BOARD OF DIRECTORS MEETING Friday, March 31, 2017 ~ 10:15 am Prescott Resort ~ Prescott, Arizona AGENDA

Transcription

1 BOARD OF DIRECTORS MEETING Friday, March 31, 2017 ~ 10:15 am Prescott Resort ~ Prescott, Arizona AGENDA A. CALL TO ORDER President Paula Monthofer, e-pro, GRI 1. Inspirational Message Hilary Sosey Lake Havasu Association 2. Pledge of Allegiance Tammara Prager, ABR, GRI Northern Arizona Association B. ASSOCIATION REPORT President Paula Monthofer, e-pro, GRI 1. Director Responsibilities, Authority and Oath of Office (attachment 01) 2. October 2016 minutes as delivered (attachment 02) 3. Election of Year 2018 Officers (attachment 03) 4. NAR Report 2017 NAR Region XI RVP George Harvey 5. Executive Committee Report President-elect Lori Doerfler, ABR, CRS, GRI, RSPS, rcrms (attachment 04 and Handout) a. AAR Bylaws Revision - FPC Approval Policy MOTION (attachment 05) b. AAR Bylaws Addition - Line Officers Credit Card Policy MOTION (attachment 06) c Leadership Appointments for Primary Committees and Local Association Executive MOTION (attachment 07) d. Pending Executive Committee Approval: AAR Bylaws Revision_RVP Nominations MOTION (attachment 08) e. Pending Executive Committee Approval: AAR Bylaws Revision_Issues Mobilization Fund MOTION (attachment 09) f. Pending Executive Committee Approval: RAPAC Bylaws Revision MOTION (attachment 10) g. Pending Executive Committee Approval: RIMC Policies Revision MOTION (attachment 11) 6. Treasurer s Report Treasurer Mary Roberts a Audit Report (attachment 12) b. Pending Executive Committee Approval: Allocation of 2016 Accumulated Operating Surplus MOTION (attachment 13 and handout) c Year-to-Date Financials (attachment 14) d Capital Budget Update (attachment 15) 1

2 7. Chief Executive Officer s Report Michelle Lind, CEO (attachment 16) a. Legal Update Scott Drucker, General Counsel C. PRIMARY COMMITTEE REPORTS 1. Professional & Business Development (PBD) Pam Frestedt, ABR, GRI, LTG, PMN (attachment 17) 2. Business Services & Technology (BST) Sasha Lopez, ABR (attachment 18) 3. Risk Management (RM) Evan Fuchs, ABR, CRS, GRI, SRS (attachment 19) 4. Legislative & Political Affairs (LPA) Gary Nelson, ABR, rcrms, CRS, GRI (attachment 20) D. REAL ESTATE SPECIALTY REPORTS 1. Jeff Lewis, CRS President, Arizona CRS Chapter 2. Shen-Yi Michelle Chang President, Arizona State Women s Council of REALTORS (WCR) 3. Greg Boccardo Arizona CCIM E. ASSOCIATION CONSIDERATIONS F. ADJOURN NEXT MEETING: October 13, 2017 Embassy Suites, Phoenix 2

3 SERVING THE ARIZONA ASSOCIATION OF REALTORS AS AN OFFICER OR DIRECTOR The Arizona Association of REALTORS ( AAR ) was incorporated in 1953 as a 501(c)(6) non-profit corporation. As a non-profit corporation, AAR is governed by its Articles of Incorporation, Bylaws, Policies and Official Statements and the Arizona Non-profit Corporation Act ( NCA ), A.R.S et. seq. i These governing documents and Arizona law define the scope of the duties and liabilities associated with serving as an AAR officer or director. AAR Governing Documents The AAR Articles of Incorporation provide that: Management and control of AAR is vested in the Board of Directors. The directors and any person that serves on a board or council in an advisory capacity shall not be subject to suit for acts or omissions made in good faith within the scope of their official capacity. The directors and any person that serves on a board or council in an advisory capacity shall not be subject to personal liability for breach of fiduciary duty to maximum extent provided by law. AAR shall indemnify any person who incurs expenses by reason of the fact that the person is or was acting in their capacity as an AAR officer, director, employee or agent to the maximum extent provided by law. The AAR Bylaws provide that: AAR business is managed by the Board of Directors and the Executive Committee. (The AAR Executive Committee officers are President, President-elect, First Vice President, Treasurer and five Regional Vice Presidents.) Every officer shall be indemnified against all expenses and liabilities reasonably incurred in conjunction with any proceeding to which that officer is involved by reason of being or having been an AAR officer, except in such cases wherein the officer is adjudged guilty of willful misfeasance or malfeasance in the performance of such officer s duties or shall have acted in such a manner as has exceeded such officer s authority so to act. The AAR Policy Statements and Official Statements: Contain guidelines for internal AAR operations. Require the Executive Committee to ensure that AAR is strategically focused, monitor but avoid conducting day-to-day AAR operations, conduct business in a timely and honest fashion, and observe the internal and external chain-ofcommand. The Arizona Non-profit Corporation Act ( NCA ) The NCA sets forth the standards of conduct for officers and directors of a non-profit corporation. The NCA provides that an officer or director s duties must be discharged: In good faith. K. Michelle Lind Updated January

4 With the care an ordinarily prudent person in a like position would exercise under similar circumstances. In a manner the director reasonably believes to be in the best interests of the corporation. See, A.R.S (directors); A.R.S (officers). In discharging these duties, an officer or director is entitled to rely on information, opinions, reports or statements, including financial statements and other financial data, if prepared or presented by: Officers or employees of AAR whom the officer or director reasonably believes are reliable and competent in the matters presented. Legal counsel, public accountants or other persons as to matters the officer or director reasonably believes are within the person's professional or expert competence. A committee of, or appointed by, the Board of Directors of which the director is not a member if the director reasonably believes the committee merits confidence. The NCA also provides that a director is presumed in all cases to have acted, failed to act or otherwise discharged such director's duties in good faith, with prudent care and in the corporation s best interests. A person challenging a director s action, failure to act or other discharge of duties has the burden to establish by clear and convincing evidence facts rebutting this presumption. See, A.R.S (D) (directors); A.R.S (D) (officers). FREQUENTLY ASKED QUESTIONS Q: Can I be held personally liable for actions taken as an AAR officer or director? A: AAR officers and directors are largely shielded from personal civil liability for actions taken as AAR officers or directors provided that they act in good faith and within the scope of their official duties. However, an officer or director can be held personally liable in certain circumstances. For example, an officer or director may be held personally liable for directly injuring someone or intentionally taking a fraudulent or illegal action. Q: If I am named in a lawsuit, will AAR reimburse me for my expenses? A: As an officer or director, you have a right to be reimbursed for reasonable expenses arising because of a lawsuit. This obligation to reimburse you is referred to as indemnification. This indemnification is provided for through both the NCA and the AAR governing documents. See, A.R.S A.R.S The NCA provides that a corporation may indemnify an individual made a party to a proceeding because the individual is or was an officer or director if: The individual s conduct was in good faith. The individual reasonably believed: K. Michelle Lind Updated January

5 o In the case of conduct in an official capacity with the corporation, that the conduct was in its best interests. o In all other cases, that the conduct was at least not opposed to its best interests. In the case of any criminal proceedings, the individual had no reasonable cause to believe the conduct was unlawful. Q: Are there any limits to the duty to reimburse me for expenses incurred in a lawsuit? A: Yes. For example, AAR may not indemnify an officer or director: In connection with a proceeding in which the officer or director was adjudged liable to the corporation. In connection with any other proceeding in which the officer or director was adjudged liable on the basis that the officer or director improperly received personal benefit. In a case in which the officer or director is adjudged guilty of willful misfeasance or malfeasance. In a case in which the officer or director exceeded their authority to act. Q: Does AAR purchase E&O insurance? A: Yes. AAR and its officers and directors are insured by the National Association of REALTORS Association Professional Liability Insurance Policy. This policy generally covers claims relating to negligent acts, errors, omissions, misstatements, misleading statements or breaches of fiduciary duty, as described in the policy. The policy also includes a number of exceptions. You may want to explore whether an individual personal umbrella policy may provide additional protection. Q: Should I be concerned about conflicts of interest? A: Conflicts of interest are addressed in the NCA (A.R.S ) and in the AAR Policy Statements and Official Statements. AAR Policy P.9 provides that AAR s decision-making bodies, including officers and directors, should not use their position with the association to further their private interests and should avoid placing themselves in situations where their personal interests may conflict with the interests of the association. Officers and directors have a conflict of interest on an issue when: The issue involves a business providing products or services to AAR in which the officer or director or a member of an officer or director s immediate family is a principal, partner or corporate officer. The issue is one in which that officer or director or a member of an officer or director s immediate family has a financial interest involving money, employment, investments, credit or contractual rights. Officers and directors have a conflict of interest in a transaction if they know at the time of commitment that they or a related person: K. Michelle Lind Updated January

6 Is a party to the transaction. Has a beneficial interest in, or is so closely linked to, the transaction and of such financial significance to the director, officer or related person that the interest would reasonably be expected to exert an influence on the judgment of the director or officer if called to vote on the transaction. Q: What should I do if I have a conflict of interest? A: AAR Policy requires that you immediately disclose the interest at the outset of any discussions and not participate in the discussion relating to that issue other than to respond to questions. Further, you may not vote on the issue and should not be present when the vote on the issue is taken. TIPS FOR THOSE SERVING AS AN AAR OFFICER OR DIRECTOR Act in good faith and in AAR s best interests. Be prepared for meetings. Review advance materials. Ask questions and participate in discussions. Do not use your position to further private interests. Avoid conflicts of interest. This article provides only an initial overview of a very complex subject. The information contained herein is of a general nature and may not be updated or revised for accuracy as statutory or case law changes following the date of first publication. Further, this article is not intended as definitive legal advice and you should not act upon it without seeking independent legal counsel. Michelle is Chief Executive Officer of the Arizona Association of REALTORS ( AAR ) and a State Bar of Arizona board certified real estate specialist. i The legal principles discussed herein are generally applicable to serving as an officer or director of a local association formed as a non-profit corporation. K. Michelle Lind Updated January

7 AAR DIRECTOR OATH OF OFFICE AS DIRECTORS OF THE Arizona Association of REALTORS YOU SHARE A SENSE OF COMMON PURPOSE AND MUTUAL VISION. YOUR PRIMARY CONSIDERATIONS, WHEN MAKING DECISIONS, SHOULD BE: 1) THE MEMBERS WHO HAVE ENTRUSTED YOU TO LEAD THIS ORGANIZATION, AND; 2) THE BEST INTERESTS OF THE ARIZONA REAL ESTATE INDUSTRY WHICH IS STATED IN THE ASSOCIATION S VISION- REALTOR THE BEST PREPARED REAL ESTATE PRACTITIONER WITH THE HIGHEST STANDARDS. DO EACH OF YOU SOLEMNLY PROMISE AND SWEAR: THAT YOU WILL UPHOLD THE HIGHEST STANDARDS POSSIBLE BY: 1) SUPPORT OF THE REAL ESTATE COMMISSIONER S RULES 2) ENFORCEMENT OF THE REALTOR CODE OF ETHICS 3) ENFORCEMENT OF THE GOVERNING DOCUMENTS OF THE ARIZONA ASSOCIATION OF REALTORS, AND; 4) IN ALL YOUR ACTS, BE GOVERNED BY THE PRINCIPLES OF HONESTY AND JUSTICE? IF YOU SO PLEDGE, PLEASE INDICATE BY SAYING I DO. K. Michelle Lind Updated January

8 ARIZONA ASSOCIATION OF REALTORS BOARD OF DIRECTORS MEETING October 14, 2016 Embassy Suites ~ Phoenix, AZ DRAFT MINUTES CALL TO ORDER The regularly scheduled meeting was called to order at 10:32 a.m. by President Paula Serven. A quorum was present. Pledge of Allegiance The pledge of allegiance was led by John Kodlick. Inspirational Message The inspirational message was given by Dale Kelley. ASSOCIATION REPORT President Paula Serven, e-pro, GRI, SFR Approval of Minutes The April 1, 2016 meeting minutes were approved as delivered. NAR Report A NAR Report was not given. Executive Committee Report The actions of the Executive Committee since the April 1, 2016 Board of Directors meeting, including those actions that were approved after the September mailing to the Directors, were presented by President-elect Monthofer: MOTION: It was moved, seconded and carried to approve the proposed revisions to the AAR Bylaws, Policies and Official Statements to reflect NAR s Code of Ethics training requirement which changes from every four (4) years to every two (2) years beginning in MOTION: It was moved, seconded and carried to approve the revisions to the AAR Bylaws, Policies and Official Statements for consistency, formatting and accuracy. MOTION: It was moved, seconded and carried to approve the proposed changes to the legislative program policy positions. MOTION: It was moved, seconded and carried to approve Laura Tarin from the Lake Havasu Association of REALTORS as the new 2017 Local Association Executive Representative appointment to the Executive Committee.

9 Treasurer s Report Treasurer D. Patrick Lewis provided a report on the 2016 year-to-date financials and the Capital Budget Treasurer-elect Mary Roberts presented the 2017 Proposed Operating/Capital Budget and Strategic Plan to Board for approval. MOTION: It was moved, seconded and carried to approve the 2017 proposed Operating/Capital Budget and Strategic Plan. Chief Executive Officer s Report CEO Michelle Lind updated the Directors on the Association s operations. Legal Update Scott Drucker, AAR General Counsel, gave an update on AAR legal issues. PRIMARY COMMITTEE REPORTS Risk Management Gerry Russell, Chair of the Risk Management Committee provided a year-to date report on the committee s activities for the Directors. Professional and Business Development Christopher Paris, Chair of the Professional and Business Development Committee provided a year-to-date report on the committee s activities for the Directors. Legislative and Political Affairs Holly Eslinger, Chair of the Legislative and Political Affairs Committee, provided a year-to-date report on the committee s activities. RAPAC fundraising: A total of $2,170 was raised at the RAPAC auction during the conference. Business Services and Technology Sasha Lopez, 2017 Chair of the Business Services and Technology Committee (filling in for 2016 Chair Yvonne Coelet), provided a year-to-date report on the committee s activities for the Directors. REAL ESTATE SPECIALTY REPORTS Arizona CRS Chapter Carol Letcher, 2016 Chair of the Arizona CRS Chapter gave an update to the Directors on chapter events. Arizona Chapter of WCR Lyn Trayte, 2016 President of the Arizona State Women s Council of REALTORS gave on update to the Directors on chapter events. CCIM Rick Padelford, 2017 President of the Central Arizona CCIM Chapter gave on update to the Directors on chapter events.

10 ASSOCIATION CONSIDERATIONS There were no issues up for consideration. ADJOURN There being no further business the meeting was adjourned at 11:58 am. K. Michelle Lind, Recording Secretary

11 2018 AAR Officer Candidates PRESIDENT LORI D. DOERFLER, ABR, CRS, GRI, RSPS, rcrms Realty ONE Group Mountain Desert N. Acoma Blvd., Ste. 102 Lake Havasu City, AZ What an amazing couple of years! Thank you for your vote of confidence in electing me to serve as part of the AAR Leadership Team as your 2015 Treasurer, 2016 First Vice President and currently 2017 President-Elect. What an amazing opportunity to share and work with dedicated REALTORS all over Arizona not to mention our incredible Arizona REALTOR staff. Prior to serving as AAR Treasurer, I had the honor of working in various capacities at the local level which included the leadership positions as President of the Lake Havasu Association of REALTORS and of the Lake Havasu Area Women s Council of REALTORS. I was involved in the formation of a regional MLS and served as charter Director of the Western Arizona REALTOR Data Exchange (WARDEX). At the AAR level, I got to be a part of the Professional Standards, Risk Management, Business and Technology, and the Professional and Business Development Committees. Additionally I served on various task forces, workgroups and sub-committees over the years. I am a committed volunteer who believes in our industry and have no agenda other than to serve ALL members. As you know, AAR is dedicated to the protection of private property rights and best interests of Arizona REALTORS in legislation and strives to provide the best most current legal information and education available. Please know that I care deeply and consider it a privilege to serve and represent YOU as the 2018 President. Thank you. 1

12 PRESIDENT - ELECT D. PATRICK LEWIS Realty Executives N. Scottsdale Rd., #140 dpatricklewis@gmail.com Scottsdale, Arizona Experience 2017 AAR First-Vice President 2016 AAR Treasurer 2016 NAR PAG Real Estate as a First Career member 2017 NAR Realtor Party Member Involvement Committee 2014 Chairman of the Board - Scottsdale Area Association of REALTORS Graduate of the SAAR Leadership Academy - Class Chairman of Government Affairs - SAAR Director SAAR Board of Directors 2014 Chairman of Business Services & Technology - AAR 2015 Vice-Chair Legislative Committee - AAR 2016 Chair Legislative Committee - AAR Served on AAR s Legislative Committee since AAR Director RAPAC Major Investor Graduate of the inaugural Citizens Academy for the Scottsdale Fire Dept. Served on the Presidential Advisory Group on Technology for AAR NAR Board of Directors ARMLS Rules Committee I am born and raised in Phoenix. Shortly after I began my real estate career in 2002 at John Hall & Associates I was lucky enough to be influenced by some great agents and a great broker to get involved. So I took that advice. As a result, I have been honored and privileged to serve both SAAR and AAR in multiple capacities and cannot think of any better way to give back to my profession than through advocating for it at every level. What matters most to me is you, my fellow members. I am here to listen to you and understand your needs so that AAR can be a resource and a partner now and in the future. I respectfully ask for your vote and thank you. 2

13 FIRST VICE PRESIDENT MARY ROBERTS, ABR, GRI Realty Executives Lake Havasu City McCulloch Blvd., Ste. 104 Lake Havasu City, AZ As a full time REALTOR in Lake Havasu City for over 28 years, Mary has had the opportunity to enjoy one of the best professions in the country. Working under her first broker, her father, and now partnering the third generation REALTOR, her son Gunner, Mary has always understood that it is important to give back to the industry that gives so much to us. Her philosophy is that while serving in leadership with passion and dedication by looking out and protecting what is best for the REALTOR community as a whole, it is also the responsibility of a leader to mentor and encourage others to step up into leadership. Mary states that I am truly proud and honored when someone thanks me for encouraging them to get involved. Throughout the years, Mary has served many positions on the Local and State Levels. On the Local Level, Mary s service includes: 2008 VP of Membership, Lake Havasu Area Chapter Women s Council of REALTORS 2009 President Elect, Lake Havasu Area Chapter Women s Council of REALTORS 2010 President, Lake Havasu Area Chapter Women s Council of REALTORS 2011 Vice President, Lake Havasu Association of REALTORS 2012 President Elect, Lake Havasu Association of REALTORS 2013 President, Lake Havasu Association of REALTORS 2014 Member of the Year, Lake Havasu Area Chapter Women s Council of REALTORS 2015 President, Lake Havasu Area Chapter Women s Council of REALTORS 2016 Co-Chair, RAPAC, Lake Havasu Association of REALTORS 2016 Treasurer, Lake Havasu Association of REALTORS On the State Level, Mary s service includes: Member, Board of Directors, Arizona Association of REALTORS Member, AAR s Professional and Business Development Committee 2012,15 Member, AAR s Business Services and Technology Committee Region 1 Vice President, Arizona Association of REALTORS Member, Executive Committee, Arizona Association of REALTORS Member, Arizona REALTORS Foundation for Housing and Community Outreach 2017 Treasurer, Arizona Association of REALTORS On the National Level, Mary s service includes: Member, Business Issues and Policy Committee 2017, Member, Board of Directors, National Association of REALTORS Mary believes in and supports RAPAC by being a Crystal R President s Circle level investor. 3

14 TREASURER JAN LEIGHTON JD Campbell Realty, Inc W. Pinnacle Peak Road Peoria, AZ If I have learned anything as a Volunteer, it is that NOTHING is impossible to envision for our Members. It takes hard work and constant application and commitment to the Code of Ethics and integrity that we ascribe to. It consists of reading your Agendas and showing up to meetings prepared and ready to work with your fellow members. It is respectfully making your point and listening respectfully to others. It means making decisions for the Good of the Members. I believe that Membership on the Local, State and National levels is the most under-utilized benefit that our Members have, and we have amazing benefits. I propose that we need to make the commitment find a way to reach out to more members and encourage more participation. This is not only a State concern, we have the same issue on the Local and National levels. I believe that by approaching this with many, many like kind minds and and our AAR Strategic Plan we will envision and enact a way to further build the REALTOR brand in Arizona. Arizona can and will move forward to become the most engaged Real Estate Community in the Nation. Open the possibilities... let s make this journey together and become more relevant to our members. VOLUNTEER ROLES: 2016 Recipient Arthur G. Crozier, Distinguished Service Award Current Federal Political Coordinator for NAR, Congressman Trent Franks 2016 WeMAR Ambassador Committee Chair 2016 WeMAR RAPAC Committee - Member Current RPAC Major Investor, Presidents Circle Golden R Current RPAC Major Investor AAR - Risk Management Committee, Member 2012 AAR - Risk Management Committee, Chair 2012 Recipient of WeMAR s George Watrous Association Leadership Award 2012 RPAC Major Investor, President s Circle Sterling R 2012 & 2006 AAR - Vacant Land Purchase Contract Revision Chair AAR Regional Vice President, Region NAR WeMAR, NAR Director 2008 WeMAR, President WeMAR, Director and AAR Director as part of Glendale/Lake Pleasant BODs Merger Glendale-West Maricopa County, Director 2002 AAR Key Results Area Industry issues Current ADRE Continuing Education Instructor 4

15 REGION 1 VICE PRESIDENT DALE KELLEY All Arizona River Realty Hancock Road, Suite 133 dkelley52@aol.com Bullhead City, AZ Real Estate Experience: 2013 BHC/MV AOR Treasurer BHC/MV AOR President Elect, BHC/MV AOR RAPAC Chair BHC/MV AOR President, BHC/MV AOR Realtor of the Year, BHC/MV AOR RAPAC Chair, RAPAC State Board of Trustees, Bulhead Region Econmic Development Association board member BHC/MV AOR RAPAC Chair, BHC/MV AOR Past President, RAPAC State Board of Trustees, Commissioner Mohave County Planning & Zoning Commissioner Mohave County Planning & Zoning. I was a Carpenter for 30 yrs. Retired in In 2009 I became a REALTOR. I ve enjoyed a wide variety of success, by any measurement. Thank you for your consideration. Lead, follow, or get out of the way! 5

16 REGION 3 VICE PRESIDENT DANIELLE LAWRENCE Realty One Group Mountain Desert S. Woodlands Village Blvd., Ste. 1 danirealtor08@@gmail.com Flagstaff, AZ In 2009 when I became a REALTOR little did I know how pursuing this passion would give me so many opportunities to help others while learning and growing as an individual. I ve had the privilege of serving at the local committee level to the state level committee membership. As AAR Region 3 Regional Vice President I hope to continue to bring the advocacy I show on the local level to members located in my neighboring associations as well. Here is a brief list of my volunteer experience Northern Arizona Association of REALTORS Volunteer Service: 2013 President s Award MLS Committee Member 2014 MLS Chair 2014 NAAR Distinguished Service Award 2015 President Elect NAAR 2015 Community Outreach Chair 2016 Board President NAAR 2017 Immediate Past President 2017 RAPAC Chair NAAR 2013 Current NAAR Government Affairs Committee Member since 2015 & 2017 NAAR Community Outreach Committee Since 2014 NAAR Board of Directors RAPAC Major Investor Arizona Association of REALTORS Volunteer Service: AAR GRI Oversight Committee 2015 AAR Leadership Training Academy Graduate AAR Community Housing Foundation Director 2017 AAR Community Housing Foundation, President AAR Business, Service, & Technology Committee 2017 AAR Professional Standards Committee 2017 AAR Solar Addendum Workgroup It would be an absolute honor and privilege to continue to serve our AAR membership and community as Region 3 Regional Vice President. Giving back to an industry that has given me so much is my top priority. Truly grateful to be considered and thankful to have your vote. 6

17 REGION 5 VICE PRESIDENT ERIC GIBBS, SFR Coldwell Banker Residential Brokerage E. Skyline Dr. #250 eric.gibbs@azmoves.com Tucson, AZ I very much feel that I m ready for this next step in leadership. I ve involved myself on many different levels in regards to the TAR as well as AAR. I become the Immediate Past-President for I ve served on the AAR Professional Business Development Committee for 2015 and 2016, and the Legislative Committee for I have participated in the AAR Strategic Planning for 2015 and I will participate in the Diversity Inclusion Workgroup starting in Oct I ve also participated in other task force and workgroups over the last two years. A graduate of the AAR Leadership Training Academy As you can see I have immersed myself in the real estate industry wanting to make a difference. As I look too 2017, I have already been appointed to the NAR Executive Committee, and appointed Chair of the AAR Legislative Committee. I will Co-Chair the TAR Realtor Party Action Committee and serve as AAR Quota Director. I very much want to serve as RVP for the south region utilizing my past experiences and knowledge to assist with supporting the local associations not only in their perspective areas but, at the AAR level as well. Giving them all a voice at the table. For those that know and come to know me will see that I personally engage with the member. I listen to their concerns and offer solutions. I reach out and empower the member to participate and make a difference. I want nothing more than to see our Southern Region continue to grow and be seen at the AAR table. Please consider me for Region 5 RVP position. Thank you 7

18 This report is intended to advise AAR State Directors of Executive Committee activities and actions. The structure approved in October 1993 included additional empowerment to the Executive Committee within parameters provided in the strategic plan, approved operating budget and Bylaw/Policy. These actions are presented for your information, except those contained in the boxed-in area below which are actions requiring approval. EXECUTIVE COMMITTEE REPORT TO THE BOARD OF DIRECTORS Actions Since The October 2016 Meeting 1. Approved 8 hearing panel decisions. 2. Approved the continuation of online voting as it has been conducted in the past. 3. Approved the amendment of the Operations and Strategic Initiatives dues income from 42,987 Fully Paid Members which amounts to $6,662,985 to 46,811 Fully Paid Members which amounts to $7,255, Approved the denial of the Aldridges second request for legal assistance, as submitted by their attorney Daniel Barr. 5. Approved the proposed revision to AAR s Adaptations to the NAR Code of Ethics and Arbitration Manual, Appendix XI to Part Four Ethics Mediation. 6. Approved the proposed changes to the section of AAR s Adaptations to the NAR Code of Ethics and Arbitration Manual titled AAR Ombudsman Retention Policies. 7. Approved for release in February 2017 the revised ancillary forms to the Residential Resale Real Estate Purchase Contract, and to remove the As Is Addendum from AAR s library of forms. 8. Approved the following slatted candidates for FPC: Congressional District 1: Congressman O Halleran Congressional District 2: Congresswoman McSally Congressional District 3: Congressman Grijalva Congressional District 4: Congressman Gosar Congressional District 5: Congressman Biggs Congressional District 6: Congressman Schweikert Congressional District 7: Congressman Gallego 1 FPC: Gary Nelson FPC: Nikki Halle FPC: Jerome King FPC: Holly Mabery FPC: Pamela Frestedt FPC: Frank Dickens FPC: Orlando Cazarez

19 Congressional District 8: Congresswoman Sinema Senator John McCain For informational purposes only: Senator Jeff Flake *Senator was not up for re-election FPC: Duane Washkowiak FPC: Craig Sanford FPC: Joe Hull 9. Approved the appointment of 2017 President Paula Monthofer and President-elect Lori Doerfler as Arizona s 2017 representatives on the Region XI Nominating Committee. 10. APPROVED THE RECOMMENDED POLICY CHANGE TO THE ARIZONA ASSOCIATION OF REALTORS BYLAWS AND POLICIES (POLICY E.2 FEDERAL POLITICAL COORDINATORS (FPC)) AS PRESENTED. (See Attachment 05) 11. APPROVED THE PROPOSED LINE OFFICER CREDIT CARD POLICY AS POLICY C.5 OF THE AAR BYLAWS, POLICIES AND OFFICIAL STATEMENTS. (See Attachment 06) 12. TO RECOMMEND APPROVAL OF THE FOLLOWING LEADERSHIP APPOINTMENTS FOR PRIMARY COMMITTEES AND LOCAL ASSOCIATION EXECUTIVE FOR 2018 TO THE BOARD OF DIRECTORS. Legislative and Political Affairs: Kent Simpson, Chair Eric Gibbs, Vice Chair Business Services and Technology Carlos Ramos, Chair Aaron Pfeifer, Vice Chair Risk Management Beth Adams, Chair Brad Ryan, Vice Chair Professional and Business Development Susan Slattery, Chair Sindy Ready, Vice Chair Local Association Executive appointment to Executive Committee Rebecca Grossman, Scottsdale Association of REALTORS 2

20 FROM: Executive Committee RECOMMENDATION to the Board of Directors RECOMMENDATION: Approve the recommended policy change to the Arizona Association of REALTORS Bylaws and Policies (Policy E.2 Federal Political Coordinators (FPC) as presented. BACKGROUND: The National Association of REALTORS maintains a formal process for nominating new Federal Political Coordinators (FPCs) or making any changes to the current list of NAR FPCs. Every two years at the start of each Congressional cycle, the incoming state association presidents must recommend FPC appointments to NAR. The deadline to recommend new and returning FPCs for the 115th Congress was Friday, November 18, The NAR RPMIC Chair then finalizes and officially approves the recommendations. A key point to remember, is that while state association presidents recommend FPC appointments, it is the president of NAR who finalizes and officially approves the recommendations. The FPC program is a NAR ran program, however, the Arizona Association of REALTORS Bylaws and Policies (Policy E.2 Federal Political Coordinators (FPC)) establishes a separate and conflicting approval process. Current Policy POLICY E.2 FEDERAL POLITICAL COORDINATORS (FPC) FPC appointments and alternates shall be recommended by the Legislative and Political Affairs Primary Committee Chairman for approval by the Executive Committee. FPC term of appointment shall coincide with term of the applicable U.S. Representative or for one-half (½) the term of the applicable U.S. Senator. The NAR policy mandates a much quicker turn-around in the recommendations for FPC. Whereas, the state policy dictates the recommendations stem from the Legislative and Political Affairs chair and then approved by the Executive Committee. After an election cycle, the next Executive Committee occurs in January of the following year, well outside of the policy set forth by NAR, thus creating a differential in the time NAR needs the recommendations and the potential for recommendations to occur that the Executive Committee would not approve. Recommended Policy Change POLICY E.2 FEDERAL POLITICAL COORDINATORS (FPC) FPC appointments and alternates shall be recommended by the incoming state association president in accordance with the National Association of REALTORS established process for Federal Political Coordinator (FPC) nominations and changes. FPC term of appointment shall coincide with the term of the applicable U.S. Representative or for one-half (½) the term of the applicable U.S. Senator. 1

21 BUDGET IMPACT: None MOTION: TO APPROVE THE RECOMMENDED POLICY CHANGE TO THE ARIZONA ASSOCIATION OF REALTORS BYLAWS AND POLICIES (POLICY E.2 FEDERAL POLITICAL COORDINATORS (FPC)) AS PRESENTED. FOR MORE INFORMATION CONTACT: President Paula Monthofer: OR CEO Michelle Lind: 2

22 RECOMMENDATION to the Board of Directors FROM: Executive Committee RECOMMENDATION: Approve the attached Line Officer Credit Card Policy as Policy C.5 of the AAR Bylaws, Policies and Official Statements. BACKGROUND: AAR corporate credit cards could streamline and expedite the Line Officer travel reimbursement process. The attached Line Officer Credit Card Policy was drafted in conjunction with the AAR Controller and accounting staff to provide parameters for the use of the cards and the procedures necessary for AAR reconciliations and financial reporting. BUDGET IMPACT: None MOTION: TO APPROVE THE ATTACHED LINE OFFICER CREDIT CARD POLICY AS POLICY C.5 OF THE AAR BYLAWS, POLICIES AND OFFICIAL STATEMENTS. FOR MORE INFORMATION CONTACT: President Paula Monthofer: OR CEO Michelle Lind:

23 Line Officer Credit Card Policy AAR line officers may request a corporate credit card but must complete and return the Corporate Credit Card Declaration prior to obtaining and using the card. AAR corporate credit cards will be issued with a maximum $5,000 credit limit per individual. The AAR corporate credit card may be used for travel expenditures that are frequently incurred in the normal course of his or her duties with the Association. This includes, but is not limited to, hotel expenditures, airfare, meals, registration costs, etc. Should the corporate credit card be used inadvertently for personal expenditures, AAR reserves the right to recoup the associated costs from the named cardholder within 30 days from the statement date. Individuals may not use the corporate credit card to obtain cash advances, checks, or electronic cash transfers as this type of activity is strictly prohibited. Misuse of any kind will result in cancellation of the card and revocation of all corporate credit card privileges. All AAR corporate credit card expenditures must be reconciled at the end of each month. AAR staff will each cardholder a list of charges incurred during the month. The cardholder is responsible for verifying that all charges listed are valid, identifying the event the charge is associated with, and submitting the corresponding receipts to the Accounting department within 5 days of receiving the list. Repetitive non-conformance to this policy will result in cancellation of the card and the loss of all corporate credit card privileges. Should a card become lost, stolen, or incur any fraudulent activity it must be reported immediately to the CEO or Controller. A new corporate card will be issued to the cardholder once a claim has been made with the bank.

24 RECOMMENDATION to the Board of Directors FROM: Executive Committee RECOMMENDATION: Approve the listed members to serve as Primary Committee Chairs/Vice-Chairs and Local Association Executive representative on the Executive Committee for BACKGROUND: The President-Elect in conjunction with the First Vice President select Primary Committee Chairs and Vice Chairs for Director approval in the spring for the subsequent year in order to allow them to be involved in the specific program planning and operating budget development. BUDGET IMPACT: None MOTION: TO RECOMMEND APPROVAL OF THE FOLLOWING LEADERSHIP APPOINTMENTS FOR PRIMARY COMMITTEES AND LOCAL ASSOCIATION EXECUTIVE FOR 2018 TO THE BOARD OF DIRECTORS. Legislative and Political Affairs: Kent Simpson, Chair Eric Gibbs, Vice Chair Business Services and Technology Carlos Ramos, Chair Aaron Pfeifer, Vice Chair Risk Management Beth Adams, Chair Brad Ryan, Vice Chair Professional and Business Development Susan Slattery, Chair Sindy Ready, Vice Chair Local Association Executive appointment to Executive Committee Rebecca Grossman, Scottsdale Association of REALTORS FOR MORE INFORMATION CONTACT: President Paula Monthofer, 2017 President: OR CEO Michelle Lind:

25 Pending Executive Committee Approval on March 28, 2017 RECOMMENDATION to the Board of Directors FROM: Executive Committee RECOMMENDATION: Approve revisions to the AAR Bylaws, Policies and Official Statements to specify who may serve on a regional nominating committee, the date applications are due, and to require the applicant s member board AE or President s signature on the application. BACKGROUND: Several Regions expressed a concern that the AAR bylaws were somewhat ambiguous in regards to the RVP nomination process and requested the following clarifications: Section 7. The RVP from each Region shall be nominated by a Regional Nominating Committee comprised of one (1) member (WHICH MAY BE THE: PRESIDENT, PRESIDENT-ELECT, IMMEDIATE PAST PRESIDENT, OR AN APPOINTEE OF THE PRESIDENT) from each Member Board within the Region. Nominees for RVP must be nominated by a Member Board within their appropriate Region. AN APPLICATION CONTAINING THE SIGNATURE OF THE APPLICANT S MEMBER BOARD AE OR PRESIDENT SHALL BE SUBMITTED TO THE CURRENT RVP NO LATER THAN NINETY (90) DAYS PRIOR TO THE ELECTION DATE. The current RVP shall chair the Committee without a vote VOTING RIGHTS, UNLESS A VOTE IS NECESSARY TO BREAK A TIE. Each Region s nominee shall be voted on by the AAR s Board of Directors at the first Directors meeting. No nominations for RVP shall be accepted from the floor. If any Region does not submit a nominee for RVP for the following year or if the Board of Directors does not accept any nominee, the AAR President-elect shall have the authority to appoint a qualified RVP from the membership within the Region with the approval of the Board of Directors or Executive Committee. BUDGET IMPACT: None MOTION: TO APPROVE THE PROPOSED REVISIONS TO THE AAR BYLAWS, POLICIES AND OFFICIAL STATEMENTS TO SPECIFY WHO MAY SERVE ON A REGIONAL NOMINATING COMMITTEE, THE DATE APPLICATIONS ARE DUE, AND TO REQUIRE THE APPLICANT S MEMBER BOARD AE OR PRESIDENT SIGNATURE ON THE APPLICATION, OTHER CLARIFICATIONS AND THE ADDITION OF A SIGNATURE LINE ON THE APPLICATION FORM. FOR MORE INFORMATION CONTACT: President Monthofer (928) / pmonthofer@me.com OR Michelle Lind (602) / michellelind@aaronline.com 1

26 Candidate for the office of: President-elect First Vice President Treasurer Regional Vice President National Director Other: A R I Z O N A A S S O C I A T I O N O F R E A L T O R S APPLICATION FOR ELECTED OFFICERS & NATIONAL DIRECTORS NAME: FIRM: BUSINESS ADDRESS: CITY:, ARIZONA ZIP CODE: BUSINESS PHONE: EXT: FAX: NUMBER OF YEARS LICENSED: NRDS#: PROFESSIONAL DESIGNATION(S) HELD: Criteria: The following are the minimum criteria, per Arizona Association of REALTORS Bylaws, which must be met to qualify as a candidate for the above listed offices. A REALTOR member in good standing. Name of the local board/association in which you hold membership: AND B Knowledge of the Arizona Association of REALTORS Strategic Plan objectives. I do have knowledge I do not have knowledge AND C Served as an elected officer of a local board/association for at least one (1) year. Office held: Year(s): OR Served at least one (1) year as an elected, or appointed, Arizona Association of REALTORS Director Elected year(s): Appointed year(s): OR Served at least one (1) year on the Arizona Association of REALTORS Executive Committee Yes, year(s): No Are you aware of the responsibilities, cost, and time requirements to serve the office for which you are applying? Yes No I certify that the foregoing information is accurate APPLICANT S SIGNATURE Please include a candidate statement addressing any information you would like to share with the Board of Directors prior to the election. Acknowledged by LOCAL ASSOCIATION AE or PRESIDENT S SIGNATURE AAR USE ONLY If no, list reason: The above applicant meets the minimum requirements as stated in the Arizona Association of REALTORS Bylaws for consideration by the Board of Directors: 255 E Osborn Rd, Ste 200 Phoenix, AZ Tel: Fax: Yes No PRESIDENT DATE

27 Pending Executive Committee Approval on March 28, 2017 RECOMMENDATION to the Board of Directors FROM: Executive Committee RECOMMENDATION: Approve a revision to the AAR Bylaws, Policies and Official Statements to specifically state that contributions to the Issue Mobilization Fund may be made from other sources such as operating surplus, at the discretion of the Board of Directors. BACKGROUND: All other bylaw provisions relating to Reserve funds specifically state that contributions to the fund may be made from other sources such as operating surplus, at the discretion of the Board of Directors. However, this language was omitted in regards to Issues Mobilization. Operating surplus has been allocated to Issues Mobilization in the past and there is no prohibition against it. Therefore, to be consistent, the proposal is to add at the end of the paragraph at Article IV, Section 3: Additional contributions to the Issue Mobilization Fund may be made from other sources such as operating surplus, at the discretion of the Board of Directors. BUDGET IMPACT: None MOTION: TO ADD AT THE END OF THE PARAGRAPH AT ARTICLE IV, SECTION 3: ADDITIONAL CONTRIBUTIONS TO THE ISSUE MOBILIZATION FUND MAY BE MADE FROM OTHER SOURCES SUCH AS OPERATING SURPLUS, AT THE DISCRETION OF THE BOARD OF DIRECTORS. FOR MORE INFORMATION CONTACT: President Monthofer (928) / pmonthofer@me.com OR Michelle Lind (602) / michellelind@aaronline.com 1

28 Pending Executive Committee Approval on March 28, 2017 RECOMMENDATION to the Board of Directors FROM: Executive Committee RECOMMENDATION: Approve the recommended policy changes to the REALTORS of Arizona Political Action Committee bylaws. BACKGROUND: The REALTORS of Arizona Political Action Committee (RAPAC) is a voluntary, nonprofit, unincorporated committee of individual members of the Arizona Association of REALTORS (AAR), and others who may be contributors, and is completely independent of and not affiliated with any political party, candidate or political committee. RAPAC is organized to solicit contributions and make expenditures for the purpose of impacting any election in the State of Arizona, or in any county, city, town or precinct in the state. The RAPAC Trustees are tasked with evaluating and understanding the philosophies and records of office holders and candidates for elective office and supporting candidates that believe in the free enterprise system, private ownership of real property and the guarding of all rights and interests that are association with such ownership. From time to time the RAPAC Bylaws may be amended by a majority vote of the Board of Trustees present and voting at any regular meeting, or at any special meeting duly called for that purpose. In reviewing the Bylaws, a number of updates are being proposed to bring the Bylaws into compliance with current practice as well as Arizona state law. Additionally, the current policies establish the CEO as well as the Chairman of the Committee as the check signers. Specifically, All checks shall have the signature of the AAR CEO, as well as the signature of the Chairman of the Committee. As a result, on an annual basis the bank documents must be updated to reflect the change in the Chairman. In order to simplify the process, a recommendation to update the policies so the second signer is the General Counsel has been suggested. SEE ATTACHMENT TITLED: SUGGESTED CHANGES PER LPAC CONCERNS BUDGET IMPACT: None MOTION: TO APPROVE THE RECOMMENDED POLICY CHANGES TO THE REALTORS OF ARIZONA POLITICAL ACTION COMMITTEE BYLAWS. FOR MORE INFORMATION CONTACT: President Monthofer (928) / pmonthofer@me.com OR Michelle Lind (602) / michellelind@aaronline.com 1

29 Suggested changes per LPAC Concerns : Page 3 ARTICLE IV Organization Section 1 All contributions to RAPAC from individual members of AAR and others shall be maintained in a separate fund of AAR. Section 2 RAPAC shall be governed by a Board of Trustees ( Trustees ). The Board of Trustees shall have general supervision and control over the affairs and funds of RAPAC and shall establish and carry out all policies and activities of RAPAC in accordance with the policies and procedures of AAR AND WITH APPLICABLE ARIZONA ELECTION LAWS. ARTICLE V Contributions Section 1 Any member of AAR, and any other class of persons approved by the Board of Trustees, and permitted by the laws of the United States and the State of Arizona, shall be eligible to contribute to RAPAC. The Board of Trustees RAPAC TREASURER has the right to deny or approve any contribution to RAPAC. Section 4 RAPAC funds shall be disbursed at the sole discretion of the RAPAC TREASURER WITH APPROVAL BY THE Board of Trustees. Page 5: Section 1. Composition ARTICLE VI Board of Trustees A. The Chair of the Legislative & Political Affairs Committee (LPA) shall appoint not less than nine (9) members and not more than fifteen (15) members to serve as Trustees for two-year staggered terms. Of these appointed Trustees, there shall be at least one representative of each of the AAR Regions. B. The Board of Trustees shall also include the following ex-officio voting members. Legislative Committee Chair LEGISLATIVE & POLITICAL AFFAIRS COMMITTEE CHAIR REALTORS Issues Mobilization Committee (RIMC) Chair Immediate past Chair of the Trustees Any member currently serving as an NAR RPAC Trustee

30 Page 6: ARTICLE VII Officers Section 1 The officers of RAPAC shall be: Chair, Vice Chair, and Treasurer. Section 2 The Chair of the LPA shall appoint a Trustees Chair and should consider appointing the Chair from among those Trustees who have served at least one year as a Trustee. The Trustees Chair shall serve for a term of one year and shall not serve for more than two consecutive terms as Trustees Chair. The Trustees Chair shall preside at all meetings of the Board of Trustees. Section 3 The VICE Chair of the LPA shall appoint a Trustees Vice Chair and should consider appointing the Trustees Vice Chair from among those Trustees who have served at least one (1) year as a Trustee. The Trustees Vice Chair shall serve for a term of one (1) year and shall not serve more than two (2) consecutive terms as Trustees Vice Chair. During any absence or incapacity of the RAPAC Chair, the RAPAC Vice Chair shall assume the duties and exercise the powers of the Chair. The Vice Chair shall perform such other duties as may be assigned by these Bylaws, the Chair, or by the Board of Trustees. Page 7: ARTICLE IX Books, Records, and Finances Section 1 RAPAC shall keep correct and complete books and records of account as required by the election laws of the State of Arizona. RAPAC's books of account shall be audited at least annually. All checks shall have the signature of the AAR CEO, OR THE SIGNATURE OF THE AAR GENERAL COUNSEL as well as the signature of the Chair of the Committee. The fiscal year of RAPAC shall begin on January 1 and end on December 31. All RAPAC funds shall be deposited and maintained in a depository selected by the AAR Treasurer, subject to the approval of the Board of Trustees. Income derived from any interest earned on RAPAC funds shall inure to the benefit of the RAPAC account.

31 ARIZONA ASSOCIATION OF REALTORS REALTORS OF ARIZONA POLITICAL ACTION COMMITTEE BYLAWS AS APPROVED APRIL 1, 2016 RAPAC Bylaws Draft Proposal RAPAC Bylaws for Approved 1

32 AAR GOVERNMENT AFFAIRS the most respected, influential political entity in Arizona. ARIZONA ASSOCIATION OF REALTORS REALTORS OF ARIZONA POLITICAL ACTION COMMITTEE BYLAWS Amended ARTICLE I Name and Definition This political action committee shall be known as the REALTORS of Arizona Political Action Committee, (hereinafter referred to as "RAPAC"). RAPAC shall be a voluntary, nonprofit, unincorporated committee of individual members of the Arizona Association of REALTORS, (hereinafter referred to as "AAR"), and others who may be contributors, and shall be completely independent of and not affiliated with any political party, candidate, or political committee. ARTICLE II Principal Office and Address The principal office of RAPAC shall be located at 255 East Osborn Road, Suite 200, Phoenix, Arizona ARTICLE III Purpose The purposes of RAPAC are: A. To solicit contributions and make expenditures for the purpose of impacting any election in the State of Arizona, or in any county, city, town, or precinct in the State of Arizona. B. To evaluate and understand the philosophies and records of office holders and candidates for elective office. C. To assist members of the AAR and others in organizing themselves for more effective political action. D. To support the election of representatives in government who believe in the free enterprise system, private ownership of real property and the guarding of all rights and interests that are associated with such ownership. 2

33 ARTICLE IV Organization Section 1 All contributions to RAPAC from individual members of AAR and others shall be maintained in a separate fund of AAR. Section 2 RAPAC shall be governed by a Board of Trustees ( Trustees ). The Board of Trustees shall have general supervision and control over the affairs and funds of RAPAC and shall establish and carry out all policies and activities of RAPAC in accordance with the policies and procedures of AAR and with applicable Arizona election laws. ARTICLE V Contributions Section 1 Any member of AAR, and any other class of persons approved by the Board of Trustees, and permitted by the laws of the United States and the State of Arizona, shall be eligible to contribute to RAPAC. The Board of Trustees RAPAC Treasurer has the right to deny or approve any contribution to RAPAC. Section 2 RAPAC contribution recognition levels shall be determined by the Trustees from time to time as part of approved fundraising plans. Annual contributions shall be recognized for the calendar year during which the contribution is made, unless exceptions are made by the Trustees. Section 3 All contributions shall be completely voluntary. Contributions shall not be solicited, nor shall they be secured, by physical force, job discrimination, financial reprisals or threats thereof. No contributions shall be received from corporations or labor organizations, or by dues, fees, or other monies required as a condition of membership in AAR. Section 4 RAPAC funds shall be disbursed at the sole discretion of the RAPAC Treasurer with approval by the Board of Trustees. Section 5 No contribution to RAPAC shall be accepted and no expenditure shall be made by or on behalf of RAPAC at any time when there is a vacancy in either the office of the RAPAC Chair or RAPAC Treasurer. In the event the office of Chair becomes vacant, the Chair of the Legislative & Political Affairs Committee (LPA) shall appoint a replacement. In the event the office of Treasurer becomes vacant, the AAR CEO shall appoint a replacement. Section 6 3

34 No Committee member of RAPAC, or anyone making a contribution to RAPAC, shall have the right to share personally in any funds or assets of RAPAC. Section 7 All contributions to RAPAC shall be in the form of the immediate payment of money, defined as cash, personal checks, personal credit cards, money orders, or cashier's checks or as otherwise permitted by law. Section 8 A. In any year, with respect to all amounts actually raised by a local association of REALTORS that are less than or equal to its goal for that year, such local association may request, in writing, that RAPAC contributions to candidates within the local association's territory as may be designated by such local association from time-to-time, up to twenty percent (20%) of such amounts. B. Additionally, in any year, with respect to all amounts actually raised by a local association of REALTORS that exceed its goal for that year, such local association may request, in writing, that RAPAC contribute to candidates within the local association's territory as may be designated by such local association from time to time, up to fifty percent (50%) of RAPAC's portion of such amounts over goal. C. Amounts subject to requests by any local associations for contributions to local candidates pursuant to paragraphs (A) and (B) of this Section may accumulate until they total twenty-five thousand dollars ($25,000). After that, no additional amounts may be accumulated except to replace accumulated amounts actually disbursed to or for local candidates designated by such local associations. Section 9 A. In any calendar year, with respect to NATIONAL ASSOCIATION OF REALTORS ( hereinafter referred to as NAR ) Major Investor recognition, a member may obtain NAR accelerated recognition if the following criteria are met: a. the member completes an AAR RAPAC Investment Installment Form authorizing regular installments to be charged to the member s credit card, committing to payments and a schedule, which if met, will result in the member achieving the status of a NAR Major Investor; b. the member makes payments equaling thirty percent of the NAR Major Investor recognition level; c. the member makes payments directly to AAR and agrees to make the final payment no later than November 30 of that year. B. For amounts collected with respect to the NAR Major Investor accelerated recognition, AAR will report and transmit one hundred percent (100%) of funds to the NAR until thirty percent of the Major Investor recognition level is satisfied. 4

35 C. Upon satisfying the NAR thirty percent portion (30%), one hundred percent (100%) of each dollar shall be retained by AAR and split pursuant to Article V, Section 8 of these Bylaws. D. Any member who fails to complete all payments agreed to pursuant to the RAPAC Investment Installment Form in the calendar year in which the member seeks recognition, shall not be eligible for NAR accelerated recognition in the future. Section 10 Requests from local associations pursuant to Article V, Section 8 of these Bylaws shall be reviewed and approved or denied by the Board of Trustees by whatever personal, electronic or telephonic method available. Section 11 No contributions shall be received for or in connection with any federal election, except that transfers may be made to the NAR Political Action Committee. Section 1. Composition ARTICLE VI Board of Trustees A. The Chair of the Legislative & Political Affairs Committee (LPA) shall appoint not less than nine (9) members and not more than fifteen (15) members to serve as Trustees for two-year staggered terms. Of these appointed Trustees, there shall be at least one representative of each of the AAR Regions. B. The Board of Trustees shall also include the following ex-officio voting members. Legislative and Political Affairs Chair Legislative Committee Chair REALTORS Issues Mobilization Committee (RIMC) Chair Immediate past Chair of the Trustees Any member currently serving as an NAR RPAC Trustee Section 2. Removal from Office and Vacancies A Trustee will automatically be removed from office upon the suspension, revocation, or unrenewed expiration of either their Arizona real estate license or their AAR membership. Any Trustee with two (2) unexcused absences may be removed by the Chair of the LPA at his or her discretion, upon recommendation by the RAPAC Chair. The Chair of the LPA shall fill any vacancies. Section 3. Agreements with NAR. RAPAC may cooperate with and may enter into agreements with the NATIONAL ASSOCIATION OF REALTORS. Section 4. Continued Terms 5

36 Trustees serving at the time these Bylaws are amended shall continue as Trustees for the duration of their terms for which they were originally appointed. ARTICLE VII Officers Section 1 The officers of RAPAC shall be: Chair, Vice Chair, and Treasurer. Section 2 The Chair of the LPA shall appoint a Trustees Chair and should consider appointing the Chair from among those Trustees who have served at least one year as a Trustee. The Trustees Chair shall serve for a term of one year and shall not serve for more than two consecutive terms as Trustees Chair. The Trustees Chair shall preside at all meetings of the Board of Trustees. Section 3 The Vice Chair of the LPA shall appoint a Trustees Vice Chair and should consider appointing the Trustees Vice Chair from among those Trustees who have served at least one (1) year as a Trustee. The Trustees Vice Chair shall serve for a term of one (1) year and shall not serve more than two (2) consecutive terms as Trustees Vice Chair. During any absence or incapacity of the RAPAC Chair, the RAPAC Vice Chair shall assume the duties and exercise the powers of the Chair. The Vice Chair shall perform such other duties as may be assigned by these Bylaws, the Chair, or by the Board of Trustees. Section 4 The Treasurer shall be an AAR employee so designated from time to time by the AAR Chief Executive Officer (CEO). The Treasurer shall ensure that accounting for all contributions is made; that all funds are deposited in a financial institution; that all designated contributions are forwarded to appropriate candidates for elective offices or to the political committee supporting such candidate; and that all books of account to be kept in accordance with applicable Arizona election laws. The Treasurer will be registered with the Secretary of State s office and will prepare, sign, file, and maintain copies of all reports required by applicable election laws and by the Board of Trustees. Section 5 The elective year of RAPAC and its officers shall commence with the elective year of the AAR. ARTICLE VIII Meetings Section 1. Regular Meetings The RAPAC Trustees shall meet at least three (3) times per year. A majority of the Trustees shall constitute a quorum for the purpose of transacting business. Section 2. Special Meetings 6

37 Special meetings of the Board of Trustees may be called by the RAPAC Chair, or upon written request of five (5) members, upon provision of five (5) days notice to the Board of Trustees. Section 3. Actions Taken by the Committee All meetings shall be conducted according to the most recent edition of Robert's Rules of Order. Any actions by this Committee, including funds requests, may be handled via a majority vote at a scheduled meeting, vote, fax vote, conference call or by other technological devices. Results of such votes shall be communicated to the committee within three (3) business days. ARTICLE IX Books, Records, and Finances Section 1 RAPAC shall keep correct and complete books and records of account as required by the election laws of the State of Arizona. RAPAC's books of account shall be audited at least annually. All checks shall have the signature of the AAR CEO, or the signature of the AAR General Counsel as well as the signature of the Chair of the Committee. The fiscal year of RAPAC shall begin on January 1 and end on December 31. All RAPAC funds shall be deposited and maintained in a depository selected by the AAR Treasurer, subject to the approval of the Board of Trustees. Income derived from any interest earned on RAPAC funds shall inure to the benefit of the RAPAC account. ARTICLE X Amendments to Bylaws Section 1 These Bylaws may be amended from time to time by a majority vote of the Board of Trustees present and voting at any regular meeting, or at any special meeting duly called for that purpose. At least fifteen (15) days prior written notice of the proposed amendments, or of intent to repeal or adopt new Bylaws, shall be given to each Trustee. Any Bylaw amendments are subject to the approval of AAR Executive Committee and AAR Board of Directors. (END) 7

38 Pending Executive Committee Approval on March 28, 2017 RECOMMENDATION to the Board of Directors FROM: Executive Committee RECOMMENDATION: Approve the recommended technical changes and policy change to the REALTORS Issues Mobilization Committee Policies. BACKGROUND: The REALTOR Issues Mobilization Committee (Committee) is a voluntary, non-profit, unincorporated committee of individual members of the Arizona Association of REALTORS and others, and is not affiliated with any political party. The Committee is organized and operated for the purpose of collecting and disbursing contributions to support or oppose federal, state and local issues that impact real property and real property owners in Arizona in accordance with the then current Arizona Association of REALTORS Bylaws, Policies and Official Statements including the Arizona Association of REALTORS Legislative Policy Statements. The current policies establish the CEO as well as the Chairman of the Committee as the check signers. Specifically, All checks shall have the signatures of the AAR CEO as well as the signature of the Chairman of the Committee. As a result, on an annual basis the bank documents must be updated to reflect the change in the Chairman. In order to simplify the process, a recommendation to update the policies so the second signer is the General Counsel has been suggested. Current Policy Article IX Books, Records, and Finances Section 1 - Books and Records The RIMC shall keep correct and complete books and records of account as required by the laws of the State of Arizona and generally accepted accounting practices. The Committee's books of account shall be audited at least annually. All checks shall have the signatures of the the AAR CEO as well as the signature of the Chairman of the Committee. Recommended Policy Change Article IX Books, Records, and Finances Section 1 - Books and Records The RIMC shall keep correct and complete books and records of account as required by the laws of the State of Arizona and generally accepted accounting practices. The Committee's books of account shall be audited at least annually. All checks shall have the signatures of the the AAR CEO as well as or the signature of the Chairman of the Committee AAR General Counsel. 1

39 BUDGET IMPACT: None MOTION: TO APPROVE THE RECOMMENDED TECHNICAL CHANGES AND POLICY CHANGE TO THE REALTORS ISSUES MOBILIZATION COMMITTEE POLICIES. FOR MORE INFORMATION CONTACT: President Monthofer (928) / pmonthofer@me.com OR Michelle Lind (602) / michellelind@aaronline.com 2

40 ARIZONA ASSOCIATION OF REALTORS REALTORS ISSUES MOBILIZATION COMMITTEE POLICIES AS APPROVED OCTOBER 17, 2013 RIMC Policies as approved on October 17,

41 AAR GOVERNMENT AFFAIRS the most respected, influential political entity in Arizona. ARIZONA ASSOCIATION OF REALTORS REALTORS ISSUES MOBILIZATION COMMITTEE POLICIES Amended 10/17/2013 Article I Name and Definition The name of this committee is the REALTORS Issues Mobilization Committee ("Committee" or "RIMC"). It is a voluntary, non-profit, unincorporated committee of individual members of the Arizona Association of REALTORS ("AAR"), and others, and is not affiliated with any political party. Article II Principal Office The principal office of the Committee shall be located at 255 East Osborn Road, Suite 200, Phoenix, Arizona, Article III Purposes The Committee shall be organized and operated for the purpose of collecting and disbursing contributions to support or oppose federal, state and local issues that impact real property and real property owners in Arizona in accordance with the then current Arizona Association of REALTORS Bylaws, Policies and Official Statements including the Arizona Association of REALTORS Legislative Policy Statements. The Committee may support grassroots lobbying, political fundraising, activities that advance AAR s corporate presence as an influential political entity and education efforts related thereto. Committee funds shall not be used to support candidates or for any purpose prohibited by federal, state or local law. The Committee shall be organized and operated according to the statutes of Arizona including the Non-profit Corporations Act and the Electronic Transactions Act. The RIMC seeks to improve public policy by encouraging and stimulating REALTORS and others to take a more active and effective role in governmental decision making and the legislative process, and shall assist Local Associations in the organization of their own Committees. Article IV Officers RIMC Policies as approved on October 17, 2013.

42 Section 1 General The Officers of the Committee shall be: Chairman and Vice Chairman. Section 2 Chairman The Legislative and Political Affairs Committee Chairman shall appoint a RIMC Chairman and should consider appointing the Chairman from those RIMC members who have served for at least one year on the RIMC. The RIMC Chairman shall serve for a term of one (1)-year, and shall not serve more than two (2) consecutive terms as RIMC Chairman. The RIMC Chairman shall preside at all meetings of the Committee. Section 3 - Vice Chairman The Legislative and Political Affairs Vice Chairman shall appoint a RIMC Vice Chairman and should consider appointing the Vice Chairman from those RIMC members who have served for at least one year on the RIMC. The RIMC Vice Chairman shall serve a term of one (1) year and shall not serve more than two (2) consecutive terms as RIMC Vice Chairman. During any absence or incapacity of the Chairman, the Vice Chairman shall assume the duties and exercise the powers of the Chairman. The Vice Chairman shall perform such other duties as may be assigned by these Policies, by the Chairman, or by the Committee. Section 4 - Elective Year The Elective Year of the Committee and officers shall coincide with the Elective year of the Arizona Association of REALTORS. Section 1. Composition RIMC Policies as approved on October 17, Article V Committee A. The Chairman of the Legislative and Political Affairs Committee (LPAC) shall appoint at least seven (7) members to serve on the Committee for staggered two-year terms. Of these appointed members, there shall be at least one representative from each of the AAR Regions. B. The Committee shall also include the following ex-officio voting members. Immediate past Chairman of the RIMC. C. The Committee shall also include the following ex-officio non-voting members. Any Arizona member currently serving on the NATIONAL ASSOCIATION OF REALTORS Issues Mobilization Committee. The AAR Designated Lobbyist as registered with the Arizona Secretary of State. Legislative and Political Affairs Committee Chairman. Legislative Committee Chairman. REALTORS of Arizona Political Action Committee (RAPAC) Chairman. Section 2 Duties The Committee shall have general supervision and control over the affairs and funds of the Committee and shall establish and carry out all policies and activities of the Committee in

43 conjunction with Arizona Association of REALTORS Bylaws, Policies and Official Statements including the Arizona Association of REALTORS Legislative Policy Statements. The members shall serve without compensation, except for reimbursement of expenses according to AAR policy. Section 3 - Removal from Office and Vacancies A member will automatically be removed from office upon loss of real estate license, or loss of Association membership. Any member who fails to attend two consecutive meetings without sound and justifiable reasons may be removed from the Committee. The Chairman of the LPAC shall fill any vacancies. Article VI Subcommittees The Committee shall have such subcommittees as the Chairman determines are necessary and desirable for carrying out the purpose and objectives of the Committee. The members of the subcommittees shall be appointed by the Chairman from among the members of the Committee and any other member or non-member. Article VII Meetings and Voting Section 1 Regular Meetings The regular meetings of the Committee shall be held quarterly if necessary and during the Elective Year of the Committee members at a time and place designated by the Chairman. Section 2 Special Meetings Special meetings of the Committee may be called by the Chairman or upon written request of five (5) of the Committtee members. Written notice accompanied by a statement of the purpose of the meeting shall be delivered to every Committee member at least five (5) days preceding the special meeting. Section 3 Emergency Meetings Emergency meetings of the Committee may be called by the Chairman, or Vice Chairman if the Chairman is absent or incapacitated or upon the written request of five (5) of the Committee s members. Notice accompanied by a statement of purpose of the meeting shall be delievered to every Committee member at least three (3) hours preceding the emergency meeting. Notice for emergency meetings shall consist of, for the purposes of this provision, of either a fax or and a telephone call to each Committee member. The three (3) hour notice shall commence from the time that the or fax was sent. The or fax and follow-up phone call shall identify the time, venue and issue(s) of the meeting. Section 4 Electronic Voting The Committee is specifically authorized to use electronic means for voting purposes in accordance with the provisions of the RIMC Policies. Electronic voting shall not be construed as either a Special or Emergency Meeting. Electronic voting may include funding requests made via fax, , or other electronic means. Electronic votes shall establish a response date and time in the request to the Committee. Written notice of the electronic vote shall include a statement of the issue to be decided and shall be delivered to every member of the Committee RIMC Policies as approved on October 17, 2013.

44 at least twenty-four (24) hours preceding the response date and time. Electronic votes shall only be deemed approved when a majority of the Committee votes signifies the same. Section 5 - Action By Committee; Quorum The most recent edition of Robert's Rules of Order shall govern the affairs of the Committee at Regular, Special and Emergency Meetings. A majority of the voting members of the Committee shall constitute a quorum. Any actions by the Committee, including funds requests, shall be handled via a majority vote. Results of votes shall be communicated to the Committee within three (3) business days and recorded in the subsequent meeting minutes. A Committee member may attend any meeting by teleconference, video conference or in person. Article VIII Contributions, Funds Allocations and Expenditures Section 1 Contributions Contributions to the Committee may be made by members of the Arizona Association of REALTORS or any other persons approved by the Committee. Section 2- Allocation of Funds The Committee shall serve as the depository for all funds contributed in the name of the Committee. All funds collected, with the exception of funds received from sources other than Arizona Association of REALTORS membership, will be allocated and expended pursuant to the following guidelines: A. Annually, up to 15% of the total available funds may be approved and spent by the Committee. The Arizona Association of REALTORS Executive Committee shall be informed of all expenditures at its next regularly scheduled meeting. B. Any expenditure request over 15% of the total funds available in the Committee s fund shall require approval of the Arizona Association of REALTORS Executive Committee or Board of Directors prior to funds being expended. C. An amount equal to 25% of the direct contributions (e.g. non-dues) collected from members of a local Association of REALTORS will be reserved for use by the local association, for local issues that impact real property owners, up to a maximum of $100,000 per association. D. In addition, local associations may request RIMC funds from state reserves, over and above the amount held in their local reserves to address issues having potential statewide impact on the form prescribed by the Committee. Section 3 Expenditure of Funds RIMC Policies as approved on October 17, 2013.

45 A. Expenditure requests up to $10,000 per request may be approved by the RIMC Chairman. Expenditure requests approved only by the RIMC Chairman shall not exceed $25,000 in the aggregate during an elective year. B. Expenditure requests up to a maximum of $50,000 per request may be approved through an electronic vote of the Committee without the item being discussed at a regular, special or emergency meeting. C. Expenditure requests in excess of $50,000 shall be addressed at a Regular, Special or Emergency Meeting of the Committee in accordance with Article VII. However, any expenditure request may be approved through an electronic vote if the subject of the expenditure request was discussed at a previous RIMC meeting. D. Requests for funds shall adhere to the REALTORS Issues Mobilization Funding Requests Procedures. Section 1 - Books and Records Article IX Books, Records, and Finances The RIMC shall keep correct and complete books and records of account as required by the laws of the State of Arizona and generally accepted accounting practices. The Committee's books of account shall be audited at least annually. All checks shall have the signatures of the the AAR CEO as well as or the signature of the Chairman of the CommitteeAAR General Counsel. The fiscal year of the RIMC shall begin on January 1 and end on December 31. All funds collected for the benefit of the RIMC shall be deposited and maintained in a depository selected by the AAR Treasurer. Income derived from any interest earned on RIMC funds shall inure to the benefit of the fund. Article X Amendments to Policies These Policies may be amended from time to time by a majority vote of the Committee members present and voting at any meeting, or at any meeting duly called for that purpose, provided that at least fifteen (15) days prior written notice of the proposed amendments, or of intent to repeal or adopt new Policies, shall be given to each member. Any amendments to these Policies are subject to the approval of the AAR Executive Committee and Board of Directors. (END) RIMC Policies as approved on October 17, 2013.

46 2016 AAR AUDIT DASHBOARD The Executive Committee has reviewed the 2016 audit conducted by the accounting firm of Walker & Armstrong. Financial Highlights: The total assets for all funds (General Operating, Fixed Assets, Operating Reserve, Capital Reserve, Strategic Initiative Reserve and Issues Mobilization) are $25,405,846 with total net assets of $22,853,718. This represents an increase of $828,264 in total net assets from 2015 audited figures due mainly to an increase in membership dues revenue and an increase in investment income activity closed with $828,264 in income in excess of expenses. Depreciation for year 2016 was $303,622. As a reminder, our Bylaws require that we recognize an amount annually in the Operating Budget for depreciation payable to the Capital Reserve. The Board of Directors set depreciation funding in the Capital Reserve at $313,178 for Net Assets and Accumulated Operating Surplus: At the end of 2016 there is an accumulated operating surplus of $1,888,405. The surplus is comprised of (a) current assets [after excluding cash equivalents and investments that are committed as designated or restricted funds] (b) less current liabilities. The Capital Reserve balance as of December 31, 2016 is $3,178,045. The Special Operating Reserve balance as of December 31, 2016 is $6,774,031. The Strategic Initiative Reserve balance as of December 31, 2016 is $1,962,674. The Arizona Homeownership Alliance as of December 31, 2016 is $100,002. Issues Mobilization Fund s balance, as of December 31, 2016 is $6,234,988 of which $323,706 is reserved for local association local issues requests. Auditor Recommendations: The audit firm of Walker and Armstrong had no recommendations with respect to the Association's financial process. There are no irregularities reported. Copies of the 2016 AAR Audit are available at the check-in desk.

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52 Pending Executive Committee Approval on March 28, 2017 RECOMMENDATION to the Board of Directors FROM: Executive Committee RECOMMENDATION: Allocation of 2016 Accumulated Operating Surplus BACKGROUND: At the recommendation of AAR s accounting firm and to preserve the Association s 501(c)(6) IRS exemption, any accumulated operating surplus beyond the amount required for cash flow purposes or projected needs has been allocated to AAR s Reserve Accounts. Historically, $100,000 - $200,000 of the accumulated operating surplus is left for cash flow purposes and for immediate access if extra funds are required during the current operating year. Pursuant to the auditors, the accumulated operating surplus in 2016 was $1,888,405. This surplus is due to a variety of positive factors, such as higher than anticipated dues income, investment returns, the addition of a new building tenant. AAR s REALTORS Issues Mobilization Fund is a reserve fund to support or oppose federal, state and local issues that impact real property and real property owners and has a ten million dollar cap and a five million dollar floor. The Operating Reserve account allows the Association to sustain financial operations in the event of significant unbudgeted increases in operating expenses, legal expenses, or reductions of operating revenues. The Capital Reserve allows for major repairs/improvements, furniture, fixtures, and equipment expenditures. The Strategic Initiative Reserve is dedicated to new member benefits, technology enhancements, communication enhancements, or other efforts that benefit the REALTOR membership. BUDGET IMPACT: None to 2017 Operating MOTION: TO RECOMMEND APPROVAL ALLOCATING THE ACCUMULATED OPERATING SURPLUS OF $1,888,405 AS FOLLOWS: 1. $750,000 ALLOCATED TO THE ISSUES MOBILIZATION FUND 2. $650,000 ALLOCATED TO THE OPERATING RESERVE; 3. $300,000 ALLOCATED TO CAPITAL RESERVE; 4. $88,000 ALLOCATED TO STRATEGIC INITIATIVE FUND; WHICH LEAVES $100,405 IN UNALLOCATED STATUS FOR CASH FLOW PURPOSES. FOR MORE INFORMATION CONTACT: Mary Roberts, AAR Treasurer mary@havasurealestateblog.com OR CEO Michelle Lind michellelind@aaronline.com.

53 JANUARY 2017 FINANCIALS Paula Monthofer, President K. Michelle Lind, CEO 1

54 ARIZONA ASSOCIATION OF REALTORS MONTHLY FINANCIAL PACKAGE JANUARY 2017 FINANCIALS SUMMARY INDEX NOTES SUMMARY BALANCE SHEET...8 GROUPED BALANCE SHEET FINANCIALS DETAIL INDEX BALANCE SHEET OPERATING RESERVE...16 ISSUES MOBILIZATION...17 CAPITAL RESERVE...18 STRATEGIC INITIATIVE FUND...19 AAR & RAPAC...20 OPERATING BUDGET VS. ACTUAL...21 ALL FUNDS BUDGET VS. ACTUAL LEGISLATIVE & POLITICAL AFFAIRS GOVERNMENT AREA SUPPORT...25 LEGISLATIVE ADVOCACY...26 LOCAL LOBBYING SUPPORT...27 LEGISLATIVE POLICY DEVELOPMENT...28 FUNDRAISING SUPPORT...29 FEDERAL LIAISON SUPPORT...30 ELECTION YEAR ACTIVITIES...31 GOVERNMENTAL COMMUNICATION...32 POLITICAL RESEARCH...33 RISK MANAGEMENT RISK MANAGEMENT SUPPORT...35 LEGAL SUPPORT...36 PROFESSIONAL STANDARDS ENFORCEMENT...37 PROFESSIONAL STANDARDS TRAINING...38 ALTERNATIVE DISPUTE RESOLUTION...39 RISK MANAGEMENT PUBLICATIONS...40 FORMS DEVELOPMENT...41 LEGAL HOTLINE...42 BUSINESS SERVICES & TECHNOLOGY BUSINESS SERVICES & TECHNOLOGY SUPPORT...44 SOFTWARE DEVELOPMENT...45 IT RESOURCE/SECURITY MANAGEMENT...46 BUSINESS SERVICES DEPT...47 COMMUNICATIONS

55 PROFESSIONAL & BUSINESS DEVELOPMENT PROFESSIONAL DEVELOPMENT SUPPORT...50 REALTOR INSTITUTE...51 rcrms...52 CERTIFIED RESIDENTIAL PROPERTY MANAGER...53 LEADERSHIP TRAINING/CONFERENCE...54 PARTNERS CONFERENCE...55 MRE SOCIETY...56 SPRING CONVENTION...57 EDUCATION OUTREACH...58 EDUCATION DEVELOPMENT...59 INSTRUCTOR DEVELOPMENT...60 BROKER UNIVERSITY...61 OPERATIONS & STRATEGIC INITIATIVES GENERAL OVERHEAD...63 RESERVE FUNDING...64 DUES OPERATIONS & STRATEGIC SUPPORT...69 ASSOCIATION RELATIONS...70 NATIONAL MEETINGS...71 EXCOM & DIRECTOR SUPPORT...72 PUBLIC RELATIONS...73 PERSONNEL...74 BUILDING

56 FINANCIAL SUMMARY 4

57 MONTHLY FINANCIAL NOTES January 2017 Income/Expense Summary (Operating Budget vs. Actual) 2017 Y/T/D Actual Budget Variance Income Dues $ 5,888,957 $ 5,875,275 $ 13,682 Other $ 73,760 $ 33,072 $ 40,687 Total Income $ 5,962,717 $ 5,908,347 $ 54,369 Expenses $ 600,869_ $ 762,724 $ (161,855) Net Income (Loss) $ 5,361,847 $ 5,145,623 $ 216,224 Year-to-date income exceeds expense by $5,361,847. This amount compares favorably with projected net income of $5,145,623 for the reporting period, therefore, we have a positive year-to-date variance of $216,224. RESERVE FUNDS Operating Reserve (Bylaw Article IV, Section 1; Policy B.6) - The balance as of January 1, 2017 was $6,774,030 inclusive of UBS RMA and Private Bank Accounts. The current balance is $6,779,056. There were no disbursements this period. The Fund has seen a change in value of $5,025. REALTORS Issues Mobilization Fund (Bylaw Article IV, Section 3; Policy B.6 & RIMC Policies) - The balance as of January 1, 2017 was $5,175,612 inclusive of the UBS RMA and Private Bank Accounts. The current balance is $5,185,099. The UBS Portfolio Management long term account (see balance sheet) is being funded gradually, the approved total amount to be invested is $1,400,000 and investment performance is reported quarterly. There were $5,002 in deposits. UBS RMA and Private Bank Accounts have seen a change in value of $9,487. Capital Reserve (Bylaw Article IV, Section 2; Policy B.6) - The balance as of January 1, 2017 was $2,807,697 inclusive of the UBS RMA and Private Bank Accounts. The current balance is $2,807,495. The amount of $350,000 was invested in the UBS Portfolio Management long term account in 2015 (see balance sheet) and investment performance is reported quarterly. There were $1,800 in withdrawals this period for Executive Committee Tablet Reimbursement. The UBS RMA and Private Bank Accounts have seen a change in value of ($202). Strategic Initiatives Reserve (Bylaw Article IV, Section 4; Policy B.6) - The balance as of January 1, 2017 was $1,698,147 inclusive of the Credit Union, MidFirst, and UBS RMA Accounts. The current balance is $1,698,587. The amount of $250,000 was invested in the UBS Portfolio Management long term account in 2015 (see balance sheet) and investment performance is reported quarterly. There were no deposits or disbursements this period. The fund has seen a change in value of $440. UBS Portfolio Management Long Term Accounts (Policy P.22) - The balance as of January 1, 2017 was $1,694,250 inclusive of the Strategic Initiatives, Capital Reserve and Issues Mobilization accounts. The current balance is $1,734,570. 5