WLV BOard Response to Playground Allegations being made by certain members

Introduction

I am writing this letter to answer a number of allegations by some members of the Association concerning the conduct of the Board of Directors as it relates to the replacement of our playground equipment. A telephone and email campaign is being conducted within the community to inform residents of the alleged misconduct of the Board. The allegations are serious; malfeasance, illegal actions, financial impropriety and the wholesale ignoring of the fiduciary responsibility of the Board.

These allegations are untrue, unfounded and malicious. As long as they were confined to a few members complaining to the Board they could be ignored. However, once the general population is being approached, we have an obligation to be sure you know the facts.

I am unsure as to some people’s intents, but I can tell you what I know…the simple and unabridged truth. For those that know me, I hope they will agree that I have no agenda EXCEPT leaving this community in better condition than I inherited it, which is probably the creed of every President and Board before us. With that said, let me present the facts surrounding the playground replacement and the allegations concerning the Board’s actions.


The Allegations

ALLEGATION: The Board removed the playground without foresight or cause.

FACT: This would imply that the Board simply decided to remove and replace the playground equipment with little or no thought. In fact, on 10/30/07 (almost 2 years ago), the Board was presented a 2 page list of “mandatory recommendations” compiled by our commercial insurance underwriter that identified 22 hazards that MUST be corrected/addressed to continue insurance coverage. #07-10 states: “It is recommended Insured remove or replace the playground equipment as it appears to be outdated and unsafe (emphasis added). Thus, the Board did not just decide to remove the equipment. The condition of the equipment posed such a potential liability that its removal and replacement became a condition for continued coverage by our insurance company. We formed a Playground Committee, did extensive research, received several proposals and had 2 presentations by potential vendors at Board meetings. Hardly “without foresight or cause”.


ALLEGATION: The Board removed playground equipment that could have been fixed.

FACT: The Board realized that the removal and replacement of the playground equipment would be an expensive proposition. Our capital projects plan prepared in 2005 simply anticipated some repairs to the equipment for approximately $14,000. Always cautious of major expenditures, the Board felt it wise to seek a second opinion and hired a qualified Playground Safety Inspector with litigation experience to advise the Board how to best meet our insurance company’s requirements and minimize our liability. The Playground Safety Audit was received on 3/18/08 and identified 7 structures that were an IMMEDIATE THREAT to life and limb AND that should be removed due to required excessive modifications. This inspection confirmed the recommendation of the insurance company. Repairs became a moot point.


ALLEGATION: The Board removed the Playground with little or no notice

FACT: The allegation contends that the Board somehow surreptitiously removed the defective equipment without telling residents that it was going to do so. I am not sure what the alleged purpose would have been. The allegation is untrue. Several Board minutes, the Village Voice, and my President’s corner blog (updated weekly) all reflect references to the future removal of playground equipment. The topic came up for discussion at the 2008 Annual Meeting of the membership. The unsafe playground equipment was finally removed in late December 2008, 9 MONTHS after the safety audit was received in order to prepare the membership for its removal.


ALLEGATION: The Board spent more than $50,000 replacing the removed equipment.

FACT: After getting the necessary bids, the Board of Directors, upon recommendation from the Playground Committee Chairman, voted to purchase the playground equipment through REP Services, Inc. of Longwood FL. The cost of the playground equipment, including charges for freight/delivery, assembly, 256 cubic yards of engineered wood fiber fill, 400’ of border, stakes for the border, and taxes is $33,921.00. That is a long way from $50,000. PLEASE REMEMBER THAT OUR PLAYGROUND HAS BEEN OUT OF SAFETY COMPLIANCE AS THE SWINGS AND OTHER EQUIPMENT HAVE HAD NO FILL SINCE THEIR INSTALLATION. There was, therefore, an additional expense for fill and borders for the remaining older equipment which totaled $9,230. This expenditure is mandatory even if no new equipment is purchased. Our total cost to purchase new equipment and bring existing equipment into compliance is $43,151.


ALLEGATION: The Board ignored that Westlake Village doesn’t have the money for this playground.

FACT: Yes, we do. In addition to the approximately $82,000 we have in our Reserve Fund, which is used to cover replacement, major renovation, and emergency repair costs for all our common assets, we have just negotiated a new 2 year lawn contract that will save us appr. $45,000 - $50,000 PER YEAR over what we have been paying from 2005 - 2009…or close to $100,000 over the next 2 years! This has not been publicized. After a Request for Proposal that netted us 20 bids, the Board selected Buccaneer Landscape Management as our new provider. By this time next year, it is anticipated that the ENTIRE Playground purchase of $43,151 will have been paid for with no impact on our budget…we were simply able to save in one place (lawn contract) to benefit another (playground).

ALLEGATION: The Board illegally signed a Promissory Note that puts our Common Assets in jeopardy.

FACT: That is incorrect - our Common Assets are not in jeopardy. The Board did sign a private Promissory Note after fruitless efforts to find an institutional lender to loan us the money with acceptable terms. Why a loan? In these uncertain times, cash liquidity is our greatest asset and the Board felt it prudent to maintain our cash liquidity at existing levels. As with all contracts over $5000, the Board consulted our lawyer, Robert Tankel, and the Promissory note was reviewed and approved by him personally. Attorney Tankel gave us the opinion that the Board does have authority to enter into loan agreements and borrow money.


ALLEGATION: The Board ignored a requirement in the Covenants that the membership has to vote on the expenditure for the Playground since the promissory note constitutes a mortgage which the Board cannot enter into without member approval.

FACT: This is incorrect. While we encourage member involvement, Florida law and our governing documents require no such membership vote on a situation such as the purchase of playground equipment or the execution of the promissory note. The Board is empowered with entering into financial arrangements such as this by our documents and Florida Statute 720. The promissory note was approved by our legal counsel and then approved by the Board at the June meeting. There is no mortgage on Westlake Village assets as a mortgage is by definition on REAL PROPERTY – the Clubhouse, pool, land, etc…the collateral for the loan is the Playground equipment itself, which is not REAL property by legal definition according to our lawyer.


Summary

I personally find it sad and disingenuous that a small group of members would be spreading these fabrications and distortions of fact. I have come to learn that as a President and Board member, I will never have the ability to please everyone all of the time. However, I have a fiduciary duty to ensure our neighborhood is properly cared for and prepared for the next 30 years to the best extent possible. We have faced other hard decisions in the recent past and successfully resolved those issues – issues that we would much rather have avoided.

Let me make this perfectly clear – despite what others may say, your Board has NO HIDDEN AGENDA with the replacement of the playground. We simply feel our dues-paying residents and our children deserve a playground that is SAFE, UPDATED, and a GOOD INVESTMENT for the future, in addition to minimizing the legal liability of Westlake Village by having ADA-compliant, industry-approved playground equipment.

Thank you for taking the time to read this. If you should receive a phone call or email concerning the playground project, I would ask that you keep the above in mind.