Well, it’s that time again. We’ve got another Serrano Homeowners Association Board of Directors election looming and it’s again shaping up to be a battle for control, with homeowners vying with the developer for control of their HOA. But it’s coupled with a few extra wrinkles: A small claims court action and a major lawsuit filed in El Dorado County Superior Court.
What’s the significance? Perhaps a brief history can help.
Twenty-some-odd years ago, when Serrano was first conceived, Serrano Associates felt the need to maintain control over the fledgling homeowners association for continuity as those first homes were being sold. And at the time, it made sense.
Fast forward to today, with the bulk of Serrano land having been sold to individual homeowners. Yet, due to the practice of sponsoring and backing selected candidates, the developer has continued to keep an iron grip on that same HOA board with at least one, sometimes two employees, on the board as recently as 2015. Several elections have been decided by the developer throwing large blocks of votes behind select candidates, even though independent candidates had actually won the majority of the homeowner vote.
Result? Developer maintains a controlling majority over the HOA Board of Directors. This situation has been described as a homeowners association being run as a profit center for the developer rather than in the best interests of homeowners themselves.
A few voting cycles ago Dean Getz, an independent homeowner with an eye for detail, was elected to the board, tasked to delve into past and present association policies and practices, looking for ways to improve the way business is conducted. He did precisely what he was “hired” to do. And to say he met with resistance would be an understatement. Other employee and developer-aligned board members worked actively to short-circuit his agenda.
Getz was voted out of office (having won the individual homeowner vote, but swamped by controversial developer block votes) after unearthing the fact that the developer was allegedly voting in HOA elections, utilizing ballots issued to undeveloped lots that were not paying dues as prescribed in our CC&Rs. In addition, he also revealed that, absent any record of action on the part of the sitting board at the time, the developer ceased paying its required assessment “subsidy” sometime toward the end of 2005.
With an average yearly obligation of approximately $800,000, that has added up to a significant amount over the years, thus adding to the dues load carried by homeowners. This missing payment was brought to the attention of the current board in mid-2016 and was added as a line item to the association’s financial reports. The board further instructed First Service Management staff to bill the developer for the corresponding amount and to resume assessments on undeveloped lots going forward. Inexplicably, that billing was never resumed.
Which brings us to the current situation. Having completed his term and seeing no board movement on the issue, Getz felt left with no choice but to file for a legal resolution. A small claims court action was filed, seeking records to clarify the voting eligibility of developer-owned undeveloped lots that have apparently not been paying dues — ostensibly a violation of Serrano’s CC&Rs. A $15.7 million lawsuit was also filed, seeking past payments missed and restoration of the developer-paid yearly assessments moving forward.
While a certain segment of the Serrano population loudly sympathizes with the developer, attempting to paint director Getz as a villain, other homeowners consider him a hero and appreciate his efforts to bring serious issues such as these to light. Their hope is that this upcoming HOA election will herald the end of developer-dominated boards and that a new field of candidates will achieve that end.
Time will tell …
Michael Miro is an El Dorado Hills resident.