Letter from the Board

Dear Homeowners,

Increase in Annual Assessments

A number of homeowners have expressed their concern regarding the $85 increase in annual assessments. This was a one-time major adjustment needed to move us from a subsidized association to one that is self-supporting. Prior to the turnover of the association to the homeowners in March 2007, D. R. Horton not only controlled the association, they also subsidized its operation. The annual assessments of $110/year did not cover the cost of the association. At the time of the transition, D. R. Horton made its last payment to the association. This payment was based on the budget the developer approved and the new Board of Directors (Board) found that key areas of the budget were under estimated. The Board has cut corners throughout the year just to keep our collective heads above water rather than leveling a special assessment. Additionally, Board members have incurred out-of-pocket expenses. By the end of 2007, the Association was nearly insolvent and the Board members themselves volunteered to pre-pay their own dues for 2008 just to keep the HOA in business. Additionally, for several months after the transition, Northwest Community Management Company generously provided us with services beyond what the association was paying for.

The management company provides an invaluable service to homeowners associations such as ours. The most visible aspect of their services are the monthly (soon to return to twice a month) site visits. However, they also manage billing and collections, maintain both our administrative and financial records, handle most of our mail, provide advice regarding compliance with state laws, and assistance in conducting the annual meeting. The volunteer Board would find it very difficult to manage the Association’s business without them. For perspective, the cost to the association is equivalent to hiring one office clerk at minimum wage to handle all of our business throughout the year, which is actually quite considerable.

Rental/Investment Properties

Investment/Rental properties have been an issue for some within the Association for the past year. The Board, through Northwest Community Management Company, is now in the position to begin enforcing Section 4.7 of the Covenants, Conditions & Restrictions (CC&Rs) of Royal Creek Homeowners Association.

Please review section 4.7 of the CC&Rs and the December 9, 2005 amendment adding section 4.7(c). In sum, Investment/Rental property shall not exceed 25% of the total Lots located within Royal Creek. There are 219 lots within Royal Creek. Thus, the total number of lots available for rental purposes cannot exceed 54.

It’s become clear to the Board that DR Horton failed to enforce section 4.7 of the CC&Rs regarding Investment/Rental property as it appears that only three owners of Investment/Rental property have complied with section 4.7 of the CC&Rs. It also appears the total number of Rented/Leased Lots may be at or above 54, the total maximum allowable lot for rental purposes.

Therefore, the Board hereby gives notice that if you own Investment/Rental property, you must immediately comply with section 4.7 of the CC&Rs. The consequences of failing to get into the rental pool before we reach the maximum approved 54 lots will mean you cannot rent or lease your home without violating the CC&Rs. Failure to comply with the CC&Rs will result in violation letters, and, possibly, fines for noncompliance.

When reviewing section 4.7 of the CC&Rs and the December 9, 2005 amendment adding section 4.7(c) thereto, please note that occupancy of Investment/Rental property shall be limited to the tenant, such tenant’s visitors and guests. In addition, at least 15 days before entering a rental or lease agreement, the owner MUST notify the Board (through NWCM) in writing of the Owner’s intent to rent or lease his or her lot. Please also note the tenant must be given a copy of the CC&Rs and that the tenant must agree to be bound by the CC&Rs and that any violation thereto constitutes a default under the rental/lease agreement.

The Board will review each application in the order received and it will vote to approve the application so long as the owner complies with the following:

1. All requirements of section 4.7;
2. The total Investment/Rental Lots do not exceed 54; and,
3. The Investment/Rental property is otherwise not detrimental to the Association and Royal Creek.

Your cooperation and understanding is greatly appreciated.

Board Resolutions

During the past year, the Board also adopted a number of resolutions which are designed to clarify and implement the CC&Rs. While the Board has used these resolutions to guide its actions, they have not been fully in effect, because the resolutions had not been communicated to the Members. These resolutions will go into full effect 30 days after mailing of this letter.

Athletic/Recreational Equipment

Whereas the Royal Creek Homeowners Association Board of Directors is empowered by statutory law [ORS 94.630 (1)(a)], and further supported by the Association documents including the Declaration of Covenants, Conditions and Restrictions [Article 4, Section 4.23 to create rules and regulations regarding certain actions and activities of the associaiton and its members,

Whereas the Royal Creek Homeowners Association Board of Directors finds it necessary to set forth restrictions on certain activities within the association property,

Whereas the Royal Creek Homeowners Association Board of Directors wishes to enhance the livability of all residents within the association.


Now be it therefore resolved that the Royal Creek Homeowners Association Board of Directors does adopt the following procedures in regards to the activities listed:

Temporary athletic and recreational facilities/equipment, including basketball hoops may be utilized in front of the home and removed from view by 10 p.m. Use and storage of temporary athletic, recreational equipment, or facilities may not be done in such a manner that it is placed in the street or parking strip, and shall not block any public sidewalk in Royal Creek at any time.

The Royal Creek Homeowners Association Board of Directors passed this resolution on this 12th day of June, 2007.

Satellite Dishes

Whereas the Royal Creek Homeowners Association Board of Directors is empowered by statutory law [ORS 94.630 (1)(a)], and further supported by the Association documents including the Declaration of Covenants, Conditions and Restrictions [Article 4, Section 4.23 to create rules and regulations regarding certain actions and activities of the associaiton and its members,

Whereas the Royal Creek Homeowners Association Board of Directors finds it necessary to set forth restrictions on certain activities within the association property,

Whereas the Royal Creek Homeowners Association Board of Directors wishes to enhance the livability of all residents within the association.

Now be it therefore resolved that the Royal Creek Homeowners Association Board of Directors does adopt the following procedures in regards to the activities listed:

Pursuant to section 6.4 of the Declaration of Covenants, Conditions and Restrictions

1.No dish can exceed 39.37 inches as described by FCC in its adoption of OTARD rules;
2.Homeowners should attempt to locate Satellite Dish in most inconspicuous location as possible so as to be less visible from the street while not unduly interfering with signal strength;
3.All Dishes shall remain as neutral color as possible so as to ensure they are least visible as possible. For example, grey is acceptable while pink, purple or other like and more intense colors are not and;
4.Homeowners are not required to seek ARC approval for installation of Satellite Dishes so long as they comply with sections 1 through 3 above.

The Royal Creek Homeowners Association Board of Directors passed this resolution on this 10th day July, 2007

Fencing

Whereas the Royal Creek Homeowners Association Board of Directors is empowered by statutory law [ORS 94.630 (1)(a)], and further supported by the Association documents including the Declaration of Covenants, Conditions and Restrictions [Article 4, Section 4.23 to create rules and regulations regarding certain actions and activities of the associaiton and its members,

Whereas the Royal Creek Homeowners Association Board of Directors finds it necessary to set forth restrictions on certain activities within the association property,

Whereas the Royal Creek Homeowners Association Board of Directors wishes to enhance the livability of all residents within the association.

Now be it therefore resolved that the Royal Creek Homeowners Association Board of Directors does adopt the following procedures in regards to the activities listed:

1. All side yard fencing shall maintain a five foot set back from the front of the home,
2. No fencing is allowed in the front yard,
3. All fencing shall be constructed of Cedar,
4. Fencing can be protected by using stain in natural colors only (i.e. no painted fences),
5. Fences shall not exceed six feet in height above grade, and
6. No fencing on lots 37 – 46 shall extend into the storm drainage easement shown and referenced on the plat.
7. So long as the proposed fencing meets the above requirements, homeowners are not required to seek ARC approval for the installation of the fencing.

The Royal Creek Homeowners Association Board of Directors passed this resolution on this 10th Day of July, 2007.

Collection of Unpaid Charges

The Board also adopted a resolution regarding the collection of unpaid charges on January 8, 2008. A copy of that resolution is attached. The Board decided to use the services of Vial Fotheringham LLP to collect unpaid debts to the Association. This resolution spells out the collections process and also shifts most of the cost of the collections process from the Association to the person(s) who failed to pay.


Communication

One of the significant challenges for the Board over the last eight months was how to communicate with the rest of the association. The budget did not allow us to send out regular mailings. With the assistance of the Neighborhood Watch, the Board was able to send out hand-delivered, high quality newsletters. However, finances didn’t allow for additional newsletters. Additionally, the Board sponsored two social gatherings in Candlelight Park this past summer. For 2008, we have budgeted for a newsletter which should assist in the communication process. Additionally, we will also sponsor neighborhood social events. The Board normally meets on the second Tuesday of the month. Notices of these meetings are posted three days in advance. Currently, these notices are posted on yellow signs under the Neighborhood Watch signs which are located at each of the six entrances to Royal Creek. Additionally, the Board also maintains a weblog/blog which can be found at http://royalcreek.blogspot.com. We are now posting the agenda for each Board meeting, the approved minutes, and financial reports.

There will be an annual meeting of the Association on March 18, 2008 at Danebo Elementary School. You will be receiving additional information regarding that meeting at a later date.

Sincerely,


The Board of Directors
Gloria Foreman
Jim Jenkins
Joel Kirkpatrick
Steve McIntire
Eric Stillwell