Appeals court reversal makes it harder to raise dues in Sudden Valley

THE BELLINGHAM HERALDMay 28, 2014 

SUDDEN VALLEY - The Sudden Valley Community Association will continue to require a 60 percent "yes" vote to raise members' dues, after the state Court of Appeals Division I on Tuesday, May 27, reversed a lower-court decision that would have made it easier to increase dues in the private neighborhood on Lake Whatcom.

The decision overturned a victory for association members Curt Casey, Dave Scott and Barbara Volkov, who filed a lawsuit in 2012 against the association.

Whatcom County Superior Court Judge Ira Uhrig ruled in April 2013 that a provision in state law governing the budgets of homeowners' associations also applied to increases in dues. Under that interpretation of state law, a dues increase would pass unless a majority of all eligible votes rejected it.

The appeals court disagreed and said the association could legally set up its own rules for approving dues increases.

"The (state) statute's plain language addresses the process for approving the budget, not the process for imposing dues," the appeals court wrote. "We decline to read into this plainly written clause a meaning the Legislature never intended."

The lower-court decision would have made it practically impossible to stop dues increases. Property owners get one vote for every lot they own. With 3,202 lots in Sudden Valley, 1,602 "no" votes would be needed to prevent an increase. In the last ballot measure calling for a dues increase, in November, only 920 total votes were cast. The increase, from $777.56 to $804.77 annually for developed lots, passed with 74 percent approval. The dues for undeveloped lots went from $672.88 to $696.43.

Property owners also approved a dues increase in November 2012 - the first increase that hadn't been withdrawn since March 2008.

Casey and the other plaintiffs argued that it was too hard to increase dues, given that Sudden Valley needed to make major investments in repairing and maintaining its buildings, culverts and other facilities. The association's board in 2011 agreed with this way of thinking and raised dues by 30 percent, after changing the voting rules to the more lenient state law. A new board took over after the 2011 elections and rescinded the increase.

Casey, a former association president, has said the association was not keeping up with maintenance needs.

Association Treasurer George Shaffner said the most pressing maintenance work and repairs will be completed by next year, after voters approved a special assessment of $326 per member in 2014.

"There's a very long project list," Shaffner said.

The board will keep up with maintenance so facilities don't fall into disrepair again, he said.

The debate over dues created a rift in the community that some said fell along class lines. Wealthier property owners wanted to see major improvements and were willing to pay for them; absentee owners who rented their houses weren't as committed to the big expenses.

Association President Larry Brown said he had mixed feelings about the win in appeals court because "there are good residents on both sides of the issue."

"We would very much hope that the mending of whatever difficulties that existed in the past continue as we go forward," Brown said. "The overall goal of everybody is identical, which is a community that works for everybody, using funds to the best and highest efficiency."

Casey wouldn't comment on the court case but agreed with Brown's sentiment about mending old difficulties.

"The tension within the valley has settled down," Casey said.

Reach Ralph Schwartz at ralph.schwartz@bellinghamherald.com or 360-715-2289. Read his Politics blog at bellinghamherald.com/politics-blog or get updates on Twitter at @bhampolitics.

Reach RALPH SCHWARTZ at ralph.schwartz@bellinghamherald.com or call 715-2298.

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