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Disaster Loan Emergency Advance – Unethical Behavior During Covid-19

Surfside HOA, Ocean Park, WA 5/27/2020

According to sources in Surfside HOA, Surfside applied for an Economic Injury Disaster Loan Emergency Advance. This is a loan designed to provide up to $10,000 of economic relief to businesses that are currently experiencing temporary difficulties.

Per George Millers blog, a long time resident at Surfside, at the end of the first quarter:
• Surfside had over 2.5 million in reserves.
• 84.8% of the members have paid for the entire 2020 dues and assessments.
• Several months remain for those paying on the installment plan.
• Payments are ahead of last year at this time.
• There has been no reduction in work force do to economic issues.
• All bills and obligations are being met.
• Budgeted expense items are continuing.

The Government has had to suspend the small business loans because the demand was greater than the supply. It has been extended to the agricultural industry only.

Yet in spite of all this, the already obviously elitist Surfside Board decided to apply for this money, taking it from other local businesses who desperately need it. According to sources inside Surfside, the Treasurer Rudd Turner reported in his financial report that a $10000 advance that did was not required to be paid back had already been received. Interestingly, this had not been brought up at a board meeting, no meeting, no quorum, not vote.

Keep in mind that this HOA a few years back, to many property owner’s dismay, reported that they lavished $6000 on a pair of binoculars to help the Tree Committee assure that the property owner’s trees heights did not exceed the CCR allowed height for their property. Really, $6000 binoculars are needed to see if trees are too tall?

This is the same Surfside HOA that reportedly illegally handled and buried asbestos water pipes, was caught and fined for doing so, and illegally filled in wetlands.

This is the same Surfside HOA that wants to have a contract with Pacific County to pay the County to assign a Sheriff specifically to their HOA. According to some members of Surfside, the Surfside Board doesn’t feel they can live with the same quality of service the Sheriff’s office provides to the rest of the Peninsula.

In my opinion the Surfside Board shows a continual lack of ethics. I don’t understand why the County continues to give this business special treatment and allows them to have such undue influence over the County.

The current Board Members are: Scott Winegar, Gary Williams, Kurt Olds, Annette deLeest, Mark Scott, James Clancy, Ric Minich and Rudd Turner

See more on this on George Miller’s blog, http://surfsideinfo.blogspot.com/2020/05/temporary-difficulties.html

Surfside HOA, Ocean Park, WA,  5/29/2020

Surfside HOA applied for an Economic Injury Disaster Loan from the SBA.  Surfside applied for and received $10000 from the Government under the Corona Virus Economic Injury Disaster program, with no payback required in spite of the fact that they don’t need the money and they were aware that there was not enough money for the small businesses that really need it.  There are a lot of questions from the Surfside members and the public outside Surfside about what happened here.     I have done more research and here is what I have found.

4/18/2020  The Surfside Board has received a $10000 loan from under the Economic Injury Disaster Loan.  It appears that this is more like a grant and does not need to be paid back.  The Surfside Board also voted to apply for more money.  This in spite of the fact that they don’t need the money, have about 2.5 million in reserves and their collections of dues are higher than last year at this time.   They are aware that other local businesses need this money and that there is not enough to help everyone.  In this meeting one of the board members state that “10,000 is a drop in a bucket” for Surfside, but they keep the $10,000 and vote to apply for more money anyway.

5/12/2020  George Miller  post this info on his Surfside Blog. (http://surfsideinfo.blogspot.com/2020/05/temporary-difficulties.html)  One commenter calls for an official investigation.

5/16/2020  Board Meeting.  The Board reversed their previous decision and voted to turn down any loan money if the SBA contacts them about going forward with their application, but no motion or even suggestion by ANY member of the board about returning the $10,000 so a small business that really needs it can have it.

The comments below, with a line of asterisks above and below them are copied directly from the Surfside Facebook page.  Rudd Turner is answering a question presented by Dan Crooks.  A very good question.   FYI, the EIDL website;   https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/economic-injury-disaster-loan-emergency-advance,  says, “This loan advance will provide up to $10,000 of economic relief to businesses that are currently experiencing temporary difficulties.

****************

Dan Crooks

May 4 at 8:02 AM

As reported in the Weekender: “As a precaution, an application was submitted to the Small Business Administration for a COVID-19 Economic Injury Disaster Loan (EIDL). A $10,000 forgivable Advance has been received. It will be used as needed to support payroll and obligations that result from the economic slowdown.” Please explain how the pandemic affected SHOA’s financial situation.

1 Like1 CommentUnlike · Comment

Surfside Homeowners Association: Mr. Crooks: As a private non-profit corporation, SHOA is eligible to receive an EIDL loan (not PPP). EIDL is an existing SBA loan program which has been augmented by the CARES Act. My Surfside Weekender article stated that over $260,000 from member fees are still owed, out of a total member-approved annual budget of $1.7 million. The COVID-19 pandemic has thrown people out of work or reduced their working hours. Retirees receiving IRA or other investment income are also impacted due to stock market losses. This includes some SHOA members. If member fee payments are reduced in the coming weeks and months, important Association programs such as those listed in the article, and associated payroll for 17 employees, will be impacted. SHOA member fees are based on the approved budget. There are no contingency funds built into the budget. The EIDL Advance received is sitting in an Operational checking account, to be used when needed.
Thank you for your interest.
Rudd Turner, SHOA Trustee and Treasurer

**************

I found the tape of the 4/18/2020 Board meeting on the Surfside web page.   This discussion starts at about 2:05:25 on the recording.  On the tape Rudd Turner says that he did apply for the $10000.  If I understood correctly, there was no motion or intention to pay back the $10,000.   They intend to keep it knowing that there are local small businesses that are in much greater need.  In the meeting the Board members point out that $10000 is just a drop in the bucket to Surfside.

In the meeting, Rudd Turner made the motion to apply for MORE money, Gary seconded.  Rudd pointed out that they knew before they applied that there was not enough money as the government expected people to apply for.  They voted.    According to the minutes: Apply for the Covid-19 Emergency Impact loan. Rudd Turner moved the authorize applying for the Covid-19 Emergency Loan. Gary Williams seconded. The motion passed 5 –2. Kurt Olds and Ric Minich voted no.  So Rudd Tuner, Gary Williams, Annette deLeest, James Clancy, Mark Scott voted yes.  The vote passed 5 to 2.  The recording is on the main page of the Surfside Website, currently at the top.  See for yourself.   

So my questions are:
·         The eligibility conditions state that the money is for businesses that are currently experiencing temporary difficulties, so how would Surfside claim that it was experiencing temporary difficulties?  Was something illegal done here?
·        According to Leonard Miller in his NextDoor, 5/28/2020 response to Rick Dunbar, Leonard Miller says, “Regard in the $10K grant, it was spent for protective gear for those who work at surfside. It also went to upgrade modems & technologies so that Surfside employees could work from home and that meetings could be done remotely to protect board members & employees.”   According to Leonard Miller, he talked with the office and this was their answer.  Those of you reading this, judge for yourselves, but I have to suspect that would not meet the eligibility requirements.  

Please understand people, I am always attempting to state the total truth.  If I have something wrong, just show me the proof and I will change it.

I think Surfside HOA should return the $10000 they unethically took from the Economic Injury Disaster Loan fund and get it back to the businesses that actually need it.

We are not attorney’s.   All communications are opinions and beliefs. Nothing in our communications should be considered to be legal advice.

Patrick Johansen
Patrick@PK80.comAdmin@HOA-Review.com
HOA Reviews and Reports LLC
503-781-4492
“The only thing necessary for the triumph of evil is for good men to do nothing.” – Edmund Burke


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See the rest of the article at the address below:

Homeowners’ Associations and the First Amendment: Are your 5 Freedoms Guaranteed?

We are not attorney’s. All communications are opinions and beliefs. Nothing in our communications should be considered to be legal advice.

Patrick Johansen
HOA Reviews and Reports LLC
503-781-4492
“The only thing necessary for the triumph of evil is for good men to do nothing.” – Edmund Burke

Cowlitz Timber Trails, Salkum, WA

Thanks for coming to HOA-Review. Please tell us about your HOA! Is it a good place to live or are there multiple horror stories lurking in the files? Does the board fairly represent the property owners? Are all the financials, decisions, and actions of the HOA open and public to all property owners? Is there a way for all property owners to easily communicate directly with the other property owners? Are the covenants too restrictive or not enough? Are the covenants enforced equally or do special people get favored treatment? What are the most wonderful things about the HOA? What are the worst things? What are your suggestions to fix the most annoying problems in the HOA? Tell us anything you would like to share, your comments may improve your HOA for you and your neighbors.

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