Several owners who weren't able to attend the March 27, 2012 Annual General Member Meeting of the Springs Owners Association have asked what the purpose of the recently announced Special Member Meeting of the HOA is about.
The short answer is that the meeting is for the following: Consider and vote on an amendment to the Springs Bylaws to prohibit the Board of Directors from amending or repealing the Bylaws, or adopt new bylaws; and any other matters that may be offered for consideration and/or vote by any HOA member. The owners present at the quorum-satisfying March annual meeting could have voted on the issue at that meeting, but were not allowed to, and thus, in accordance with our Bylaws, more than 10% of the Springs owners called for a Special Member Meeting to consider and vote on the issue.
While the following information should also be provided in the Notice of the Meeting that must be mailed to all owners, the background and genesis of the issue is as follows:
Proposed Amendment to Article 15.01, Association Bylaws
Background: Article XV, Amendments to Bylaws, of the Springs HOA’s Bylaws currently states that the Bylaws may be amended or new Bylaws adopted by a vote of a majority of the members at a meeting that achieves a quorum. The original Bylaws, adopted and recorded by the Springs developers in 1998, assigned the authority to amend the Bylaws or adopt new ones to the Board of Directors. In October 2000, the Springs Board of Directors approved five amendments to the original Bylaws, one of which transferred the authority to amend or adopt Bylaws from a majority of the Directors to a majority of members at a member meeting. While not required, that Board of Directors also stipulated that the five approved amendments would be in effect only after ratification by a majority of the members at the next HOA Annual General Member Meeting (AGMM). That AGMM was conducted in November 2000, and a majority of the 65 owners attending that meeting approved all five amendments offered by the Board of Directors. The Board of Director’s rationale for the amendment to Article 15.01 was: “Current Bylaws delegate too much authority to Board of Directors.” The Bylaw amendments approved by the Board of Directors and members in 2000 were formally incorporated into the Bylaws adopted by the members at the 2001 AGMM. Those Bylaws were formally recorded at the Bexar County Clerk’s office in December, 2007, allowing them to remain as the governing Bylaws in effect today for the Springs HOA.
In February 2012 a member of the HOA’s Board of Directors tasked the HOA’s attorney to perform research to determine if the Board could gain the authority to amend the Bylaws. The attorney subsequently provided the Board the portion of the Texas Business Organizations Code that addressed the authority to amend or repeal bylaws or adopt new bylaws for non-profit organizations (section 22.102, Bylaws, effective January 1, 2006). Because the Springs HOA is a non-profit organization, and the referenced Section 22.102 states that such an organization’s Board of Directors may amend, repeal, or adopt bylaws unless expressly prohibited by its members from doing so, our attorney’s research resulted in our Board of Directors adopting the authority to amend, repeal, or adopt bylaws, similar to the existing authority of the HOA members to do the same. This co-authority to amend, repeal, or adopt bylaws results from our Bylaws’ Article 15.01 not “expressly providing that the board of directors may not amend or repeal the bylaw,” as required by the 2006 Business Code; as such, both the Spring Board of Directors and our HOA members currently have the authority to amend, repeal, or adopt bylaws.
Our attorney has advised the Board of Directors that the members could revoke the authority for the Board of Directors to amend, repeal, or adopt bylaws by a vote of a majority of members at a member meeting achieving quorum. However, the Board of Directors does not enjoy a similar ability to revoke the authority for the members to amend, repeal, or adopt bylaws.
Pro: Approving the Proposed Amendment will (1) eliminate the current co-approval authority shared by the HOA’s Board of Directors and HOA members, which could lead to the adoption of conflicting amendments to the same Bylaws Article, (2) re-establish the sole authority to amend, repeal, or adopt bylaws to the members, as first established in 2000 and used as our governing practice until March 2012, and (3) avoid the concern expressed by the Board of Directors and accepted by a majority of the HOA members in 2000 that assigning the authority to amend, repeal, or adopt bylaws “delegate too much authority to Board of Directs.”
Con: Voting on proposed amendments to the Bylaws would have to wait until the next annual or special meeting of HOA members that achieves a quorum.
Proposed Amendment:
As reads:
15.01 These Bylaws may be altered, amended, or changed and new Bylaws may be adopted at a regular or special meeting of the members by a vote of a majority of a quorum of the members present in person or acting by proxy.
Proposed:
15.01. These Bylaws may be altered, amended, or changed and new Bylaws may be adopted at a regular or special meeting of the members by a vote of a majority of a quorum of the members present in person, acting by proxy, voting by absentee ballot, or voting by electronic ballot. The authority to alter, amend, change, repeal, or adopt a Bylaw by the Association’s Board of Directors is expressly prohibited.
Hopefully, the above information provides sufficient information to reduce or eliminate any confusion or concern that you may have about this first-ever member-called Special Member Meeting.
