Proposed Changes to Election Portions of CC&Rs

Proposed Revisions to the
GENERAL REGULATIONS OF THE VALLE ESCONDIDO HOMEOWNERS ASSOCIATION COVENANTS, RIGHTS, DUTIES AND RESTRICTIONS

CHAPTER II
Powers and Duties of the Association
Article 6. Steering Committee: This group is composed of 5 members who will serve as
the decision making body for the Valle Escondido Homeowners’ Association. All
procedures for the election of the Steering Committee will follow the guidelines
established in Chapter III of this document.

Steering Committee Members will be elected on a rotating basis with two (2) new
members beginning their term in even number years and three (3) new members
beginning their term in odd number years. Each member will serve for a two-year term.
Committee members will be elected by a simple majority of voters who cast their
vote personally or by proxy in accordance with the guidelines established in the Rules of
Election. If there are two members being elected, the two candidates with the most votes
will be elected, if three members are being elected, the three candidates with the most
votes will be elected.. In the event of a tie, there will be a run-off scheduled within 7
days of the original election. Nominations to the Steering Committee will be taken per
the procedures laid out in the Valle Escondido Rules of Election.

By the nomination deadline, if the number of candidates matches the number of
committee member vacancies, the election does not need to be held and can be deemed
complete by the Election Inspector.

The required quorum for this election will be the same as that established in
Chapter III, Article 4 of this document.

At the beginning of each year, the five (5) Steering Committee members will elect
among themselves a President, Vice President, Secretary, and Treasurer. A member may
hold more than one position at the discretion of the acting committee.
The Steering Committee will make decisions by simple majority with a minimum
of three Steering Committee members casting their vote. The Steering Committee is
empowered to carry out and enforce these decisions. Items requiring legal filing will be
submitted to the Board of Directors.

If a Steering Committee member is unwilling or unable to fulfill his or her
position for the elected term, the remaining Committee members will, through majority
vote with the departing member casting a vote, select a replacement. This replacement
will be in effect for the remainder of the term being vacated.

CHAPTER III
VOTING RIGHTS
Article 1. Rules of Election. Elections will be conducted in accordance with the Valle
Escondido Rules of Election, which can be modified by majority vote of the existing
Steering Committee. The Valle Escondido Rules of Election provides for the existence of
an Election Inspector to ensure the validity of all elections.

Article 2. Voting Rights. One vote will be allotted to each lot. For election purposes,
this vote will be referred to as a "Member" in the Valle Escondido Homeowners'
Association. When one home is constructed on two or more lots, the member will be
entitled to only one vote as assessments are collected to the ratio of one assessment per
constructed home. When more than one person holds interest in any lot, they will decide
among themselves how the vote will be cast, but in no event shall more than one vote be
cast with respect to any lot.

Article 3. Member in Good Standing. Each member is entitled to one vote per lot given
that the owner is a “Member in Good Standing”. A Member is Good standing is one
who is current in all debts to the Valle Escondido Homeowners’ Association. It is the
responsibility of the Election Inspector(s) to determine the eligibility of voting members.
This must be done twenty-five (25) prior to the close of the election.

Article 4. Quorum. A quorum is constituted by 60% of Members casting an online ballot
and/or attending a meeting with the stated purpose of hosting an election.. If the required
quorum is not forthcoming, another electronic ballot and/or meeting may be called, and
the required quorum at any such subsequent meeting shall be one-half (1/2) of required
quorum at the preceding meeting, or 30% of the members. No such subsequent meeting
shall be held more than sixty (60) days following the preceding meeting.
Article 5. Election Timeframe. Notice of elections will be given via email
communication and/or an open meeting no less than twenty five (25) working days or
more than fifty (50) working days prior to the final voting date inf the election.
Information regarding candidates and issues will be provided in writing no less then 2
weeks prior to the final date of voting in the election.


CHAPTER V
Maintenance Dues and Assessments
Article 1. Personal Obligation of Assessments. Property owners are subject to two forms
of assessments: 1) Annual dues as set forth in Chapter V, Article 3, and 2) Special
Assessments as set forth in Chapter V, Article 4. Payment of dues begins when at least
one of the following criteria is met:
(a) Acceptance of Title for the property
(b) Inhabitance / use of the property

Article 3. Annual Dues. In January 1, 2003 the annual dues were set at nine hundred
dollars ($900.00) per Lot.
After consideration of current maintenance costs and further needs of the
Association, the Steering Committee may increase the annual dues no more than 20% of
the current fee in a two-year period. This increase must then be submitted to the Board
of Directors for appropriate legal filing.

If an increase of more than 20% is deemed necessary by the Steering Committee,
a special vote of the members will be called. Such an assessment must be approved by
two-thirds (2/3) of members who are voting in person or by proxy. An election for this
purpose shall follow the election requirements as stated in Chapter III of this document.
Article 4. Special Assessments. In addition to the annual assessments authorized above,
the Valle Escondido Homeowners’ Association may levy in any assessment year, a
special assessment applicable to that year only. This assessment would be for the
purpose of defraying, in whole or in part, the cost of any construction, reconstruction,
repair or replacement of a capital improvement upon the Common Area. An election for
this purpose shall follow the election requirements as stated in Chapter III of this
document.

Such special assessments shall require the approval of more than two-thirds (2/3)
of members who are voting in person or by proxy. An e-mail, fax or written invoice for
the annual assessment shall be sent to every Owner subject thereto no sooner than 30
days after the close of the election. Failure to pay the assessment will result in the
procedures and penalties as detailed in Chapter V, Article 10.

CHAPTER XI
General Provisions
Article 2. The covenants and restrictions of these General Regulations shall run with and
bind the land, and shall enforceable by the Steering Committee for the benefit of all
members, their respective legal representatives, heirs, successors and assigns.
The Steering Committee may recommend amendments to these covenants and
restrictions. Any potential amendment shall be put to a vote of members. Such an
election shall follow the requirements as stated in Chapter III of this document. Any
amendment shall have the assent of 75% of members who are voting in person or by
proxy. This resolution will then be duly signed and filed by the Board of Directors.