof chromium, including chromium-6, is already twice as protective as the national standard used by EPA. Drinking water provided by all the Coachella Valley water agencies is in compliance with this more stringent standard.

The Chromium-6 Groundwater Concerns in the Coachella ValleyBy Steve Bigley, Coachella Valley Water District

All domestic water delivered by Coachella Valley Water District to

domestic water customers meets state and federal

drinking water standards established to ensure your

water is safe to drink.


CHApTer NeWS


TeCHNOLOgY TODAY

Congratulations to Nena Rutherford-Milward with Associa/Desert Resort Management for participating in the 30,000 & Counting Membership drive. Nena was awarded 4 months of Free Membership for recruiting 6 new members from CAI National for her effort. A total of 556 CAI members recruited gaining 1,147 new members for CAI.

Brandi Scott, also with Associa/Desert Resort Manage-ment, delivered a beautiful baby boy on February 8th. Dominic weighed in at 6 lbs, 9 ounces, and was 19 inches long with blond hair. Dominic will be well looked after with Big Sister Bella around. Congratulations to the Scott family.

ATTENTION BUSINESS PARTNERS - Have you ever considered wanting to become more educated through CAI and wondered why there wasn’t such an avenue? CAI National has listened and delivered on just that. There is now a Business Partners Essentials class you can take on line and distinguish yourself as an Educated Business

By Wendy Van Messel, CAI-CV

Have You Heard?April 2012

revCO SOLAr eNgINeerINg INC.

pATrICIA MOeLLer, CCAM

In 2011, REVCO celebrated its 35th anniversary in business.

As a regional leader in the commercial and residential marketplace, REVCO Solar Engineering, Inc. has installed over 500 solar electricity systems and more than 9,500 solar swimming pool heating systems. They have earned an A+ rating from the Better Business Bureau.

Members of REVCO’s professional sales, design, engineering and installation teams have experience working on a wide variety of state-of-the-art solar projects including: HOA Communities, Long Beach Airport, McDonald’s, Pomona College, U.S. National Park Service – Yosemite, The LDS Church, Cal Trans, Lamar Outdoor Advertising and many others.

REVCO Solar Engineering’s Palm Desert office is well positioned to serve the renewable energy needs of the Coachella Valley and the Greater Inland Empire.

To contact Dave Mourhess, General Manager, call (760) 619-9296, email to [email protected] or visit him at 73-802 Dinah Shore Drive, Palm Desert, CA, 92211.

Patricia Moeller is a new member of CAI and has worked for Gold Coast Enterprises since November 2005. She was certified by CACM in June 2009. Patricia writes “I am 35 years old and have been married to my wonderful husband James for 15 years. We have 4 beautiful children, step-daughter Jessica 24, daughter Kirstian 18, daughter Elizabeth 14 and son Joshua 12. I also have a beautiful granddaughter, Raina 7 years old.” She loves hiking, camping, going to the beach, playing board games and puzzles. She continues, “I knew from my first day at Gold Coast, that Property Management was my new career choice. I really love my job, meeting new people and love being a property manager.”

Shelly Ruegsegger, CMCA, Personalized Property Management. Shelly can be reached by calling (760) 325-9500 or via email at [email protected]

I am sure in this confusing world of Internet there are many questions in regards to cyber liability. Below are some common questions and answers that may help managers and board members better understand the coverage.

QUESTION: What happens to an association if the members have their identity stolen from the association’s computer?

ANSWER: Cyber Liability coverage with pay for all noti-fication expenses including credit monitoring expenses for the member. Some carriers are offering up to 12 months of credit monitoring for their insureds, such as homeowner’s association. Customer notification expenses include legal expenses, postage and advertising costs as well as the credit monitoring.

QUESTION: What happens if one of the association’s employees should accidently distribute personal informa-tion regarding the association’s members, such as driver’s license number, social security number, birthdates, etc. Is this covered by cyber liability?

ANSWER: Yes and the same coverages will apply as listed above.

QUESTION: Will the insurance pay for reasonable and necessary sums required to recover and/or replace data that is compromised, damaged, lost, erased or corrupted?

ANSWER: Yes.

QUESTION: Does the coverage apply to cyber extortion?

ANSWERS: Yes, it will pay extortion expenses and extortion monies as a direct result of a credible cyber extor-tion threat.

By Carol A. Fulton, CIRMS, LaBarre/Oksnee Insurance Agency

Cyber Liability includes coverage for both online and offline information, virus attacks and denial of service. It will also extend coverage for defense costs and fines/penal-ties for violations of privacy regulations including but no limited to Red Flag rules and new Hi-Tech Act. It will also include multimedia insurance which is coverage for both online and offline media. It includes claims alleging copy-right/trademark infringement, libel/slander, advertising, false advertising, plagiarism and personal injury.

Cyber liability additionally includes coverage for cyber terrorism. It will also pay extortion expenses and extor-tion monies as a direct result of a credible cyber extortion threat. Cyber liability offers worldwide coverage.

There is also Network Asset Protection which includes coverage for all reasonable and necessary sums required to recover and/or replace data that is comprised, damaged, lost, erased or corrupted. Coverage also includes business interruption and extra expense coverage for income loss as a result of the total or partial interruption of the insured’s computer system.

Recently in the New York Times, there ran an article sharing about the challenges Sony is facing for losses related to data breaches earlier this year. At last count they had found that 100 million customer accounts had been compromised. They also anticipate the debt would cost up to $200 million. There are currently 58 class action law-suits in the works and more potentially to come. Now for the really bad news: Sony’s losses are not insured. They did not have a Cyber Liability Policy.

Now is the time to make sure you are protected. Talk with your insurance agency today to find out what coverage may help protect you and your associations from the grow-ing cyber threats.

Carol A. Fulton, CIRMS with Labarre/Oksnee Insurance Agency. You can reach her at (760) 346-7251 or by email at [email protected].

Partner. This is a brand new program and thus far only 14 Business Partner members have jumped on the opportu-nity including 3 of our CAI-CV members. Congratulations to Micha Ballesteros with Flood Response, Amanda Gray with Securitas Security Services USA, Inc., Tina Palacios with Roy Palacios Insurance Agency and Cat Coltrell with First Associations Bank for becoming the first CAI Educated Business Partners.

Have you seen the Membership Directory on the website yet? After working and reworking, the membership direc-tory is up and running. Business Partner information is available without member login, however members will need to log in to view Association Manager or Homeowner information. If you need assistance or you need to edit your information, please contact the chapter office or email [email protected].

Wendy Van Messel is the Chapter Executive Director for the CAI Coachella Valley chapter. If you have an item for Have You Heard, you can reach Wendy at: [email protected].

The office number is (760) 341-0559.

Welcome AboArd By Shelly Ruegsegger, CMCA, Personalized Property Management

Cyber Liability What Does It Really Cover?

ACCountAnts & BooKKeepers

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AMS pAVIng .............................................................................. 31ASphAlt MD’S .......................................................................... 13ben’S ASphAlt ........................................................................... 3nelSon pAVIng & SeAlIng ................................................... 34

Attorneys

epSten grInnell howell ................................................... 20FIore rACobS & powerS ...................................................... 31green bryAnt & FrenCh, llp................................................ 4gurAlnICK & gIllIlAnD ........................................................ 15lAw oFFICe oF peggy reDMon .......................................... 46peterS & FreeDMAn, llp ...................................................... 37

BAnKs

MutuAl oF oMAhA ................................................................ 47pACIFIC weStern bAnK ........................................................... 2SeACoASt CoMMerCe bAnK................................................ 46

ConCrete

grAnIte ConStruCtIon CoMpAny ................................... 15

eleCtriC & wAter

CoAChellA VAlley wAter DIStrICt .................................... 3

insurAnCe

lAbArre/oKSnee InSurAnCe .............................................. 47tIMothy ClIne InSurAnCe .................................................... 3

lAKe mAnAgement

DIVerSIFIeD wAterSCApeS .................................................... 15

lAndsCAping

ConSerVe lAnDCAre ............................................................ 37hIgh teCh IrrIgAtIon, InC. ................................................. 46KIrKpAtrICK lAnDSCApIng SerVICeS, InC. .......................... 6o'Connell lAnDSCApe MAIntenAnCe .............................. 3SunShIne lAnDSCApe ........................................................... 15

mAnAgement CompAnies

DeSert MAnAgeMent ........................................................... 31ASSoCIA/DeSert reSort MAnAgeMent ........................... 20

pest mAnAgement

powerFul peSt MAnAgeMent ............................................. 6

outdoor furniture

pAtIo FurnIture DoCtorS, InC. ........................................ 46

pool plAstering

the leAK DeteCtorS ............................................................. 23

pool deCK resurfACing

CtI oF the DeSert .................................................................. 20

roofing

relIAble rooFIng.................................................................. 46weStern pACIFIC rooFIng .................................................... 6

seCurity

AllIeD bArton ........................................................................ 23SeCurItAS SeCurIty SerVICeS uSA, InC. ............................ 13

CAI-CV Chapter New & Renewing Membersnew Business pArtners

desert welComeMr. Greg Jones (760)413-7747

diversified roofing serviCes, inC.Mr. Bill Fitzgerald (760)407-9639 [email protected]

eColAB pest eliminAtionMr. Eric Nathanial Skelton (760)272-5788 [email protected]

pro lAndsCAping, inC.Mr. Jesse Escamilla (760)343-0162 [email protected]

new mAnAger memBership

mrs. syntheA hill(760)567-8707 [email protected]

mr. gAry whitAKer(760)564-0148 [email protected]

AssoCiA/desert resort mAnAgementMr. Terry Kramer (760)772-2092 [email protected]

new volunteer leAder

Country CluB estAtes homeownersMrs. Nancy Denholm (760)770-3767 [email protected]

Mr. Louis Kremnitzer (760)321-8546

Mrs. Carrol Magder (760)883-1610 [email protected]

Mrs. Gayle Wolff (760)324-4441 [email protected]

CHApTer NeWS ADverTISer INDex

lvC mAster AssoCiAtionMrs. Marylyn Sherman [email protected]

vistA del JACinto homeowners AssoCiAtionMs. Karen Proksel (760)774-4294 [email protected]

renewing Business pArtners

AlAnte/mCs insurAnCe serviCesMr. Stephen Grane

AmsMs. Gina Morrelli

AnimAl pest mAnAgement serviCes, inC.Mr. Dan Fox

AssoCiAtions insurAnCe AgenCy, inC.Ms. Terri Guest

del mAr pACifiC generAl ContrACtorsMr. E. Todd Parnell

desert properties light mAintenAnCeMr. Mark Stewart

mutuAl of omAhA BAnK - Community AssoCiAtion BAnKing & CondoCertsMs. Cyndi Koester, CMCA, AMS, PCAM

nelson pAving/goldstAr AsphAltMs. Rhonda Reed

o’linn seCurity, inC.Ms. Kimberly O’Linn

pAtio furniture doCtorsMs. Sharon Richardson

pAul dAvis restorAtion And remodelingMr. Scott Johnson

rotolite, inC.Mr. Mark Soblom

seCuritAs seCurity serviCes usA, inC.Ms. Amanda Gray

steven g. segAl insurAnCe

AgenCy, inC., fArmers insurAnCe groupMr. Steven G. Segal

tinnelly lAw groupMr. Richard A. Tinnelly, Esq.

vAlleyCrest lAndsCApe mAintenAnCeMr. Charles Buddemeyer

vintAge AssoCiAtesMs. Fran Mullahy

mAnAger memBership

desert resort mAnAgementMs. Jacqueline White

monArCh mAnAgement group A division of the mAnAgement trustMr. Charles Walters-Clark Mr. Jerry McDonald, AMS, PCAM Mr. Rick Rapp

monterey Country CluB AssoCiAtionMr. Jon Wilson

personAlized property mAnAgement Co.Mr. Steven Shuey, PCAM

the springs Community AssoCiAtionMs. Kelly Robertson, CMCA, AMS

volunteer leAder

CAthedrAl springs homeowners AssoCiAtionMr. Dave Carter Mr. Sam Hinds Mr. Bill Reith

desert willows property owners AssoCiAtionMr. Dan Hearn Ms. Joy Hicks Ms. Donna Kubiak Mr. Edward Swenson

pAlm springs golf & tennis CluBMr. Jeff Freise Mr. Andrew Johnson

ADverTISINg INFOrMATIONCAI-CV Chapter Executive Director,

Wendy Van MesselE-mail: [email protected]

Phone: (760) 341-0559

so muCh informAtion

I am intimidated by vivid real-time images of the force of massive waves of water. Technology has provided the unprecedented ability to feel every nuance. These, and other visuals, have almost a science fiction quality that both desensitizes and distances us from emotion. One thing certain is that “information” will have an effect.

An optimist might pronounce that most “survivors” (what exactly a survivor is is rarely defined) will eventually escape their pit. Many will actually live happier, more fulfilling lives. Survival of the fittest. This viewpoint validates Nietzsche’s commentary, “What does not kill me, makes me stronger.” Shakespeare might even chime in: “Sweet are the uses of adversity, which like the toad, ugly and venomous, wears yet a precious jewel in his head.”

The reality is that no estimation of “effect” is true for everyone, especially for our young in age and heart, who are necessarily forced to absorb “information” within their then current capacity. I cannot help observe that this generation receives an enormous amount of unmatched and unfiltered information. Information forces! The “force” is thoughts, decisions, opinions, and even shutting down.


Seacoast Commerce Bank offers a full range of comprehensive banking and financial services for Homeowner Associations and property management companies.

Seacoast Commerce Bank provides our Property Management and Homeowner Association clients the ability to maximize their use of bank services. We understand the unique Banking needs of our Property Management and Association clients, providing industry specific products and customer service that you have grown to expect and deserve.

Property Management Banking

Ken CarteronSenior Vice PresidentProperty ManagementBanking Division760-803-9541 Mobile760-301-0046 [email protected]

ProPerty management BanKIng solutIons•Depository

Services

•Cash Management

•Remote Deposit Capture

•Lockbox Services

•ACH Origination

•HOA Financing

•Online Dues Program

allIson dIsarroAssistant Vice PresidentProperty ManagementBanking Division619-988-6708 Mobile619-476-7770 [email protected]

700 La Terraza Blvd, Suite 110, Escondido, CA 92025

Patio Furniture Doctors Inc.“REFINISHING SPECIALISTS”

We can create a new look with your existingpatio furniture for about 1/2 the cost of new!

We are your only locally owned and operated state of the artrefinishing factory in the Coachella Valley for over 25 years.

Please call me any time for your free on-site furnitureassessment. I am always in your neighborhood.

Owner/Operator Bill Richardson

BEST PRICES, QUALITY & SERVICEWe can meet or beat any professionally written quote.

(760) 328-8999

go the extra mile for your clients become a cai educated business partner

You go the extra mile for your business. Show your community association clients you’re willing to go the extra mile for them, too.

The new Educated Business Partner distinction recognizes active CAI Business Partner members who have successfully completed Business Partner Essentials, an online course

developed by CAI to help product and service providers better understand the issues and challenges faced by their

association clients.

Take the course, pass the test, be affiliated with an active CAI Business Partner member, and you’ll earn the CAI Educated Business Partner distinction. As an added benefit, you’ll be listed on the CAI website, where clients can see your commitment to service.

Visit www.caionline.org/bpcourse, e-mail [email protected] or call (888) 224-4321 to learn more.


essentials (Board Boot Camp) when: April 12th, Registration 8:15 a.m. where: Palm Valley Country Club, Palm Desert

April monthly Breakfast program topiC: FHA - Where Are We Now? when: April 13th, Registration 7:30 a.m. where: Palm Valley Country Club, Palm Desert

2012 spring golf tournament when: April 27th, Registration 7:00 a.m. where: Indian Canyons Golf Resort, Palm Springs

Ap

ril

mA

y may monthly lunCh program topiC: Indian Land Leases: Is Time Running Out on Your Land? when: May 11th, Registration 11:30 a.m. where: Palm Valley Country Club, Palm Desert

CAi national Annual Conference & exposition when: May 2nd – 5th where: Las Vegas, Nevada

m-100 Class when: May 17th – 19th where: Residence Inn Marriott, Palm Desert

CAI - CV upCoMIng eVentS

prOFeSSIONAL MANAgeMeNT DeveLOpMeNT prOgrAM

running meetings, managing finances, developing rules, filing insurance claims, communicating with homeowners...Need a little help? This course offers a practical overview of critical association issues. You’ll receive a 300-page participant guide filled with dozens of sample forms and time-saving tips for working with homeowners, suppliers, managers and other professionals.

m-100The Essentials of Community Association Management | CALIFORNIA VERSION

oFFICIAl 2012 pMDp SponSorSAlliance Association Financial Services

Association Voice

Sky Security Services

FOr COurSe DATeS LOCATIONS AND DeSCrIpTIONS CALL CAI MeMBer ServICeS AT (888) 224-4321 Or vISIT WWW.CAIONLINe.Org/pMDp.

spACe is limited— reserve your plACe now!

May 17th, 18th, & 19th

residence Inn Marriott, 38305 Cook Street, palm Desert, CA 92211, (760) 776-0050

CAI room rate:$109 Studio Suite - expires: April 13, 2012

Don’t wait—register online four weeks ahead and receive a $25 discount!

Join CAI! There are many benefits to being a part of our chapter, including a free copy of the Quorum! Call (760) 341-0559 today!

41-905 Boardwalk, A.2Palm Desert, CA 92211

preSOrT STDu.S. pOSTAge

pAIDSAN BerNArDINO, CA

perMIT # 2968

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