TREASURE ISLAND COUNTRY CLUB

RESOLUTION OF THE BOARD OF TRUSTEES

ASSESSMENT COLLECTION RESOLUTION

At a regular meeting of the Board of Trustees (“Board”) of the Treasure Island Country Club (“Association”), held on May 7, 2011, at the address of 4350 Grapeview Loop Road, Grapeview, WA, at the time of 9:00 a.m., the Board states as follows:

WHEREAS, a regular meeting of the Board was duly called and held on the date, location and time set out above;

WHEREAS, the Association president and secretary, by signing below, attest that pursuant to Bylaws Article 9, Sec. D, notice of the meeting was duly given and that a quorum of board members was present in person or by conference telephone;

WHEREAS, the Board’s and Association’s powers to take the actions set out herein are contained in the Washington HOA Act (RCW 64.38 et seq., (the “HOA Act”)), the Washington Nonprofit Corporations Act (RCW 24.03 et seq., (the “Nonprofit Act”)) the Articles of Incorporation for the Association (“Articles”), and the Bylaws of the Association (“Bylaws”), including but not limited to the sections enumerated herein;

WHEREAS, “assessments,” as used in this Resolution, includes all amounts validly assessed against a Lot or Owner pursuant to the Bylaws, the Rules and Regulations, any Board Resolution, the Articles or the HOA Act, including but not limited to association dues, common expenses, special assessments when adopted, and installments and interest due thereon, fees, fines, attorney fees and collection costs;

WHEREAS, Article 4, Section A(7) of the Bylaws authorizes the Board, on behalf of the Association, to establish written procedures for the collection of assessments and for the foreclosure of liens;

WHEREAS, Article 4, Section A(6) of the Bylaws requires the Association to diligently collect all assessments owed, and, Article 4, Section B of the Bylaws requires Owners to pay all assessments, including but not limited to fees, interest, attorney fees, and late charges;

WHEREAS, Article 4, Sections B and D of the Bylaws authorize the Board, on behalf of the Association, to bring suit to foreclose the lien against a Lot and/or to bring an action to obtain a money judgment against an Owner for damages and/or for unpaid assessments;

WHEREAS, from time to time Owners become delinquent in the payments of their assessments and fail to respond to the demands from the Board to bring their accounts current, and it is imperative that assessment payments are timely received;

WHEREAS, the Board deems it in the best interests of the Association to adopt a uniform and systematic procedure for the collection of unpaid assessment in a timely manner, and, after exhausting reasonable efforts to work with a delinquent Owner to bring their account current, the Board further believes it is in the best interests of the Association to refer these accounts to an attorney for collection so as to minimize the Association’s loss of assessment revenue.  The Board also believes that a uniform assessment collection policy will favorably impact the overall promptness of payments thereby reducing the administrative burden associated with collection of delinquent assessments, and, the Board believes it is fundamentally fair to Owners that they have advance notice of the consequences of failure to pay assessments in a timely manner.

NOW THEREFORE, the Board, after consideration and deliberation regarding the matters set forth herein, resolves that the following steps be adopted to provide for the uniform and systematic procedure for collection of unpaid assessments:

BE IT RESOLVED, that pursuant to the authority of the Association as set forth in Article 4, Section B(2) of the Bylaws and RCW 64.38.020(11), there is hereby established a late fee of ten dollars ($10), or ten percent (10%) of the delinquent assessment, whichever is less (the “late fee”), against any assessment that is not paid within fifteen (15) days of the due date thereof, and late fees will continue to accrue on a monthly basis on the first of each subsequent month so long as any delinquent assessment or other amount remains unpaid;

BE IT RESOLVED that, pursuant to Article 4, Section (B)2 of the Bylaws, interest at the rate of twelve percent per annum (12%) shall be applied to all delinquent assessment amounts (excluding interest and late fees (i.e., interest will not be compounded, and interest will not accrue on late fees)) remaining unpaid thirty (30) days after the due date;

NOW, BE IT FURTHER RESOLVED, that the following steps be adopted to provide for the uniform and systematic procedure for the collection of billed but unpaid assessments: 

1.     Assessment payments and/or yearly or special assessment installments will be due on the first day of the month as set by the Board in the notice of assessment sent to Owners.  Any assessment payment not received by the Association on the first day of the month that it is due will be considered delinquent.  However, to allow for mail and other unforeseen delays, the Association allows a fifteen (15) day grace period for the payment to be received. 

Payments must be mailed or delivered to:

                        Treasure Island Country Club
                        P.O. Box 44
                        Grapeview, WA   98546 

2.     Any assessment not received by the 15th day of the month that the payment is due will be mailed or delivered a notification of the delinquency and assessed a late fee. 

3.     If any assessment remains unpaid by the Owner for more than thirty (30) days from the due date for its payment, the Board shall send a notice to the Owner indicating the amount due, including notice of any late fee(s) and/or interest, and demand for immediate payment thereof. 

4.     An additional late fee and interest will be applied to any outstanding delinquent balance that remains due on the first day of each month following the initial month an account is delinquent. 

5.     If any assessment remains unpaid for sixty (60) days or more, the Board may turn over collection to the Association’s attorney (“Attorney”).  The Attorney’s fees and costs will be assessed to the delinquent Owner’s account, which will increase the amounts owed. 

6.     Once a delinquent account is turned over to the Attorney for collection, the Attorney may utilize one or more of the following actions, independently or simultaneously as permitted by law, to collect any delinquent assessment: 

a.      Mail or personally deliver one or more demand letters. 

                                                    i.     Estimated cost to Owner:  $125-$200 per letter. 

b.     Record a lien against Owner’s Lot for all delinquent amounts together with principal balance of any remaining unpaid regular or adopted special assessment.

                                                    i.     Estimated cost to Owner:  $150-$400, plus recording costs. 

c.      Institute a lawsuit to obtain a money judgment and, once obtained, collect on such judgment.

                                                    i.     Estimated cost to Owner:  Variable, but normally a minimum of $1,000. 

d.     Foreclosure of Association’s lien.  In the event any assessment is past due by six (6) months and an Owner’s assessment account delinquency exceeds three times the amount of the regular yearly assessment, the Board, by a 2/3 vote of the then sitting Board of Trustees, may approve a foreclosure action.  In the event a foreclosure is authorized, the Board will follow the notice provisions contained in Bylaws Article 4(D)(2) before authorizing Attorney to proceed.

                                                    i.     Estimated cost to Owner:  Variable, but normally a minimum of $2,000. 

7.     The Association reserves the right to take or cause its Attorney to take any other action, or combinations thereof, which may be available under the Articles, Bylaws, or the law.   

NOW, BE IT FURTHER RESOLVED, if the Association recorded a lien for delinquent amounts, then the Association shall act with reasonable diligence to record a lien release once payment in-full of all delinquent amounts is received.  The Board may require the affected Owner to pay the costs and/or Attorney’s fees associated releasing the lien before the Association will record a lien release.   

NOW, BE IT FURTHER RESOLVED that these provisions also apply to a special assessment or other non-recurring charge, provided that if the due date for a special assessment or other non-recurring charge is a date other than the first of the month, no late fee shall apply until at least fifteen (15) days following the due date of the first payment of such non-recurring charge. 

NOW, BE IT FURTHER RESOLVED that, as contemplated in Article 4, Section A(6) of the Bylaws, the Board may exercise its reasonable discretion, on a case-by-case basis, to authorize occasional deviations in the application of late fees and/or interest, or other terms hereof.  For instance, if an Owner is out of town when payment is due, but pays promptly upon return, the Board may, in its discretion, waive a late fee.  However, such deviations from the policies herein shall be applied fairly, reasonably, and in a non-preferential and non-discriminatory manner.  Any deviations from the policies set out herein shall in no way constitute a waiver by the Association of any right to impose and collect charges and assessments, or to exercise any other right or remedy.

NOW, BE IT FURTHER RESOLVED that the policies contained in this resolution are intended to supplement, not limit, the provisions of the Bylaws, Articles and the law.  Where, in the Board’s discretion, specific circumstances dictate a deviation from the policies pertaining to legal action contained herein, the Board may authorize, or refrain from, legal action, as appropriate, as deemed to be in the Association’s best interests.

NOW, BE IT FURTHER RESOLVED that, notwithstanding the above, the Association may authorize longer term repayment plans for regular and/or special assessment amounts contingent upon an Owner’s consent to a lien recording or other agreement that provides security for the Association in exchange for offering longer payment terms.  The terms of this resolution apply to such installment payments, and installment payments not timely received may, upon written notice to Owner and in addition to other actions permitted under this Resolution, subject the entire unpaid principal balance to acceleration and collection hereunder.

BE IT RESOLVED that the collections policy shall become effective 30 days after a copy is sent to all Owners at their address of record.

Approved by the Board May 7, 2011

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