The Northridge Fact-Finding Committee

1. The Northridge Fact-Finding Committee Presentation to the property owners of Northridge March 21, 2007

2. Norms • Assume positive intent. • Talk about issues, not people. • Allow for all voices to be heard. • Allow all points of view to be respectfully heard. • Disagree respectfully.

3. Not a Debate • This meeting is not a Debate • Please sit back - hopefully any questions you have will be answered through the work of the committee • If not, please write your question on the cards provided for the Q&A session at the end of the presentation or the follow-on meetings

4. Agenda • Goals • Introductions • Presentation • Clarifying Questions • Next Steps

5. Goals for this meeting • To provide information regarding issues and questions about the Northridge subdivision and the Northridge Homeowners Association. • To provide a mechanism for settlement of the issue of an HOA in Northridge.

6. Who We Are • Michelle Eubank, Teacher • Tim Perkins, Banker • Dave Hauger, Air Traffic Controller • Connie Deitsch, Human Resources Director • Chris Bickel, Semi-retired • Janie Perkins, Realtor • Don Blake, Engineering Manager

7. What We Have Done • Met with the Town of Erie’s Administrator • Spoken with lawyers • Spoken with HOA management companies • Researched CCIOA and Colorado Statutes governing Common Interest Communities • Read the documents pertaining to Northridge and it’s development • Read the legal opinions of attorneys for various Northridge property owners

8. Assumptions • People do not want • Assessments • to take care of drainage problems • to finish and maintain the pocket park • to maintain ditch and trails • to obtain liability insurance • Legal Fees • A draconian organization that tries to control individual property owners

9. Assumptions • People do want • To protect property values by: • Maintaining common areas within Northridge • Ensuring that others maintain their property • Creating a sense of community in Northridge • To clarify liability issues • To have a voice for Northridge • To finish the ‘pocket park’

10. What We Learned: The Root of the Problem • The Developers and the Town of Erie failed the property owners of Northridge when they: • Allowed the developer to leave without completing their obligations to the Northridge property owners • Did not put the mechanism in place to elect a board of directors to the existing HOA • People moving into Northridge were given mixed messages as to the existence of an HOA.

11. Is there an HOA? • The HOA framework is currently in place. • The only thing missing is a Board of Directors. • There are differing legal opinions concerning the HOA question. • The only way to clarify the current legal status of an HOA in Northridge would be for: • A board of directors to be elected • A property owner to sue the HOA claiming that the HOA is invalid. • Legal judgment to be passed

12. Present Concerns • Liability in common areas • The ditch / Parcel A (the undeveloped hillside between Northridge and Fletcher) and trails • The pocket park • Neighborhood entrances • The Money that Erie has earmarked for Northridge • Development of the pocket park • Maintenance of entrances and common areas • Drainage issues • Property values/covenant enforcement • ‘Hatfield and McCoys’ reputation

13. Liability • There are liability questions with regard to common areas. Only a law suit could clearly determine who could be held liable should something tragic happen in one of the common areas such as: • Ditch / Parcel A • Trails • Pocket Park • Every property owner could be named in a lawsuit

14. Liability: The Ditch • “the Ditch” is the Erie-Coal Creek ditch which runs parallel to and is between Northridge and Fletcher. The ditch that is SW of Northridge is not our problem. • Morton and Norton were made owners of “The Ditch” per “The Ditch Agreement”. • The Homeowners of Northridge are responsible to maintain the ditch and the adjoining trails according to this agreement. • Liability is a question and could only be settled through a lawsuit at this point. Northridge property owners or the Town of Erie are liable, the ditch company clearly is not. • Each property owner could be held liable, regardless of their location with respect to the ditch.

15. “the Money” • $230,000 currently • Comes from the settlement agreement between Erie and Morton & Norton and development impact fees • $33,000 earmarked for the Pocket park • The Town controls the money: it can be used for Northridge projects, but not simply ‘handed over’ to a Northridge HOA. • The money is currently set aside for Northridge projects, but could be re-directed by the Town.

16. Development of The Pocket Park • The Town will not release the funds for completion of the pocket park because there is: • No one to negotiate with • No one responsible for maintenance of the park • Pocket Park plans: • Specific plans already exist for the pocket park • Northridge property owners can decide to change the existing plans and control how the park would look

17. Maintenance of Common Areas • The Town has maintained the entrances to date, but will discontinue doing so in the near future. (no firm date given, but don’t expect maintenance this summer). • Erie has standardized their agreements and all HOAs are being held responsible for maintenance of their own common areas. • The Town only maintains parks in which they hold recreation programs. The pocket park would not be one of those parks.

18. Maintenance of Common Areas • The Town has stopped allowing the ditch company to burn the weeds in the ditch due to health concerns. • The Town provides no maintenance on the ditch or trails at this time. As part of the Erie Trail plan, this may change in the future. • The ditch company can perform necessary maintenance and expect payment. • All Northridge property owners are responsible to ensure a flow of 25 cubic feet per second.

19. Drainage Issues • The Town believes it has completed its obligations where drainage issues are concerned • The Town has completed all actions identified in the Settlement Agreement with Morton & Norton. • The drainage problems stem from having allowed the original 1% grade on the development. The Town does not take responsibility for this.

20. Drainage Issues FYI • The Town would be willing to install curb and gutter • 100% of property owners without curb and gutter would have to be in agreement • This would help the drainage issues to a certain extent, according to the Town. • There would be a special assessment from the Town on only those who would benefit from the improvement in order to pay for it. • The assessment would not impact those who already have curb and gutter and has nothing to do with the existence, or lack thereof, of an HOA.

21. Covenants / Enforcement • Currently, any property owner can pursue enforcement of the covenants through legal action. • With an HOA in place, covenants could be enforced and result in fines and/or liens. • With an active HOA, the covenants can be amended by a 2/3 vote of the property owners. • The HOA by-laws may be amended by a majority of the HOA board of directors.

22. Options for Northridge • Neighborhood Association • Optional membership • Social opportunities and neighborhood beautification • Not necessarily helpful in maintaining property values • Unclear legal status • Special Tax District • Cost prohibitive to set up • Additional tax assessment to homes • More than we need Researched - not viable Researched - not viable

23. Options for Northridge • Continue without an HOA • Benefits • No assessments • No organization to intrude on individual property owners • Individuals speak out regarding the issues that affect them. • Comfort of the “Status Quo” • Risks • Unclear liability issues • Individual liability coverage • No maintenance of common areas: could impact property values • Leaves enforcement of covenants up to individuals • Maintains status quo on the Pocket park • Ditch/trail maintenance issue not settled

24. Options for Northridge • Elect a board of directors for the HOA • Benefits • Clarify liability questions regarding the Ditch • Ability to secure liability Insurance Coverage • Enables maintenance of common areas • Entity to negotiate with the Town and/or other entities • Entity to manage funds • Enforce Covenants • Modify Covenants and/or by-laws if necessary or desired • Risks • Northridge HOA acknowledges liability for the Ditch • Assessments • Enforcements of Covenants • Lawsuits between neighbors

25. Expected Costs • Fiscal and Liability insurance for individual board members • Liability insurance for common areas of Northridge • Maintenance of Common Areas • Ditch, Parcel A, and trails • Entrances • Pocket Park • One time expense for completion of pocket park (to be covered by town of Erie) • Management costs • Could be a special assessment to all property owners should there be lawsuit(s).

26. Expected Costs

27. Assessments • First assessment maximum of $100 • Annual assessment increase cap of 20% of previous year’s assessment • Assessment increases over 20% must be approved by a majority of property owners

28. Next steps – Background • According the Northridge Covenants it takes votes by 50% + 1 (96) property owners to elect a Board of Directors when the election is held by mail. • The Board can consist of 3-7 members - must be an odd number

29. Next steps - express opinions and concerns • At the next meeting, anyone who would like to will have two minutes to speak. • One speaker per household. • Speakers will sign up identifying themselves as ‘in favor’ or ‘against’ or ‘neutral’ regarding reinstatement of the HOA. • The committee will call people up to speak in a manner as to allow for balance in expression of opinions.

30. Next steps - Nominations for Board of Directors • Individuals nominate themselves or someone else, the nomination requires a second, and that nomination will go on the ballot. • The number of nominees will determine the number of Board members. • More nominees will mean more board members, up to 7 • It will be an odd number

31. Next steps - Mail-in Ballot • The Committee will prepare a ballot and mail one to each property owner. • Each property owner has the opportunity to cast one ballot by mail and can elect: • To cast a vote for nominees for the Board of Directors. • To not return the ballot.

32. Next Steps - The Vote • Any ballot returned with a vote for one to seven nominees will be counted towards the 96 required to be considered a valid election. • If 96 property owners do not return a ballot with a vote cast, the election is not valid and a Board of Directors is not elected. • Ballots postmarked after the cut-off date will not be considered valid.

33. Proposed Timeline

34. Q & A • We will address questions to clarify the material presented today • Please write new questions on the note cards provided • Again, this is not a debate • Q&A will end at 8:20 so we have time to clean up

35. More Info • Many documents pertinent to the Northridge community are available to view at the following web address www.geocities.com/northridge_erie

36. In conclusion… • Digest this material and consider questions for the next meeting • Next meeting: April 11, 2007 Same time, same place • Donations for room costs, mailing, etc • Everybody lend a hand in cleaning up