What
does the Council do?
For the past decade the primary accomplishments of the Council have
been:
•
Approved spending $4.5 M on a New Center with:
--No architectural plan
--No due diligence on what the current building
status is or what spending is required
--No RFQ/RFP defining the building cost of
whatever a committee (consisting of almost entirely golfers) decides it wants
•
Approved the Universal Amenity Fee 2011
•
Approved spending $4.5 M on South Cove 2008
•
Diluted its financial authority and scope of
responsibility, such as in Paragraph 8.6 which is documented here:
•
Abdicated responsibility for the Golf Committee
and Golf Oversight.
o
Continues to ignore golf costs and the golf
financial drain on community including a 25% reduction in golf membership fees.
• Abdicated
financial responsibility for Restaurant and Center.
• Abdicated
financial responsibility by eliminating quarterly financial report from Finance
and Budget Committee Chair.
o
Neglected its financial oversight of the
community’s financial performance by ignoring the FY 2014 Audit Report failure
to even conform to GAAP.
What are the Council MEMBERS’
Current Responsibilities?
1. Change the community's Declarations and Covenants:
• The most recent example of this resulted in the
Amenity Fee. This could have been accomplished simply by the Board indicating
they needed a 4% incremental operational spending increase to cover its excess
spending.
Instead, the community
got a complicated fee structure reducing golf membership fees by 25% as well as
other golf fees, and increasing costs for others who do not actively use the
amenities. This is clearly an issue that should have been decided by all
community members.
2. Approve a proposed capital expenditure pursuant to
Article VIII 8.6(a) of the Declarations (See below)
3. Consider a proposal to borrow money for any purpose
pursuant to Article VII Section 7.7(g) of the Declarations (See below)
THAT’S IT FOLKS
Some
things the Council does not do:
•
It has no authority on
setting the budget.
•
Outside of approving
phraseology, it has no operational
financial authority or responsibility. Its capital authority is minimal.
•
It does not oversee or
review the activities of any Committees.
•
Since in most cases,
Council reps can vote any way they want, they only represent themselves.
•
Few members demonstrate
any concern regarding the content of Financial Statements.
What the Council Members Prohibit by their existence:
• Consistently
has failed to allow Direct Vote to become an open transparent dialogue amongst
community members and to enable a Council vote authorizing Direct Vote on major
financial expenses.
• It
prevents the ECA members from representing themselves as to what the community
spends on what and why, as well as what checks and balances are provided for ECA
members’ rights.
Furthermore, the Council blocks financial accountability and visibility
as to what and how ECA funds are being expended. Its existence prohibits an
open transparent participation in the financial decision process on the part of
members. Members are simply to pay the bills and much like any group whose basis is authoritarian leadership, accept what they are
told without question. Failure to do independent due diligence yields all power and knowledge control to the authoritarian leaders.
If the Council were eliminated today, would
you notice? To answer this question, Eastmanites need to consider what is
the added value of having a Council to each of us and to the community as a
whole? Some questions that concerned residents might ask themselves are:
1. Is the Council simply an obstacle to empowering
Eastman residents to vote directly on how their community is operated and how
their money is spent?
2. Is the Council just a huge waste of time, which
buffers the Board from having direct accountability to the residents?
The cost of having the Council involves not
just meeting time but all the employee direct costs associated with it--the
costs of more than 20 committees, endless reports and an overwhelming
bureaucratic complex. But how would the community run without it? Pretty
much as it does now is the answer. The only difference would be that the Board
would no longer be able to hide behind the Council and their Committees. The
community would instead hold them directly accountable and perhaps the
community members might decide that the repetitive failure to comply with GAAP
financial reporting requirements and meaningless, unverified financial
statements distributed by the General Manager is unacceptable.
Further, the refusal of the General Manager
to provide specific Center financial history, as documented here
would not be tolerated by his employer. No elected official would be allowed to
call for a capital funding vote without being required to provide a detailed Renovation
Cost List in priority order of required renovations. Here is a
Capital Improvement example:
· A detailed Center Renovation Cost List in priority
order of required renovations categorized as follows:
a. Must do: 0-12 months / Dollars per major item
b. Need to do: 0-12 months/ Dollars per major item
c. Want to do: 0-12 months/ Dollars per major item
d. A similar list created for 12 to 60 months
Voting power in the Council is discriminatory
based on the Special Place you live in. Those on the golf course have 17
representatives as do those in West Cove, which represents 41% of the Council
voting power. The other 14 Special Places have the remaining 59% of the voting
power scattered about in fragments with 5 Special places having 5 (five)
representatives each and the remaining crumbs of representation dabbled about.
Is the ECA Council a sham to ECA members?
Article 7.7
(g) borrow
money by the issuance of secured or unsecured notes…. and (iii) in any other
circumstances with the approval of two-thirds of the members of the Council
present and voting (Revised 09/12/09). (Added 7/11/98).
Article 8.6
The following provisions shall govern the use of monies collected by
assessments …..:
Capital
expenditures (with the exception of existing infrastructure [e.g. roads,
drainage, bridges, etc.], equipment and vehicles, all of which the Board is
authorized to expend and which capital expenditures are not subject to the
limitations set forth herein and below), which exceed the above 2% limitation
but are 25% or less of the budgeted revenues from the combined Operating and
Capital Assessments, shall require approval by a majority of the Council
members present and voting and a majority of the Board (Revised 09/12/09).
Contributed by Bob Logan who is the CEO of a
consulting practice since 1993 which provides expertise on improved business,
financial and operational performance as well as leadership.
