The Rancho Santa Fe Post

Op-Ed: Good Spending Limits Make Good Neighbors

Here in Rancho Santa Fe, as in other communities all over our country, excessive spending is a common concern. In these times of increasingly limited resources, it becomes imperative that stakeholders exercise their rights to vote on measures that ultimately affect their pocketbooks. In light of this, we should consider placing limitations on the Board’s expenditures.

Currently, there are no spending caps in the bylaws. As a result, the Board can spend freely even outside the core operating expenses incurred to maintain our beautiful community. This freedom has generated a real concern in light of previous Boards’ major expenditures that were approved without a vote of the community. The Osuna Ranch, for example, was purchased for $12 million and did not even have approval from the finance committee, let alone the community as a whole.

Further, having the power to spend without limits is not good even for a responsible Board, because any major spending item is going to have legitimate concerns.

When it comes to big-ticket items, the community should have the opportunity to weigh in and the sponsors of such spending should be willing to iterate on a project till the plan is really optimized. This happened with the planning of the school renovation eight years ago, and while the process took a long time, the result is really beautiful!

As the community embarks on a broad exercise to update our bylaws and make them compliant with Davis-Stirling, I would encourage us to consider placing spending caps on the Board so that any significant spending is subject to the approval of the majority of our members.

To that end, I would suggest that we consider caps for both non-operating capital expenses and non-operating non-capital expenses (e.g. surveys, feasibility studies, and the like). In determining these spending limits we should take into account the size of our budget and not unduly limit the Board’s ability to carry out the business of the association.

Any projects that will cost more than the limit should be put to a vote of the community members.

Spending caps would ensure all of us that our dues are used in a manner that is supported by the community. The current protocol, which requires that members circulate a referendum petition to stop a project after a decision has already been made, encourages divisiveness rather than consensus and leaves us vulnerable, making decisions without a mandate.

I have been asked whether I support significant expenditures for projects like the Covenant Club. I feel strongly that my opinion is just one of a few thousand potential votes. I am delighted that the current Board is bringing these kinds of issues to a community vote, exactly as they should. I would like to ensure that all significant spending now and in the future is held to the same standard by mandating that a vote must take place before the money is committed and spent.