Trouble in paradise- Chapter II: Huge crowd shows up at Mandalay Shores Assoc. annual meeting and it’s canceled

By George Miller

Short-term rentals, cover-up, legal expenses, dues, management company, board arrogance are issues

Over 300 people, more than ten times the normal turnout,  showed up for what was expected to be a contentious  annual meeting of Oxnard’s Mandalay Shores Community Association.  Note that it is NOT a “Homeowners Association” which would put it under different laws. Attendance  is said to usually be about 30 (of 1400 total members) and a pile of proxies for management. Not. This. Time. A knowledgeable source told us that usually, 350-400 proxies are received. It might have been lower this time, since more people showed up in person. At the Hollywood Beach elementary school meeting site, a long line snaked out the door and nearly to Channel Islands Boulevard, a quarter hour after the meeting was supposed to have started. A previous board meeting on 11-19-15 had proven to be very contentious and little was resolved.

The meeting room was very crowded and not all comers were able to fit in. There were well over 200 in the room, with more left outside- perhaps a total of 300+. We had the impression that the board was anticipating a small, quiet, calm meeting, but it was shaping up to be anything but.

MandalayComm1-9-16 001

A quarter-hour after game time for the Mandalay Shores Community Assoc. annual meeting on 1-9-16, there were still many people waiting to get in. Photo: George Miller/CitizensJournal.us

 

After 10:20 AM, Chairman David Laufer addressed the people assembled in the room, taking note of the over-capacity crowd and the fact that 18 candidates were running for the board, with only 9 listed on the ballot. Without formally opening the meeting, checking the quorum or anything like that, he first asked for a show of hands of who wasn’t a member and mentioned something about it being  a closed meeting. That line was quickly dropped after some informal words with audience members. Next, he asked for a show of hands of who wanted the meeting to proceed even if not everyone could fit in the meeting room, which is about 80 x 80 ft. Most in the room raised their hands, indicating that they wanted to proceed even if it meant disenfranchising other members. There was also some talk about holding the meeting outside, but that was deemed impractical. Finally, the Association Counsel opined that the meeting should best be postponed and rescheduled in a larger venue.  It was decided to reschedule the meeting and redo the meeting paperwork/notices, etc. The gathering ended unceremoniously, with people either leaving or staying to talk in the vicinity.

?

A brief, confused, abortive Mandalay Shores Community Association almost meeting took place in a standing room only hall with people lined up outside, unable to get in- 1-9-16. Photo: George Miller/CitizensJournal.us

Two Oxnard police officers and two security guards were on scene. We didn’t see any problems requiring law enforcement action. This might have been a precaution due to a disturbance at the 11-19-15 meeting.

Issues

With no meeting to report on, we had to base much of our story on what happened at the 11-19-15 board meeting we attended, talking to people who showed up on 1-9-16 and those who talked to us beforehand. From what we have gathered, major issues are: short term unit rentals, Association budget, dues increase, legal expenses, management company, legal counsel, street flooding/drainage, landscaping, even the very existence and utility of the association. 

The rental issue seems to be most contentious. The current board wanted to eliminate rentals of less than six months. A member told us that the board passed punitive regulations, with $500 fines that double with each occurrence. This is one of their signature issues. Many owners rely upon short term rental income. Most (and we can’t be sure of this) do this via rental real estate brokers, who attend to tenant screening, legalities, rental collection and even collect and pay the “bed taxes,” which the City of Oxnard covets. Two people told me that agents collect 20% commissions. At recent City Council meetings, there has been talk of even forcing these sometimes financially strapped owners to obtain a business license to rent out their own houses. Short-term rental opponents say short-term rentals sometimes bring in noisy, inconsiderate and disruptive outsiders. Renters say this is after all a resort area and that they attempt to manage problems themselves or via agents. Two policemen we talked to on site said that problems don’t seem too bad and that they respond to complaints. They did not express any opinions to us on rental policy. We were told that when calling the police dept., someone was told that they do not collect statistics that would readily provide figures on such matters and that it didn’t appear to be linked to an increase in crime. How does one conclude that without statistics to support it? There is talk about the county developing uniform short-term rental regulations.

Dues were increased from $20 to $50 annually (about $70,000 total annually), presumably to fund professional management, legal costs and landscaping. Some residents at the 11-19 meeting were up in arms about this, saying it was never needed before.

At that same meeting, much was said about street flooding due to storm runoff, high surf and “king tides.”  The city cleans beach drains, services valves and installs/operates pumps when this occurs. Some residents want to see all stormwater collected and treated rather tan dumped into the ocean. The $20 million estimate we heard to do this might be conservative. Development on higher ground upstream is worsening the problem, which comes to a head in this neighborhood.

The board also wants to improve landscaping at homeowners’ expense. The land in question is said to be city property and some are not sure whether the association has a legal right to modify or maintain it,

The board’s proxy form allows the members to authorize the board to vote for people the board designates, but they only specified board members that they want, and form of organization for tax purposes. No other issue positions are specified, so signing it is like signing  a blank check. New proxy forms and agenda will now likely be required.

Three board members have resigned over “transparency and other issues. See discussion on this later in this bulletin.

A group called Friends of the Shores has a very different viewpoint. They don’t want members to send in the proxy and they have their own list of candidates, which they thought should have been on the ballot.  They also have their own positions on issues, which they have been informing residents on.

FriendofShores1

?

 

The Friends of the Shores group even has its own proposed budget. We weren’t able to get in touch with Association Chair David Laufer to obtain the board’s proposed one, but one can infer some of it by reading this alternative:

MandalayBudget

Some members we have heard from say that the board has overreached its powers. We were told by a member that the short term rentals prohibition was raised in November, voted in on 12-2-15 and members were informed starting 12-19-15. Resigning board member Rubin says that the members were not informed. While the board is technically empowered to change the rules, we are told that it violated the 90 days notice rule and also that something with such great import to many members should have been referred to the general membership for an approval vote, to help ensure buy-in. The Saturday turnout suggests that this might be correct. Laufer has repeatedly claimed “I will take down short term rentals.”

Well, it turns out that the board has split over the handling of the rental issue, although it was in favor of passing it. Meanwhile, three board members have resigned: Dr. Robert Rubin, Rick Swan and Josh Willis (who is an attorney, but not the board’s counsel).  You can read Dr. Rubin’s bombshell of a resignation letter right here, below. All stakeholders need to read and digest it before taking action. What he says is that the board tried to cover up the new regulation until after the board election at the annual meeting. He also confirmed the split in the board over this. 

MandalayShoresBoard1-6-16

The board’s 1-6-16 answer to a Friends of the Shores letter

Letter source

Why I Withdrew My Nomination for MSCA Board Membership 4d ago

RubinRobertDr

Dr. Robert Rubin

Robert Rubin from Oxnard Shores

Early this year I attended an MSCA Board meeting in which the increasing problems caused by short term rentals in Mandalay Shores were discussed. Persons in attendance gave examples of noise, trash, smoke from backyard fires, etc. caused by short-term renters who were vacationing in, but with little regard for, our community. An Enforcement Committee was charged with finding solutions to the issue. I volunteered for the Committee, and it was formed along with Rick Swan (Board member), Josh Willis, and David Laufer (MSCA President) as members; Josh was Chair. We met on a number of occasions and developed a set of recommendations for the MSCA Board to consider. These included 1) retaining a management company to assist in achieving greater membership compliance with MSCA’s Bylaws and DCRs, 2) a six (6)-month minimum rental period for any residential dwelling within MSCA jurisdiction, 3) activating the Class B Membership Application Process for all tenants, 4) a schedule of fines for documented violations of the six-month minimum rental period and Class B membership requirement, 5) notification of the approximately 50 MSCA property owners currently out of compliance with the new rental and Class B membership regulations to cease unpermitted activities, and 6) implementation of the MSCA Enforcement Committee’s “Recommended Commercial Rentals Activity Restriction Enforcement Program”, which included a process for MSCA members to file complaints and seek enforcement against owners who make unapproved rentals, as well as retention of legal counsel as needed for enforcement. ALL THESE RECOMMENDATIONS WERE PUT FORTH AS MOTIONS TO THE MSCA BOARD AND APPROVED BY THE BOARD IN LATE NOVEMBER. Thus, they are current, viable regulations affecting all residential property owners in Mandalay Shores. 

Shortly after enactment of these regulations by the Board, I indicated to David Laufer that the membership needs to be notified about them as soon as possible. At David’s request I drafted a memo for the Board to send to MSCA members, indicating each new regulation and its rationale. One month later, that memo still has not been sent to members. Reasons/excuses have been that 1) the minutes of the meeting have not yet been drafted, 2) some Board members were still questioning whether all motions had passed (the votes were unambiguously tallied at the meeting), 3) all Board members have not yet approved the minutes, etc. Also stated (and the real reason, in my opinion) was the desire to get the Board re-elected before informing the membership of the new regulations. Meanwhile, the short-term rental owners, AKA Friends of the Shores, have been ramping up their campaign to dissolve MSCA and repeal its bylaws. We all know what the fate of our residential community will be if the short-term rental owners take charge. 

To my knowledge, the Board still has not informed the membership of the recently enacted regulations, giving the appearance of a do-nothing Board. I challenged the Board that it was not fulfilling its fiduciary responsibility to its members and might face legal challenge on that basis. The Board is responding by asking MSCA members to approve mandatory mediation of all disputes between homeowners and the Board, thus trying to protect itself from those who may wish to enforce the Board’s responsibilities to its dues-paying members. Of note, the Board did not discuss the mediation proposal with the Enforcement Committee. In the past month David Laufer has lost all three members of the Committee in protest of his actions: Rick Swan resigned from the MSCA Board; Josh Willis indicated the mediation proposal was extremely ill-advised and resigned from the Enforcement Committee; and I have withdrawn my Board nomination for the reasons stated above. 

When I first joined the Enforcement Committee I suggested the dues increase to $50 per year, recognizing that there is a cost to actions by the Board in terms of the need for a management committee and for legal counsel. The Enforcement Committee worked very hard to develop equitable regulations for our community that would retain its unique residential character yet not stifle quiet, respectful, non-disruptive commercial activity from one’s home (e.g., giving music lessons or producing crafts for sale). The six-month minimum rental rule will allow rentals but should ensure tenants who will consider the rental (and our community) their home and treat it as such. I was pleased to have been a part of the process that crafted the new regulations. However, the Board’s not having informed MSCA members of the six enactments enumerated above, before the Board election, is a travesty. This is why I have withdrawn my nomination for the MSCA Board (and am resigning from the Enforcement Committee). I cannot be part of a process that puts self-interest (getting re-elected to the Board) first, and fiduciary responsibility to members second. I hope all MSCA members will thoughtfully consider who their representatives on the Board should be and will vote accordingly.

 

Meanwhile, we are told that Laufer is sending “cease and desist” letters to homeowners attempting to rent out their properties and harassing real estate agents handling such transactions as well.  We are also told that the City Attorney was contacted about this and decided that the City has no jurisdiction in this matter.

The Friends of the Shores group opines that the Association does not need a professional management company and that huge legal expenses are less likely to be incurred if homeowners and their agents aren’t harassed. 

It is possible that there will be some changes in the board before this all plays out. But, there is still a problem to be addressed in dealing with problem renters.

 

Mandalay Shores

The name Mandalay originated from the second-largest city and the last royal capital of Burma. Mandalay, the city, gets its name from the nearby Mandalay Hill. The name is likely a derivative of a Pali word. The root word has been speculated as: “Mandala” (believed to mean “auspicious land.”  The famous and legendary city has been celebrated in poems and the song “Road to Mandalay.” So, naming this bucolic beach enclave Mandalay  Shores was a stroke of genius- much better than Oxnard Shores, which evokes images of gang violence, and municipal incompetence for some.

Mandalay Shores, also known as Oxnard Shores, is thought by many to be the most desirable community in the City of Oxnard. With  a temperate climate, soft sand beaches with almost no rocks, the Pacific Ocean and Channel Islands views, it is a paradise for beachgoers, dogwalkers, surfers, kayakers, etc. It stretches along about a mile of beautiful sandy beach, from Oxnard Beach Park up to 5th Street, bounded by Harbor Boulevard to the east. The power plant, oil wells and McGrath State park are just north. The low-lying community is often sandblown and even has flooded streets when the waves and tide are aligned just so. There are about 1400 owner/members of the association, many absentee. My previous door-to-door efforts to stay in contact with residents revealed numerous vacant units and numerous tenants on site, with a high turnover rate in some buildings.  The “Dunes” section is east of Harbor Blvd. and north of Wooley Road and is not part of the Association, but is part of the Oxnard Shores Neighborhood Council, a citizen arm of city government.

The area prime oceanfront properties sell for $2.5- 5 million and even the inshore properties aren’t exactly cheap. There are also hundreds of apartments. Plenty of units are beach house/apartment rentals- some are commercially dedicated to this purpose, with signage indicating this. The entire community is within easy walking distance of beautiful ocean beaches and there are ample beach access routes.

There are many very longtime property owners and many are absentee owners. There are both long and short term tenants in the area. We were told by resident and former Association Chair Julie Pena that the Association was formed in 1959. There are some owners who claim to predate the Association, didn’t join it, don’t want to join it and do not feel bound by its decisions/actions. In addition, it appears that many more bought properties in the neighborhood, never receiving a disclosure of the Association’s existence or CC&R’s.

We apologize fort not attributing so many things to specific sources, but this was at their specific request, in fear of harassment/retribution, which in itself may be telling. We apologize for not presenting the full position of Chair Laufer, but we cannot force him to respond to us. The proper venue for this is members acting at the very next meeting.

 

~~~~

David Laufer is association President- 818-437-7096. 

Meeting was scheduled Jan 9th at 10am Hollywood Beach Elementary School Auditorium 4000 Sunset Blvd., Oxnard, CA 93035. It will be rescheduled.

Mandalay Shores 1-8-16 011

Mandalay Shores is a beach paradise on Oxnard’s gold coast. Some properties are priced in the millions, but are way cheaper than comparable Malibu ones. Photo: George Miller/CitizensJournal.us.

 

Mandalay Shores 1-8-16 004

Near sunset at Mandalay Shores, looking out toward Santa Cruz Island, 18 nm offshore, 1-8-16. Photo: George Miller/CitizensJournal.us

 

Mandalay Shores 1-8-16 003

Sand blown in by recent storms at Mandalay Shores, 1-8-16. Photo: George Miller/CitizensJournal.us

Mandalay Shores 1-8-16 009

____________________________________________

George Miller is Publisher of CitizensJournal.us and a “retired” operations management consultant residing in Oxnard

Get Citizensjournal.us Headlines free  SUBSCRIPTION. Keep us publishing – DONATE

 *Scroll down to post a comment

x

Leave a Reply

Your email address will not be published. Required fields are marked *