Historical Perspective – The current TRMA was written by the Developer (Great Western Corp./Terramar Corporation) in 1970 to help promote Terlingua Ranch land sales. Three of the ten sections have been modified over the last 38 years. The proposed TRMA removes all the references to the “rights of the Developer” regarding their sale of lands and their right to grant exempt property status, to act as custodian and administrator of the Maintenance Fund or to terminate express liens.

 

Definitions – In any legal document the definitions of the terms used are most important in understanding and defining the terms of the document itself. The Definitions of the proposed TRMA have been clarified to remove the ambiguity that exists in many of the terms used in the current TRMA. Additions to these definitions clarify the meaning of an Owner, with a specific definition of Exempt Owner.

Importantly, the definition of Tract has been rewritten to secure a per Owner assessment in Section I. This definition removes all possibility that a per tract fee could be charged in Section I.

 

Section I - Determining the Annual Assessment Fee –

In the current TRMA, the annual assessment is automatically adjusted for the Cost of Living Allowance (COLA), and any further increase in the annual assessment fee requires an affirmative vote by property owners.

 

The proposed TRMA provides the following set of guidelines to enable the Board to deal with increasing costs and special situations, while limiting their authority to do so without owner consent:

The proposed TRMA eliminates the original developer as Administrator of the Maintenance Fund.

 

In the current TRMA and in the proposed TRMA, POATRI, acting through its Board of Directors, retains the right to reduce, waive or abandon maintenance assessments, pro rata as to all Owners who pay annual assessments, should it be deemed best for all property owners.

 

Additionally, the proposed TRMA requires an election by mail and a two thirds super-majority of votes cast, with at least 10% of the Members in Good Standing voting, in order for POATRI to transfer its obligations as Administrator to another party.

 

The proposed TRMA has been reworded for clarity and updated to include assets now owned by POATRI which were owned by the Developer at the time POATRI became the Administrator.

 

There are no proposed changes to this section which contains the legal language which allows the Administrator to transact business.

There are no proposed changes to this section which maintains the Texas Not for Profit status of POATRI and any successor Administrator. Developer language was removed.

 

In the proposed TRMA both Annual Assessments and Special Income Assessments are secured by an express lien. Developer language was removed.

 

The new definition of Tract, so important to ensuring the Owner assessment cannot be misinterpreted, will also more fully secure assessments by express liens. This will allow POATRI to more efficiently utilize the foreclosure process which will move delinquent properties to new, fee-paying owners.

 

The proposed TRMA removes the Developer’s right to add property to the TRMA and allows for a successor of POATRI as Administrator, subject to certain powers that do not pass to the successor Administrator.

 

The start date for the current TRMA was November 1, 1970, and the initial time period was for 30 years with automatic 10 year renewals. The start date for the proposed TRMA is November 1, 2007, and the initial period is for 20 years, with 10 year renewal increments.

 

The current requirement for terminating the TRMA has been maintained in the proposed TRMA. Termination requires that the owners of legal title to 51% of Terlingua Ranch property, which must include 51% of the Members in Good Standing, agree to terminate the agreement in writing. Exempt Owners may not vote to terminate in either document.

 

The current TRMA requires a simple majority of votes cast by Members in Good Standing to modify the TRMA. In the proposed TRMA, the requirement has been increased to a two-thirds super-majority of the votes cast, with at least 10% of the Members in Good Standing voting, in order for an election to be valid.

 

In the current TRMA there are no restrictions on the voting rights of Exempt Owners. In the proposed TRMA, Exempt Owners are not permitted to vote on any amendments that affect the assessments or other fees paid by Non-exempt Owners.

 

The authority and limitations with regard to Special Assessment are specifically defined in the new Section XI of the proposed TRMA. The Administrator (POATRI, acting through the Board of Directors) may call for a special assessment. Its authority to do so is limited as follows:

Section XII makes all members of POATRI assigns of POATRI’s easement of ingress and egress over Terlingua Ranch roads, based on the Assignment of Easements and Rights to POATRI from Terramar Corporation filed with Brewster County. The intent is to confirm access to Terlingua Ranch roads for all property owners, consistent with long standing POATRI policy.

 

 

 

 

Property Owners Association of Terlingua Ranch, Inc.