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“CLERICAL ERROR”?

1/31/2022, 4:35 PM

“CLERICAL ERROR”?

Ranch Matters (RM) published on 1/29/22, “PAPERS PLEASE” regarding the budget preparation process and the importance of the mandatory filing of the IRS Form 990 by the Ranch Association. The 990 is a significant part of the overall financial reporting process and the Ranch is federally mandated to make it available upon request.

(See story for details)

RM Member Dale Wiley commented: “What is there to fix? Nothing there can be amended. Looks like some inaccurate information was listed on the form by the accountants. They must have missed or were not told about the bylaws vote thing by their Boards contact. Probably just a clerical error by the accountants. I am sure it is just a minor misunderstanding, easily corrected.”

Mr. Wiley spoke with us about his comment and asked, “Was it just a clerical error by the accountants?” He added: “Is there more to the story?

We told Wiley, there is more to the story and walked him through, chronologically, the Ranch 2016 Election Process/Controversy.

For readers unfamiliar with the election process, every August Crooked River Ranch (CRR) holds elections for members of the Board of Directors along with other BALLOT MEASURES.

 

The August 2016 election cycle ran from August 1, 2016 through August 31, 2016, and according to former Ranch Vice President, John Williams, that election, “Was one of the most important in the history of Crooked River Ranch…”

WHY?

The Ranch Officials were unhappy with how they had to govern the Association based on the BYLAWS at that time and placed on the Ballot, Measure 2. Measure 2 asked the Members to amended Article XVII, Section 1, of the BYLAWS by replacing the 2016 version of 50% plus 1, affirmative votes, of all eligible property owners, to “2/3 majority” of only votes cast. At that time at least 1300 plus eligible property owners represented the required voting quorum and that too stood in the Ranch Officials way. They knew if they could get what they wanted and amend the BYLAWS accordingly, they would finally be able to govern all Ranch Affairs via a very small number of select (“AFFLUENT”) residents.

Interestingly, former Ranch Secretary/Director, Paula Bartolomei posted the following Message/ Solicitation in the July 2016 TELEGRAPH: “…In order to change the By-Laws, we need a majority of eligible voters plus one-or, 1,324 votes in favor (YES)-in order to change anything.”

 

In July of 2016 and before the annual election cycle started, questions involving the process fell on deaf ears and triggered an opposing/controversial NO ON 2 campaign regarding the subject ballot measure.

During the election cycle, Ranch Manager, Judy Lapora ordered the removal, “theft” of our NO ON 2 Political Signs-Message and concealed them in the Ranch Boneyard. Theft reports were filed and efforts to recover all of the stolen signs resulted in threats of arrest for trespass by former Ranch President Dave Palmer.

After the 2016 election, Ranch Officials knew they had a problem with the election results and sought the assistance of the Ranch attorney. In a obtained email, dated August 30, 2016 and authored by Secretary/Director Bartolomei, addressed to then President, Mitch Mitchener, Bartolomei stated: “Mitch, do you think it would be worthwhile to have at the work session a letter from Steve Bryant (attorney) addressed to Ranch residents outlining his legal opinion on the quorum/plurality issues?” Mitchener responed:

“Maybe a letter in our back pocket isn’t a bad idea.” He added: “We have asked Zach (CPA) to give the results at the work session to lend credence.”

 

Bartolomei expressed her concerns, as a Ranch Officer, about the election results and felt “experts” were needed to legitimize it. She stated: “I think it’s imperative that we do what we can to stop the rumor-mongering that is affecting the Ranch so negatively, and one way to do that is to have ‘experts’-Zach from the auditor and a letter from Steve Bryant-giving their outside opinions on our election results. If it comes from the Board, it is going to be suspect, but if it comes from the auditor and the attorney, it will be MORE LEGITIMATE.”

In another obtained email, dated August 29, 2016, authored by former Director/President, Dave Palmer, he stated: “So, after reading and re-reading this ad nauseam it really seems to me that the intent is not only do we need the 50% plus 1 of eligible voters, but to pass a measure the total YES VOTES must be that 50% plus 1 also.”

At the beginning of the 2016 election cycle, Bartolomei stated clearly what was required to amend the by-laws and Palmer too, understood. At the end of the election cycle, the numbers didn’t add up so they hired experts to make it seem “MORE LEGITIMATE.”

March 20, 2017, RM Dave Stangland and John Stevens submitted to the Ranch Board of Directors a statutory required NOTICE-ORS 94.630 listing 16 claims, including claims regarding the by-law amendment election. Efforts to negotiate/mediate were rebuffed by the Ranch Officials.

 94 Notice Attached

April 2017, shortly after submitting the above mentioned 94 Notice, the Ranch obtained legal representation from Portland attorney William Ohle. On April 28, 2017, the controversial by-law amendment was CERTIFIED with the Jefferson County Clerk’s Office on Ohle’s watch. Efforts to negotiate/mediate were again rebuffed by Ranch Officials and their hired gun, Ohle.

On July 27, 2017, Stevens and Stangland’s attorney, Robert Birk, wrote the Oregon Attorney General (DOJ) regarding the CRR 2016 ballot election, amending Association By-Laws. Birk’s letter stated in part: “My clients Dave Stangland and John Stevens are two homeowners, who suspect there has been a statutory violation by directors of the largest homeowners association in Oregon.” “They wish to assert a complaint and request review of that homeowners association’s handling of an election by applicable business activities and non- profit regulatory functions, including reviewing if that non-profit entity and its board violated aspects of ORS 94 and ORS 65.” The DOJ replied: “Your best recourse may lie in the courts.”

Fast forward to September 14, 2017 and as reported in PAPERS PLEASE, Ranch former President/Officer Dave Palmer signed and submitted along with CPA, Zachary L. Harmon, IRS FORM 990, for the Tax year 2016, to the IRS. As reported, the 2016 FORM 990 included a SCHEDULE 0-“Supplemental information to Form 990” that states in part: “If changes to the bylaws are proposed, the changes must be voted on by the members.”

Their ANSWER: “No member policy votes occurred in the current (2016) tax year.”

The September 14, 2017, 990 was submitted: “Under penalties of perjury, (Palmer & Harmon) I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct and complete declaration of preparer (other than officer) is based on all information which the prepare has any knowledge.”

The above referenced 2016 990 Form confirmed: “NO MEMBER POLICY VOTES OCCURRED IN THE CURRENT TAX YEAR.”

However, former President Palmer and former Secretary Bartolomei both signed and recorded with the Jefferson County Clerk’s Office-6 months earlier, the official record substantiating there was an election in 2016 that AMENDED THE BYLAWS.

Wiley asked: “Was it just a clerical error by the accountants?”

Accountant Zach Harmon’s CPA Firm conducts the annual elections for the Association and performs the annual audits. In the 2016 election cycle his firm managed the election, tallied the numbers and he reported the results at the September 7, 2016 Work Session Meeting.

“CLERICAL ERROR”?

Ranch Matters Staff