Policies

OPERATING PROCEDURE #101

ELECTIONS

This Operating Procedure is written to set out the step by step procedure for handling all elections conducted by the Surfside Homeowners Association, including but not limited to, the election of new members of the Board of Trustees at the Annual Meeting.

1. Board of Trustee Action

1.1 The Board shall appoint an Election Committee Chairperson (ECC) at the January Regular Board Meeting.

1.1.1 ECC will be a current member of the Board of Trustees.

1.1.2 This requirement may be waived by a majority vote of the sitting Board of Trustees.

1.2 The Board will appoint a Nominating Committee Chairperson (NCC), with the recommendation of the ECC, at the February Board Meeting.

1.3 The Board will hire a Designated Election Committee Chairperson (DECC), with the recommendation of the ECC, at the May Board Meeting.

2. Responsibilities of ECC

2.1 ECC shall have complete oversight of all election procedures and will act as liaison between all election committees and the Board of Trustees.

2.2 ECC will appoint a Nominating Committee Chairperson with the consent of the Board of Trustees at the February Board Meeting. (See ECC Committee Charter)

2.3 ECC will find and present to the Board of Trustees a Designated Election Committee Chairperson at the May Board Meeting. This person will be hired by a vote of the Board of Trustees. (See DECC Committee Charter)

2.4 ECC shall supervise, and be responsible for, the printing and safekeeping of all Management Proxy forms and Floor Ballots.

3. Nominating Process

3.1 This process shall be conducted by the Nominating Committee Chairperson (NCC) with oversight of the ECC

3.2 The NCC shall conduct his/her action in accordance with the NCC Committee Charter.

3.3 Nomination of candidates for Board of Trustees

3.3.1 Full Term: Article IV, Section 2, of the SHOA By-Laws states. "Trustees shall be elected to serve for three years or until their successors are elected and duly qualified."

3.3.2 Partial Term: Article IV, Section 7, of the SHOA By-Laws states: "Any vacancy on the Board of Trustees shall be filled by appointment by the majority of the remaining Trustees. The Person so appointed shall hold office until the next annual meeting of the members of the corporation, at which annual or adjourned annual meeting, the vacancies for the remainder of the original terms, if any, shall be filled by election by the members in the regular manner."

3.3.3 The appointed Trustee, if he/she desires, may be a candidate for the full term position at the next election (Annual Meeting). Operating Procedure #101 cont.

4. Designated Election Committee Chairperson

4.1 The DECC shall conduct the Election Process in accordance with the DECC Committee Charter, with oversight by the ECC.

4.2 The DECC shall be hired by the Board of Trustees as per a written contract drawn by the Association Attorney.

5. Handling and Control of Management Proxies, Floor Ballots and Association records prior to Annual Meeting.

5.1 Management Proxies and Floor Ballots

5.1.1 The ECC, with help from the Financial Administrator, shall take delivery of all printed Proxies and Floor Ballots and shall be responsible and accountable for their control and safekeeping until they are mailed to the membership or, in the case of the floor ballots, turned over to the DECC

5.1.2 There shall be a mailing each year in June to all members of record to announce the Annual Meeting. This mailing shall include the time and place of said meeting as well as a Proxy Form and a self addressed return envelope. (Return address shall be that of the DECC) See note #1

5.1.3 Upon the receipt of returned Proxies the DECC shall convene his/her hired staff and shall precede with the following tabulation and verification procedure:

5.1.3.1 Verify authenticity of the Management Proxy (M.P.)

5.1.3.2 Register the receipt of returned verified proxies on the Master Members List. (Computer print out supplied by SHOA office) No M.P. shall be counted or otherwise considered which is received after the cut off date stated on the Proxy Form. No Proxy shall be counted or considered if it has been altered in any way.

5.1.3.3 DECC shall count and collate all Proxies returned. A tally shall be kept of all items listed on the Proxy.

5.1.3.4 No cumulative voting shall be allowed.

5.1.3.5 After counting all valid Proxies, all Proxies and Tally Sheets shall be placed in a safe container for storage and transport to the Annual Meeting.

6. Registration for Annual Meeting

6.1 The Registration for the Annual Meeting will be handled by the Registration Committee in accordance with the Committee Charter set forth in this manual.

6.1.1 Registration shall begin at 8:00 AM the morning of the Annual Meeting and shall continue until all eligible members have been permitted to enter the meeting. Registration shall not be terminated before 9:45 AM.

6.1.2 The Annual Meeting shall be called to order at exactly 10.00 AM.

6.1.3 It shall be the duty of the Registration Committee to return all records to the Association office at the conclusion of the Annual Meeting. Operating Procedure #101 cont.

7. Declaration of a Quorum

7.1 It shall be the duty of the Secretary of the Board of Trustees, in conjunction the DECC to report to the President of the Board that a quorum is present at Annual Meeting

7.1.1 In compliance with Article V, Section 3, twenty per cent of the members shall represent a quorum. The actual count in determining a quorum be the number of valid Proxy Forms returned to the DECC, added to the number of members attending the Annual Meeting in person. (NOTE the absence of a quorum, no business or election can be valid.)

8. Control of Management Proxies and Floor Ballots at Annual Meeting

8.1 All Proxy forms and Floor Ballots shall be brought to the Annual Meeting by the DECC and his/her staff.

8.2 Members in good standing who are not recorded on DECC Master List as having voted by Proxy, shall be issued a floor ballot identical to the Proxy except identified by a different colored paper. In addition, they may be issued a colored voting slip for use in voting for issues other than those covered by the Ballot.

8.2.1 A member who previously mailed his/her Proxy to the DECC, but now wishes to vote in person, may request the return of said proxy. His/her Proxy shall be removed from the Held Proxy File by the DECC, subtracted from all the tally counts and destroyed. A Floor Ballot will then be issued to the member in lieu of his/her Proxy.

8.3 When Registration is complete and a quorum has been declared, the DECC shall present to the Proxy Holder, the total number of Proxies that member is authorized to vote during the voting process. Recipient of each Proxy must affix his/her signature to each Proxy as having received same.

8.3.1 Designated Proxy Holders shall be furnished a Floor Ballot for each Proxy they receive.

8.4 Prior to Floor Balloting, the DECC shall be introduced to the Membership.

8.5 All candidates for office shall be introduced to membership.

8.6 Association President shall call for any nominations from the floor.

8.6.1 Introduction of any floor candidates.

8.7 After Floor Balloting the DECC and his/her staff shall collect all ballots cast.

8.8 When all Floor Ballots have been counted, a certified tally sheet shall be prepared, dated and signed by the DECC. The Tally Sheets from the mail-in Proxy and that of the Floor Ballot voting shall then be combined into a Final Combined Tally Sheet showing the results of the election. This Final Combined Tally Sheet shall then be signed, dated and Certified by the DECC.

8.8.1 If on the Final Combined Tally Sheet, candidates for election are separated by less than one-half of one per cent, the DECC will undertake an immediate recount of votes affecting those persons only.

8.8.2 In the case of ballot issues not related to office holders, i.e.; funding, building, etc., a recount of votes will be limited to the issue/issues involved only Operating Procedure # 101 cont

8.9 Two copies of the Final Combined Tally Sheet shall be prepared and certified by the DECC. One copy shall be presented to the Board Secretary to report and Certify the results of the election. The second copy will be used by the DECC to report the election results to the membership. The Board Secretary's copy of the Certified Election Result shall be placed in the SHOA office security vault with all Proxies, Floor Ballots and Tally Sheets of the election until ordered destroyed by the Board of Trustees after four (4) years.

8.9.1 The DECC shall hold the Proxies, Floor Ballots and Tally Sheets in his/her possession and shall be responsible for their safekeeping until turned over to the Secretary of the Board of Trustees

SPECIAL INSTRUCTIONS TO DECC:

1. Coordinate with ECC to insure that a POST OFFICE BOX has been rented to facilitate the mail-in Management Proxies. This PO Box must be rented before the Management Proxies are printed or mailed.

2. Receive, verify, tabulate and provide a final tally of all mail-in proxies.

3. Keep an alphabetical file on all returned mail-in proxies.

4. Verify with SHOA office all current changes in Master Membership List.

SPECIAL NOTES NOTE #1. Mailing of Annual Meeting notice and Management Proxy Forms shall be at least twenty (20) days prior to the date of the Annual Meeting. Revised and Approved June 20, 1998

OPERATING PROCEDURE #102

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LIENS AND FORECLOSURES

The Board of Trustees has set this Lien and Foreclosure policy to ensure the consistent and fair collection of delinquent accounts. It is the responsibility of the Financial Administrator to initiate the process according to the guidelines set forth in this Operating Procedure. The actual foreclosure process shall be handled by the Association Attorney.

1. Lien Action

1.1 Accounts delinquent as of August 1st of each year shall be sent an "Intent to Lien" form letter by Certified Mail.

1.2 Accounts still delinquent as of September 1st shall have a Lien filed against the delinquent owners property.

2. Foreclosure Action

2.1 Accounts remaining delinquent for a period of two (2) years shall be sent a "Notice of Intent To Foreclose" letter by Registered Mail.

2.2 Accounts which remain unpaid thirty (30) days from the mailing of the "Intent To Foreclose" letter shall be turned over to the Association Attorney for foreclosure action.

2.3 All legal fees and court costs shall be paid by the delinquent property owner.

3. Purchase of foreclosed property

3.1 The Association shall not purchase foreclosed properties at the County foreclosure sale unless it is in the best interest of the Association.

3.2 The purchase of property at County foreclosure sales shall require a majority vote of the full Board of Trustees.

OPERATING PROCEDURE #103

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BUDGET DEVELOPMENT

This Operating Procedure is written to provide a set procedure for the initiation, development and adoption of the yearly operating budget of the Surfside Homeowners Association. This process shall be in full compliance with Board Policy concerning the Budget Process and new Washington State Laws.

1. The Budget Committee shall be formed at the August regular Board Meeting of each year. The Committee shall consist of the Board Treasurer, who shall act as the Committee Chairperson, the Financial Administrator and no more than three additional members who shall be appointed by the Committee Chairperson.

2. The following Department Heads and/or Designated Trustees and Committee Chairpersons shall submit preliminary budgets to the Budget Committee Chairperson no later than the regular September Board Meeting. These budgets shall cover all expenses needed for the up-coming fiscal year. Separate budgets shall be submitted for operating expenses, and capital improvements.

2.1 Water Superintendent/Field Manager

2.2 Financial Administrator

2.3 Committee Chairpersons/Designated Trustees of committees who expect to expend Association funds:

2.3.1 Fish Management Committee

2.3.2 Insurance Committee

2.3.3 Lands and Buildings Committee

2.3.4 Water Systems Planning Committee

2.3.5 Legal Trustee

2.3.6 Security Trustee

2.3.7 Compactor/RV Area Trustee

3. The Budget Committee shall prepare an operating budget and a capital expenditure/reserve funds budget from the input from all the above named sources along with the computerized year to date financial statements provided by the Association business office and the audited financial statements of the prior fiscal year.

4. The Budget Committee shall present a final draft of the proposed budget at the October regular Board Meeting for Board approval.

4.1 Budget must be accepted or rejected at this meeting.

4.2 Accepted proposed budgets will be printed and a special membership meeting for budget approval shall be scheduled. Operating Procedure # 103 cont

4.3 All members shall be mailed a summary budget letter and a proxy ballot, informing the membership of the time, date and place of the special budget meeting and giving voting instructions for those wishing to vote by proxy.

4.3.1 The meeting shall be no sooner than fourteen (14) days nor more than thirty (30) days from the date of the mailing.

4.3.2 Members attending the budget meeting and those voting by proxy, shall vote on the acceptance or rejection of the adopted budget.

4.3.3 Budgets which fail to receive a majority negative vote shall be considered ratified.

4.3.3.1 The budget committee may present a new budget using the same process listed above.

4.3.3.2 Info new budget is ratified, the previous years budget shall govern assessments and spending in the next fiscal year, or until a new budget is ratified by a vote of the membership.

5. Budget development shall be made considering long range plans and needs of the Association. A five (5) year plan should be the goal of these considerations.

6. All Budget and Budget Development procedures shall conform to the guidelines outlined in the new Washington State Laws regarding Homeowners Associations, RCW 64.00.00.

OPERATING PROCEDURE #104

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ARCHITECTURAL COMMITTEE OPERATION

This operating procedure is written to set out the step by step procedure the Architectural Committee shall use in the performance of their charter. This procedure shall be followed in all actions taken by the committee and all its members. The Chairperson shall be responsible to see that this operating procedure is followed as written.

1. Committee Duties: Determine that all plans submitted for approval conform to all the Association Bylaws and Covenants/Architectural Guidelines.

1.1 Chairperson

1.1.1 Preside at all Committee meetings,

1.1.2 Determine that all plans are submitted with the proper forms and the correct number of copies,

1.1.3 Verify that all forms and paper work is completed at all steps during the approval process,

1.1.4 Verify that all needed inspections of property and set backs are completed,

1.1.5 Verify that at the end of the building process, or at the one (1) year time frame, that the inspection process is completed and the proper action is taken or the proper report is filed,

1.1.6 Appoint and oversee an inspection sub-committee (See Committee Charter, Architectural Committee)

1.1.7 Submit a written Committee Action report at the monthly Board Meeting.

1.2 Vice-Chairperson

1.2.1 Assume all duties of Chairperson in his/her absence.

1.2.2 Assume the responsibility to head inspection sub-committee.

1.3 Committee Members

1.3.1 Review all submitted building, septic, water service or other plans,

1.3.2 Determine that all plans meet Association covenant requirements,

1.3.3 Visit property sites to determine decisions to be rendered on all requests for approval of plans which are questionable or unusual due to location or type of construction.

2. Official Meeting Requirements:

2.1 Meetings shall be held on a weekly basis, time and day to be determined by the Chairperson. Time and day will remain constant unless unusual circumstances dictate otherwise. Time and day of meetings shall be post in business office.

2.2 Special meetings may be called by the committee chairperson.

2.3 No meeting shall be held with less than three members physically present.

2.4 Minutes shall be kept of each meeting 2.4.1 Committee "Minutes Form" will be used,

2.4.2 All action taken by the committee shall be noted in the minutes, (plans submitted, approved/disapproved, other action taken),

2.4.3 Minutes shall be typed and placed in a committee file and made part of the public records of the Association. Operating Procedure # 104 cont

2.5 All meetings shall be open to all Association members.

3. Plan Submission Procedures:

3.1 A plan submission packet shall be available at the Association Office.

3.1.1 All members wishing to submit plans for approval shall fill out all applicable sections of the packet.

3.1.2 Plans shall not be reviewed without the proper Association forms being completed.

3.2 Plans and forms must be submitted to the business office at least forty-eight (48) hours prior to the meeting date.

3.3 Two (2) copies of all plans must be submitted to be reviewed.

3.3.1 One (1) copy shall be returned to the member with approval notice,

3.3.2 One (1) copy shall be retained by the Association for seven (7) years. 4. Plan Approval Process:

4.1 Each submitted plan shall be checked by the committee for compliance with all covenant and architectural guidelines, this would include, but is not limited to, single family residence, mobile units, multiple residence, commercial structures, septic system placement and other property development and improvements.

4.1.1 Review plot plans for placement of septic tanks and drain fields

4.1.1.1 Plot plan must show footage from property lines and size and placement of anticipated dwelling on parcel,

4.1.1.2 Approved plan is then taken to Pacific County Health Dept. for final approval,

4.1.2 Building plans; general

4.1.2.1 Building Covenant Check List shall be filled out for each plan submitted,

4.1.2.2 Plans are reviewed by entire present committee, and if plans are in conformance with all requirements they are approved and signed by all members who reviewed the plans,

4.1.2.3 Plans found not to be in compliance are rejected and returned to the member along with written explanation of the reason plans were rejected,

4.1.2.4 Approved plans along with all supporting documentation shall be filed in the Association office for a period of seven (7) years,

4.1.3 Complete recording and filing of approved plans

4.1.3.1 Approved building and plot plans, covenant check list, approval request form and copy of the letter sent to the requesting member shall be filed in the Architectural Committee file cabinet by the committee chairperson or his/her designated member,

4.1.3.2 Prior to filing, data on building approval shall be entered in Master Record File and color shading will be placed on proper property location on master office map showing that a building is being constructed. Name of property owner, date approved and location of building shall be represented by a black dot on map. (Silver dot indicates construction has started) Operating Procedure # 104 cont

4.1.4 Final inspection

4.1.4.1 Upon notification of property owner that exterior of building is complete, or at the end of the one (1) year period, the inspection sub-committee or committee chairperson shall check the building for exterior completion in compliance with the Association covenants. The covenant check list for this property shall be up-dated with completion and inspections dates. The Master File and office map shall be up-dated to reflect changes.

5. Variance Requests

5.1 Property owners who have special developmental needs on their property shall be allowed to file a Variance Request to the Board of Trustees. The form for this Variance Request shall be available in the Association business office.

5.1.1 Variance request form shall be submitted to the Board of Trustees stating the reasons for the request along with any supporting documentation the member wishes the Board to consider in their decision. A memo from the Architectural Committee stating the reasons for their action on the original application shall be submitted along with the Variance Request Form,

5.1.2 The Board of Trustees shall take action on all Variance Requests at an Open Board Meeting;

5.1.3 The Board shall inform the Architectural Committee in writing of any action taken on the Variance Request,

5.1.4 All Variance Requests and all associated paper work and correspondence shall be kept on file in the Architectural Committee file cabinet.

5.2 Upon the granting of a variance by the Board of Trustees the member shall take his/her plans back to the Architectural Committee along with the letter from the Board for further action by the committee.

6. Special Situations and Requests:

6.1 Requests for opinions on how property can or should be developed, made of individual committee members, shall not be answered,

6.1.1 Requests for opinion on lot or home development shall be referred to the next regular committee meeting for consideration by the entire group of committee members present,

6.1.2 Property may be visited by the committee if so instructed by the committee chairperson or inspection committee.

6.2 Questionable or Unusual Requests:

6.2.1 Plans for construction of unusual or questionable structures or development shall be taken up by the entire group of members present at a regular committee meeting,

6.2.2 Property may be visited by the committee (no less than three members) before a decision is reached,

6.2.3 All decisions made on these special requests shall be entered into the committee meeting minutes, and kept on file, Operating Procedure # 104 cont

6.2.4 The member requesting the opinion of the committee shall be notified in writing of all findings,

6.2.5 If the committee makes the decision to grant the members request for variance or special circumstance a Covenant Check List shall be filled out and placed with the approved plans. These plans and the applicable forms and paper work shall be kept on file.

7. Enforcement of all Architectural Guidelines and Association Covenants regarding structures and buildings, shall be investigated and enforced by the Architectural Committee.

7.1 This enforcement responsibility is governed by Article VI, Section 7, of the Surfside Homeowners Association Bylaws,

7.2 This authority reaffirmed by the Association Attorney in a letter dated May 24, 1994.

8. Forms used and issued by the Architectural Committee:

AC-l Information Sheet for member/builder

AC-2 Approval Request, form for asking for plan or plot approval

AC-3 Statement of Intent, signature sheet for member/builder

AC-4 Commercial Property Approval Request

AC-5 Variance Request

AC-6 Sample Plot Plan

AC- 7 Letter of Approval

AC-8 Building Covenant Check List

AC-9 Minutes

AC-10 Letter of Non-Compliance

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