What Does Member Outreach Look Like To You?

To Board President Foster and the other board members,

Please understand I am not attempting to usurp your position within the RCSC Board of Directors structure. My attempts are to find ways of making member interaction available as well as provide additional opportunities for collaboration and communication with the membership. This is a small part of member outreach which can go a long way for member involvement. No disrespect intended.

 

Not much to say!?!?

True, the statement was misleading.

Robert's Rules will tell you that attending a meeting where you are not a member of that assembly, (simply attending as a guest), you have no ability to ask questions or make comments unless you are granted permission to do so by the chair or assembly. But with that said, our bylaws, which takes precedence over Robert's Rules, states: "Member comments at Board Meetings will be limited to posted motions." As we saw at the last Board meeting, no motions, no comments!!!!

As far as the Member/Board Exchanges go. The rules seem to change for each meeting. At first you could just ask a question(s), then you were limited to 3 minutes, then you had to take a number at the deli counter, and now you get your 3 minutes to ask as many questions that you have. The Board will sometimes, but not always, respond but only after your 3 minutes are up. There no longer is a dialog between the Member and the Board!

If you're lucky they will allow you come back once all others have had their first opportunity.

Who remembers the bell if you spoke to long? Lol!

 

I thank FYI for the clarifiaction to include the written bylaw definition. This bylaw would appear to restrict member comments, to the detriment of the members, including the example of not allowing comments by the members a during a meeting of the board in which no motions were present. So, would this be the best example of promoting the common good and general welfare of the people of the community? As a 501c4 organization, to maintain the the IRS 501c4 tax exempt status, there are specific performance codiciles that have been put in place, as of 2015, that an organiztion must meet in order to maintain its exempt status.

New legislation enacted at the end of 2015 added Section 506 to the Internal Revenue Code. Section 506 requires an organization to notify the IRS of its intent to operate as a Section 501(c)(4) organization. The IRS has developed a new form – Form 8976 – that organizations should use to provide this notification. For information about applying for exemption, see application for recognition of exemption.

This requirement only applies to organizations intending to operate under Section 501(c)(4). Organizations operating under any other 501(c) section should not file this notice. To be operated exclusively to promote social welfare, an organization must operate primarily to further the common good and general welfare of the people of the community (such as by bringing about civic betterment and social improvements).

In my opinion, restricting comments of the members defies the tenet of civic betterment. Per ASU, civic betterment also referred to as civic engagement is described as follows:

Recently seven in ten Americans reported that it’s important to belong to a community that shares their values. Civic engagement refers to the active participation of individuals in activities aimed at improving their communities and addressing societal issues. It encompasses both political actions, like voting and advocacy and non-political efforts, such as volunteering and community organizing. Engaging civically not only enhances the well-being of communities but also fosters a sense of personal fulfillment and social responsibility.

Not allowing members to be active participants in their own community does not promote the common good or the general welfare or the PEOPLE of the community. Having writeen deterrents to the ability or the member to speak during a meeting is against the IRS tax code, defining common good of the people.

Actually, if one reads the bylaws, as written, specificaly allows the ability to vote during prescribed meetings, and denying the members ability to the common good in order to bring about social improvement is against the tax code, placing the tax exempt status of the RCSC is question. There may have been some amendments in question that affected the status of the corporation, but the wholesale denial to vote during the member meeting is denying the members ability to further the common good and general welfare of the people of the community.

Additionally, other bylaws are in contradiction of the tax code, as researched. I have not taken it further to define the Arizona Revised Statutes and current written documents. What is irrefutable is the RCSC Corporate Documents, Restated Articles of Incorporation, Article III, Section 3

3. To promote cooperation in all matters of interest and benefit to the residents and/or homeowners of the area within the bounds set out in Article I, who become and remain Members of this Corporation.

The denying members their ability to speak at members meeting, and in general, denying member benefits of a corporation that is charged with promoting the well being and the best interest of the residents/homeowners is in defiance of its Arizona State Charter as a non-profit organization,

This is a lot of legal mumbo jumbo, but it boils down to the RCSC's Charter as a non profit corporation and its adherance to state law in regards to its own corporate documents. This further brings into question its treatment of members and its applicability to IRS Tax Code and the requirements to maintain its 501c4 tax exemption.

No, I am not a lawyer, but the corporate attorney appears to have overstepped when incorporating a wholesale denial of a vote by the members during a guaranteed annual meeting as described within the current RCSC documents. Deterring the vote and not allowing the members to view the proposed amendments, not in conflict with the corporate documents, is a clear violation of members rights. Declaring the entirety of the proposed amendments filed as null is against the corporate documents making the action illegal within the context of denying the members due process, in my opinion.

I understand there is a beleif that directors are not experts in the legal field, but they are charged with governance of the community within the RCSC documents. As described above, the actions are not in compliance with the written documents or the tax code. I have not done additional research as of this moment as to application of the Arizona Revised Statutes. The basic tenet for which the Corporation was formed is highlighted above. Anything written that deters from that premise is against the very Corporate Documents filed when the RCSC was formed, in my opinion.

FYI, I most certainly welcome your interpretation to what I have written. I await your your response before proceeding further. Thank you

 

I'm no lawyer either, but I did sleep at a Holiday Inn Express last night!

The question I have had is this... do we really even satisfy the bylaw requirements of holding an Annual Membership, which is a must every year, if we're not allowed to conduct any business?

As screwed-up as that last meeting was, we should have, at least, received a financial and management report, instead we get an excuse from our corporate attorney.

And you have to wonder how restrictive is the rule that only properly and timely submitted motions on the Agenda can be voted on at the Annual Meeting? Geez, could I have made a motion for a recess from the floor or would that be out of order? If we didn't achieve a quorum, could I have made the motion to fix the time to which to adjourn for a date two weeks later so that I could round up enough members to actually hold a meeting or would they call that "out of order" too?

There's a lot of crap that happens and can happen but nobody is thinking past their nose, so when these issues come up, they either shut you down or run to their lawyer!

Being the stickler I am, it kinda disturbs me when they don't produce minutes for a meeting that lacked a quorum. The last minutes that were produced were from 2023. Granted, the bylaws have a provision that the Minutes from Annual Membership Meeting will be approved by 3 Officers of the Board within two-weeks after the meeting, but that doesn't mean they can't also be approved by the membership at the next membership meeting, there may need to be a correction made. But most of all, as a good practice, there should have been Minutes produced and approved for the 2024 meeting even though the meeting wasn't held due to a lack of a quorum. All the Minutes had to say was "the meeting was called to order at 6:00pm and due to a lack of a quorum, and no further motions, it was adjourned at 6:02pm."

What those Minutes do is produce an actual record that, per the requirements of the Corporations bylaws, an Annual Meeting was in fact held. Board Policy 34 says the Minutes from Membership meetings must be permanently retained. Go try to find if we actually called and held a membership Meeting in 2024!

I think you're right on Carol. And I believe the cause of it is the lack of familiarity with the documents that govern our corporation as well as not thinking and planning ahead before they shoot off their mouths! I think the Board really does need training as well as back-up from somebody who actually does know the rules.

A Bylaws "working-group" Really? When the Bylaws only allow for Standing and Ad-Hoc committees, which could have been established with the exact restrictions they're currently using. And when I challenged them on working outside the Bylaws, the response I got was, "the bylaws don't say you can't establish a "working-committee." WOW! That pretty much leaves the doors open to do just about anything as long as the Bylaws don't specifically prevent it!

They need help but don't always seem ready to accept it!

 

CM & FYI - IMHO the board does not have an independent understanding of the Bylaws. I will get into the "why" in a moment. My lawsuit was predicated on the announcement of the proposed actions of the Board not being in compliance with the Bylaws provisions guaranteeing members the right to vote. I suspect they asked the lawyer to give them a way to prevent a vote. He obliged and referenced a procedural section which seems to require board recommendation for members motions. The long and short of it is the board did not recommend a vote on any motion. I may disagree with their decision and the appearance it creates, but I chose not to fight it.

Now, why IMHO does the board does not understand the bylaws, training, resources and expertise. The Board training is controlled by the GM and IMHO is worthless. Further, the Board does not have free resources to get advice from since they disbanded the legal and regulatory affairs committee. Finally, if you examine the expertise of the Board, none have specific relevant experience in the areas they are overseeing. I think this may be common in the non-profit world but is unheard of in the for-profit world. The GM situation does not help.

My recommendation for future boards is they outsource training to an expert and bring back the legal and regulatory affairs committee.

 

Hmmm? Can you be a little more specific on that procedural section?

Seems to me the only procedure that's required going through the Board is if a Member wants to amend the Articles of Incorporation without going through the 10% petition process on their own. It requires that the Board must first make a resolution to amend them before it can be presented to the Membership for a vote. And of course there's always the "affairs of the corporation" restriction, but if the motion doesn't affect the affairs of the corporation then I don't believe they have the right to prevent other amendments to the Bylaws from being offered?

Articles of Incorporation, Article XIV
An amendment to the Restated Articles of Incorporation may be proposed by resolution of the Board of Directors or by petition signed by at least ten percent (10%) of the total membership of the Corporation as of the first day of the preceding July. The proposed amendment shall be submitted to a vote of the Members at a regular or special meeting called pursuant to the provisions of the Bylaws.

Remember, Membership Meetings are Membership meetings and because the Board is subordinate to the Membership, the Board should really have nothing to say about the motions that MEMEBRS want to be addressed at their MEMBERSHIP meetings. Just because the Chair is a Director he is not their in his capacity as a Director but only as a Member serving as Chair, and who can be replaced with a 2/3rd's vote of the assembly even though the Bylaws say a Director will Chair all meetings of the corporation. (RONR 62:12)

"RONR 57:7 However, as already stated in 57:1(4), all bylaw amendments of which notice was given are entitled to be considered, as a matter of the rights of their proposers, and a bylaw amendment is not dropped simply because it would conflict with one previously adopted. This procedure does not violate the normal parliamentary rule as might appear, because when any bylaw amendment is adopted, that amendment becomes a part of the bylaws immediately; and it is the bylaw language as thus amended, rather than the previous language, which any bylaw amendments subsequently considered would now propose to modify."

 

First, sorry for delay in responding, blood pressure and heart rate are not playing nicely and I’m regulating to best of my ability until the cardiologist appointment on Thursday. Requires time that I would rather apply to the issues at hand.
Next, thank you for your timely and comprehensive advice. What I highlighted in the previously long post was just that, the topical questions that I feel, in my opinion, are quite relevant to the RCSC as we know it today, and whether or not the removal of members benefits from the documents was legitimate and legal. I quoted several related points, the Articles of Incorporation, the RCSC bylaws,as written today, and a snippet from the IRS website in relation to the 501c4 status enjoyed by the RCSC. A wide net to cast, yet all intertwined.
All related to the member benefits and the systematic restructuring and removal of same. As I read the most recent version of the bylaws, it literally brought tears to my eyes. The sorrow over the loss of what should have never been taken away is overwhelming. The fact that so much of this occurred on my watch and couldn’t stop it does not make it any less painful.
Then comes the anger. How could any single person believe they were so omnipotent that the they were the sole force of sovereignty and the savior du jour for the RCSC. The hatred directed towards the members screams for some sort of savior, but no one came. No one came because the changes were done in such an insidious manner, they were not necessary seen, nothing really overt, just the unsettling feeling one got at every board meeting that none of this was good. Couldn’t stop it. The screaming matches that occurred did nothing but create drama and raise one’s blood pressure. There were loud voices in an attempt to stop what was happening, only to have it happen anyway.
So my lament is complete. Now I want something to happen, only no more losses, no more suffering by the members or the board due to a situation where the players were played and the members lost. I don’t know what the direction will ultimately be, but I am clear I don’t want it to take years to restore what should have never been stolen to begin with. The destruction of the bylaws at the onset, took less than 18 months. I want the restoration to take even less time than that. Doesn’t mean I can have that aggressive of a timeline, but that’s my sovereign opinion to try the hardest I can to make everything return to pre-2006 , then do edits to reflect 2025 and beyond. Now if my blood pressure and heart rate will just cooperate, I can keep on a steady path.

 

FYI, the obscure article referenced is an ARS statute that John mentioned in his thread and I remembered that I posted about a rebuttal position, but John was right in stopping the process where it was. If I take some time, I probably could find the rebuttal statute, as I quoted it in the thread.

 

Don't go crazy looking, but I would like to read the statute.

 

FYI
10-11021. Amendment by board of directors or members

If the articles of incorporation or the bylaws require that an amendment to or repeal of the corporation's bylaws be submitted to the members, the procedures set forth in section 10-11003 shall apply.

10-11003. Amendment by board of directors and members

A. The following apply to amendments to the articles of incorporation by the board of directors and the members, if there are members entitled to vote on the amendment:

1. A corporation's board of directors may propose one or more amendments to the articles of incorporation for submission to the members.

2. For the amendment to be adopted all of the following shall have occurred:

(a) The board of directors shall recommend the amendment to the members
My rebuttal:
John,
The full content continues:
B. The following apply to amendments to the articles of incorporation by the members, if there are members:

1. If the articles of incorporation expressly permit, the members may propose amendments to the articles of incorporation. If so permitted, the articles of incorporation shall set forth procedures for adopting member initiated amendments, including the percentage of voting power and method of notice required to propose an amendment and the responsibility for calling a member meeting to consider the amendment.
The Articles clearly state members may change the amendments. This is Section B of the same article which was quoted earlier.

 

I would argue that 10-11021 doesn't apply because the Articles and Bylaws don't require that an amendment must only be submitted to the Members, I guess from the Board. The Members have the full right per the Articles to submit and amend the Bylaws on their own at a Membership Meeting!?!?

 

CM and FYI, Your arguments are very logical. Unfortunately, I needed to take into account the hierarchy of authority. In the event of a conflict between the corporate documents and ARS the ARS prevails.

 

If the entire statute is read in its entirety, it supported John’s actions when he filed suit. Read the top section that was quoted to John as the reason he couldn’t prevail. Then read the very next paragraph, section B. It supports the argument because it states that members shall have the right to vote as outlined in subsection 1.

 

But our Articles of Incorporation or Bylaws don't explicitly require that an amendment must be, and can only be submitted to the Members by the Board? Our Articles say quite the opposite. They say the Members can amend the Bylaws and there is no caviot saying only if submitted by the Board? The Articles even go one step farther saying the Members shall prevail!

So how is it possible for the Members to prevail if they are not allowed to amend their own Bylaws.

I think those statutes pertain to two separate situations? One being that ALL amendments must go through the Board and the other being that our Articles allow the Members to do it on their own.

I think the lawyer was blowing smoke up our butts just like the 2021 Annual Membership Meeting when the lawyer said the Bylaws take precedence over the Articles!

Just my opinion.

 

CM and FYI - I agree there are technical arguments that the quoted section should not apply as you have pointed out. Our articles provide as follows:

The Bylaws may be amended, modified, revised, or revoked by the Directors or by the Members. In the event of conflict concerning the Bylaws as amended, modified, revised, or revoked by the Directors, the action of the Members shall prevail.

The issue turns on whether the statute applies to all amendments or to any amendments. If I had pursued the lawsuit and was successful what is to prevent the Board from changing the bylaws to require a member vote for any amendment? I may have achieved a moral victory, but the remedy could have been avoided.

For me the bottom line is we need to apply title 33 and let the members vote on the big stuff.

 

So...let's take this one step farther. What is the vote required to amend the Articles of Incorporation or Bylaws by either the Board or the Members?

The Bylaws say for the Members: Once a quorum has been established for any meeting, appropriate business may be conducted and decided by a majority vote of Members present unless otherwise required by the laws of the State of Arizona or Articles.

The Articles of Incorporation say: "The proposed amendment shall be adopted or rejected by a majority vote of the Members, present or represented by proxy at such meeting or adjourned meeting." (Article XIV 2nd paragraph)

But what do the Arizona Revised Statutes say for the Members? "5. Unless chapters 24 through 40 of this title, the articles of incorporation or the board of directors acting pursuant to paragraph 3 of this subsection requires a greater vote or voting by class, the amendment to be adopted shall be approved by two-thirds of the votes cast or a majority of the voting power, whichever is less."

Which means for the Bylaws to be amended by the Board, the Board is only required to have a majority vote, but the Membership is required to have a 2/3rd's vote because 2/3rd's is the lesser amount of the entire Membership. The Bylaws do make reference to the ARS's, which is a good thing.

But...I see a conflict between the Arizona Revised Statutes and the Articles of Incorporation! The Articles of Incorporation state that only a majority vote of the Members can amend the Articles of Incorporation, but the ARS say's the Members need a 2/3rd's vote?

 

Tom, Have you read this section?

10-3723. Voting requirements

Unless chapters 24 through 40 of this title provide otherwise, the articles of incorporation or the bylaws require a greater vote or voting by class, if a quorum is present, the affirmative vote of the votes represented and voting, for which affirmative votes also constitute a majority of the required quorum, is the act of the members.

 

Okay, so which one do you use since they seem to contradict each other?

10-3723. Voting requirements
Unless chapters 24 through 40 of this title provide otherwise, the articles of incorporation or the bylaws require a greater vote or voting by class, if a quorum is present, the affirmative vote of the votes represented and voting, for which affirmative votes also constitute a majority of the required quorum, is the act of the members.

10-11003
5. Unless chapters 24 through 40 of this title, the articles of incorporation or the board of directors acting pursuant to paragraph 3 of this subsection requires a greater vote or voting by class, the amendment to be adopted shall be approved by two-thirds of the votes cast or a majority of the voting power, whichever is less."

I believe all it means is there needs to be a majority! More Yes' than No's or more No's than Yes'!

 

Chapter 30,
10-3721. Voting entitlement generally
A. Unless the articles of incorporation or bylaws provide otherwise, each member is entitled to one vote on each matter voted on by the members. A member is entitled to vote only on those matters expressly provided in the articles of incorporation or bylaws.

 

Nobody's blaming you John, but you can see, these statutes are all over the place! Which ones do you adhere to?