Chronicles
From the MyRSF.net archives of the Email Chronicles
RSFA Election, Auditor Loss and Events
Author: Phil Trubey
Date: May 10, 2024
Hello, Phil Trubey, RSFA Board member here sending an occasional email about RSF.
It's RSFA election season (you should be receiving ballots today through early next week).
A standard, if unsavory, tactic in election campaigns is to allege that the previous administration is incompetent and making mistakes. In last night's town hall, RSFA Board candidate Clotfelter used that tactic in spades.
But his allegations were simply wrong. Given that Clotfelter hasn't lived in Rancho for a long time (he lives in Washington state and told me he would fly down for Board meetings), this isn't surprising.
Since I'm the current RSFA Treasurer, his attacks against our finances were particularly galling.
He stated that our reserves are suspect. He says he reviewed our latest reserve study, but doesn't believe they are good enough even though we hire an independent third party firm to do our reserve studies (as almost all HOAs do). This is a smear without substance since he doesn't state what is specifically wrong with them.
He repeatedly charged last night that we don't have a five year capital plan. If he'd ask, he'd have found that staff is currently working on exactly that. The budget that got unanimously passed yesterday, for the first time in Rancho history as far as I'm aware, contained a newly created Capital Improvement Fund outlining fifteen capital projects and their budgets. This is huge step up in transparency and planning that we accomplished this year thanks to our hard working staff.
Another candidate, Alario, charged that restaurant expenses need to be transparent and we need to know deficits. Yesterday morning we had a Board meeting where the CFO presented that very information. Detailed spreadsheets showing the deficit had been posted (and is still there) on the Association website (Supporting Info for the Board meeting). This charge of lack of financial transparency is really, really annoying since it is and has always been false.
And this focus on restaurant deficits is completely moot anyways since last year's and this year's budgets had assessment funded deficits capped at $500K, with the golf club paying the lion's share of the deficit. I'll go into a pros and cons discussion of this policy at a later date, but would be happy to discuss with anyone in the meantime. The point being that restaurant deficit changes don't impact our assessments.
The budget passed yesterday for fiscal 24/25 for the first time in decades actually reduces the dollar amount of assessments and fees collected from Association members by 3.8%? That's largely because we eliminated, many years earlier than promised, the $65/month surcharge for RSF Connect/Race customers. Only sound fiscal management could have produced that.
Clotfelter also alleged that our Board isn't working well together and staff are cowed by our diktats. That's nonsense. Our Board collectively has tried very very hard to empower staff so that they can deliver great service to the community.
Given what I heard last night, if you do want a dysfunctional Board and stressed employees, vote someone like Clotfelter in. Just my opinion, of course.
That's it for the town hall last night, I just had to set the record straight on the major inaccuracies I heard.
Here's a link to my letter explaining the budget passed yesterday.
If it bleeds, it leads. Media publishers everywhere know the maxim that to encourage engagement, you've got to have controversy, and if there isn't one, create it.
I must confess that when I was editing the RSF Post, I too initially succumbed to the impulse of courting controversy, but as I became more experienced, I consciously switched tracks to instead orient the Post to be a force for cohesiveness in the community rather than the opposite.
The Post currently has a polemicist as an editor who gins up controversies out of whole cloth, so much so that she hired none other than Michael Aguirre to represent her when an RSFA Member dared to ask her who inserted some malicious smears into an article an RSFA Board member wrote.
I shall try in these emails to keep you informed of what is actually going on in the Association, but realize that I am constrained by the actions of activists that have taken legal action alleging, among other things, lack of Association communications. Ironic isn't it? The entire RSFA Board spent all day Wednesday in a downtown San Diego conference room with a retired judge mediator between us and Michael Aguirre and a who's who of RSFA's disgruntled (I counted at least 7 Members).
Since such a mediation session is usually a prelude to a lawsuit, we must assume one is coming, and take our direction from our very experienced Cooley law firm litigator the Association has hired to defend us. And yes, we are exploring all options to eventually recoup the Association's mounting expenses dealing with these actions.
It isn't a secret that HOAs typically prevail in lawsuits against Members, and there's nothing I've seen that would make me doubt that any future lawsuit from these agitators would go the same way.
Last night I spoke with one of the activists that I saw with Aguirre during our mediation session. She assured me that the reason she was there was only because of her concerns about Osuna.
OK, if people are so spun up about Osuna that they'd tie themselves to Aguirre, I better set the record straight here.
The problem we (Board/staff) are trying to solve is that the equestrian portion of Osuna is in dire need of major facility upgrades. Frankly, the equestrian operations were in need of such in 2007 when we bought it and very little has been done since. Successive Boards had ignored it since it is a relatively small part of the budget.
OK, so that puts Osuna into the same category as anything else we manage like our trails, soccer fields, restaurant and clubs. Yes, but staff estimated that to bring Osuna up to "decent", not luxurious, but just decent standards, would cost $3M. Oookay, we can still figure that out. Yes, but Osuna only has 11 Members boarding there. Uh, Houston we have a problem.
All our other facilities, revenue producing or not, all serve a large swath of our membership. Is it fiscally prudent for any Board to spend $3M for the enjoyment of 11 Members? And yes, non-equestrian events are conducted on the property, but I'm talking just about the equestrian portion of the property here. That $3M is just to maintain the working equestrian part of the property to an acceptable level.
So that's the genesis of staff's proposed non-binding Member vote. It outlined three ideas, each of which could be further refined, but the basic question is what does the community want to do to address a chronic funding shortfall for the equestrian operations at Osuna? We can 1) fund the shortfall through financing/member assessments, 2) eliminate the equestrian portion of Osuna & keep the land for other uses, or 3) sell the whole property and hope that it stays as an equestrian property (it is zoned residential class A, with a historical 50 horse boarding limit, so high density development is not possible on it).
Complicating the picture is that Osuna is also the site of an almost 200 year old Adobe, and protecting that is what is apparently animating various activists. That's fine, but we need to address the equestrian operations.
Since that Board meeting, I've talked to many Members about Osuna and also got a sense of the mood at the town hall last night. It appears that very few people want to sell Osuna. Ranch residents appreciate the value of real estate and realize that selling off such a useful piece of land isn't wise. My point being that it is very likely such a vote would permanently cement Osuna with the Association.
Look, we are an equestrian community. We maintain a 40+ mile network of trails at that is paid for out of assessments. Just yesterday we had a presentation at the Board from the Trails & Rec committee about the work they are doing to continue to secure trail easements. It could very well make sense that we would own an equestrian barn to complement the dozens of private and non-profit barns (like the Rancho Riding Club) in Rancho Santa Fe. Indeed one of the Board candidates last night said Osuna should be turned into a world class equestrian center. Whatever we do, we shouldn't continue being a slum lord. If we're going to own one, it needs to have half decent facilities, higher rent, and provide programs for our Members - personally I favor a lesson program for kids who want to learn how to ride. But that needs investment. Do we want to do it? That's what the non-binding vote will determine.
Next step is for the Board to meet with the Osuna committee to further enhance the vote information/presentation. We may very well hold a town hall event providing even more information and answer questions before a vote is held (we held a town hall before we asked Members to vote on traffic lights vs roundabouts, and before the vote to build the fiber network).
None of what I wrote above is a state secret. It was discussed in an open Board session, the result of which was a unanimous motion to further consult with the Osuna committee. Moreover if anyone had further concerns about Osuna, a quick call/chat with a Board member would have told them all they needed to know. Hiring a lawyer is definitely not the way to go and frankly given how much time and mental energy the Board wastes on Member legal actions, hiring a lawyer is a fast track to having the Board dismiss your concerns.
I constantly hear about "lack of communications". It's a two way street people! If you have concerns, call a Board member! All Board members have an email of first initial+last name @rsfaboard.com. Mine is ptrubey@rsfaboard.com. All Board members, and contact emails are listed on the RSF Association website.
So we (the RSFA) lost our auditor. The three Amigos (Whittemore, Strong and Krisel with their lawyer Aguirre) filed a complaint to the California Board of Accountancy alleging our auditor was negligent handling the PPP situation. While the complaint is likely baseless, the auditor informed us that they needed to disengage us as a client. We've increased expected expenses in the 24/25 budget to get a new, very likely more expensive auditor.
It will be hard for us to even find an auditor since we now have known agitators in our community that are wont to report any such auditor to their Accounting Board.
Such actions are costing us significant lost employee time and Member money.
I have much more to say, but I'll put in into another email to come, this letter is long enough. I'd like to highlight two upcoming meetings that might be of interest to Members (full calendar here).
As an RSFA Board member, I am always available to any Member that wishes to talk. I can be reached at ptrubey@rsfaboard.com or just reply to this email.
Phil Trubey