By E. Roberts Musser
In my capacity as an attorney and as a consumer advocate, I was asked by SCD members to review the new proposed bylaws. I gave my honest legal opinion the proposed changes were not in the best interests of SCD, nor its membership. Some concerned SCD members took their complaints to the Davis Senior Citizens Commission. It was there that SCD Board President John Gerlich was encouraged by Commissioners to slow down the process and obtain more member input before putting the matter to a vote.
Despite convening two town hall meetings and an official board meeting to explain his side of the matter, meetings that turned out to be extremely contentious, Mr. Gerlich steadfastly refused to change his position. At each meeting he reiterated there was going to be an up or down vote on the new proposed bylaws on August 14, 2012. This persistence was stubbornly adhered to in the face of mounting resistance – from swelling numbers of SCD members, from the city, and from a major SCD benefactor who had contributed hundreds of thousands of dollars to the organization.
At this point, SCD members made a written legal request to the SCD Board to inspect and copy the membership list, pursuant to California Corp. Code Section 6330(a)(1), for the purpose of encouraging SCD members to come to the August 14, 2012 meeting to vote on the proposed bylaws. The request to copy the membership list was denied. An SCD member was permitted to view a computer screen of the list, but not allowed to print out a copy.
Other ways were found to notify members, through a Freedom of Information Act request. As a result, the Davis Senior Center was inundated with telephone calls asking about the proposed bylaw changes and the August 14, 2012 board meeting. In consequence of all this uproar, a meeting was convened by the SCD Board on July 31, 2012, with SCD members, city representatives and the public in attendance. The city made its position crystal clear by tendering copies of two scathing letters to the SCD Board, one from the city and one from SCD’s major donor, Mr. George Valente.
The letter written by city representative Chris Helwig emphatically declared: “On behalf of the City of Davis and the Senior Center Staff, I would like to take this opportunity to formally state our strong opposition to the proposed SCD bylaw changes scheduled to be voted on August 14, 2012. We believe that, if approved, the proposed changes to the bylaws will fundamentally change the nature of the partnership that has existed between the two organizations for over 40 years. Please place this letter before the entire Board and membership so that they will be informed of City Staff’s position.
The proposed bylaw changes, which omit all wording contained within the existing bylaws making specific references to SCD’s affiliation with the Davis Senior Center, would significantly change the relationship between SCD and the City’s Senior Center. The proposed bylaws, both significantly reduce the historical connection with the Davis Senior Center, and greatly diminish the likelihood of ongoing, mutual benefits between the two organizations into the future. As with other nonprofit organizations in the City, the City and SCD have an established long standing partnership that has been implemented through agreements that recognize the contributions that each entity brings to the partnership. If the proposed bylaw changes are approved as currently presented, at an absolute minimum, these agreements will certainly need to be reviewed and evaluated by the City, and the City Council will need to determine, in revised agreements, whether and how our two organizations will conduct business with each other in the future.
Second, the City of Davis Staff expects that the SCD Board will continue to work with its membership, the George and Lena Valente Foundation, and the City, to ensure that the existing assets of SCD are fully applied towards their original intent or purpose, and not be used for SCD activities that diverge from the purposes for which the funds were initially solicited. The City Staff expects that SCD will not divert these funds from use at the Davis Senior Center…”
The major donor from SCD, George Valente, who has contributed more than $800,000 towards the Davis Senior Center, in his letter had much to say, the most pertinent parts reading as follows: “As a lifetime member of SCD, this letter shall serve as an official record of a “no” vote on the proposed changes to the SCD bylaws… 100% of the contributions from the George and Lena Valente Foundation accepted by SCD in the past were intended to directly support the ongoing programs, services and facilities of the Davis Senior Center. These funds are not to be used for a broader purpose and are intended to be spent at the sole discretion of the Davis Senior Center Staff, in cooperation with the SCD membership. If these funds will no longer be facilitated in this manner and with their original intent, I respectfully request that the remaining balance of funds be returned to the George and Lena Valente Foundation…Should the SCD Board of Directors choose not to proceed with any and all of the above requests, consideration of future contributions to SCD from the George and Lena Valente Foundation will cease immediately.”
Things then seemed to go from bad to worse. Board President Gerlich made up an arbitrary rule pulled out of thin air that those members joining SCD after June 30, 2012 would not be eligible to vote on the proposed bylaws at the Aug. 14, 2012 meeting. He didn’t dare take the chance a slew of people would suddenly join SCD in order to swell the number of detractors against the proposed bylaws. He then decided the vote on August 14, 2012 would be taken by secret ballot, even though the current bylaws required a voice vote. And he refused to send out either one of the letters critical of the proposed bylaws in the SCD voter packets, neither the letter from the city nor the one from Mr. Valente. The packets would only contain his self-serving version of the issue.
The weekend prior to the vote, Mr. Gerlich created total chaos, by sending out the voter packets with information indicating an up or down vote was to take place on Aug 14, 2012. Then shortly thereafter he turned around and sent out a post card saying the meeting was canceled. Many members received both pieces of information the exact same day, causing complete confusion. Mr. Gerlich also attempted to post a flyer in the Davis Senior Center, stating the August 14, 2012 meeting was canceled. However, Senior Center Staff refused his request. Instead upon legal advice, they posted an announcement the meeting would still be held as scheduled and anyone was welcome to attend.
The Davis Enterprise ran a story on the matter in their Sunday newspaper, two days before the Aug 14, 2012 meeting, explaining the meeting was still scheduled under the law. I carefully informed the reporter that interviewed me it was important for SCD members to understand a vote would take place on August 14, 2012. It was made clear Mr. Gerlich could not unilaterally decide to cancel such a meeting without the proper notice and board meeting, which had not taken place.
It was heartening to see approximately 250 SCD members in attendance at the August 14, 2012 special membership meeting to vote on the proposed bylaws. The Board President John Gerlich was nowhere to be found during the entire proceeding. He was in the building, ducking his head into the room for a brief second just before things got underway. Then he was gone. Apparently Mr. Gerlich did not care to face a “mob” of irate senior citizens. He tried to later claim in the Davis Enterprise it was not an official SCD meeting, so indicated he would not recognize any vote taken as legitimate.
Board member and former Board President, Betty Iams, called the meeting to order. Even though she appeared to be the only Board member there, it was a proper membership meeting according to the current bylaws. This was because a quorum of the Board at a membership meeting is deemed to be a majority of those Board members present. And only one Board member seemed to be in attendance at the time. Ms. Iams then requested I come up to the podium and address everyone.
The audience was asked by me if they wanted a brief overview of the issues, or if the floor should be opened up for questions. The consensus was for an explanation of what was going on. Many seniors did not understand why there was so much fuss over the proposed bylaws. Others were more in the know. Thus SCD members were given a brief rundown on the changes being advocated for in the proposed bylaws.
As I mentioned in a previous article in the Davis Vanguard, the proposed bylaws would give the President and Board much more power, taking it away from members; remove independent oversight of assets, investments, and financial transactions; and omit mention of the Davis Senior Center in its mission statement as well as eliminate it as the beneficiary in case of dissolution. The SCD principal place of business would no longer be at the Davis Senior Center, but in the new proposed bylaws would be anywhere within the city or county.
The reasons given for such drastic alterations were 1) that SCD needed to be more of a “business model”; and 2) greater “flexibility” was needed. This rationale was not very convincing to the crowd, as they shook their heads in consternation. None could understand why the Board would thumb their noses at: the Davis Senior Center Staff, the City, a major donor, and SCD members – just to push for changes in the bylaws that were not even in the best interest of the organization.
SCD members wanted to know how the bylaws even came to be in existence in the first place. I explained the Board had approved the proposed changes – except the lone holdout of Board member Betty Iams. Ms. Iams had doggedly tried to convince the rest of the Board what they were attempting to do was foolish and unwise, but the others on the Board refused to listen, approving the changes anyway. They determined the proposed bylaws would be put to a vote by the membership, as required in the current bylaws.
I noted to the audience it was very telling no other board members, other than Ms. Iams, were now present for the actual vote. Someone piped up that Board Vice President Wes Penny was standing in the back. Caught off guard, I apologized and invited him to join Board member Betty Iams at the front of the room. Mr. Penny took courage in his hands, and graciously acquiesced to my request, and came forward.
It must have been terribly embarrassing for the poor man. In my opinion, he showed a lot of bravery to face such a hostile crowd. Then came the piece de resistence of the entire morning. As I spoke about the potential for the elimination of the independent position of Finance and Budget Director, a former SCD member, Ed Contreras, who had held that very position before, spoke out with vehemence.
He insisted there needed to be proper checks and balances over SCD finances. He could not support the changes in the proposed bylaws. This was someone who spoke with great authority, because he was a former auditor for the state. His background gave him extreme credibility. But the finest moment came when the vote was actually taken. The audience was tired of questions and demanded the proposed bylaws be put to the test.
As the presiding Board member with the greatest rank, Board Vice President Wes Penny was asked by Board member Betty Iams to supervise taking the actual vote. Mr. Penny asked all those in favor of the proposed bylaws to stand up. There was not a single taker. Subsequently, all those opposed to the proposed bylaws were asked to stand up. As you can probably guess, every single person in the room rose from their seats, including those who came with canes and walkers. It was a stunning spectacle, an awesome moment.
Mr. Penny had the grace to accept defeat, and conceded there was no point in counting the votes. He declared the proposed bylaws unanimously and officially disapproved. Nevertheless, Mr. Penny defended the Board, stating they all voted in good conscience. However, he noted the SCD members had spoken, then indicated SCD would move forward. He complemented members on the process that had taken place, which seemed an odd remark in the circumstances. It must have been a difficult moment for him.
I then tendered a formal written legal request to the Board, to form a Bylaws Subcommittee, made up of 3 SCD members, 2 SCD Board members excluding the President and Vice President, a member of the Davis Senior Citizens Commission, a nonprofit expert, and 2 members of city staff. The request also asked that a Nominating Committee for elections be formed, which was supposed to have been done in July. It remains to be seen how receptive the Board will be to these requests and to its angered membership.
Lesson to be learned: Never, ever underestimate the power of seniors who believe someone is trying to put something over on them!
Elaine Roberts Musser is an attorney who concentrates her efforts on elder law and aging issues, especially in regard to consumer affairs. If you have a comment or particular question or topic you would like to see addressed in this column, please make your observations at the end of this article in the comment section.