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The Need for Term Limits

Updated: Dec 17, 2019

This article has been updated. The original article appears below after the update.


Summary

  • Our Board adamantly opposes term limits. Some directors, including President Bill Fautsch, have served up to 13 years, and they are determined to stay in power for many years more.

  • Board directors argue that term limits would force a turnover that would rob the HOA of institutional memory. But no one is indispensable, and there are many factors specific to our association that would minimize any negative effects of term limits.

  • Board directors argue that elections provide a natural process for limiting terms. But the reality is that a pair of corporate members dominate our elections. In the May recall, they were able to flip the results after we homeowners voted nearly 4:1 to remove Fautsch. These two corporate members could re-elect Fautsch in 2020 without a single vote from us homeowners.

  • The Board has committed to putting term limits up to a vote of the HOA’s members, though the directors want the members to reject them. But even if the members approve term limits under the Board’s process, those limits would not take effect until 2021. Moreover, the clock would not start until then.

  • The process the Board is following would ensure that there would be no limit on the terms of Fautsch and other long-serving incumbents for many more years, no matter how overwhelmingly we members vote for those term limits.

  • The Board’s position makes a mockery of the whole concept of term limits.

  • The only way to ensure a regular infusion of new leadership with new ideas on the Board is to reform the Bylaws so that term limits are in place for the 2020 election and that those limits apply to the incumbents.

The original article below spells out the basic arguments for term limits, both pro and con. It explains our position favoring term limits for the Foothills Community Association (FCA). We have had extensive discussions with certain Board directors about the issue. These discussions brought out many important factors specific to the FCA that should be taken into account.


The Board directors strongly objected to term limits. While they acknowledged that the Board had committed to put the issue up to the FCA’s members in an election, they made clear that they wanted the members to reject term limits. Their objections focused on two areas:


#1 Institutional Memory: The Board directors asserted that managing the FCA was a complicated matter. It took new Board directors considerable time to become familiar with the many issues. If term limits forced a turnover every four years, this would deprive the Board of directors with the necessary experience and institutional memory to guide the FCA most effectively. Moreover, there were some directors, such as the treasurer, who had technical roles that were particularly challenging and required considerable training/experience.


These arguments have some merit. But in fact, all public organizations must undergo some level of turnover. No one is indispensable. People come and go all the time in all sorts of positions, and organizations cope with this reality and move on. It is no different with the FCA.


What is different is that the specific situation of the FCA greatly mitigates the negative effects of such turnovers. For example, former Board directors don’t just disappear; they generally remain in the community and may still actively participate in the FCA’s activities. They are free to offer their advice and experience to their successors. There are others, such as the management firm and the legal firm, who also can provide support. Finally, the Bylaws allow the Board to select people who are not on the Board to fill the officer positions (other than president). Thus, if it wanted, the Board could appoint the incumbent treasurer to be the new treasurer even if that person were no longer a Board director.


Thus, term limits offer a clean mechanism to ensure fresh ideas on the Board with a negligible loss of institutional memory due to turnover.


#2 Elections Provide a Natural Way to Limit Terms: The Board directors argued that the FCA’s members should be allowed to decide in the elections whom they want on the Board. Their decision should not be limited by term limits.


Again, this argument also has some merit. But it overlooks two critical and interconnected facts.


One is that incumbency inherently confers some benefits. The incumbent exercises power, and he builds relationships with people and entities who stand to benefit from the exercise of that power. These people and entities understandably support the re-election of the incumbents. In the case of the FCA, there are corporate members who have a long-standing relationship with incumbents such as the president, Bill Fautsch, who has served more than 13 years.


The second related point is that there are corporate members of the FCA with huge blocks of votes. Two of these corporate members command 465 votes between them. Five of the six current Board directors (six of seven, if the director who resigned in December is included) are beholden to these two corporate members for their seats. The overwhelming power of these two corporate members was demonstrated in the May recall election. The homeowners voted nearly 4:1 to remove Fautsch; the vote was 500 to 143. But these two corporate members were able to reverse the election and secure Fautsch’s seat. Thus, Fautsch remained on the Board while only garnering the support of 3% of the FCA’s homeowners. This showed his low popularity among the homeowners after 13 years on the Board.


The situation is made more problematic by the issue of ‘cumulative voting’. Per the FCA’s CC&Rs, members with more than one property can ‘cumulate’ their votes. This means that they can cast all their votes for one or more candidates. In the 2020 election, there will be four positions open. The two corporate members will have a total of 1,860 votes to cast. If they chose, they could cast 930 votes each for Fautsch and the other incumbent up for re-election who has also served more than a decade. To put things in perspective, 930 votes is more votes than any candidate has received in recent elections. In essence, the current rules could allow these two corporate members to re-elect these two directors without a single vote from homeowners. This is not just an academic point—this type of cumulative voting was utilized in the 2019 election.


****


The only remedy to this reality is term limits.


We believe that term limits is a critical issue that should be decided by the FCA’s members. We believe Board directors should recuse themselves, as they clearly have a personal interest in it. Indeed, they repeatedly emphasized to us that they took the issue very personally.


We advocated putting the issue up to a vote of the FCA’s members in February. If done in conjunction with the preparations for the 2020 election, such a process could have the members decide the issue before the regular 2020 election for Board members at a negligible cost.


At its December 4 meeting, the Board unanimously rejected this proposal from its own Bylaws committee. The Board maintained that it would put term limits up for a vote in the regular election. Pressed on the issue, the Board made clear that even if the members approved term limits, the limits would not take effect until 2021. In essence, they chose a path that would facilitate having the corporate members re-elect Fautsch and the other affected director for another term.


Moreover, in our discussions with directors, they insisted that even if term limits were voted in by the members this year, the clock should not begin until they were implemented…in 2021. Thus, not only could Fautsch remain in office for one additional term, he could remain in office for however many more years were allowed by the term limits. Thus, his 13-year reign could potentially extend beyond 16 years to perhaps 18 or 20 years, depending on what limits were set.


This position makes a mockery of the whole concept of term limits. The purpose of term limits is to ensure a regular turnover of leadership. Potentially having the president serve for two decades runs totally counter to this.


What is most troubling is that this is a core issue that should be up to the members of the FCA to decide. The process being followed by the Board would essentially bypass the will of the members and ensure the possibility of Fautsch remaining on the Board for many years to come.


The only way to ensure a regular infusion of new leadership with new ideas on the Board is to reform the Bylaws so that term limits are in place for the 2020 election and that those limits apply to the incumbents.


Original Article

We have all heard the expression “power corrupts.”  Power can be a potent and insidious drug that, over time, deeply affects the person holding it.  More and more that person can get accustomed to wielding his or her power, and the desire to maintain this power can grow ever stronger and affect his or her attitude and actions.  This is often to the detriment of the organization he or she leads.


History has proven time and again that, in any organization, there comes a point where the person in power—no matter how well he or she performs—needs to step aside and let in new blood for the good of the organization.


Those of you who have read my biographical sketch on this website know that I was a Foreign Service Officer for the U.S. Department of State, and that I worked for decades on Latin America.  The history of Latin America is replete with cases of leaders who took power—often with popular support and good intentions—but then succumbed to the narcotic effect of power. 

 

While stationed in Washington, I witnessed this same phenomenon play out over and over, albeit in a different way.  I often saw senior bureaucrats who were solidly entrenched in their positions and deeply resentful of anyone from the outside who attempted ‘to play in their sandbox.’  Influenced by their years of exercising power, they had largely lost track of the fact that they were there to serve the American people.


Sadly, I have seen this same mentality among some on the Foothills Community Association (FCA) Board.  The Board’s President, Bill Fautsch, was first elected to the Board in 2006 and became its President in 2007...12 years ago.  Notwithstanding whatever good or bad he might have done over his years on the Board, for the good of the FCA, it is simply time for him to move on.  For me, the fact that the reforms that we are promoting are all needed and could have been implemented years ago, but the Board he heads did not consider them, is testament to the need for new leadership.


I acknowledge that the proposed amendment to set term limits on the members of the FCA Board of Directors is the one element of our reform package about which there can be legitimate debate.


The argument against term limits is essentially that people who are doing a good job should not be prevented from staying in office simply because of some arbitrary deadline.  Moreover, term limits effectively could deny the members of the FCA from voting for the person that they most want to serve on the Board. I will concede that these points have merit.  However, when looking at the big picture, the case for term limits is far stronger.

  

Following the death of President Franklin D. Roosevelt in 1945, during his fourth term, our federal government adopted the Twenty-second Amendment setting terms limits on the presidency.  As towering and beloved a figure as was Roosevelt, our people understood that it was better for the nation to limit the tenure of any president to two terms. Here in Arizona, we have term limits for the governor and members of the legislature.  Fautsch has already served as our Board’s President nearly as long as Roosevelt served in the White house, and far longer than a governor could serve in Arizona. If America and Arizona have term limits on their leaders, why shouldn’t our Association have term limits on its leaders?


Finally, I invite all of you to take a look at the BC cartoon on our website.  It makes the case for term limits far more succinctly and eloquently than I ever could.


David Randolph is a resident of the The Foothills.

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