By Robert O. Jester
Finance Advisory Committee Chair
As published in The View, May 2023:
This has been a very busy month for Sun City Shadow Hills and the Nation. We will be considering two questions this month that we are sure are of interest to you.
1. Who is the new legal counsel for the Association?
We began March having received a resignation of the Epstein Law Firm as counsel for the Association. The General Manager and the Board immediately started a search for qualified law firms that principally represented California homeowner’s associations. We were very pleased that two of the premier law firms in this field were available to this Association. The Board conducted intensive interviews of these law firms and then made a unanimous decision on a new firm.
The new firm is the Tinnelly Law Group of Mission Viejo, California. This firm even has three seasoned attorneys in residence in Riverside County which is a real advantage for the Association. The Tinnelly Law Group has represented California HOAs exclusively for over 30 years and possesses the depth and expertise that the Board sought for our community. The firm has a deep understanding of the unique legal landscape faced by associations and their boards. This firm represents almost 1400 associations of various sizes so it knows the issues that confront an association from large to small. In addition, they are no strangers to litigation or the appellate courts and have numerous reported appellate decisions.
The other special asset that they bring to our Association is that they participate in the various California Community Associations on a state level and serve on various statewide boards that are in regular contact with the California legislature. Plus, they have created a comprehensive library of HOA law and legal information known as www.findhoalaw.com, and regularly publish a newsletter of current matters of concern to HOAs. During the interview process, they presented each Board member with their publication, Board Member Basics. This community should be very pleased that we have a law firm with HOA expertise, a depth of qualified legal professionals, and local access for our Board.
2. Is this Association protected from a bank failure?
The other hot topic of the month in the nation has been recent bank failures, with one of the largest here in California. As we all know the FDIC protects our bank balances up to $250,000.00, but what about protection for our Association that has funds on deposit each month that are much more than that coverage limit? Thankfully, this Association and its managing entity are aware of this exposure and have protected the Association’s funds for years from a possible bank failure.
I am sure your question is then, “How is it protected?” Desert Resort Management (DRM), our management entity, purchases a Private Depositor’s Bond that protects all moneys over which it has oversight above the FDIC coverage limit of $250,000.00. The FAC reviews that bond quarterly to be sure it is providing adequate coverage for the Association’s funds. The bond currently has a coverage limit of $300,000,000.00, and combining all accounts controlled by DRM in all associations that it manages, those accounts have a monthly average of 250 million dollars, so this Association’s funds are well protected from the adverse consequences of a bank failure. We certainly hope that this Association is never a victim of a bank failure, but rest assured the Association funds will not be lost.
Contact the author at finance@scshca.com.