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Note: MLCCE HOA (Meadow Lake Country Club Estates Home Owners Association) is the same entity as MLHOA (Meadow Lake Home Owners Association) and may be referred to as MLHOA throughout this website.
ANNEX A: Vision Elements and Goals
Three of the four elements of the HOA’s vision are “lifestyle,” “stewardship,” and “governing documents” (the fourth relates to who the board serves). The following are examples how these elements relate to association management obligations.
- Lifestyle: Social events, inter-personal communication, use of common areas, recreations.
- Stewardship: Safety and security, budget resources, management communications, infrastructure maintenance and improvements, environment improvement, information management.
- Governing Documents: Membership access, document currency, compliance.
To fulfill the vision, the MLCCEHOA, Inc. board of directors maintains a list of long-range goals for fulfilling the association’s vision. Each goal is referenced to the vision element it supports. The board may revise this list as it deems appropriate. Based on these goals, the board develops initiatives that for managing the association and fulfilling the board’s chartered responsibilities. The goals are listed without reference to order of importance. (L = Lifestyle; S = Stewardship; G = Governing Documents)
- Maintain a “total community” perspective in developing initiatives and managing programs. L
- Conduct and support community service programs for the benefit and enjoyment of all members. L
- Conduct long-range program planning for roads, security/safety, architectural standards, budgeting, and community development. S
- Be financially responsible in funding annual budgets and fulfilling reserve obligations. S
- Continue the upgrading of common use areas and community services. S
- Provide viable community information services. S
- Provide an active professional administrative service fulfilling chartered responsibilities. S
- Manage programs and services in an environmentally conscious manner. S
- Be ethical serving all members equally and fairly without consideration of personal or special interests. G
- In all efforts comply with the intent and purpose of the association’s governing documents. G
ANNEX B: FY 2019 Initiatives
The MLCCEHOA, Inc. board of directors annually updates initiatives for the purpose of achieving goals and thus fulfilling the association’s vision. The following initiatives are planned for the association’s 2019 calendar year.
- Survey the members for needs statement to develop a Community Center for Meadow Lake HOA members. – SPECIAL
- Review and update existing association management plans and governing guidelines (i.e., Strategic Plan, Security Plan, Weed Management Plan, Disaster Preparedness Plan, Building Standards, Community Standards, Operating Procedures, and charters for existing committees). Focus for 2019: Update Disaster Preparedness Plan, and re-establish COPS Committee for updating Security Plan. – ADMIN
- Inventory non-working and absent yard lights; notify property owners of needed corrective action as necessary– BIM
- Resolve drainage on Gleneagles Trail – BIM & ARB
- Continue to negotiate with Meadow Lake entities for use of on-site facilities serving all members. – ADMIN
- Identify/Validate timeshare Unit Representatives and encourage them to attend meetings and become active in their associations, and in the MLCCE HOA. – ADMIN
- Establish a formal entrance to the Mountain Watch neighborhood with mail boxes and bulletin board at Meadow Lake Drive and Gleneagles Trail. – BIM
- Encourage community involvement in HOA committees and the board by providing routine announcements on community bulletin boards, website and Nextdoor of available vacant positions .
- 9Enhance relationships with the Sub Associations. – ADMIN
- Improve the Entrance signage to Meadow Lake at the intersection of Tamarack and St. Andrews Dr. – BIM
Adopted by the HOA Board of Directors on March 9, 2019.
A Staff Study on Strategic Planning For Meadow Lake Country Club Estates Homeowners Association, Inc.
A Study on Long Range Planning for Meadow Lake Resort
MLCCEHOA, Inc. July 29, 2010
The Meadow Lake Country Club Estates Homeowners Association, Inc. (MLCCEHOA, Inc., or “HOA”) board of directors initiated a study in September 2009 to engage the homeowners association in strategic, long range planning. The study is an ongoing project directed by a committee of board members and guided by Beargrass Marketing, Inc., which the board contracted for this purpose. The study and subsequent planning effort, when completed, will provide a vision for the association’s future and a long range plan by which the board can manage the association in fulfilling that vision.
Meadow Lake Resort has a successful 25 year history. Its growth, commercial success, and real estate development reflect favorably on its past. Current stagnant conditions are temporary, but future opportunities suggest significant resort growth lies ahead. Over the next 20 years it is expected the resort will continue towards build-out as residential and time share construction follows economic trends. Once completed, the resort will nearly double ownership numbers thereby placing a heavier burden on HOA services. Management decisions must be responsive to the anticipated growth.
To meet the challenges of growth over the coming years the HOA board of directors must examine current conditions and anticipate future demands that may impact the resort and subsequently its homeowners association. Driving the execution of projects and programs deemed essential for the HOA’s future success will be the economy and related resources, resort growth patterns and demographics, Meadow Lake’s infrastructure, the role of businesses in the community, and organizational management issues. Current conditions, HOA management resources, and limiting factors each require study if a resort plan is to emerge.
What will the HOA plan look like? First, and most important, it will include a “vision” describing the structure, management and services the association aspires to achieve. From that vision come the goals, objectives, and initiatives necessary for the HOA to fulfill its future obligations. The HOA board will review the plan annually, as it will be a “living document.” From time to time the board will adopt changes to the plan as new challenges and opportunities become evident. Initiatives stemming from the plan may require long term efforts (for example, initiatives relating to pathways or resort security may require long term funding and project planning that spans a number of years). Goals serving community values and resort management concepts will likewise generate objectives and initiatives that require extensive planning as the HOA reaches out to achieve its vision.
With the support of Meadow Lake business, time share, and residential interests, all parties will benefit from this effort as the community grows and achieves maturity. A vision for the future, a plan to achieve that vision, and the support of all community members will collectively help promote the safety, security, and value of the resort. It’s the role of the HOA, led by its board of directors, to “own, control, maintain and improve the common area and provide services and facilities to the owners as it may determine” (CC&Rs Article IV, Section 1). This study represents a major effort by the HOA to fulfill its role as the resort progresses towards completion of build-out.
In November 2010, the HOA board will meet to review this study and craft an outline for a long range plan. The board anticipates presenting a draft plan to the association at its general membership meeting in June 2011.
Defining “Strategic Planning”
Current Resort Conditions
- a. The Economic Outlook
- b. Economic Resources
- c. Resort Growth Patterns
- d. Ownership Demographics
- e. Infrastructure Resources
- f. The Role of Resort Businesses
- g. Management Issues
Available Management Resources
- a. Board of Directors
- b. Paid Managers
- c. Contractors
- d. Volunteers
- a. Manpower
- b. Budget
- c. Facilities and Services
- d. Membership Support
- e. Declarant Powers
- f. Variant Perspectives
Without long range strategic planning, the board of directors for Meadow Lake Country Club Estates Homeowners Association, Inc. (MLCCEHOA, Inc, or “HOA”) lacks the ability to effectively and efficiently manage the association in meeting its future needs. These needs stem from a changing economic environment, growth patterns and ownership demographics, infrastructure demands, the business environment, and HOA governance and organizational management challenges.
Defining Strategic Planning:
In the context of this study the term “strategic planning” refers to a long range perspective for planning the future direction of Meadow Lake’s HOA. That perspective involves the integration of all aspects of the resort’s operation. Though the MLCCEHOA, Inc. has no legal or operational responsibility for businesses or associations comprising the Meadow Lake community, it is responsible for mutually shared common area interests. The HOA must therefore look at how each community component individually—and all components collectively—impact overall common resort interests. Through this process the HOA can envision future goals and objectives while managing supporting initiatives designed to fulfill the association’s future obligations. Strategic planning is therefore the integration of Meadow Lake’s long range common community interests, an integration that is represented in an ongoing planning process towards a shared vision of the future. For the purposes of this study, that future extends for 20 years, until the year 2030.
On 30 October 1985 the Declaration of Covenants, Conditions and Restrictions (CC&Rs) of Meadow Lake Country Club Estates was signed by the declarant, Peter E. Tracy. Article IV of the CC&Rs created Meadow Lake’s homeowners association. Section 1 of this article defined the association’s purpose as “…to own, control, maintain and improve the common area and provide services and facilities to the owners as it may determine.”
The HOA board of directors, on 30 April 1994, executed an instrument installing the association’s by-laws. These by-laws were revised when the HOA was reincorporated on 17 October 2003. In the 2003 by-laws recognition is given the declarant’s right to appoint the HOA as his successor (Article II, Section 7, “Declarant”), a provision fundamental to successful 2 planning of the association’s future. Also, specified in the new 2003 by-laws were powers assigned the board of directors, including the power to govern use of the association’s common areas plus “… all powers, duties, and authority vested in or delegated to this Association and not reserved to the membership by other provisions of these By-laws, the Articles of Incorporation, or the Declaration” (Article VII, Section 2, “Powers”). The CC&Rs and by-laws together provide the authority for the board of directors to define the association’s future and to plan for the opportunities that future offers.
The 1985 CC&Rs established an Architectural Review Board (ARB) the purpose of which was to “…insure that homes and other buildings constructed at Meadow Lakes Country Club Estates are aesthetically compatible with the landscape and the Master Plan Concept.” When the 1994 by-laws were adopted, the association was assigned the responsibility to appoint ARB members (Article IX, HOA By-laws, 30 April 1994). This arrangement was continued by the 2003 by-laws revision. And finally, in 2006 the association’s board of directors adopted the current “Community Standards, Design Standards, & Construction Regulations,” which updated ARB guidelines and established standards derived from the CC&Rs, by-laws, and applicable government guidelines.
In 2009 the HOA board of directors adopted the “Community Operations and Protective Services (COPS)” plan at its annual membership meeting in June. This plan placed in motion HOA initiatives to provide for a safer Meadow Lake community. Planning for the resort’s future “security” needs and implementing programs designed to service those future needs became central themes for the newly established COPS Steering Committee.
A review of the HOA’s governing documents (CC&Rs, by-laws, ARB regulation) suggests that, while the documents adequately address the structure, purpose and procedures for managing the HOA, there are no specified provisions for future planning. However, these documents collectively provide the authority and means by which the association can take the initiative and implement processes and procedures for such planning. The duties and responsibilities vested in the association’s board of directors command sound management practices which, by definition, should include long range planning.
The HOA functions as an umbrella organization having responsibilities over the resort’s common areas and their use by member organizations, owners and guests. It has no authority over the operational activities of these members other than those of the association, nor should it. It does, however, exercise specified responsibilities and authority over architecture, landscape, traffic, signage, and other matters throughout the subdivision, including the conduct of persons within the resort.
The HOA board of directors generally manages its affairs on a situation by situation basis. Some long range practices are evident in financial matters, such as the building of reserves. However, the forecasting of long range needs and developing policies and plans to meet those needs has not been evident except for recent efforts of the COPS program. This condition exists primarily 3 due to historical management patterns driven by the unique organizational structure of the entire resort.
The challenges confronting the association cover a broad range of institutional issues. Some of these challenges include the following:
- Absence of a “vision” by the board of directors upon which it should be planning the association’s future;
- A board whose members function primarily in an advisory role rather than a leadership role;
- Lack of an existing management structure for conducting association staff work relating to tasks or projects appearing before the board;
- A management system lacking the ability to look forward in anticipation of future association needs;
- Limited long term budget planning to ensure future anticipated programs are supportable;
- Restricted ability to change governing documents (CC&Rs, By-laws, regulations, plans, etc.);
- Absent authority to contribute to the resort’s municipal water and sewer district decisions;
- An association membership reluctant to consider alternative funding sources to support special community needs.
As the association looks forward to the next two decades, its past is an indication of what association members might anticipate. In 25 years Meadow Lake has grown from a small recreational site to a valued residential community and oftentimes vibrant destination resort. Full-time and recreational residences now surround much of one of Montana’s highest rated golf courses. New subdivisions within the resort have opened, and their additional expansion is already planned or approved. The timeshare industry will continue to grow, with six additional buildings planned near golf holes 14 and 15 and a hotel near the 10th hole tee boxes. Given the growth of the past, in 20 years Meadow Lake could be a community with over 600 residences, 25 timeshare buildings, and a luxury hotel. By 2030, Meadow Lake Golf and Ski Resort could be a fully developed resort community.
Planning for that future requires forward looking strategic planning by the HOA’s board of directors. Blessed with a solid foundation of governing documents and a history of successful leaders and innovative developers, the resort’s board is poised to begin that planning process. A review of economic and demographic conditions and community resources available to the association will provide the foundation for future initiatives. Such initiatives will soon become necessary if the board of directors is to exercise its leadership role. With a vision for the future and a plan to get there, the association’s board of directors will be fulfilling one of its most important obligations to Meadow Lake owners, visitors and guests for decades to come.
Current Resort Conditions:
Meadow Lake Resort is influenced by a wide range of conditions impacting its growth, management, and community membership. These three components are at the heart of the resort’s future. As the resort cuts across a population of residents and guests representing an international community, the future of the resort’s homeowners association depends on association leaders who can plan and manage its programs melding the issues arising and forecasted among these components. Planning for the future is therefore fundamentally based on an understanding of issues forecasted for the resort.
a. The Economic Outlook: One must suppose that the long term economic outlook, both for Meadow Lake and the Flathead Valley, are positive. Trends dating back many decades reveal ebbs and flows in the national economy also bring like change to the Flathead Valley. Real estate activity, for example, has had boom and bust cycles, including the most recent down turn dating back to 2007. Land subdivision activity and residential construction declined from a peak in 2005 through 2009. Employment trends have followed a similar pattern. Each “recession” has been followed by a period of growth. Some economists claimed a recovery trend in 2010. Others forecasted economic stagnation. Both views are evident in the construction industry within the Flathead Valley as employment forecasts point towards a recovery; but new projects are limited, and trends are confusing. While unemployment rates approach 14% in the Flathead, recreation industries such as the Whitefish Mountain Ski Resort reported a near record year in skier visits and lodging, and Glacier National Park officials reported solid numbers in park visitors despite a weak economy. These are signs that Meadow Lake Resort, with its appeal to the recreationist, may be poised for growth when the economy does in fact begin to improve.
The economy impacting Meadow Lake Resort has many aspects. Subdivision development and construction are key to the continued build-out of the resort. The timeshare community and Tamarack Heights represent the bulk of growth opportunity. Additionally, the Canadian economy and value of the Canadian dollar are significant to the growth of Meadow Lake. As the real estate market rebounds, Canadian and American interests in resort home and timeshare ownerships will increase. Three recessions occurred during the last 25 years. In the next 20 years there will be more recessions. However, boom periods will also occur. Judging from the past, a majority of the remaining residential and timeshare lots within the entire Meadow Lake subdivision could be sold before 2030.
b. Economic Resources: The basic source to fund HOA activities is the monthly dues, at approximately $38.00/month. This is a relatively low monthly fee for service in a resort/residential development, making it one of the attractions for Meadow Lake ownership. Presently, this provides a $182,000 annual budget to the HOA. The HOA has limited ability to raise these rates. This in turn requires tight expense controls and promotes short term planning. The board has therefore been reluctant to consider 5 major expense initiatives or long term alternative funding techniques to support increasing community needs. Long term budgeting is necessary, and additional revenue sources are limited.
The association presently charges fines to owners of residences, lots and timeshares who repeatedly violate CC&R, by-law and Architectural Review Board rules and regulations. Monies raised by these violations are limited and cannot be included in the association’s forecasted revenue stream. Other potential funding sources:
- Substantial dues increases (changing the HOA by-laws is necessary to increase the monthly association fees by more than 15% a year, an action inconsistent with expectations shared by the resort’s developers and HOA members);
- Special assessment (requires approval by 51% of members present or by proxy at a meeting to consider such action);
- Special Improvement District (SID) bonding (requires approval by 51% of members present or by proxy at a meeting to consider entering the association into any indebtedness; however, this may be a taxing authority issue that could require 75% approval of all owners).
There are many challenges impacting the board’s ability to use options like those mentioned above. For example, as a second home community, the membership will resist increasing home ownership costs. But these options exist, and if the community demands the HOA provide a higher level of service to protect individual and business investments in a competitive resort such as Meadow Lake, then additional funding will be necessary. Without it, Meadow Lake might one day look much like any other middle-class subdivision community adjacent to a private golf course rather than a “Gold Crown” or “luxury” resort.
c. Resort Growth Patterns: Meadow Lake began its resort history as a golf course which was, and remains, a privately owned course open to the public. The course, which was opened for play in its present 18 hole format in 1987, was originally a partnership with the dominant partners being Peter Tracy and Ron Holliday. In 1994, Tracy and Holliday divided their resort assets, with the golf course and undeveloped real estate going to Tracy, and to Holliday went the restaurant, hotel, recreational facilities, timeshare business and some real estate. This is the current arrangement.
Following declaration of the CC&Rs in 1985, and through 1987, platted lots were offered for sale and four model homes were built on lots 1Z through 4Z. In 1988, there being no groundswell of interest in Meadow Lake real estate, a decision was made to construct new units and actively market a timeshare product which was euphemistically called “fractional ownership,” the idea being “timeshare” was stigmatized and “fractional ownership” sounded somewhat more wholesome.
In 1988 Meadow Lake consisted of 330 acres which contained Tracy’s Restaurant, the Golf Pro Shop, Condo Building 1 and the four homes previously mentioned. Condo Building 2 was under construction, with some units completed by fall of 1988. There were numerous “Z” lots for sale along St Andrews Drive, with a small number of sales having been consummated. Prices ran from $12,000 to $22,500. As with virtually every resort start up, the early years were fraught with some ups and downs, but eventually there were more of the former than the latter and the resort began to meet with reasonable success. For the first several years of operation golf course revenues and timeshare sales were the only sources of resort income. Had timeshare sales and marketing not worked out successfully, Meadow Lake would not exist as it does today.
Over the years Meadow Lake has offered a variety of real estate products, including established homes, resident home sites, timeshares, townhomes and condominiums. As noted, established homes and home sites were the first real estate offerings. Townhomes first appeared about 1992. They were fourplex units introduced with two different floor plans at a price of about $120,000. Timeshare ownership started with rotating five week packages and specific monthly ownerships in building 2. Then came three week ownership programs in buildings 3, 4 and 5, followed by one-and-a-half week options in buildings 6 and 7.
Buildings 1 through 7 form the Saint Andrews Homeowners Association. The Spyglass Hill Homeowners Association, composed of timeshare buildings 8 through 12 followed. Spyglass Hill units were offered originally in time intervals as small as one week packages. At the start of the new millennium the resort began building NeNastako Village units. NeNastako owners are not represented by a “neighborhood” HOA.
Future resort development will likely conform to existing patterns. Residential home sites remain in areas previously developed, and two principle subdivisions contain the bulk of remaining sites yet to be sold or built on: Whisper Village and Tamarack Heights. Architectural designs for these subdivisions will likely remain consistent with current ARB standards and the resort’s overall existing architecture.
Opportunities remain for multiple unit residential growth, such as the duplexes planned for Whisper Village and a third condominium building for Condominiums on the Green. However, it is not anticipated that additional fourplex townhomes will be constructed since available building sites have all been platted for other types of construction. Timeshare growth will continue, there being plans for an additional six buildings in the new Glacier Village complex. Additionally, the corporation has plans for a hotel complementing the Inn at Meadow Lake. These units may be built-out in a rapid or delayed manner, depending on the economy and joint project interests between MLDC and some other resort development interests.
Meadow Lake, given its history and economic conditions, again appears poised for ownership growth with construction of already planned subdivisions and timeshares. The additional units will nearly double the resort’s resident and part-time membership, placing added pressures on the HOA to provide services necessary to continue meeting the community’s high standards.
d. Ownership Demographics: The Meadow Lake community serves primarily two groups: the resort timeshare owners and the residential homeowners. Others served by the community include renters, RCI timeshare exchange clients, overnight guests, and visitors invited by the many resort interests. Meadow Lake homeowners reside in single family homes, townhomes, duplexes, and condominiums. Some landowners have not developed their property and others retain it for investment purposes. Many residential owners also own timeshares, and many timeshare owners own multiple weeks which provide for extended stays at the resort.
The following is a breakout of resort/residential demographics.
Timeshare Ownership: The resort presently consists of 24 hotel rooms, 114 timeshare units, and 17 short term rental homes (owned by others, managed by the resort). There are 3,500 timeshare owners, and the resort registers an average 8,000 guests per year in the units managed. Planned expansion allows for six additional timeshare buildings (60 units). These might be built over the next 10 years, depending on market conditions. This could increase HOA monthly assessment revenue approximately 25%, with a similar proportional increase to ownership numbers. A hotel with 48 rooms is considered that could significantly add to the daily visitor load.
Residential: There are approximately 155 residences in Meadow Lake which consists of the following:
- 12 fourplex townhomes
- 1 sixplex condominium
- 1 tenplex condominium
- 7 duplex/patio homes
- 77 single family homes
Of the 155 residences, 35 on average are occupied as permanent residences, the balance being seasonal use, rentals, and vacation homes. Overall, Meadow Lake is a second home market. About 72% of the overall ownership is Canadian. There are approximately 104 platted “yet-to-build” residential lots that would supply 120 additional residences. These lots consist of:
- 96 single family lots (44 in Tamarack Heights)
- 7 duplex lots
- 1 tenplex lot
There are an additional 136 planned, but not yet platted, single family lots in Tamarack Heights.
Meadow Lake has limited land for additional development, thus it is unlikely developers could expand or increase the number of buildable Meadow Lake lots. It is possible, though, that land use trades or platted density revisions could change these numbers. Substantial build-out is estimated to be at 20 or more years. Full pay-out for HOA fees could occur within 10 years.
e. Infrastructure Resources: Meadow Lake Resort is blessed with several infrastructure resources that give the community a sense of independence from neighboring Columbia Falls and other county institutions. Among these include:
- A platted location outside of Columbia Falls city limits;
- Meadow Lake’s water and sewer district operated solely for the resort;
- Parks owned and regulated by resort businesses and HOA;
- A private road system maintained by the HOA;
- Internal recreation facilities sponsored by association member businesses (including HOA common use areas);
- Natural resources such as habitat for waterfowl, big game and other animals.
The extensive infrastructure resources enjoyed by the Meadow Lake community provide a solid foundation for the resort’s continued growth and development. They also contribute to a life style attractive to many people looking for recreational opportunities and the feeling of being a part of the Montana experience. These factors assure owners their investment in the resort is sound and sustainable. These are important conditions when potential owners look at Meadow Lake.
But are these infrastructure resources sustainable with the growth anticipated at Meadow Lake over the next two decades? The answer is “yes,” providing the community owners and associated businesses invest in the maintenance, expansion and protection of the common area infrastructure. This requires planning—long term and vision driven. And it also requires an integrated and participative community membership if owners and businesses are to fulfill the vision most owners held when first investing in the resort.
f. The Role of Resort Businesses: Business activity within Meadow Lake has its roots in the creation of the resort in the mid-1980s. Peter Tracy, Ron Holliday and other investors over time created a resort with three primary business activities: golf, timeshares, and real estate. Today, these three activities are represented by Meadow Lake Golf Resort, Inc. (MLGRI), Meadow Lake Development Corporation (MLDC), and Meadow Lake Resort (MLRE). Other business interests also now exist, including the Meadow Lake Water and Sewer District, Remedies Day Spa, and a restaurant.
Meadow Lake, through its business activity and residential community, engages numerous contractors in support of its operations. Like any community, the contracted services are essential as they allow for operations to succeed without the added costs of conducting those services with in-house resources. Landscape services, snow plowing, facility repair, trash removal, etc. are a few of these services. The Flathead Valley hosts a wide range of companies providing added services a growing community like Meadow Lake might require in the future. All services, however, will become more expensive as the economy moves forward.
Questions regarding how businesses and the HOA can work together to achieve a community-wide vision for their common interests remain. Addressing them will be necessary in any HOA planning effort. Some of these questions include:
- Will the resident businesses at Meadow Lake and contracted services continue to operate in the future?
- Will there be new businesses seeking opportunity within the boundaries of Meadow Lake, and, if so, how can the HOA accommodate such businesses?
- Will the HOA be required to amend its governing documents to accommodate new business activity or to engage contractors who might bring new services to the community?
- And how will unilateral business decisions by the principle business interests at Meadow Lake impact HOA members if the HOA lacks the authority to protect community and common area standards?
Business activity at Meadow Lake is an essential component of the success and future of the resort. The resort exists because of the three principle businesses operating within its boundaries. Through long range planning the community can prosper because of these businesses while concurrently cooperating and promoting their individual business objectives. Meadow Lake is a community, and all parties must share in a vision of its future and work together to achieve that vision. g. Management Issues: The current structure of the Meadow Lake resort includes a variety of business and residential entities. Principal businesses include MLGRI, MLDC, MLRE, and Meadow Lake County Water and Sewer District. The residential structure involves a number of homeowners associations within the timeshare community, Whisper Village, Condos on the Green, and others. Additionally, NeNastako timeshares, individual residential townhomes and private homes exist without association representation, except for the “master” HOA of Meadow Lake. This structure, the continued rights of the declarant, and the complexity for amending the HOA’s governing documents, create a difficult arrangement for flexible management practices within the association.
An example of management difficulty is the question “Who controls the ARB?” The CC&Rs assigns control to the declarant. However, the association’s by-laws dating back to 1994 assign the appointment of ARB members to the association (an arrangement consistent with the provisions of the CC&Rs, Article V). And finally, the “Community Standards, Design Standards, and Construction Regulations” (adopted 20 January 2006) were approved by the HOA. It is not clear the declarant has assigned ARB duties and responsibilities to the HOA. Within the HOA board of directors, confusion often exists regarding the specific limits of the association’s role regarding ARB matters: the HOA appoints ARB members and establishes regulatory guidelines, but is it really responsible for the ARB? Such confusion exists because changes to the governing documents have not occurred even though they may have been agreed upon in past meetings between the responsible parties. Additionally, the ARB is often not sure of its responsibilities and will defer to the HOA board for guidance. Governing documents must be updated.
Other management issues requiring study include:
- The resort’s business, community and association structure as a component of the HOA;
- The limited authority of the HOA board of directors to modify governing documents, implement rules, and draft regulations;
- Absence of an effective level of community member participation in HOA activities;
- Lack of volunteers for community projects and committees;
- Limited financial resources for the master HOA to effectively fulfill its obligations;
- Conflicting interests among resort entities when it comes to governing the community-wide issues.
Second to the ARB, the COPS program became a formal approach to resort-wide management by the HOA from the standpoint of enforcement of Meadow Lake CC&R’s and by-laws. When planning the COPS program, the HOA board began to realize the benefit of having a HOA “manager” whose duty would be to implement the decisions of the board and facilitate a working relationship among the resort’s competing interests. Whether a manager would serve full or part time might depend on the management structure engaged by the HOA, available economic resources, and associated costs.
Available Management Resources:
The Meadow Lake Country Club Estates Homeowners Association (HOA), Inc. was established by the declarant and incorporated with the resort’s CC&Rs. While purpose, functions and authority are delineated in the CC&Rs and by-laws, managerial functions necessary to fulfill the association’s charter are not. Planning, organizing, directing and controlling (the four functions of management) are at the discretion of personnel actively engaged with the association. These personnel include the board’s directors, paid managers, contractors, and volunteers.
a. Board of Directors: Elected to office by the association membership, the directors represent the membership in three categories: residential, timeshare, and at-large.
Each must be a volunteer. Their backgrounds and abilities vary, and their degree of participation in board meetings and committees generally conditioned on their residential distance from Meadow Lake, time available, and interest. Motivation for being a board member may involve the desire to serve the community, to be active with some professional effort while in retirement, to satisfy self-interests, to serve a personal agenda regarding the association, or some combination. Usually directors choose not to become involved in staff work (managerial or administrative tasks) or be available to plan, manage or lead association committees or projects. These efforts will characteristically be assigned contractors or other paid Meadow Lake staff personnel. Most directors will assume the roles of advising and consulting. For the board to function effectively as structured and fulfill its inherent managerial functions, dedicated staff personnel are necessary for conducting the planning, organizing, directing and controlling tasks. But these resources are limited. Until they exist in greater quantity, the board’s success will be limited mostly to small, short-range tasks, many of which can be resolved during a two hour board meeting.
b. Paid Managers: The principal “manager” of the association is Meadow Lake Real Estate. Meeting planning, records keeping, financial accounts, contractor coordination, etc. are functionally performed by this office. The association pays for these services, and to a large extent the real estate office is the central office for association affairs. However, the office is not responsible for the management functions normally attributed to an incorporated body such as MLCCEHOA, Inc. Tasks such as landscape and road maintenance, security, communications, budget planning, legal and insurance considerations, architectural policies, CC&R enforcement, etc. require board leadership in addition to the administrative support of MLRE. The real estate office provides a “central office administration” environment for association members. The HOA perhaps receives more benefit from the contractual arrangement with MLRE than the paid-for services would otherwise justify. While this arrangement serves the association’s current needs, additional staffing and facility resources will be needed as the association expands its functions and services. Meadow Lake Real Estate alone cannot carry the workload associated with a manager who would implement the planning, organizing, directing and controlling functions necessary to accommodate the HOA’s future growth. The HOA/MLRE alliance has served the association well and will continue in the future as an administrative services relationship.
c. Contractors: The HOA directs common area projects and maintenance tasks to contractors. These tasks include landscaping, snow plowing, sign construction and installation, security patrols, communication networking, road maintenance, etc. The association lacks the managerial or administrative staff to oversee contractor performance except for the diligence of local members of the board of directors, residents, and the managerial staff of MLRE. “Contract management” as a functional responsibility of the board does not exist. While the present system operates effectively in that contractor performance is meeting association needs, having a dedicated contract manager for all association contracts has the potential to reduce costs and improve quality. Competitive bidding, job performance evaluation, a standard review process of performance specs, scheduling payments to facilitate the smooth flow of association expenditures, and the coordination of necessary contracts with other Meadow Lake entities likely could reduce costs for many contracts. As the resort grows, the need for contract services will increase along with the demand for more formal and centralized contracting services.
d. Volunteers: The Meadow Lake resort has limited volunteer activity. While volunteers working on resort sponsored activities can provide a greater sense of community for those involved and help provide for a better community, few structured volunteer activities exist within the resort. Residents and guests may pick up trash while on daily walks, and others may contribute time and services on boards or committees. Because of the small number of full time residents and the recreational nature of the resort community, volunteer programs have limited appeal for the owners. Programs designed to accommodate the unique demographics of Meadow Lake could, however, promote group and individual activities that have a volunteerism basis while simultaneously engaging people in sports, social or benefit oriented events. Such efforts require organization and institutional support. The association at present appears to have a reservoir of volunteers if an appropriate management structure existed to tap it.
The board of directors, paid managers, contractors and volunteers potentially represent a viable mix for effective HOA management. What’s missing, however, is a vision from which association leadership can build goals, objectives and tasks/projects designed to fulfill that vision. Without institutional planning, the association will continue to function on a task by task basis using its current management structure. The entire management mix must work as a collective system pursuing an integrated set of goals and objectives. Additional limitations facing the association as it currently operates include the following:
a. Manpower: The lack of managerial and labor manpower will continue to dictate the necessary operation of the association as it now conducts business. An association manager potentially could bring the existing management, contract and volunteer resources into a successfully functioning management structure. Facility and communication services exist to support such a central management activity. MLRE would continue the administrative and management services necessary for the association to function, and contractors would still perform necessary tasks supporting association operations. A HOA manager, reporting to the board of directors is presently a missing component for the HOA’s future success. The board of directors is authorized to hire such a manager (By-laws, Article VII, Section 2(d)).
b. Budget: For HOA management to grow with the forecasted need, the board of directors requires additional budgetary resources. The HOA board can increase its funding resources by increasing the annual assessment of each member, or borrowing funds for membership approved projects. (Another source for an increase in assessment fee collections could be the additional platting and building of new residential lots/homes and timeshare units, though this avenue has limited potential and would not result from any HOA initiative.) The most significant limiting factor for increasing the annual assessment beyond 15% or funding special projects is the by-laws requirement for association membership approval. Increasing revenue is a difficult task.
c. Facilities and Services: Facility and communication resources are adequate for current operations. As the association increases its activities, especially as new services and manpower might increase, the need for additional office space and a more centralized network for communications will appear. A new HOA website now exists, but little benefit has appeared in terms of documented membership use. An HOA office, with dedicated phones and administrative support, will tax current facilities and services presently offered by MLRE. As the association continues to grow, it will need to address these limitations before it can accommodate any enhanced management function or increase in management team numbers.
d. Membership Support: The HOA membership roll shows over 400 members listed. Fewer than 100 people usually attend the annual membership meeting, and that number includes non-voting spouses and friends. Additionally, developers whose building lots or timeshare units have not been sold retain voting rights on those developed units. This creates a challenge obtaining sufficient voter support for new initiatives in which a majority of members must vote in favor of the proposal (when a small number of people control a large block of votes, the number of owners who must vote in favor of a proposal increases significantly unless the large block owners too are supporters). Additionally, volunteer support for committees and boards is generally lacking amongst the membership. This limitation exists primarily due to the “resort” nature of Meadow Lake. Perhaps as much as 80 percent of the membership is composed of recreational owners.
e. Declarant Powers: Since the creation of Meadow Lake, the declarant (Peter Tracy) has held authority to revise the resort subdivision CC&Rs. The record reveals that this authority has been justly exercised since resort incorporation in 1985. As the resort builds-out in the future, the HOA must depend on the continuance of this level of support. However, if possible, the HOA board of directors would become more effective at administering to its responsibilities and achieving a vision if those declarant powers relative to the HOA were to become powers of the HOA. The by-laws recognize this possibility (Article II, Section 7). However, until the board of directors and the declarant satisfy this issue, it will continue as a potential limitation for all matters confronting association management.
f. Variant Perspectives: Comprising the Meadow Lake community is a variety of business, owners, and visitor interests. Each brings to the resort varied perspectives regarding community values, expectations, goals, etc. For example, timeshare owners may be more interested in services and recreational opportunities than full-time resident owners. Conversely, the full-time resident may express stronger interests regarding road maintenance and association assessment fees. Other varied perspectives likely involve MLDC and MLGRI (their revenue streams may come from similar sources but their security and maintenance concerns are not equally shared). And again, owners of all categories certainly will not share common goals when considering proposals brought to them by the HOA board of directors. These varied perspectives represent limiting factor, the impact of which must be factored when planning future resort programs.
What do the HOA members expect regarding how their association is managed? Most expect responsible leadership and managerial decisions designed to protect their interests in Meadow Lake and promote the value of their investment. The association has a history of improper management (a one-time incident, the Hodges affair, after which corrective actions were taken). Members entrust their board members and supporting personnel (such as MLRE) to conduct business ethically and in the best interest of the association. In sum, they expect efficient and effective HOA management. This expectation therefore requires effective planning, organizing, directing and controlling. A long range strategic plan can serve as a cornerstone for fulfilling that expectation.
The declarant and other developers created an environment for Meadow Lake Resort in which community values have evolved that define a “Montana” life style. These values provided the foundation for Meadow Lake’s appeal to potential residents and vacationers thus creating today’s diverse resort. Keeping those values is critical to sustaining a prosperous residential and timeshare community. To do this, the MLCCEHOA, Inc. board of directors bears responsibility for insuring the HOA fulfills its role maintaining and improving the common area as well as services and facilities assigned the association. To meet this obligation in the coming years, the board should take the following steps in the form of a “strategic” (long range) plan.
a. Develop a Vision: Like any successful organization, the “master” HOA should plan, organize, and operate consistent with a definition of what its members want for the association…a “vision” defining the organization of tomorrow. As the board begins to plan for the future, it must do so in a manner designed to lead the HOA to the fulfillment of that vision. The board should define that vision and gain the endorsement of association members so that institutionally the HOA can go forward planning for the future with a membership that understands and supports the board’s direction.
b. Define Association Goals: Given a vision, the board should develop goals that become general targets in pursuit of that vision. Goals should cover a wide range of vision elements, elements such as “safety,” “security,” “aesthetic values,” “management,” “community,” etc. While goals are general and global, they should provide direction for the association to define its operational objectives and subsequent project initiatives. Well defined goals will set the direction the association follows toward fulfillment of its vision.
c. State Measurable Objectives: With a vision and agreed upon goals, the planning effort must next include stated objectives that lead to goal fulfillment. Each objective should be stated in measurable terms so the association can track progress, define successes and clearly recognize limitations and (when necessary) failures. Once the plan includes objectives, the board of directors can plan, organize, direct and control specific initiatives supporting the association’s efforts to fulfill its vision.
d. Identify Initiatives: A strategic plan is a “living document.” The board of directors, once a plan is developed, should implement it through initiatives designed to achieve specific objectives. These initiatives may come from association directors, members, external sources, or factors relating to institutional resources. Regardless of their origin, each must directly support the objectives, goals and vision of the association. Initiatives may be revised or cancelled, and new initiatives created when goals and objectives change. Through this process resource limitations, membership services, common area maintenance and operations will receive focused oversight ensuring community and membership interests are well served.
In summary, the MLCCEHOA, Inc. board of directors is responsible to its membership for the future welfare of the Meadow Lake association’s common areas, services and facilities. The resort’s CC&Rs charge the board with this responsibility and assign the board the authority to fulfill its duty as it may determine.
The resort is changing. It is entering a phase in which build-out will occur. Economic factors of national and international character will impact future real estate and recreational trends. Given its diverse and fragmented organizational structure, Meadow Lake Resort must increasingly look to its “master” HOA for effective leadership and management to ensure resort common interests meet the forthcoming challenges. Long range planning is a critical element necessary for this to occur.
The “master” HOA board of directors has little experience planning long term, especially when considering broad, strategic needs. But it must begin to manage the association strategically if it is to fulfill its chartered obligations. Engaging in strategic long range planning should be the cornerstone of the HOA board of directors’ mission for the future.
- The MCLCCE HOA, Inc. board of directors initiate strategic long range planning as proposed by the board’s special committee.
- Meadow Lake Resort’s business leaders and representatives of its various neighborhood HOAs actively support MLCCEHOA, Inc.’s effort to create a strategic long range plan for the resort’s common area interests.
Prepared by the MLCCEHOA, Inc., July, 2010
Direct questions or comments to: Russ Gregory, Vice President
MLCCEHOA, Inc. P.O. Box 236 Columbia Falls, MT 59912
Telephone: (406) 892-2801