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COMMENTS ON BYLAWS
APRIL 11, 2014 VERSION
of
SOUTH COAST COMMUNITY FOUNDATION (SCCF)

20 APRIL 2014
PREPARED FOR XXXXX XXXXXXXXXX
Page 1 of 10

You asked me to read the latest proposed SCCF Bylaws document and to offer my comments.
Im flattered and I appreciate being asked. We both probably expected ten minutes effort. My
red pen bled all over two SCCF documents. Forgive the sarcasm that is caused by repeated
reading of the Bylaws. Be advised that I may send a copy to another person.

I have offered comments on the earlier version of these Bylaws and those comments are
attached. I have also attached a copy of a Bylaws document that I wrote for an organization
last month; and I have sent a redacted copy of Bylaws to your home. I am prevented by
executed non - disclosure agreement from releasing more of what I have done. You can easily
see the difference between professional and amateur work. At best, I consider the SCCF Bylaws
document to be incomplete; perhaps intentionally vague or misleading. If what Mr. Lansing has
stated is correct, the county and cities should be furious that unauthorized private citizens have
been negotiating tax related matters with Jordan Cove Energy for ten years. Unauthorized
private citizens, keeping what they have been doing in secret and hidden from the public, speaks
volumes. Hopefully Ms. Verger was not involved in these discussions while she had a fiduciary
responsibility to the citizens as our elected State Senator.

I believe that any local elected official with a fiduciary responsibility to the citizens and who
endorses the ill - defined Community Enhancement Plan and unknown Bayfront Investment
Corporation and these SCCF Bylaws (as they are written) deserves to be removed from office.
Honest Abe Lincoln would not be referring to this matter as a government of the people, by the
people, for the people.

Not only is the cart before the horse in this matter, its the whole damn 20 mule team being led
by the wagon. After reading the Bylaws document many times, it is impossible to disagree with
former state representative Lehman who called the education fee concept a money laundering
scheme.

Some history, as I and my neighbors understand.
The SCCF will be a private government operating beyond the public involvement, beyond
public scrutiny, and beyond any citizen control.
The SCCF effort is being undertaken to avoid the state schools funding equalization
formula.
The SCCF intends to transfer otherwise public tax monies to a private corporation.

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The SCCF proposes that, in lieu of property taxes, Jordan Cove Energy will pay a
Community Enhancement or Community Service Fee.
25% of the Community Enhancement Fees will be directed to the unknown Bayfront
Investment Corporation to be spent as that organization may desire.
50% of the monies collected as Community Enhancement Fees would go to the SCCF to
be allocated as they desire - some as an investment.
5% of monies collected would go to SCCF administrative costs (thats millions of dollars
annually) (I believe that it will be more).
Half the money collected as Community Enhancement Fees would be invested by
somebody unknown, for an undefined purpose.
Repeatedly we are told that monies collected are for the schools. However, as the SCCF
Bylaws are written, it is possible that the schools will never see one penny.
All Community Enhancement Fees would ultimately be significantly lower than what
government agencies would receive if Jordan Cove Energy was paying property taxes at
the regular rate. (There must be some benefit to Jordan Cove Energy or they would not
be funding the SCCF).
The SCCF has three non - elected, self - appointed, non - controllable by the citizens,
directors / officers. We know that one intends to resign immediately upon cities approval
of the SCCF concept. Who will replace that person? Another from the good old boys and
girls collection?
Mr. Lansing, who appears to operate as the tongue of the SCCF, has stated that as a
private corporation, SCCF will not be subject to Oregons public records and meetings
laws.

Before I comment on the SCCF Bylaws, its important to comment on the SCCF Articles
of Incorporation that were filed with the state last November, and as that document was
amended last week. And, comments on SCCF eligibility to be a 501(c)3 are appropriate.
A copy of the SCCF Articles of Incorporation are attached. For our neighbors who are opposed
to SCCF, as the organization is being proposed, loquacious Bill Lansing is their best friend. I do
not believe that SCCF will continue to receive IRS 501(c)3 status when all about the organization
is made known - and my position, easily argued, is based on the words - oral and written - of
SCCF Bill Lansing. Ive heard that somebody has already filed a complaint with the Oregon DOJ.

Some DOJ Charitable Section people who have helped me in the past are Kirk Harvey the Chief
investigator (who determines if an organization is really qualified to be a non - profit); and Kate
and Nora who help with general questions. According to the state web site, SCCF is not yet
registered with the state as doing business. Bayfront Investment Corporation is an unknown.

If you are opposed to SCCF, I urge you to contact Kirk Harvey. Im not opposed to SCCF just
SCCF as organized. There is a link at the AG web site home page - lower right. The office is in
Portland, not Salem. What Mr. Lansing has not said in interviews with the local media, or orally
before the video camera to support the SCCF concept and Bylaws, and his less than transparent
activities to date, he has put in writing. This fellow would not have qualified for CEO in my
former world. If not already done, I would expect one or more of the more vocal malcontents of

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our community to file a complaint with the state DOJ. I believe that any complainant would win
an argument that SCCF should not be a 501(c)3 tax exempt organization.

As 1/3 of the triad that is the operating arm of SCCF, its time for Verger to break her silence.
Its time for her to tell the public why the SCCF Bylaws as written are an oh so peachy deal for
the citizens of Coos County.

A comparison of IRS 501(c)3 Exemption requirements and the SCCF Articles of
Incorporation follows:

501(c)3
Among other things, to be tax exempt, the SCCF must be organized and operated for exempt
purposes. Those purposes are clearly defined as charitable, religious, educational, scientific,
literary, testing for public safety, fostering national or international sports competition and
preventing cruelty to children or animals. Period. In such matters as this, the state of Oregon
interprets the terms charitable and educational to mean advancement of education, erecting or
maintaining public buildings; lessening the burdens of government; lessening neighborhood
tensions.

SCCF Articles of Incorporation
SCCF claims to be a non - profit operating under the protective umbrella of a 501(c)3. And
that is probably correct as profit is defined in the business world. Article III of the SCCF
Articles of Incorporation states that the SCCF will be organized and operated exclusively for
charitable, scientific, and educational purposes. Scientific not. Advancement of education
not. Erecting and maintaining public buildings not. Lessening neighborhood tensions
definitely NOT; they have created tension.

501(c)3
None of the SCCF earnings may inure to any private shareholder or individual.

SCCF Articles of Incorporation
The SCCF Bylaws as written acknowledge four private shareholders. The federal and state
lawyers can decide this one. If Lansing argues that the SCCF is private, not a public
organization with citizen members, then earnings from those planned investments must benefit
private shareholders.

501(c)3
SCCF may not be an action organization.

SCCF Articles of Incorporation
Seems like Lansing is doing one heck of a lot of lobbying on behalf of Jordan Cove Energy. Is
that considered action? SCCF Articles of Incorporation Article IV states that no substantial
part of the activities of the corporation shall be propaganda or influencing legislation. So
apparently SCCF believes that something less than substantial action is OK.

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501(c)3
SCCF may not be organized or operated for the benefit of private interests.

SCCF Articles of Incorporation
Article II states that SCCF is a public benefit corporation. Yet one of the three Directors /
Officers of the corporation has informed the citizens, during recorded meetings, that the SCCF is
a private corporation. Two of the three Directors / Officers of the corporation have told us that
the public should not be involved in this corporation. They have done all possible to keep the
public away. One Director / Officer has apparently been silent to date. The (public) average
citizen gets no benefit whatsoever from SCCF. Frankly the public loses powers that they now
have; that power being transferred to a private corporation. The citizens of this community are
generally older people - many retired. If a citizen has a child in a local school, there may be
some indirect benefit.

Comments on other Articles of Incorporation
Article VI
OK, is somebody being cute, or does somebody believe that we are dumb? Maybe we were not
supposed to catch this one. When the document writer / author causes you to doubt one part of
what they have written; you question all parts. Remember, its four members (Coos Bay,
North Bend, the county, and the port) who own the SCCF. They employ (possibly
uncompensated) a Board of Directors to run the organization. Some day there will be no Jordan
Cove Energy, no source of revenue, and the SCCF organization will be dissolved. At that time,
there could be many millions of dollars remaining invested or in the bank, or other. Generally
dissolution is covered in the Bylaws. The SCCF Bylaws are silent. However, the Articles of
Incorporation state that upon dissolution, its the Board of Directors, not the members, who will
distribute the monies and other properties as the board of directors shall determine. It is
possible that, as written, all monies could legally go to SCDC. This is no good and should be
amended.

Article VII
States that the corporation shall not have members. I believe the intent was to say that the
organization shall not have any public (citizens) as a part of the organization; referring to them
as members. On April 3, this error was caught and the Articles of Incorporation were amended
to reflect the four members.

General Comments on the Bylaws
After reading the SCCF Articles of Incorporation and Bylaws documents many times, Im
convinced that somebody worked very hard to convince we citizens that we are stupid or that
the writers of these documents are stupid. In addition to what is missing, I believe that every
page should be prefaced with Trust Me! The opinions expressed herein are mine alone. If you
intend to do anything other than read the comments, I urge you to get a second opinion.

I believe that the SCCF concept could be the greatest thing since sliced bread. However, there
is too much power and peoples money placed in the hands of three private citizens who are not

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elected by the public, who are not appointed by the public, who are not accountable to the
public. There is absolutely no reason why Bill Lansing et al have made this a subject matter that
has again polarized the community. If Mr. Lansing is reporting fact, there is no reason why
these three private citizens have been working in silence with Jordan Cove Energy to capture
and control the peoples money. There is absolutely no reason for the principals or the Directors
/ Officers of SCCF to fear public involvement in the matter, if their intentions are honorable.
And, do not forget that the county assessor has told us that the amount paid by Jordan Cove
Energy as tax or monies in lieu of tax, and monies paid under the SCCF scheme would be the
same.

The SCCF matter is primarily directed at receiving what would have been tax monies and monies
in lieu of taxes promised by Jordan Cove Energy, from Jordan Cove Energy, and funding SCCF
with up to hundreds of millions of dollars, some say half a billion dollars, that will then be
directed by three unelected, non - appointed, unaccountable people to some unidentified
organizations selected by these same three people. As the Bylaws are written, these three
officers of SCCF have a fiduciary responsibility to nobody, private or public. Yet there is not one
single word among the ten pages masquerading as Bylaws that addresses funding of SCCF. The
Bylaws are silent on the SCCF stated plans to invest half of the monies received perhaps
several hundreds of millions of dollars for some future date. There are provisions for hiring
financial advisors. But, there are no restrictions placed on anybody regarding investing and the
amount of risk to be taken or avoided. The entire investment could be lost.

Jordan Cove Energy has not agreed in writing to do anything, to be part of anything, to pay into
anything, that is related to SCCF. At a minimum, where is the agreed upon formula covering
these hundreds of millions of tax dollars? Jordan Cove Energy has stated that they plan to grow
again; this time by as much as 50% upon receipt of permits. Where is the formula covering
monies then and now? Over the years Jordan Cove Energy has made many promises as
principal and as wholly owned subsidiary. They have promised amounts of monies (taxes,
monies in lieu of taxes, monies when no monies may be payable to any party), numbers of jobs,
all changing depending on who they are speaking to, and what they are seeking. Apparently not
one single professional politician or governors port appointee has demanded anything in writing.
And, none of those promises are in writing. Any professional pushing the SCCF concept would
start with an enforceable Jordan Cove Energy agreement. And, recognize that Jordan Cove
Energy will probably sell out once permits are in hand. Will any agreements between the parties
be transferable or enforceable? How will SCCF assure this happens?

I believe what has been done to cause fear in the less educated Jordan Cove Energy supporters
among us who are seeking jobs, by making jobs and SCCF dependent, especially by the Jordan
Cove Energy financially supported Boost Southwest Oregon organization, is sad. It can easily be
argued that BS Oregon and SCCF, both funded by Jordan Cove Energy, both reporting that they
have attempted to influence the success of Jordan Cove Energy, are in fact lobbyists for Jordan
Cove Energy. Jordan Cove Energy must get benefit by funding these organizations. If Jordan
Cove Energy was funding organizations because they are nice folks, they would send money to

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Jody McCaffree. Every time that I get on the fence about local LNG, Jordan Cove Energy knocks
me off.

You asked about my verifiable qualifications to comment. This surprised me as there are no
qualifications for commenting other than having common sense. But:
Staff to the president of two of the largest aerospace companies on the planet
Director of Business Development
Deputy Director of an aerospace program *
Director of Contracting *
o Worked with contracts since 1962
o Drafted effective and enforceable contracts since 1968
o Drafted many Bylaws, much policy and procedure (as recently as March 2014)
o Appeared in court as expert witness
o Appeared before the ASBCA
o Successfully defended against claims of impossibility, commercial impracticability,
superior knowledge
Director of Subcontracting *
Deputy Director of Material
Industrial Offset Manager (resident of other countries)
Failing companies turn - around specialist
*Programs and contracts to more than several billion dollars (in todays dollars)

And, Chairman / President of the largest Little League Baseball affiliate in the US. That taught
me to tolerate whining people.

At moments like this, I recall what my USC Business Professor Norman Sigband - long dead but
alive on the Internet - once told the class - be unimpressed with titles - PhD merely means piled
higher and deeper. There are some locals more qualified to comment for you than me.

The Bylaws are an improvement from earlier versions. It appears to me that the proposed
Bylaws have been intentionally poorly written and intentionally written to keep the public away.
Transparency is a foreign word to SCCF. Hopefully the person who prepared the Bylaws
document is at best a paralegal. Reading Section 2.4 several times caused me to believe that
the author got their legal shingle from a Cracker Jack box. I am disappointed that Cribbins and
Soper, both lawyers, have not rejected these Bylaws. But, I realize that both have but a couple
years experience working with the law and possibly zero experience with Bylaws. Where is
comment from North Bend and Coos Bay legal counsel who are being paid by the citizens? Why
arent they screaming?
Ill shine your shoes for six months if Im wrong here; but, I would expect several local 501(c)3
companies to be formed immediately if SCCF is approved. There is absolutely nothing within the
Bylaws covering restriction of monies - how recipients of the peoples money are selected; who
may receive; how much they may receive; how often they may receive; etc. Since there is no
written agreement with Jordan Cove Energy in place, it is possible that Jordan Cove Energy

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could place restrictions of who gets the money. Frankly, it could all go to SCDC and be
compliant with the Bylaws as written.
I can easily envision more than $3 million being spent annually on salaries, investor services,
legal services, and other G&A costs. If you enjoyed SCDC spending more than $2 million and
accomplishing nothing, you will enjoy SCCF more. Because I am convinced that SCCF should
not be tax exempt, there may be other costs. In all likelihood, SCCF will be making a few
friends very happy.
Whats included in the Bylaws for benefit of the public
Section 1.6 Members of the public may attend SCCF meetings - assuming that they receive
adequate notice - and that may not happen. Once there, the citizens whose money is being
spent can sit quietly, listen, and go home and wait until some day when minutes may be
published by somebody. The public may view an end of year fiscal statement.
Some of whats missing from the Bylaws
All documents should stand alone. The Articles of Incorporation, Bylaws, policy and procedure
are all stand - alone documents. The SCCF Bylaws meet the minimal requirements of ORS
Section 65. But, what about compliance with Oregon Administrative Rules Section 137 Division
10? Do Bylaws meet the requirements of ORS Section 128?
The secret formula! We have been repeatedly told that Community Service Fees (in lieu
of taxes) will be calculated based on some secret formula - at least once we were told
through a formula based on the assessed value of the property. This is the meat of the
Foundation. Yet, the Articles of Incorporation and the Bylaws are silent on this matter.
We have been told by the parent of Jordan Cove Energy that soon after permits are in
hand they will increase the size of the facility by 50% or more. This formula, easily
reduced to writing, is much too important to not be a part of these documents. Of course,
the formula should be agreed upon by Jordan Cove Energy - in writing before the SCCF is
endorsed by the members.
Name of Corporation (Brief comment in Articles of Incorporation Article I)
Principal place of Business (Brief comment in Articles of Incorporation Article XII its
in the Whitty law offices)
Who is the Registered Agent? (Articles of Incorporation Article XII its Whitty)
Provisions for a possible name change
Purpose of the organization
Provision for dissolution / distribution of monies (Articles of Incorporation Article
VI see earlier comments regarding dissolution)
Provisions for publishing meeting agendas
Provision for an annual organization budget
Provisions for a treasurers report and financial statement at every board
meeting
Provisions for restricted funds
Policy covering expenditure of funds

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Provisions for an accounting system
Provisions for a bookkeeper
Provisions for an annual Report
Provisions for communicating - members, directors, staff, etc.
And this assumes that SCCF is and will remain a 501(c)3 corporation.
The Bylaws require lots of cut and paste. There is no coherent flow. Often there is discussion of
something that is not described until much later.
Comments on specific sections of the Bylaws
Preamble
There is much missing here, commencing with a definition of The Foundation or Directors,
which causes problems throughout the document.
Section 1
1.1 Taxpaying, tax receiving citizens of the county will never be a member of SCCF.
Citizens do not get a voice at any time in how or where dollars are spent. As I understand
the Bylaws, there are four members of the organization with one vote each; each of the
four have 25% of the voting power - I hope. It is unclear if ever more than the four
permanent members vote on anything. There will be from four to seven directors,
possibly four different officers, several committee heads, and several assistants - do they
vote on anything?
1.4 At the annual meeting somebody will generally discuss the fiscal condition of the SCCF
organization. There are no provisions for an outside audit of the books. There is no
requirement for an accounting system. There is no provision for an annual financial
report. There are no provisions for public access to Forms 990. There is no requirement
for a treasurers report at every board meeting.
1.5 I assume that 50% of voting power means two of the four members.
1.6 First line, remove members of (also same words removed in Section 2.8). There are no
provisions for publishing a meeting agenda for benefit of the public. There are provisions
for only two days notice; ORS requires seven days notice. And, its not two business
days. Notice could come in Saturdays World paper for Monday morning meeting. There
are no requirements for timely publishing minutes. It is unclear who publishes meeting
minutes. Meetings must be scheduled for accessible locations - interpreted to be areas
generally open to the public - not the conference room at Jordan Cove Energy - not the
county jail.
1.11 No provision for tie votes. What happens if two / two vote results? Perhaps elsewhere
there could be a statement that Roberts Rules of Order could be followed at times when
the Bylaws are silent.

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Section 2
2.1 The four members (cities, county and port) give away all of their powers to the Board of
Directors. Yet, confusing as it may be, its the members who vote. Maybe. Are the
members close enough to the day to day activities of the corporation to make intelligent
decisions?
2.2 Where in the document is a definition that would enable the reader to understand what in
line five, board carry out its functions means. Last sentence is all subjective, not
objective. Which of the four members is qualified to select financial advisors who will
avoid risk and assure return on investment? Financial advisors invest monies that will
best benefit them. Why be concerned about risk - its not their money. What recourse
does the public have if the director is not providing effective governance and leadership?
2.4 Second paragraph - twelve consecutive years is crap. Four years is plenty. The first
paragraph appears to have been written by an aspiring trainee paralegal.
2.7 Lets assume that the organization - over which we citizens have no control - employs a
deadbeat Director. First, we the citizens may not recall of remove anybody. Second, a
stiff may only be removed by the member who selected them; i.e., three of the four
members may want this do nothing, disruptive bozo gone it wont and cant happen as
this section is written.
2.8 Remove words member of in the sixth line. So far, without any discussion of a hiring
process, we know that there will be at least four, possible seven, directors who will get
paid something, if only incurred expenses. Now we learn that there will be counsel (full or
part time - who knows). And, we learn that SCCF will have real property - why? Earlier
the four members were required to publish minutes. Now we learn that the Directors are
to keep those minutes and some day make them available to the public. Again, two days
notice in lieu of ORS required seven days notice.
2.10 This paragraph was written by a Sunset Middle School drop out. Read the first sentence
carefully. The first thing that we learned in Section 1.4 is that the annual meeting of the
organization will be held on the same day and at the same time for the next 20 years -
maybe. We have been told that its the directors, not the four members who are running
the company. We learned that there will be regular meetings of the directors. Now we
are told that there will be annual and many other regular meetings and those directors
who are expected to be in attendance do not need to be notified of the meetings date,
time, place or purpose of the meeting. Say what? Is ET among us?
2.11 Poorly worded at best. As the first sentence reads, any director may waive any notice
required by the Bylaws, including that two day notice to the public that there will be a
meeting.
Section 3

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3.1 Do the officers ever report to the four members? They serve at the pleasure of the Board
of Directors. But, Officers may be the Board members.
3.3 etal The job descriptions should be strengthened.
3.4 One Director is appointed by each member. Do Directors ever report to members or
just to the Board?
3.5 Earlier the members kept minutes; then we were told that the directors keep minutes;
now we are told that the Secretary keeps minutes.
3.7 We have so far, four permanent members, from four to seven directors, one counsel,
three or four officers who may be different people, some financial advisors. Now we get
assistants. And, there could be many and they wont come cheap. Is it time to shout -
and a partridge in a pear tree! There are no controls. There is no requirement for a
budget. There are no provisions for hiring. There are no provisions in place for
employees. This sounds like SCDC revisited. Who do the assistants report to?
Section 5
5.2 Change the word required to permitted in line 3. There are no requirements for an annual
report or for an audited financial statement; yet both will be available to the public.
5.5 Nothing in this document discusses receipt of funds to be distributed. That should be
priority number one - the cart is before the horse. Why Reedsport? Where is the
procedure covering how funds are allocated? Whats an other governmental body? Are all
501(c)3 eligible for monies?
Bottom line, this Bylaws document is an abortion. Lehman may be correct, these Bylaws give all
appearance of a money laundering scheme.
Sorry that I did not have time for a more thorough effort. XXXXX, ten years ago I was
persuaded to run for public office by a man who I respect and admire. I knew that I was more
qualified than the incumbent. I did not have the desire, not the drive. And, I was in poor health
leading to five artery bypass seven years ago. I did not listen to counsel. Yet, without name
recognition (the incumbent was a fixture here), with zero effort, receiving shitty comments from
the World paper (from the less than charming former city editor who is now employed by the
port), I still got about 40% of the vote (thousands). That told me that people are eager for new
blood, new thought. I still feel young. I will place my name on the ballot to replace any person
who signs up to these SCCF Bylaws and agrees to join SCCF.
With kindest regards,