Dear GRCA Board of Directors:

Recent communications from the GRCA Board of Directors and The Management Trust are of utmost concern, and have us questioning the Board’s misplaced loyalties and failure to honor its fiduciary responsibilities, and act in the best interest of the Gold River Community Association.  Furthermore, we question your legal authority under the Davis Stirling Act to adopt or take action on matters below in Executive Session which do not involve the formation of a contract with third parties.

In September, 2024, The Management Trust (TMT) emailed a letter dated September 5, 2024 referencing the Corporate Transparency Act (CTA) accompanied by a DocuSign legal agreement and distributed to 125 Gold River Village Association Directors and referenced as “urgent”.  The letter did not address the highly significant and material contractual changes TMT was setting forth in the DocuSign Amendment, which we believe to be deceptive and misleading, not to mention the Village Homeowner Associations were being asked to execute an unenforceable document as TMT’s contract is with GRCA and not the Villages.  

We understand TMT has revised the Amendment for GRCA and the Village Associations which the GRCA Board intends to take action on in Executive Session on October 15, 2024, without first discussing in Open Session for comment.  We strongly advise you reject acting upon the proposed TMT Amendment in its entirety, as we believe there is no clause that stands to benefit either GRCA, the Villages or it’s homeowners, and only serves to further benefit TMT.   

Our primary reasons to reject the Amendment (or any similar revision) include, but are not limited to:

  1.  1. Homeowner Contact Information: Granting TMT access and ability to share homeowner contact information with others, including, and without limitation, third parties for solicitation which TMT could benefit from financially is absolutely unacceptable.  Stating that homeowners must individually Opt-Out of TMT sharing homeowner contact information is completely unacceptable and burdensome for our homeowners.

We understand this clause is being modified to allow the President or the Board of Directors to first approve any communication before it is sent to homeowners by TMT or Vendors.  We expect the GRCA Board of Directors to honor GRCA’s Resolution in 2024 to guard and protect Gold River Homeowner’s contact information and not share or distribute to anyone, including TMT or its vendors for solicitation purposes.  We understand the GRCA Resolution to protect homeowners’ contact information permits the President to authorize release of this information to TMT. We are worried that if the President is overly sympathetic to the desires of TMT homeowners remain at risk and we want assurances that the President, individually, and the GRCA Board collectively, will not permit the use of Gold River homeowners contact information to be shared with any TMT vendor, nor TMT, if it clearly is not in the best interest of the homeowner.  If the GRCA Board President elects to exercise this power, we expect it to be fully justified, disclosed and is in the homeowner’s best interest (not TMT’s) and still not shared with vendors or third-parties.

  1.  2. Insurance – Consenting to allow TMT the ability to charge undisclosed add-on fees for annual Village and GRCA insurance renewals (which are currently a covered free of charge in the Village Service Agreement), without disclosure of costs of the fees, and without requiring TMT to invoice or receive Association consent is not tolerable.  Furthermore, setting up Auto-Pay at the option of TMT, rather than the Associations is not agreeable.  Additionally, many of our Village Associations have been recently charged by TMT $185.00 to $250.00+ for annual insurance renewals, which is a free service set forth in the existing Village Services Agreement.  This is a violation of trust and completely unacceptable.  We request all non-contractual Village Association charges be reversed by TMT and credited back to each impacted Village Homeowner Association.
  1.  3. TMT Indemnification and Release of Liability: It is a violation of trust that TMT is requesting to be indemnified or held harmless of any liability, including if they are deemed to be a Substantial Decisionmaker per the CTA but refuse to register as such with FinCEN or otherwise.  This indemnification clause exposes Associations to absorb significant penalties and legal fees if TMT is determined to be a Beneficial Owner and is willfully noncompliant.  And the existing contract between TMT and GRCA should stand as-is.  
  1.  4. Payment on Termination:  Again, this clause is clearly self-serving for TMT and harmful to GRCA.  Should GRCA terminate its contract with TMT, there should be a full accounting of any charges TMT proposes to assess GRCA, and agreed upon by both parties prior to payment.  Again, we see no benefit for GRCA to enter into this clause and strongly recommend GRCA rely on the termination terms set forth in its existing contract.
  1.  5. Automated Responses and AI – Gold River pays TMT handsomely to staff onsite employees and we expect to have our homeowners have the ability to directly contact the Gold River office, via phone, email or in person and do not want to be subjected to AI through “Trusty” or any other third-party vendor provided response.  The release of liability from TMT regarding AI in the Amendment is alarming.

To Summarize:

1. Why would the GRCA Board enter into a sweetheart deal and enter into such a document when it is clearly a one-sided attempt by TMT to release themselves of liability, expose GRCA and Villages to increased costs, and expose our homeowner contact information and to services such as AI we do not want? 

2. Is the Board performing its fiduciary duties and reviewing any legally binding documents with outside independent counsel (who does not have a relationship with TMT)? Especially, documents that have been drafted by TMT’s legal counsel!

3.  In the spirit of transparency and trust, adoption of this or any revised agreement should be first discussed and justified in Open Session, and shared with outside GRCA legal counsel and Village boards for comment and recommendations.

4.  Why is GRCA not asking for an indemnification agreement from TMT, for their refusal to register with FinCEN, if it is determined they are a Beneficial Owner?

Village Services Agreement:

Additionally, we understand from a homeowner that a board member stated the Board’s intention to revise the Village Services Agreement as “requested by the Village Board Presidents”. What Village Presidents requested these changes?  We have 25 Villages.  Was there a majority of Village Presidents requesting changes, as we understand the Village Service Agreement to be working well? Is this action planned for Executive Session on October 15, 2024?   Once again, why not be transparent and disclose and discuss in Open Session, with Village Boards and independent counsel?  Who has drafted the revised Agreement (TMT?)?  What are the changes set forth in the revised Agreement? What is the financial impact to the Villages? For example, does this now provide TMT to start charging Villages for insurance renewals?  Why haven’t the Village Boards had a chance to first review the revised document before being acted upon by the GRCA Board?   Why would we enrich TMT at the expense of the Village Associations and GRCA?     WHY THE RUSH?  If TMT drafted the revised Village Services Agreement, is it being pushed through because TMT believes they have a Board that is now agreeable to their desires, rather than upholding its fiduciary responsibilities? Will the revised agreement increase charges to Villages and GRCA, reduce TMT’s role and responsibilities to GRCA and its Villages, and find additional revenue opportunities for TMT at the expense of the Villages and the homeowners? 

Prior to proceeding further, we trust this matter will be discussed in Open Session beforehand, be decided by unanimous consent by the Board, and only if it is in the best interest of GRCA and is reviewed and recommended by independent GRCA counsel.  

If the GRCA Board of Directors does intend to entertain changes or revisions to the Village Services Agreement, we ask first that in the spirit of transparency and trust, you first run any draft agreement by the 25 Village Association Boards for review and input, and outline any increased cost implications (either disclosed or silent) and justify how these changes will work to the benefit of GRCA and the Villages.  We also request that any proposed agreement entertained also be reviewed and recommended by independent GRCA counsel and Village Associations’ counsel for input, and not executed via DocuSign.

We expect the GRCA Board of Directors to uphold their fiduciary responsibilities and act in the best interest of the Gold River Community Association which encompasses our community of 2,735 homes, and not to succumb to pressures by TMT which will weaken homeowner’s rights, and impose increase costs on Villages and homeowners alike.  

To emphasize please do not take any actions on these matters on these proposed amendments or agreements.  We will continue to monitor the GRCA board’s actions and keep the Gold River Community informed.  

Regards,

The Coalition to Protect Gold River