The Northridge Fact-The Northridge Fact-Finding CommitteeFinding Committee

Presentation to the property Presentation to the property owners of Northridgeowners of Northridge

March 21, 2007March 21, 2007

NormsNorms

Assume positive intent.Assume positive intent. Talk about issues, not people.Talk about issues, not people. Allow for all voices to be heard.Allow for all voices to be heard. Allow all points of view to be respectfully Allow all points of view to be respectfully

heard.heard. Disagree respectfully.Disagree respectfully.

Not a DebateNot a Debate

This meeting is not a DebateThis meeting is not a Debate Please sit back - hopefully any questions

you have will be answered through the work of the committee

If not, please write your question on the cards provided for the Q&A session at the end of the presentation or the follow-on meetings

AgendaAgenda

GoalsGoals IntroductionsIntroductions PresentationPresentation Clarifying QuestionsClarifying Questions Next StepsNext Steps

Goals for this meetingGoals for this meeting

To provide information regarding issues To provide information regarding issues and questions about the Northridge and questions about the Northridge subdivision and the Northridge subdivision and the Northridge Homeowners Association.Homeowners Association.

To provide a mechanism for settlement To provide a mechanism for settlement of the issue of an HOA in Northridge.of the issue of an HOA in Northridge.

Who We AreWho We Are

Michelle Eubank, TeacherMichelle Eubank, Teacher Tim Perkins, BankerTim Perkins, Banker Dave Hauger, Air Traffic ControllerDave Hauger, Air Traffic Controller Connie Deitsch, Human Resources Connie Deitsch, Human Resources

DirectorDirector Chris Bickel, Semi-retiredChris Bickel, Semi-retired Janie Perkins, RealtorJanie Perkins, Realtor Don Blake, Engineering ManagerDon Blake, Engineering Manager

What We Have DoneWhat We Have Done

Met with the Town of Erie’s AdministratorMet with the Town of Erie’s Administrator Spoken with lawyersSpoken with lawyers Spoken with HOA management companiesSpoken with HOA management companies Researched CCIOA and Colorado Statutes Researched CCIOA and Colorado Statutes

governing Common Interest Communitiesgoverning Common Interest Communities Read the documents pertaining to Northridge Read the documents pertaining to Northridge

and it’s developmentand it’s development Read the legal opinions of attorneys for various Read the legal opinions of attorneys for various

Northridge property ownersNorthridge property owners

AssumptionsAssumptions

People People do notdo not want want AssessmentsAssessments

to take care of drainage problemsto take care of drainage problems to finish and maintain the pocket parkto finish and maintain the pocket park to maintain ditch and trailsto maintain ditch and trails to obtain liability insuranceto obtain liability insurance

Legal FeesLegal Fees A draconian organization that tries to A draconian organization that tries to

control individual property ownerscontrol individual property owners

AssumptionsAssumptions

People People dodo want want To protect property values by:To protect property values by:

Maintaining common areas within NorthridgeMaintaining common areas within Northridge Ensuring that others maintain their propertyEnsuring that others maintain their property Creating a sense of community in NorthridgeCreating a sense of community in Northridge

To clarify liability issuesTo clarify liability issues To have a voice for NorthridgeTo have a voice for Northridge To finish the ‘pocket park’To finish the ‘pocket park’

What We Learned: What We Learned: The Root of the ProblemThe Root of the Problem

The Developers and the Town of Erie failed the The Developers and the Town of Erie failed the property owners of Northridge when they:property owners of Northridge when they: Allowed the developer to leave without completing Allowed the developer to leave without completing

their obligations to the Northridge property owners their obligations to the Northridge property owners Did not put the mechanism in place to elect a board of Did not put the mechanism in place to elect a board of

directors to the existing HOAdirectors to the existing HOA People moving into Northridge were given mixed People moving into Northridge were given mixed

messages as to the existence of an HOA.messages as to the existence of an HOA.

Is there an HOA?Is there an HOA?

The HOA framework is currently in place.The HOA framework is currently in place. The only thing missing is a Board of Directors.The only thing missing is a Board of Directors. There are differing legal opinions concerning the There are differing legal opinions concerning the

HOA question.HOA question. The only way to clarify the current legal status of The only way to clarify the current legal status of

an HOA in Northridge would be for:an HOA in Northridge would be for: A board of directors to be elected A board of directors to be elected A property owner to sue the HOA claiming that the A property owner to sue the HOA claiming that the

HOA is invalid. HOA is invalid. Legal judgment to be passedLegal judgment to be passed

Present ConcernsPresent Concerns Liability in common areasLiability in common areas

The ditch / Parcel A (the undeveloped hillside between The ditch / Parcel A (the undeveloped hillside between Northridge and Fletcher) and trailsNorthridge and Fletcher) and trails

The pocket parkThe pocket park Neighborhood entrancesNeighborhood entrances

The Money that Erie has earmarked for NorthridgeThe Money that Erie has earmarked for Northridge Development of the pocket parkDevelopment of the pocket park Maintenance of entrances and common areasMaintenance of entrances and common areas Drainage issuesDrainage issues Property values/covenant enforcementProperty values/covenant enforcement ‘‘Hatfield and McCoys’ reputation Hatfield and McCoys’ reputation

LiabilityLiability

There are liability questions with regard to There are liability questions with regard to common areas. Only a law suit could clearly common areas. Only a law suit could clearly determine who could be held liable should determine who could be held liable should something tragic happen in one of the common something tragic happen in one of the common areas such as:areas such as: Ditch / Parcel ADitch / Parcel A TrailsTrails Pocket ParkPocket Park

Every property owner could be named in a Every property owner could be named in a lawsuitlawsuit

Liability: Liability: The DitchThe Ditch

““the Ditch” is the Erie-Coal Creek ditch which runs the Ditch” is the Erie-Coal Creek ditch which runs parallel to and is between Northridge and Fletcher. The parallel to and is between Northridge and Fletcher. The ditch that is SW of Northridge is not our problem.ditch that is SW of Northridge is not our problem.

Morton and Norton were made owners of “The Ditch” per Morton and Norton were made owners of “The Ditch” per “The Ditch Agreement”.“The Ditch Agreement”.

The Homeowners of Northridge are responsible to The Homeowners of Northridge are responsible to maintain the ditch and the adjoining trails according to maintain the ditch and the adjoining trails according to this agreement.this agreement.

Liability is a question and could only be settled through a Liability is a question and could only be settled through a lawsuit at this point. Northridge property owners or the lawsuit at this point. Northridge property owners or the Town of Erie are liable, the ditch company clearly is not.Town of Erie are liable, the ditch company clearly is not.

Each property owner could be held liable, regardless of Each property owner could be held liable, regardless of their location with respect to the ditch.their location with respect to the ditch.

““the Money”the Money”

$230,000 currently $230,000 currently Comes from the settlement agreement between Comes from the settlement agreement between

Erie and Morton & Norton and development Erie and Morton & Norton and development impact feesimpact fees

$33,000 earmarked for the Pocket park$33,000 earmarked for the Pocket park The Town controls the money: it can be used for The Town controls the money: it can be used for

Northridge projects, but not simply ‘handed over’ Northridge projects, but not simply ‘handed over’ to a Northridge HOA.to a Northridge HOA.

The money is currently set aside for Northridge The money is currently set aside for Northridge projects, but could be re-directed by the Town.projects, but could be re-directed by the Town.

Development of The Pocket ParkDevelopment of The Pocket Park

The Town will not release the funds for The Town will not release the funds for completion of the pocket park because there is:completion of the pocket park because there is: No one to negotiate withNo one to negotiate with No one responsible for maintenance of the parkNo one responsible for maintenance of the park

Pocket Park plans:Pocket Park plans: Specific plans already exist for the pocket park Specific plans already exist for the pocket park Northridge property owners can decide to change the Northridge property owners can decide to change the

existing plans and control how the park would lookexisting plans and control how the park would look

Maintenance of Common AreasMaintenance of Common Areas

The Town has maintained the entrances to date, The Town has maintained the entrances to date, but will discontinue doing so in the near future. but will discontinue doing so in the near future. (no firm date given, but don’t expect (no firm date given, but don’t expect maintenance this summer). maintenance this summer).

Erie has standardized their agreements and all Erie has standardized their agreements and all HOAs are being held responsible for HOAs are being held responsible for maintenance of their own common areas.maintenance of their own common areas.

The Town only maintains parks in which they The Town only maintains parks in which they hold recreation programs. The pocket park hold recreation programs. The pocket park would not be one of those parks.would not be one of those parks.

Maintenance of Common AreasMaintenance of Common Areas

The Town has stopped allowing the ditch The Town has stopped allowing the ditch company to burn the weeds in the ditch due to company to burn the weeds in the ditch due to health concerns. health concerns.

The Town provides no maintenance on the ditch The Town provides no maintenance on the ditch or trails at this time. As part of the Erie Trail or trails at this time. As part of the Erie Trail plan, this may change in the future.plan, this may change in the future.

The ditch company can perform necessary The ditch company can perform necessary maintenance and expect payment.maintenance and expect payment.

All Northridge property owners are responsible All Northridge property owners are responsible to ensure a flow of 25 cubic feet per second.to ensure a flow of 25 cubic feet per second.

Drainage IssuesDrainage Issues

The Town believes it has completed its The Town believes it has completed its obligations where drainage issues are obligations where drainage issues are concernedconcerned The Town has completed all actions identified The Town has completed all actions identified

in the in the Settlement AgreementSettlement Agreement with Morton & with Morton & Norton.Norton.

The drainage problems stem from having The drainage problems stem from having allowed the original 1% grade on the allowed the original 1% grade on the development. The Town does not take development. The Town does not take responsibility for this.responsibility for this.

Drainage Issues FYIDrainage Issues FYI

The Town would be willing to install curb and The Town would be willing to install curb and guttergutter

100% of property owners without curb and gutter 100% of property owners without curb and gutter would have to be in agreementwould have to be in agreement

This would help the drainage issues to a certain This would help the drainage issues to a certain extent, according to the Town. extent, according to the Town.

There would be a special assessment from the Town There would be a special assessment from the Town on only those who would benefit from the on only those who would benefit from the improvement in order to pay for it.improvement in order to pay for it.

The assessment would not impact those who The assessment would not impact those who already have curb and gutter and has nothing to already have curb and gutter and has nothing to do with the existence, or lack thereof, of an HOA.do with the existence, or lack thereof, of an HOA.

Covenants / EnforcementCovenants / Enforcement

Currently, any property owner can pursue Currently, any property owner can pursue enforcement of the covenants through legal enforcement of the covenants through legal action.action.

With an HOA in place, covenants could be With an HOA in place, covenants could be enforced and result in fines and/or liens.enforced and result in fines and/or liens.

With an active HOA, the covenants can be With an active HOA, the covenants can be amended by a 2/3 vote of the property owners. amended by a 2/3 vote of the property owners.

The HOA by-laws may be amended by a The HOA by-laws may be amended by a majority of the HOA board of directors.majority of the HOA board of directors.

Options for NorthridgeOptions for Northridge

Neighborhood AssociationNeighborhood Association Optional membershipOptional membership Social opportunities and neighborhood beautificationSocial opportunities and neighborhood beautification Not necessarily helpful in maintaining property valuesNot necessarily helpful in maintaining property values Unclear legal statusUnclear legal status

Special Tax District Special Tax District Cost prohibitive to set upCost prohibitive to set up Additional tax assessment to homesAdditional tax assessment to homes More than we needMore than we need

Options for NorthridgeOptions for Northridge

Continue without an HOAContinue without an HOA BenefitsBenefits

No assessmentsNo assessments No organization to intrude on individual property ownersNo organization to intrude on individual property owners Individuals speak out regarding the issues that affect them.Individuals speak out regarding the issues that affect them. Comfort of the “Status Quo”Comfort of the “Status Quo”

RisksRisks Unclear liability issuesUnclear liability issues Individual liability coverageIndividual liability coverage No maintenance of common areas: could impact property valuesNo maintenance of common areas: could impact property values Leaves enforcement of covenants up to individualsLeaves enforcement of covenants up to individuals Maintains status quo on the Pocket parkMaintains status quo on the Pocket park Ditch/trail maintenance issue not settledDitch/trail maintenance issue not settled

Elect a board of directors for the HOAElect a board of directors for the HOA BenefitsBenefits

Clarify liability questions regarding the DitchClarify liability questions regarding the Ditch Ability to secure liability Insurance CoverageAbility to secure liability Insurance Coverage Enables maintenance of common areasEnables maintenance of common areas Entity to negotiate with the Town and/or other entitiesEntity to negotiate with the Town and/or other entities Entity to manage fundsEntity to manage funds Enforce CovenantsEnforce Covenants Modify Covenants and/or by-laws if necessary or desiredModify Covenants and/or by-laws if necessary or desired

RisksRisks Northridge HOA acknowledges liability for the DitchNorthridge HOA acknowledges liability for the Ditch AssessmentsAssessments Enforcements of CovenantsEnforcements of Covenants Lawsuits between neighborsLawsuits between neighbors

Options for NorthridgeOptions for Northridge

Expected CostsExpected Costs Fiscal and Liability insurance for individual board Fiscal and Liability insurance for individual board

membersmembers Liability insurance for common areas of NorthridgeLiability insurance for common areas of Northridge Maintenance of Common AreasMaintenance of Common Areas

Ditch, Parcel A, and trailsDitch, Parcel A, and trails EntrancesEntrances Pocket ParkPocket Park

One time expense for completion of pocket park (to be One time expense for completion of pocket park (to be covered by town of Erie)covered by town of Erie)

Management costsManagement costs Could be a special assessment to all property owners Could be a special assessment to all property owners

should there be lawsuit(s).should there be lawsuit(s).

Expected CostsExpected Costs

WhatWhat Annual costAnnual cost

Director’s Liability insurance ($ 1M)Director’s Liability insurance ($ 1M) $ 687$ 687

General Liability insurance ($ 4M)General Liability insurance ($ 4M) $ 727$ 727

Property insurance – entrances ($1,000)Property insurance – entrances ($1,000) $ 2$ 2

Maintenance (one estimate)Maintenance (one estimate) $12,000$12,000

Watering costs ($0.11/ sq ft / yr * 30,000 sq ft)Watering costs ($0.11/ sq ft / yr * 30,000 sq ft) $3300$3300

Management costs (if a management company is Management costs (if a management company is used) ($3.75 / lot / month)used) ($3.75 / lot / month)

$ 9,000$ 9,000

TotalTotal $ 25,716$ 25,716

Per household (based on 191 lots)Per household (based on 191 lots) $ 134$ 134

AssessmentsAssessments

First assessment maximum of $100First assessment maximum of $100 Annual assessment increase cap of 20% Annual assessment increase cap of 20%

of previous year’s assessmentof previous year’s assessment Assessment increases over 20% must be Assessment increases over 20% must be

approved by a majority of property ownersapproved by a majority of property owners

Next steps – BackgroundNext steps – Background

According the Northridge Covenants According the Northridge Covenants it takes votes by 50% + 1 (96) it takes votes by 50% + 1 (96) property owners to elect a Board of property owners to elect a Board of Directors when the election is held by Directors when the election is held by mail. mail.

The Board can consist of 3-7 The Board can consist of 3-7 members - must be an odd numbermembers - must be an odd number

Next steps - express opinions Next steps - express opinions and concernsand concerns

At the next meeting, anyone who would like At the next meeting, anyone who would like to will have two minutes to speak.to will have two minutes to speak.

One speaker per household.One speaker per household. Speakers will sign up identifying themselves Speakers will sign up identifying themselves

as ‘in favor’ or ‘against’ or ‘neutral’ as ‘in favor’ or ‘against’ or ‘neutral’ regarding reinstatement of the HOA.regarding reinstatement of the HOA.

The committee will call people up to speak The committee will call people up to speak in a manner as to allow for balance in in a manner as to allow for balance in expression of opinions.expression of opinions.

Next steps - Nominations for Next steps - Nominations for Board of DirectorsBoard of Directors

Individuals nominate themselves or Individuals nominate themselves or someone else, the nomination requires a someone else, the nomination requires a second, and that nomination will go on the second, and that nomination will go on the ballot.ballot.

The number of nominees will determine The number of nominees will determine the number of Board members. the number of Board members. More nominees will mean more board More nominees will mean more board

members, up to 7members, up to 7 It will be an odd numberIt will be an odd number

Next steps - Mail-in BallotNext steps - Mail-in Ballot

The Committee will prepare a ballot and The Committee will prepare a ballot and mail one to each property owner.mail one to each property owner.

Each property owner has the opportunity Each property owner has the opportunity to cast one ballot by mail and can elect:to cast one ballot by mail and can elect: To cast a vote for nominees for the Board of To cast a vote for nominees for the Board of

Directors.Directors. To not return the ballot.To not return the ballot.

Next Steps - The VoteNext Steps - The Vote

Any ballot returned with a vote for one to Any ballot returned with a vote for one to seven nominees will be counted towards seven nominees will be counted towards the 96 required to be considered a valid the 96 required to be considered a valid election.election.

If 96 property owners do not return a ballot If 96 property owners do not return a ballot with a vote cast, the election is not valid with a vote cast, the election is not valid and a Board of Directors is not elected.and a Board of Directors is not elected.

Ballots postmarked after the cut-off date Ballots postmarked after the cut-off date will not be considered valid.will not be considered valid.

Proposed TimelineProposed TimelineDateDate EventEvent

April 11April 11 Next meeting: Erie Middle School at Next meeting: Erie Middle School at 6:306:30

April 16April 16 Committee mails out ballots to property Committee mails out ballots to property ownersowners

May 1May 1 Ballot submission deadlineBallot submission deadline

May 7May 7 Results posted on Northridge websiteResults posted on Northridge website

If elected, the Board members will If elected, the Board members will determine a later date on which they will determine a later date on which they will take office.take office.

Q & AQ & A

We will address questions to clarify the We will address questions to clarify the material presented todaymaterial presented today

Please write new questions on the note Please write new questions on the note cards provided cards provided

Again, this is not a debateAgain, this is not a debate Q&A will end at 8:20 so we have time to Q&A will end at 8:20 so we have time to

clean upclean up

More InfoMore Info

Many documents pertinent to the Many documents pertinent to the Northridge community are available to Northridge community are available to view at the following web addressview at the following web address

www.geocities.com/northridge_eriewww.geocities.com/northridge_erie

In conclusion…In conclusion…

Digest this material and consider Digest this material and consider questions for the next meetingquestions for the next meeting

Next meeting: Next meeting: April 11, 2007 Same time, same place April 11, 2007 Same time, same place

Donations for room costs, mailing, etcDonations for room costs, mailing, etc Everybody lend a hand in cleaning upEverybody lend a hand in cleaning up