Sale of RML To An Unaffiliated Company
Pro / Con List

Pro – Reasons To Sell RML 

1. The Number 1 Reason:  The HOA and ALL owners could benefit from a one time financial gain of a whopping $500,000 to $1,000,000, or more, as the net proceeds received from a sale of RML, thereby benefiting ALL homeowners.
2. Part of these proceeds could result in a one time CASH distribution to ALL owners of $5,000 to $10,000 EACH.
3. In addition to the HUGE cash distribution to EVERY owner, remaining, undistributed proceeds of $200,000 or more from the sale could finally establish a substantial reserve account so that ALL owners are not burdened with all of the ongoing special assessments such as the $1,000 assessment that was due on February 1, 2007 and the $600 per unit that was required last year. 
4. A detailed RML Valuation Analysis showing the derivation of the above numbers can be found at The Value of RML.  Note: The actual value of the management company can only be established by Joe providing the RML committee ALL the information that was requested multiple times by Robert . So far, Joe continues to be unresponsive, for very obvious self-serving reasons, since he wants to steal RML from the owners.  Details and analysis on Joe’s Gypity Do Dah offer to buy RML for himself - at the expense and detriment of ALL owners - can be found at www.DeerRidgeOwners.com.
5. With the sale of RML, the HOA no longer has financial liability to cover business losses by RML which could result in more special allocations to all owners to cover such losses.
6. The HOA would no longer be liable for major payroll costs and payroll-associated expenses.
7. The HOA would no longer be liable for employee injury liability or employee litigation risks such as the $17,000 Worker Comp claim that had to be paid last year.
8. The HOA would benefit from greatly reduced risk for litigation from tenant-related issues and threats.  While the HOA could still be sued by a renter (e.g., hurting themselves slipping on icy walkways), many of the management company issues such as theft or damage to goods, room unavailability, etc. would be tied to a new, independent management company and not directly or indirectly back to the HOA.
9. The Board would no longer have to waste its valuable time considering RML issues but instead can concentrate on those issues that are good for the property as a whole and for all owners – not just those in the rental pool.
10. The Board would no longer be primarily and overwhelmingly rental property-focused to the detriment of the 20% of owners who do not rent out their unit.
11. By selling RML, a separate, unbiased property manager could be hired by the HOA as its sole employee.  This person would oversee and report weekly, or monthly, to all owners via email on the property’s operation and the results of the management company that successfully buys RML.  This will GREATLY reduce the current, rampant conflicts of interest we have now by having Joe as both the current manager AND the head of the management company operation.  This Property Manager could be Joe as long as he was not associated in any way with the new management company.  Typical compensation for this position for this size property would be in the range of $35,000 to $50,000. All of this could be covered by charges to the new management company for rent of office space at Deer Ridge.
12. Those owners who wish to rent their units would benefit by having a professional management company offering their services at a greatly reduced management fee rate – much less than RML has to charge the owners just to break-even.  This means that those in the rental pool would NET a LOT more money each year from their ownership at Deer Ridge than is possible through RML with its grossly inefficient operation that is a result of only managing 84 units.
13. Owners who rent their units would no longer have to pay RML the ridiculous and outrageous Prime Time Use Excise Tax that grossly penalizes owners for using their OWN unit during the best times to be at Deer Ridge.
14. Deer Ridge assets like the pool, spa, etc. would not be used and depreciated by cabin renters like they are now with RML managing outside units.  This extra wear and tear from tenants not even staying at Deer Ridge cost all owners through higher expenditures for repairs and replacement.
15. The HOA could charge market rents for the office space used for both management and share in the real estate brokerage, thereby generating more ongoing revenue for the HOA which would add to the reserve account.
16. The HOA could receive over $35,000 a year form its 60% share of net revenues from the new management company renting movies, buying firewood, coke and candy sales, etc. with the management company only receiving a percentage.
17. ???

Con – Reasons Not To Sell RML 

1. The HOA, or rather the Board, has more control, theoretically, over the management company if RML remains owned by the HOA.
2. If RML could ever generate significant NET profits, those profits could potentially benefit the HOA.   However this is mitigated by the present value of the proceeds from sale on the Pro List.
3. ???