Click to View Each Transfer Fee Memo
*Important Note – 1.4.2022 Memo was drafted after a decision had already been made by the Board*
On October 28, 2021, with no mention in the Agenda, yet included in the packet was “RESOLUTION TO RESCIND POLICY N0. 2016-1 CAPITAL RESERVE HOLDING ACCOUNT – BUYER TRANSFER FEE SUDDEN VALLEY COMMUNITY ASSOCIATION”. The Buyer Transfer Fee was a fee of 1/4 of 1% of the purchase price of a home charged to Buyers and placed in a Capital Reserve Holding Account for Association purposes. Enacted in 2016, it originally faced scrutiny from Members and real estate brokers alike yet it proved to have no ill effect on the marketability of properties and raised approximately $1.2M in reserves in the nearly 5 years it was in effect.
READ: Pages 10-11 “RESOLUTION TO RESCIND POLICY N0. 2016-1 CAPITAL RESERVE HOLDING ACCOUNT – BUYER TRANSFER FEE SUDDEN VALLEY COMMUNITY ASSOCIATION” https://drive.google.com/file/d/1TGcfKue3i06kXGlTv0OjSg5iGtipbaXW/view
Source: Sudden Valley Community Association
The resolution states that the reason for the rescission of the policy was stated as follows:
Several community members, including Real Estate Branch Manager Sommer Cronck and Real Estate Managing Broker Chris Weitzel, both of the Sudden Valley RE/MAX office with a combined Sudden Valley market experience of over 55 years) spoke to the fact that the fee has caused no measurable harm to the marketability of properties in Sudden Valley and that the Sudden Valley real estate market has continued to appreciate on pace with Bellingham and surrounding communities. Examples of at least one other community with the same percentage-based transfer fee was cited.
After closed session, the Board came back to the meeting and briefly discussed the fee, saying it was a hardship to Buyers who needed money to buy things like washers and dryers and that it was unfair – reasons not stated in their own resolution as to why they wished to rescind the fee.
A unanimous vote was held to stop the collection of the Buyer Transfer Fee at the end of 2021 and furthermore, a vote to refund the collected fees (totaling approximately $1.2M) was made and approved.
After the motions were passed, the talk then changed to the fee being “illegal” and one day after the new GM was on duty (January 2022) a letter from the SVCA legal counsel was produced (also dated January 2022) stating that the fee was a “grey area”.
If legality was the reasoning for the cessation of the fee, why would it not have stopped immediately? Why would that not have been the reason stated in the resolution? Why would it take two months to produce such a statement from the attorney?
Furthermore, no notice was provided to real estate companies, the Whatcom County Association of Realtors or the title companies until the very end of December 2021 despite repeated requests to the Board for an official statement to be circulated.
As of May 2022, no refund process has been determined and no one has received a refund. The last mention of it was in a Board meeting where it was determined they would hire an outside firm at an estimated $40,000 base rate to work on creating the process and refunding the fees. The $1.2+M to be refunded continues to grow as new costs associated with giving away these capital funds are added.
WATCH: Non-Voting Board Member Keith McLean states at the November 11th Board meeting that he was unaware it was even up for discussion and surprised at how quickly and easily the discontinuation of the fee passed.
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