Cover Letter
Note: There is a link to open the “Madison River Ranch Proposed Bylaws” at the end of the letter.
Association Member, June 11, 2018
At the beginning of our Association we inherited a set of governing documents (CCR’s and Bylaws) from the original property developer (the Declarant). As is normal, these documents were written to protect the best interests of the developer. As is normal, the Board (run by the developer) was given a great deal of power and the Members of the Association had very limited power. Through the years this has resulted in governing documents which are neither suitable nor effective to run a Member based Association. For example, currently Members have no right to review and approve the budget, a single Member can constitute a quorum at an annual meeting and take action, Members have no right to review and approve rules and regulations formulated by the Board, the Association can not legitimately hold a mail ballot, the Board has no requirement to take minutes of meetings or to retain those records, amendments to Bylaws need not be recorded. The list goes on. We are fortunate that we have a good and honorable Board that has elected to work outside of our governing documents to provide broader Member involvement. However, this may not always be the case.
The governing documents need to be amended to fit the needs of our Member run Association and to allow us to govern within the rules embodied in those documents. However, amending our documents requires a 51% vote of all eligible Members. This is reasonable. The problem is that we have never had attendance at a Member meeting either in person or by proxy that was sufficient to pass an amendment. The solution was to send mail ballots to all Members. However, our Bylaws, inherited from the developer, do not allow this without the prior written approval of all Members and this is not possible.
Solving this problem makes your attendance in person or by proxy at the June 30 annual meeting so very critical.
At the last annual meeting the Members agreed that the governing documents needed to be changed to reflect the needs of a Member based Association. A motion was passed to establish a committee to comprehensively review the governing documents with the following in mind;
• remove unnecessary references to the Declarant.
• identify unclear language and propose clarifications.
• make recommendations concerning quorums.
In addition, the Directors and non Director members of the committee considered how the Association was being practically run, how records were being kept and retained and the balance of power between the Board and the Members.
The Bylaws and Guidelines attached below for your review and consideration are the product of that work. They reflect the recommendations of the committee, the comprehensive review of the Board and the complete review of the Associations attorney. Of special note, each of over 200 recommendations are made with the unanimous consent of all those involved. The Board, the committee members and our attorney recommend this restatement of our Bylaws for your approval.
Once again, your attendance at the June 30 meeting in person or by proxy is critical for the future success of our Association.
Regards,
John Clark, President of the Association
Joe Fritsch, Chairperson of the Documents Review Committee
GUIDELINES FOR REVIEWING THE PROPOSED RESTATED BYLAWS
Your review involves considering the current bylaws, understanding the amendments being proposed and the reasons for those proposals. The following plan has been used to assist in the review of all of this information.
• BLACK text is original to the original Bylaws (1989).
• RED ITALIC text is amendments made over the years to the Bylaws.
• GREEN BOLD text are recommended amendments.
• STRUCK THROUGH small text is amendments for removal of earlier words.
There are two basic types of recommended amendments. First are housekeeping amendments. Second are substantive amendments which directly effect Member rights and governance.
Housekeeping Amendments do not have a stated REASON associated with them in the body of the document. Housekeeping amendments concern;
• change references to “MRRA” or “Ranch” to “Association” and “Declaration” to CCR’s.
• gender neutering the text (ie change “his” to “their”).
• remove references to “Declarant”.
• spell out numbers and percentages.
• capitalize the words “Member”, “Owner”, “Association”, CCR”, “Tract”, “Common Area”, “Common Areas”, “Property”
• correct addresses and names and insert references to applicable Montana law.
• clarify responsibility (i.e. Article VI)
Substantive Amendments always have a REASON given at the end of the amended text. Among the more critical Substantive Amendments to protect and enhance Member rights are;
• establish the right of Members to vote for and approve the Budget (article 7.1 and 7.11).
• require that a quorum must be maintained at a meeting (article 7.8)
• assure Members have ample time to question the procedures at a meeting (article 7.9)
• provide an effective means to conduct a vote by mail ballot (article 7.10).
• require that the Board must give the Owner notice before they enter the Owners Tract (article 8.1 (h).
• establish the right of Members to review and approve all rules and regulations developed by the Board (article 8.1(i) and 13.1).
• require that the Board must keep meeting minutes and publish them to the Members (article 8.1(j) and 8.9).
• require that the Board hold and maintain comprehensive Association records and backup duplicates (article 8.1(k)).
• require term limits for Directors, establish a transition plan between directors, establish a mail ballot for electing directors and end cumulative voting (article 8.2).
• require the notification of Members regarding both Regular and Special Board meetings (articles 8.3 and 8.4).
• require the attendance of Members when Directors make and pass motions discussed in private executive sessions (article 8.5).
• require a comprehensive letter of resignation from Directors to assure transfer of knowledge (article 8.7 and article 9.4).
• require a Board vote on the release of reserve funds (article 8.11(b)).
• require that all officers (i.e. President, Treasurer) must be Members (article 9.2).
• eliminate non-Member subordinate officers and all subordinate officers (article 9.3).
• require that the voting majority on committees be non-Director Members (article 10.1 and 10.3 and 10.5).
• require removal of committee members only with cause (article 10.4)
• require the Board to respond to a Members request to review Association records within 5 working days (article 14.1)
• establish the right to hold votes on amendments with a mail ballot (article 7.10 and 15.1).
• require that the Bylaws be recorded with the County Clerk and that certificate contains complete disclosure on the voting (article 15.1).