Vote Against Proposition #3

Do Not Allow Your Representation To Be Taken Away From You

The so called “Alliance for a Better Community” is a small group attempting to promote their own agenda by gaining control of the POA Board. Their newspaper flyers make blatantly false claims by using out of context quotes.

 

FICTION: “Research shows that 87% of S&P’s 500 now have annually elected boards.”

FACT: The POA is a non-profit corporation and cannot be compared to a large “for-profit” business. In addition, almost all “non-profit” and “for profit” corporations that do hold annual elections replace Directors on a staggered annual basis, not all of the Directors at the same time.

 

FICTION:  “Elect all Directors’ every two years. Staggered terms for directors decrease corporate value and produced “entrenched” boards unresponsive to shareholders.”

FACT: Again, this group has picked out sentences from articles that would Oppositionappear to support their cause. Reality is that the Harvard Business Review (HBR), April 2014, reported the WORST performing companies had either five or more director turnovers or no turnovers in a three year period. Another HBR article reported that the average S&P 500 has 11 board members. The present POA election cycle using staggered terms is just common sense. It is cost efficient and provides for operational continuity.

 

FICTION: “Cut the POA board size to 7 directors. Every person added to a decision-making group over seven reduces decision effectiveness by 10%.”

FACT: Another study conclusion reported that there are substantive justifications for boards of 11 to 16 members to ensure accountability and representation of the diverse interests of the people they represent. Small boards result in control by a few resulting in less representation of the community as a whole.  The simple fact here is that this group wants to take over the POA and reduce your representation.

 

If you’ve already voted based upon the misinformation that’s been sent out, you have the right to complete a new proxy vote which will override the original.

 

About the Author

Chuck Ingraham
First mayor of Diamondhead

6 Comments on "Vote Against Proposition #3"

  1. Alliance for a Better Community does in-depth, widespread research before claiming anything.  We leave blatantly false claims to others, who, like Whack-a-Moles, are popping up all over Diamondhead email lists nowadays.  

    One of their whoppers is that the proposed change in elections will constantly produce massive turnover in directors.  No, the studies show they don’t. Most directors who run are re-elected and shareholders rarely throw them out – unless they are representing their own rather than shareholders’ interests.  Isn’t that when you should be able to throw them out?

    The facts, for those who want the truth, are in the the articles below. In short:

    1.   Non profit and for profit boards have a number of similarities* but there’s certainly one big difference – few can reach into your wallet for whatever dues and assessments they want like our POA board can do. Shouldn’t you want more control than that?

    2. 87% of S&P’s 500 do indeed make all of their directors stand for election every year.** To claim that’s fiction just means you haven’t done your homework.

    3.   Entrenchment of staggered boards and their ill effects are established by multiple studies.***  Claims that our staggered board is cost effective are belied by the just-released auditor’s report on our $1.5 million POA deficit.  Claims that 11 staggered directors give the POA membership better “representation” are torpedoed by POA director votes that killed even the smallest of dues reductions this year against the clearly expressed wishes of the membership. Those votes were cast by the staggered leftover directors from the last administration — Mr. Crosby, Mrs. Johnson, and Mr. Kyger — joined by Mr. Harvey who is Semper Fi to any new and futile spending that comes along.

    Mr. Ingraham keeps using that word “representation.” I do not think it means what he thinks it means.

    *https://pattonmcdowellblog.wordpress.com/2011/04/08/key-similarities-in-nonprofit-for-profit/

    *http://www.startnonprofitorganization.com/nonprofits-versus-business

    **http://www.skadden.com/insights/us-corporate-governance-boards-directors-face-increased-scrutiny

    ***http://www.nber.org/digest/feb05/w10587.html

    ***http://articles.chicagotribune.com/2012-04-04/business/ct-biz-0401-bf-staggered-boards-20120401_1_board-structure-board-members-board-terms

    ***http://www.hblr.org/wp-content/uploads/2013/08/HLB101_crop.pdf

    ***http://www.djcl.org/wp-content/uploads/2014/08/Declassifying-the-Classified.pdf

  2. Pat Fuchs | June 3, 2015 at 8:30 am |

    The group that worked to incorporate Diamondhead into a city used as one of their issues the expiring of the covenants starting in 2020.
    I have received several emails from these same people opposing Prop 3 on the grounds that nothing should change until that actually happens. This has certainly confused me, we needed a city to protect us but we should not streamline the Board of Directors.

    Hancock County has five supervisors, the city of Diamondhead has 5 councilmen and a mayor but the POA board needs 11 members to operate.

    The expiration of the covenants starting in 2020 jeopardizes the right of the POA to collect dues and thus their ability to maintain the amenities. Only Glen Eagle has covenants that continue in perpetuity.

    The present board seems to be on a spending spree (football fields, Bocci and Croquet, alfresco dining, football fields, etc., etc.) This seems extremely imprudent in view of what must be dealt with in 2020. It seems to me the more prudent approach would be to maintain the amenities as they are now with no expansion.

    A better use of funds would be an aggressive push to save the covenants. Waiting until 2020 is foolhardy somewhat like being in the path of a Cat 5 hurricane and waiting for landfall to prepare.

    Prop 3 is simply an endeavor to streamline the board and make it more efficient. It is not as some have said, “a well financed plan” to take over the POA and trash the amenities. We are only a small group of people hoping to preserve our community well into the future.

  3. To those concerned about experienced board members shortened terms:

    If a Diamondhead POA director does a good job, he most probably would be re-elected. Why take the chance of having to deal with someone who does not represent what the majority voted for?

  4. wayne king | June 7, 2015 at 7:56 pm |

    The State of Texas which is the 12th largest economy in the world manages to operate with its Legislators meeting every two years, seems we over do it somewhat here in Diamondhead, meet once a year pass a budget, let the general manager execute it, if he screws up fire him, hire another at the next meeting. My desire would be for a lot less secrecy in our Diamondhead governments.

  5. squaredeal1 | June 11, 2015 at 7:54 am |

    Ingraham, did you go to a special school for liars?

  6. Since the city took over some big POA functions, a more streamlined, smaller board with shorter terms is best for all Diamondhead citizens. With the POA created city and it’s various politicians, the large POA board with 11 entrenched directors… government here has become too inefficient and unwieldy. Proposition 3 makes sense for Diamondhead. We need a less cumbersome more open, responsive and efficient board for the changes, complex challenges and financial decisions we will soon be forced to address.

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