RA Will Look to Citizens to Help Hire Pro Firm for Lake House Review

by Karen Goff June 24, 2016 at 11:30 am 28 Comments

New Lake House Reston Association’s Board of Directors is going to conduct an independent review of the Lake House budget development process.

But first it will call on people in the community to help review and hire an auditing firm.

The board voted on Thursday to establish a Tetra Review Request for Proposal (RFP) Selection Committee comprised of three RA members to work with RA’s Board Governance Committee to review RFPs and help hire a professional firm to do the review.

RA’s Board Governance Committee recommended last week that the independent review be done to determine exactly what caused RA’s 2016 budgeting for Tetra/Lake House to have a $430,000 cost overrun.

RA Attorney Ken Chadwick advised the board Thursday that for the review to be truly independent, it has to be done with committee members who are not on RA’s staff or board.

Several RA board members spoke in agreement.

“If you want something that can be trusted, it can’t be RA members,” said At-Large Director Ray Wedell.

Said At-Large Director Jeff Thomas: “I am not sure of the value of the review. I think we have a pretty good idea of what went wrong. But we should bring someone in who knows what they are doing and do it right.”

RA CEO Cate Fulkerson has said the former owner opting not to rent back ($100,000) and construction costs that came in much higher than estimated contributed to the deficit. RA paid $2.65 million for the 33-year-old building on the banks of Lake Newport last July.

The association will put out a call for candidates to serve on the Tetra Review RFP Selection Committee soon with an application deadline of July 15, 2016. Candidate interviews will be conducted by the Board Operations Committee at a July 18 meeting.

Meanwhile, what RA will asking potential professional firms includes:

1.  A breakdown of estimated charges and a total estimated cost of the contract.
2.  Resumes of those professionals to be involved, as well as the hourly rate to be charged for each one.
3.  Company or group experience in conducting similar reviews.
4.  An outline of how you would propose to carry out the review.
5.  An estimate of the amount of time required to produce a final report, with an expected end date.
6.  Any other information believed to be relevant to the proposal.

RA has a deadline for RFP responses of Aug. 1. The board will hold a special meeting in August to consider the recommendations of the selection committee.

The board also discussed what the independent task force will do. The final report will include: “a review of the processes and internal controls that were followed across the organization in decision making and handling all decision-making, governance, administrative and financial aspects of RA’s purchase, including the referendum, planned use and renovation of Tetra (now known as the Lake House property) that have led to cost overruns and revenue shortfalls,” RA said in a statement.

“The review will include all materials and documents deemed necessary by the consultant and/or were shared with the RA board and the public related to the Tetra/Lake House and may include interviews with RA staff, board members, committee members and others.”

In other Lake House news, the board also voted to approve Fulkerson’s plan to replace $400,650 of the $430,000 moved out of the operating fund. The cost savings will come mostly from not filling open staff positions. The board further directed Fulkerson to come back to its July 28 meeting with savings ideas for the remaining balance of $30,000.

The board voted to direct RA staff to provide documents by July 8 on the Lake House to three RA members who have requested materials.

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