(Revised) All the posturing is over, and those of us (estimated to be over 400 members) who attended last night’s 4+ hour board meeting found our worst fears realized. This appeared to have been the largest-attended and longest board meeting of all time. Clearly, a very high number of SCA members care a great deal about their Security Patrol.

A number of SCA members spoke who were career professionals from the insurance underwriting and security services professions.  They provided very compelling arguments that changing the name would not avoid any litigation risks or reduce our insurance rates. But, their excellent expertise was summarily dismissed and disregarded in the final vote.  The board was not listening.

After over 4 hours of discussion, at least 98% found NO compelling evidence provided by the board, attorney or insurance broker to justify forcing a name change at this time. It was alleged that there might be one or two cases at the national level that might have some relevance to the issue, but none in Nevada.  Not mentioned was that there are tens of thousands of HOAs in the USA, and many, if not most, include some kind of security services.

Not provided was any really relevant data on the alleged risks for SCA. For example, it might be possible that there could be over 10,000 HOAs in the US using the term security in their names or service descriptions–without having any problems. There are over 3,000 HOAs in Nevada and none of them has ever had a law suit filed (or lost) over the word “security“.

So, exactly why was the SCA Board demanding the change–now?   They claimed they were forced to act because of their “fiduciary duty” to avoid the possible risks–however exceedingly remote they might be. But, the directors did not mention their “business judgment” responsibility to avoid making bad business decisions. They are required by statute to balance these responsibilities, but failed to do so.  At the end, the board proceeded to vote 5 in favor and 0 against (with 2 undecided/abstaining) to remove ’security’ from the Patrol’s name.

The long-term cost risks of implementing this decision appeared to be much higher than the extremely remote risks of SCA losing a law suit due to a misunderstanding over the intent of the Security Patrol name in our mostly open/non-gated neighborhoods.

Note that the Board has never done anything to educate all of the members about the limited purposes of the Security Patrol.  The logos on the patrol cars and uniforms do not make the mission clear.  And, there have been no requirements for members to sign disclaimers acknowledging their understanding of the limited “observe and report” mission.  Such a disclaimer could easily be included to be signed at near zero cost along with the periodic certification of age-restricted residents.  Many members demanded to know why not initiate those kinds of practical actions instead of arbitrarily changing the name and risk destroying most of the morale within the volunteer SP force?

Sadly, all the members got was insulting lip service about how such actions “might” help, but how they could not “prevent” a law suit.  Really.  As if we, not the board, were senile.  In general, the members were treated like ignorant children–instead of the accomplished, retired professionals that they proved to be.  And, the directors behaved like they were being bullied into making a very bad business decision by the association attorneys.

One of the biggest surprises of the evening was when Director/Attorney Ann Small went ballistic and threaten to resign from the board if the security patrol name was not removed.  She also claimed to be considering filing criminal charges against the past and current Security Patrol leadership for using some unregistered software on the SP computers.  Most of the audience never understood why Ann Small was so outraged about PC software in use by the SP when the issue for the evening was risk assessment over the name “Security Patrol”. 

At a couple of points, some directors even accused the SP leadership of lying about not knowing there were major PC software registration problems.  Imagine that kind of disrespectful attack against the SP leadership in an open board meeting! 

Since RMI is required to provide oversight to the groups receiving SCA funding, the members had to wonder why the directors were openly yelling at the SP–instead of RMI?  If there had been some kind of PC software problem, RMI would have been required under its contract to have resolved it. RMI’s failure was no cause to insult the SP volunteers.

It made us wonder if this whole mess was just some kind of hidden board retaliation against some SP leaders?  Many of them are retired law enforcement officers who are naturally intolerant of incompetent leadership.  Some members now believe that the board is acting like it wants to eventually implement a high-cost contracted patrol that never questions anything they are told.  Early estimates are that such a contracted patrol might cause assessments to increase between $150 to $300 per resident per year.

So, at the end of 4+ hours, it was seen that the issue about changing the Security Patrol name had been decided months before the meeting.  It seemed clear the issue had been precipitated by a few prior and current directors, the association attorney, and the “CAI”.  The insurance broker and underwriter were not pressing for any changes or asking for more money.  It was all the board’s doing.

It was a very sad night.  Even the so-called “unity party” people were heard complaining that the whole affair was handled (by their party member directors) about as poorly as it could have been….

PS: Those who remembered that the association law firm was just incorporated in 2007 (and that SCA was one the first clients) were stunned to hear Attorney Ed Song say that they now have over 700 HOA clients!  Wow! One to seven hundred in just 3 years!  One has to wonder how they are able to fairly balance their time and travel among those 700 associations?  And, which developers, HOA management companies, security companies, and other members of CAI were instrumental in helping the law firm expand so quickly?  And, what level of “quality” products do you suppose SCA is receiving from a firm with so many conflicts of interest?  After last night’s fiasco, it would not surprise many to discover that recruiting security companies is an important CAI sales objective for the future.

See this link for more info on the CAI:
http://www.cai-nevada.org/sub_category_list.asp?category=49&title=2010+Chapter+Sponsors