I have read the October Minutes. I understand that an RFP was issued advertising for management companies to offer proposals to meet our management needs here at the Elizabeth. As a long-time consultant, my first question is does the Elizabeth have a current Needs Assessment?
For those not familiar with a Needs Assessment, it is a study that establishes clearly and concisely what is required (and in this specific case) to effectively manage the ongoing and long-term business of running the Elizabeth Condominium. It includes gathering together in one place: standards, job descriptions, training plans, a catalogue of problems/deficits, the strengths and weakness of personnel and current operating procedures, a profile of the culture that is the Elizabeth, evacuation plans, financial data/budgets, etc.
A Needs Assessment is a road map. It states:
This is where we are currently.
This is where we want to go. (a list of priorities)
These are the obstacles and current benefits.
The options for possible solutions and growth opportunities
It also establishes upfront why a Needs Assessment is required.
I believe that hiring a company to evaluate RFPs from various management companies will be a wasted exercise if we have not documented our requirements.
So again, I ask do we have a current Needs Assessment?
Jim Rich
Tuesday, November 25, 2008
October 2008 Minutes of ECA Board Meeting
MINUTES OF REGULAR MEETING OF THE BOARD OF DIRECTORS OF THE ELIZABETH CONDOMINIUM ASSOCIATION, INC.
MINUTES of Regular Meeting of the Board of Directors Of the Elizabeth Condominium Association, Inc. (“Association”), held on October 14, 2008 in the Party Room of the Condominium pursuant to notice in accordance with the Bylaws. Present were: George (Woody) Cunningham, Judith Gann, Monique Fridell, Alexandra Kielty, Judith Barth and Alfred Muller. Jeffrey Axelrad was absent. Carolyn Farrell represented Management.
The President, Mr. Cunningham called the meeting to order at 7:35 p.m.
MINUTES:
A motion to accept the Minutes of the Regular Meeting conducted on September 9, 2008, as corrected, was made by Dr. Muller with a second by Ms. Kielty. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
PRESIDENT’S REPORT
Mr. Cunningham, President, raised the issue of a letter that was sent in October 2008 to all residents from a group of residents and non-resident owners calling themselves CLAWS (Condo Owners Lobbying Against Wasteful Spending). This letter had many erroneous statements, which Mr. Cunningham addressed. He also noted that a letter would be sent to all residents and non-resident owners disavowing the CLAWS letter.
• Increase in condominium fees. The Board announced in May 2008, at the Annual Meeting, that the Board would hold off increasing condo fees if residents were able to achieve a 10% reduction in utility usage/costs. As of August 2008, this had not been achieved—usage has increased. At this time the Board has not discussed nor made a decision regarding an increase in condo fees. The Board is planning to have a Reserve Study performed to define our future repairs and maintenance requirements.
• Security Contract. The Board elected not to renew the contract with Alpha Security in May 2008. A Security Committee was formed. After meeting with several companies, the Committee recommended Securitas, an international security company currently providing services to many of our neighboring buildings. The Board agreed to enter into a contract with Securitas. The cost of which is basically the same as the prior Alpha contract. There are still three individuals providing services under the new contract. The only difference is that the two shifts from 7 a.m. to 11 p.m. provide doorman services and the 11 p.m. to 7 a.m. shit is a roaming security patrol. The petition from residents requesting dismissal of the doorman was discussed during the September 2008 Board Meeting. The Board notified residents at that meeting that we are still in a trial period. The additional expenditure of $100,000 noted in the petition was incorrect. The only way to reduce the cost of the contract would be to reduce the number of personnel.
• Condominium Refurbishment. The Board has not yet decided on which specific projects will be performed. The Board has consistently stated that the amount to be spent is $1.2 million, as set forth in the five-year plan. In September, a Request for Proposal was sent to six design firms. Responses are due on October 25, 2008 with estimates of cost and scope of work to be performed. The Board will then evaluate the proposals and present its decision at a regular Board Meeting. All activities regarding the Refurbishment project to date have been reported monthly at Board Meetings.
• The Party Room. The Board never proposed moving the Party Room to the West Lobby. The idea was discussed but ultimately rejected.
• Social Committee. The proposed television for the West Lobby will be discussed and voted on tonight.
Additionally, the President said that repairs to the façade are complete and have been tested for a two-hour period, which is equivalent to seven inches of rain. Jean Marx of Unit 214 said she still had leakage. Mr. Cunningham asked Ms. Farrell to check on this problem.
All elevator repairs have been completed.
TREASURER’S REPORT:
News
DeLeon & Stang is finalizing the first draft of FY 2008 financial statements for initial discussions with Management and Board. Their preliminary feedback is positive; there are no material accounting/control issues.
Auditor has recommended that we commission a Reserve Study rather than perform an in-house preparation of Five Year Plan. Ms. Fridell agrees with this recommendation, and she and Ms. Farrell will be making a proposal to the Board tonight to hire a professional Reserve Study firm to perform this analysis. The Five Year Plan is an appendix of the audited statements; therefore the publishing of final audited statements will need to wait for Reserve Study results, likely in December or January. In the interim, we have draft audited FY 2008 financial statements available for review by residents and prospective buyers.
We have distributed copies of the utility usage chart, which is tracking performance under our 10% cost reduction challenge. For the month of August and YRD we did not meet our 10% cost reduction target in any category.
Ms. Fridell state that our delinquencies are down to 1.85% receivables. The case of the chronically overdue account against which we filed a lien in September was resolved and ECA was repaid 100% of amount due.
Asset Allocation
As of 9/30, ECA had $2.6 MM in cash and investments roughly even YOY as growth in operating cash balances offsets the decline in reserves.
Reserves are down 4% to $1.94 MM YOY due to FY 2008 capital expenditures of almost $653K. The environment for investing in bank CDs is extremely challenging. Fifteen banks have failed so far this year. The bank where we have our CDARS program, Wachovia, was a merger target of both Citibank and Wells Fargo. This was resolved in the last few days with Wells Fargo as winning acquirer. We have $173K in CD exposure to two different Wachovia entities, 100% of this amount is covered by FDIC insurance.
On 10/3/08, the FDIC temporarily raised its deposit insurance coverage to $250K until 12/31/09. On 10/8/08, Federal Reserve cut discount rate to 1/5% in response to the financial crisis. Given the strong fears of recession that have surged in the last month, it is likely that already low interest rates at which we invest will be driven even lower.
Monthly Performance – September
The Board requested that we show the previous month’s financial results rather than report two months behind. Ms. Fridell acknowledges that it is better not to lag on financial reporting, but given the degree to which statements are understating expenses due to timing, she questions the value of reporting/analyzing at monthly Board meetings significantly understated monthly financial statements. For example, at the September Board Meeting, we reported August net income of $89K. this was vastly overstated due to non-receipt of August billing. The final net income figure for August was $25K, a $64k difference.
Last month Ms. Fridell suggested that one solution might be to move the Board meeting date later into the middle of month so that Management has more time to receive and reflect in our financial statements vendor billing which arrives after month end. At the September 2008 Board meeting, the Board made no comment or response to this suggestion. This month Ms. Fridell is formally proposing that we do this, and she would like the Board to either formally approve or reject this proposal.
For the month of September, we had a net income of $17K. This is understated by non-receipt of the water bill.
In September, almost $44k was transferred to reserve and almost #24K was spent from reserves on the electrical system and fire horn installation.
FY 2009 to Date (YTD) Results
For the three months ending 9/30, net income was $68K.
A transfer of $131K was made to reserves this year to date and $118K was spent from reserves on the fire horn installation and correction of electrical system deficiencies.
OLD BUSINESS:
Management Report: [This is a separate report and that document is not contained in these minutes.]
Ms. Farrell updated the Board on the following:
• Emergency Generator. The specifications for the emergency generator have been completed and are ready to be sent out for bid.
• Energy Audit. Ms. Barth presented a proposal to contract with American Innovators to perform an energy audit for the Elizabeth. They will begin before Thanksgiving. Ms. Barth made a motion to approve the Energy Audit contract to American Innovators for $2,650. Dr. Muller seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
NEW BUSINESS:
COMMITTEE REPORTS:
Energy Conservation Committee: Ms. Joan Rosenbach presented her report, [which is a separate report and not contained in the minutes.]
Refurbishment Committee: Ms. Gann reported that six Request for Proposal were sent out and are due back on October 25, 2008.
Social Committee: Ms. Barth announced that the next event is a Brunch/Redskins program on October 26, 2008. On November 4, 2008, an Election Results Party will be held using the new television if it is approved for purchase.
• Dr. Muller proposed the purchase of a large screen television from Best Buy. The related costs are: Panasonic 50-inch Plasma TV $997.99, Delivery $99.99, Set Up $99.99, Wall Mounting $199.99, Tilting Wall Mount $169.99, Four Year Home-Visit Warranty $169.99, and sales Tax of $104.15 for a total of $1872.09. Cable hook up through Comcast is available at no additional charge beyond what we are currently paying. Dr. Muller proposed that the cost of the TV be funded from reserves out of the $1.2 million Refurbishment budget. M. Fridell pointed out that according to the Fixed Asset Policy passed by the Board at the September 2008 Board Meeting, expenses under $3,000 are to be expensed and not come from the reserve funds. Ms. Fridell asked whether the Board proposed any cost-cutting to offset the cost of the TV, as it is not included in the 2008-2009 budget. No cost-cutting offset was proposed. The TV will be paid from the operating budget. Dr. Muller made a motion to purchase the TV. Ms. Gann seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
• The Exercise Committee is looking into televisions for the Exercise Room(s).
Friendship Heights Village Meeting: Dr. Muller reported that rehabilitation of the streets of the Village would begin shortly.
Miscellaneous: Ms. Barth asked about the status of the purchase of a new telephone system. Ms. Farrell explained that subsequent to the September 2008 Board Meeting at which the Board approved this purchase, additional technical components and costs have been identified. Management is still comparing alternatives and will have another proposal for the Board’s review.
Ms. Barth asked if we might purchase a bike rack to accommodate visitors. Management will look into this matter.
CONTRACTS:
A contract from Americlean, Inc. for $4,684 to clean the Lobby heating and air conditioning system was discussed. There would be an additional cost of $2300 every two years to perform this service. Ms. Barth asked if this could be done on a regular schedule. Mr. Cunningham asked if the hallways could also be checked at the same time. Ms. Barth made a motion that the contract for $4,684 from Americlean be approved. Ms. Kielty seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
A contract from Carrier Services was presented for ratification for $2,940. Carrier installed three pneumatic pressure clips, three relays and one battery in the domestic hot water controller. The President signed the contract so the work could be completed and the heat could be turned on. Ms. Kielty made a motion to ratify the contract and Dr. Muller seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
A contract from Highway and Safety Services was presented for $2,233 to replace the driveway apron section and gutter pans in front of the dumpster area, while the same company is repairing/repaving the Village sidewalks. This repair is for cosmetic purposes only. Dr. Muller moved the contract be approved. Ms. Barth seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
A contract from Mulheron Tree Experts was presented for snow removal at the cost of $225 per cleaning of the driveways with an additional 3% surcharge. This is the same company that performs the Village’s snow removal and will therefore be practical and cost-effective. Ms. Kielty made a motion to approve the contract and Ms. Barth seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
Two contracts were presented from RMS Fitness Equipment Services. One for preventative maintenance on all equipment for $545 per quarter. The second was for a walking belt for the treadmill and a guide rod for the weight stations for $824.85. Dr. Muller made a motion to approve the contract and Ms. Gann seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
Ms. Fridell presented her and Management’s recommendations to the Board that we commission a Reserve Study. These recommendations and their due diligence performed on three alternative companies were presented in a five-page memo sent to the Board. She explained that a Reserve Study is a budget-planning tool that identifies the current status of a condo association’s reserve fund and projects an equitable reserve funding plan to offset anticipated future major common element expenditures. The Elizabeth has not commissioned a Reserve Study since 1978. The auditors have recommended for the last two years that a reserve study be performed.
Based on their due diligence regarding Reserve Studies and their analysis of the tree proposals summarized in their memo to the Board, Ms. Fridell and Management requested approval for the following four items:
1. That the Board selects Reserve Advisors to perform a Reserve Study (RS) for ECCA to be initiated immediately. The RS is likely to take between three to six months.
2. That the RS be funded from ECA’s reserves.
3. That the results be shared with all residents at a public meeting.
4. That the results be included as supplemental information to ECA’s audited FY 2008 financial statements and the publication of the latter awaits RS results.
In addition, Ms. Fridell and Management recommended that future Boards commission regular RS updates at least every five years and that the performance of an RS becomes a Standard Operating Procedure for ECA.
Ms. Fridell made a motion recommending that Reserve Advisors perform the study for a cost of $9,200, which would be paid out of reserves. Mr. Cunningham seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
Ms. Gann moved that the Elizabeth have such a study performed every five years and the results are shared at a public meeting. Ms. Kielty seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
Management Company Proposals: Cost proposals have been received from three management companies in response to the Board’s RFP.
Ms. Fridell presented a memo to the Board proposing that ECA contract an external consultant or accounting firm to assist the Board in analyzing/comparing the costs of management company (MC) proposals with each other and with ECA’s existing cost structure. This would enable the Board to compare proposals on an “apples to apples” basis. Given the seminal nature of the decision to go from self-management to a professional management company, Ms. Fridell said she believes it is essential to have an independent analysis supporting this decision to show ECA residents and for posterity. The external consultant or accounting firm would be selected when we receive responses to RFPs issued in September 2008. Ms. Fridell’s memo forwarded a preliminary proposal from our auditor, DeLeon & Stand (D&S) to perform such an analysis for 2008-2009. Ms. Barth suggested hiring an independent consultant rather than use our consulting firm. It was noted that the Board should discuss this at a later date once the Board received and reviewed the proposals.
Ms. Fridell made a motion to hire a consultant firm to provide an independent study and quantitative cost analysis of the three management company proposals. Ms. Kielty seconded the motion. Mr. Cunningham, Ms. Fridell and Ms. Kielty voted in favor of the motion. Ms. Gann, Ms. Barth and Dr. Muller voted against the motion. Mr. Axelrad will be asked to break the tie vote upon his return.
Ms. Fridell recommended moving the Board Meeting to the third Tuesday of each month so that when the Treasurer presents the previous month’s financial statements to the Board and residents, they will more accurately reflect all costs/bills/expenses received for the previous month. Dr. Muller made a motion to approve this recommendation. Ms. Gann seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
Ms. Fridell reported that DeLeon and Stang has finalized its draft audit report. The firm noted no control or audit issues. The Board has already initiated many of their recommendations. The FY 2008 final audit statements will await the results of the Reserve Study so that they may be included as the addendum to the financial statements. Until then, the draft FY 2008 audited statements are available from the Management office if any resident would like to review them.
COMMENTS FROM THE FLOOR
Jerry Feldman, #1819: He read a lengthy statement on behalf of the “Silent Majority” in opposition of the CLAWS letter.
Charles Bressler, #1806: He spoke in favor of the CLAWS letter. He said 90% of residents want the doorman position eliminated, and residents want to know what the Refurbishment Committee is doing.
George Bason, #104, 110: In response to a statement by Dr. Muller, he said there is nothing in the House Rules against door-to-door solicitation by a resident. He asked where the new television would be installed and asked about the RFPs sent to management companies.
Carlos Astiz #314: He wants to see the contract for the management company once a company has been selected.
Warren Aaronson, #201: He asked if there would be Halloween Party. He applauded Ms. Farrell for her work on behalf of the Elizabeth.
Joyce Tavner, Beauty Salon owner, Elizabeth Arcade: She asked when the new commercial sign would be ready. Ms. Farrell said it would be up in November.
Alan Gann, #711: He asked whether anything is being done about the maintenance of the main drains within the towers. Ms. Farrell said an RFP for pressure washing the drains is in process.
Karren Alenier, #301: She asked about the progress of the website and indicated she might be willing to do a blog for the building. At the least, she asked that information should be placed in the elevators. She is happy about the consideration of replacement of thermostats and windows. There should be a time limit on speakers/residents. Residents with pets should use the side doors and not go through the lobby area.
Sally Hart, #1811: She wanted to know why the air conditioning was turned off prior to October 15
Sharon Bobb, #911: She said air conditioning should goon sooner and be kept on longer. She does not think the halls are set at the proper temperature. They are set at 78 degrees per Mr. Cunningham.
Ellen Winthrop, #1114: Her unit is very cold.
Barbara Sandler, #211: if the air conditioning is turned off prior to the stated date, residents should be informed.
Charles Bressler, #1806: Notices regarding air conditioning should be in boxes not elevators; he believes they are unattractive.
Martin Newhouse, #1002: Calcium/lime deposits have damaged his care and parking space. Ms. Farrell responded that this happened when Verizon installed FIOS in the building. She is in discussions with Verizon to whether they will cover the cost of damages relating to their installation. Dr. Muller moved that Management should proceed with reimbursing Mr. Newhouse’s damage expenses. Ms. Gann seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
Henrietta Asen, #817: She wants better communications with residents. She has a box of used batteries and asked how to dispose of them. Ms. Farrell said we would collect them. She said water is coming into her unit #816 and wants to know when something will be done about the problem.
Judith Barth, #207: Management should send a letter to the front desk informing them not to use the intercom and to use the regular phone to contact residents.
Sharon Bobb, #911: She is concerned about spider bites from insects in the garage. Others have told her they have been bitten. She raised the issue of tax credits for energy savings and asked the Board to investigate. She wants the Board to issue a communication on security measures. She has requested this of the in the past to no avail.
Jean Marx, #214: She voiced concerns about her water leakage problems and asked that they be resolved.
The meeting was adjourned at 10:30 p.m.
[These minutes were prepared by Judith Gann, Secretary of the ECA, but Karren Alenier retyped these minutes lacking timely cooperation from the Board in sending her an electronic copy. Alenier has bolded some of the issues for ease of locating specific topics. The ECA Board Meeting Minutes is a public document and available in paper copy at the ECA Management office.]
MINUTES of Regular Meeting of the Board of Directors Of the Elizabeth Condominium Association, Inc. (“Association”), held on October 14, 2008 in the Party Room of the Condominium pursuant to notice in accordance with the Bylaws. Present were: George (Woody) Cunningham, Judith Gann, Monique Fridell, Alexandra Kielty, Judith Barth and Alfred Muller. Jeffrey Axelrad was absent. Carolyn Farrell represented Management.
The President, Mr. Cunningham called the meeting to order at 7:35 p.m.
MINUTES:
A motion to accept the Minutes of the Regular Meeting conducted on September 9, 2008, as corrected, was made by Dr. Muller with a second by Ms. Kielty. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
PRESIDENT’S REPORT
Mr. Cunningham, President, raised the issue of a letter that was sent in October 2008 to all residents from a group of residents and non-resident owners calling themselves CLAWS (Condo Owners Lobbying Against Wasteful Spending). This letter had many erroneous statements, which Mr. Cunningham addressed. He also noted that a letter would be sent to all residents and non-resident owners disavowing the CLAWS letter.
• Increase in condominium fees. The Board announced in May 2008, at the Annual Meeting, that the Board would hold off increasing condo fees if residents were able to achieve a 10% reduction in utility usage/costs. As of August 2008, this had not been achieved—usage has increased. At this time the Board has not discussed nor made a decision regarding an increase in condo fees. The Board is planning to have a Reserve Study performed to define our future repairs and maintenance requirements.
• Security Contract. The Board elected not to renew the contract with Alpha Security in May 2008. A Security Committee was formed. After meeting with several companies, the Committee recommended Securitas, an international security company currently providing services to many of our neighboring buildings. The Board agreed to enter into a contract with Securitas. The cost of which is basically the same as the prior Alpha contract. There are still three individuals providing services under the new contract. The only difference is that the two shifts from 7 a.m. to 11 p.m. provide doorman services and the 11 p.m. to 7 a.m. shit is a roaming security patrol. The petition from residents requesting dismissal of the doorman was discussed during the September 2008 Board Meeting. The Board notified residents at that meeting that we are still in a trial period. The additional expenditure of $100,000 noted in the petition was incorrect. The only way to reduce the cost of the contract would be to reduce the number of personnel.
• Condominium Refurbishment. The Board has not yet decided on which specific projects will be performed. The Board has consistently stated that the amount to be spent is $1.2 million, as set forth in the five-year plan. In September, a Request for Proposal was sent to six design firms. Responses are due on October 25, 2008 with estimates of cost and scope of work to be performed. The Board will then evaluate the proposals and present its decision at a regular Board Meeting. All activities regarding the Refurbishment project to date have been reported monthly at Board Meetings.
• The Party Room. The Board never proposed moving the Party Room to the West Lobby. The idea was discussed but ultimately rejected.
• Social Committee. The proposed television for the West Lobby will be discussed and voted on tonight.
Additionally, the President said that repairs to the façade are complete and have been tested for a two-hour period, which is equivalent to seven inches of rain. Jean Marx of Unit 214 said she still had leakage. Mr. Cunningham asked Ms. Farrell to check on this problem.
All elevator repairs have been completed.
TREASURER’S REPORT:
News
DeLeon & Stang is finalizing the first draft of FY 2008 financial statements for initial discussions with Management and Board. Their preliminary feedback is positive; there are no material accounting/control issues.
Auditor has recommended that we commission a Reserve Study rather than perform an in-house preparation of Five Year Plan. Ms. Fridell agrees with this recommendation, and she and Ms. Farrell will be making a proposal to the Board tonight to hire a professional Reserve Study firm to perform this analysis. The Five Year Plan is an appendix of the audited statements; therefore the publishing of final audited statements will need to wait for Reserve Study results, likely in December or January. In the interim, we have draft audited FY 2008 financial statements available for review by residents and prospective buyers.
We have distributed copies of the utility usage chart, which is tracking performance under our 10% cost reduction challenge. For the month of August and YRD we did not meet our 10% cost reduction target in any category.
Ms. Fridell state that our delinquencies are down to 1.85% receivables. The case of the chronically overdue account against which we filed a lien in September was resolved and ECA was repaid 100% of amount due.
Asset Allocation
As of 9/30, ECA had $2.6 MM in cash and investments roughly even YOY as growth in operating cash balances offsets the decline in reserves.
Reserves are down 4% to $1.94 MM YOY due to FY 2008 capital expenditures of almost $653K. The environment for investing in bank CDs is extremely challenging. Fifteen banks have failed so far this year. The bank where we have our CDARS program, Wachovia, was a merger target of both Citibank and Wells Fargo. This was resolved in the last few days with Wells Fargo as winning acquirer. We have $173K in CD exposure to two different Wachovia entities, 100% of this amount is covered by FDIC insurance.
On 10/3/08, the FDIC temporarily raised its deposit insurance coverage to $250K until 12/31/09. On 10/8/08, Federal Reserve cut discount rate to 1/5% in response to the financial crisis. Given the strong fears of recession that have surged in the last month, it is likely that already low interest rates at which we invest will be driven even lower.
Monthly Performance – September
The Board requested that we show the previous month’s financial results rather than report two months behind. Ms. Fridell acknowledges that it is better not to lag on financial reporting, but given the degree to which statements are understating expenses due to timing, she questions the value of reporting/analyzing at monthly Board meetings significantly understated monthly financial statements. For example, at the September Board Meeting, we reported August net income of $89K. this was vastly overstated due to non-receipt of August billing. The final net income figure for August was $25K, a $64k difference.
Last month Ms. Fridell suggested that one solution might be to move the Board meeting date later into the middle of month so that Management has more time to receive and reflect in our financial statements vendor billing which arrives after month end. At the September 2008 Board meeting, the Board made no comment or response to this suggestion. This month Ms. Fridell is formally proposing that we do this, and she would like the Board to either formally approve or reject this proposal.
For the month of September, we had a net income of $17K. This is understated by non-receipt of the water bill.
In September, almost $44k was transferred to reserve and almost #24K was spent from reserves on the electrical system and fire horn installation.
FY 2009 to Date (YTD) Results
For the three months ending 9/30, net income was $68K.
A transfer of $131K was made to reserves this year to date and $118K was spent from reserves on the fire horn installation and correction of electrical system deficiencies.
OLD BUSINESS:
Management Report: [This is a separate report and that document is not contained in these minutes.]
Ms. Farrell updated the Board on the following:
• Emergency Generator. The specifications for the emergency generator have been completed and are ready to be sent out for bid.
• Energy Audit. Ms. Barth presented a proposal to contract with American Innovators to perform an energy audit for the Elizabeth. They will begin before Thanksgiving. Ms. Barth made a motion to approve the Energy Audit contract to American Innovators for $2,650. Dr. Muller seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
NEW BUSINESS:
COMMITTEE REPORTS:
Energy Conservation Committee: Ms. Joan Rosenbach presented her report, [which is a separate report and not contained in the minutes.]
Refurbishment Committee: Ms. Gann reported that six Request for Proposal were sent out and are due back on October 25, 2008.
Social Committee: Ms. Barth announced that the next event is a Brunch/Redskins program on October 26, 2008. On November 4, 2008, an Election Results Party will be held using the new television if it is approved for purchase.
• Dr. Muller proposed the purchase of a large screen television from Best Buy. The related costs are: Panasonic 50-inch Plasma TV $997.99, Delivery $99.99, Set Up $99.99, Wall Mounting $199.99, Tilting Wall Mount $169.99, Four Year Home-Visit Warranty $169.99, and sales Tax of $104.15 for a total of $1872.09. Cable hook up through Comcast is available at no additional charge beyond what we are currently paying. Dr. Muller proposed that the cost of the TV be funded from reserves out of the $1.2 million Refurbishment budget. M. Fridell pointed out that according to the Fixed Asset Policy passed by the Board at the September 2008 Board Meeting, expenses under $3,000 are to be expensed and not come from the reserve funds. Ms. Fridell asked whether the Board proposed any cost-cutting to offset the cost of the TV, as it is not included in the 2008-2009 budget. No cost-cutting offset was proposed. The TV will be paid from the operating budget. Dr. Muller made a motion to purchase the TV. Ms. Gann seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
• The Exercise Committee is looking into televisions for the Exercise Room(s).
Friendship Heights Village Meeting: Dr. Muller reported that rehabilitation of the streets of the Village would begin shortly.
Miscellaneous: Ms. Barth asked about the status of the purchase of a new telephone system. Ms. Farrell explained that subsequent to the September 2008 Board Meeting at which the Board approved this purchase, additional technical components and costs have been identified. Management is still comparing alternatives and will have another proposal for the Board’s review.
Ms. Barth asked if we might purchase a bike rack to accommodate visitors. Management will look into this matter.
CONTRACTS:
A contract from Americlean, Inc. for $4,684 to clean the Lobby heating and air conditioning system was discussed. There would be an additional cost of $2300 every two years to perform this service. Ms. Barth asked if this could be done on a regular schedule. Mr. Cunningham asked if the hallways could also be checked at the same time. Ms. Barth made a motion that the contract for $4,684 from Americlean be approved. Ms. Kielty seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
A contract from Carrier Services was presented for ratification for $2,940. Carrier installed three pneumatic pressure clips, three relays and one battery in the domestic hot water controller. The President signed the contract so the work could be completed and the heat could be turned on. Ms. Kielty made a motion to ratify the contract and Dr. Muller seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
A contract from Highway and Safety Services was presented for $2,233 to replace the driveway apron section and gutter pans in front of the dumpster area, while the same company is repairing/repaving the Village sidewalks. This repair is for cosmetic purposes only. Dr. Muller moved the contract be approved. Ms. Barth seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
A contract from Mulheron Tree Experts was presented for snow removal at the cost of $225 per cleaning of the driveways with an additional 3% surcharge. This is the same company that performs the Village’s snow removal and will therefore be practical and cost-effective. Ms. Kielty made a motion to approve the contract and Ms. Barth seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
Two contracts were presented from RMS Fitness Equipment Services. One for preventative maintenance on all equipment for $545 per quarter. The second was for a walking belt for the treadmill and a guide rod for the weight stations for $824.85. Dr. Muller made a motion to approve the contract and Ms. Gann seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
Ms. Fridell presented her and Management’s recommendations to the Board that we commission a Reserve Study. These recommendations and their due diligence performed on three alternative companies were presented in a five-page memo sent to the Board. She explained that a Reserve Study is a budget-planning tool that identifies the current status of a condo association’s reserve fund and projects an equitable reserve funding plan to offset anticipated future major common element expenditures. The Elizabeth has not commissioned a Reserve Study since 1978. The auditors have recommended for the last two years that a reserve study be performed.
Based on their due diligence regarding Reserve Studies and their analysis of the tree proposals summarized in their memo to the Board, Ms. Fridell and Management requested approval for the following four items:
1. That the Board selects Reserve Advisors to perform a Reserve Study (RS) for ECCA to be initiated immediately. The RS is likely to take between three to six months.
2. That the RS be funded from ECA’s reserves.
3. That the results be shared with all residents at a public meeting.
4. That the results be included as supplemental information to ECA’s audited FY 2008 financial statements and the publication of the latter awaits RS results.
In addition, Ms. Fridell and Management recommended that future Boards commission regular RS updates at least every five years and that the performance of an RS becomes a Standard Operating Procedure for ECA.
Ms. Fridell made a motion recommending that Reserve Advisors perform the study for a cost of $9,200, which would be paid out of reserves. Mr. Cunningham seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
Ms. Gann moved that the Elizabeth have such a study performed every five years and the results are shared at a public meeting. Ms. Kielty seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
Management Company Proposals: Cost proposals have been received from three management companies in response to the Board’s RFP.
Ms. Fridell presented a memo to the Board proposing that ECA contract an external consultant or accounting firm to assist the Board in analyzing/comparing the costs of management company (MC) proposals with each other and with ECA’s existing cost structure. This would enable the Board to compare proposals on an “apples to apples” basis. Given the seminal nature of the decision to go from self-management to a professional management company, Ms. Fridell said she believes it is essential to have an independent analysis supporting this decision to show ECA residents and for posterity. The external consultant or accounting firm would be selected when we receive responses to RFPs issued in September 2008. Ms. Fridell’s memo forwarded a preliminary proposal from our auditor, DeLeon & Stand (D&S) to perform such an analysis for 2008-2009. Ms. Barth suggested hiring an independent consultant rather than use our consulting firm. It was noted that the Board should discuss this at a later date once the Board received and reviewed the proposals.
Ms. Fridell made a motion to hire a consultant firm to provide an independent study and quantitative cost analysis of the three management company proposals. Ms. Kielty seconded the motion. Mr. Cunningham, Ms. Fridell and Ms. Kielty voted in favor of the motion. Ms. Gann, Ms. Barth and Dr. Muller voted against the motion. Mr. Axelrad will be asked to break the tie vote upon his return.
Ms. Fridell recommended moving the Board Meeting to the third Tuesday of each month so that when the Treasurer presents the previous month’s financial statements to the Board and residents, they will more accurately reflect all costs/bills/expenses received for the previous month. Dr. Muller made a motion to approve this recommendation. Ms. Gann seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
Ms. Fridell reported that DeLeon and Stang has finalized its draft audit report. The firm noted no control or audit issues. The Board has already initiated many of their recommendations. The FY 2008 final audit statements will await the results of the Reserve Study so that they may be included as the addendum to the financial statements. Until then, the draft FY 2008 audited statements are available from the Management office if any resident would like to review them.
COMMENTS FROM THE FLOOR
Jerry Feldman, #1819: He read a lengthy statement on behalf of the “Silent Majority” in opposition of the CLAWS letter.
Charles Bressler, #1806: He spoke in favor of the CLAWS letter. He said 90% of residents want the doorman position eliminated, and residents want to know what the Refurbishment Committee is doing.
George Bason, #104, 110: In response to a statement by Dr. Muller, he said there is nothing in the House Rules against door-to-door solicitation by a resident. He asked where the new television would be installed and asked about the RFPs sent to management companies.
Carlos Astiz #314: He wants to see the contract for the management company once a company has been selected.
Warren Aaronson, #201: He asked if there would be Halloween Party. He applauded Ms. Farrell for her work on behalf of the Elizabeth.
Joyce Tavner, Beauty Salon owner, Elizabeth Arcade: She asked when the new commercial sign would be ready. Ms. Farrell said it would be up in November.
Alan Gann, #711: He asked whether anything is being done about the maintenance of the main drains within the towers. Ms. Farrell said an RFP for pressure washing the drains is in process.
Karren Alenier, #301: She asked about the progress of the website and indicated she might be willing to do a blog for the building. At the least, she asked that information should be placed in the elevators. She is happy about the consideration of replacement of thermostats and windows. There should be a time limit on speakers/residents. Residents with pets should use the side doors and not go through the lobby area.
Sally Hart, #1811: She wanted to know why the air conditioning was turned off prior to October 15
Sharon Bobb, #911: She said air conditioning should goon sooner and be kept on longer. She does not think the halls are set at the proper temperature. They are set at 78 degrees per Mr. Cunningham.
Ellen Winthrop, #1114: Her unit is very cold.
Barbara Sandler, #211: if the air conditioning is turned off prior to the stated date, residents should be informed.
Charles Bressler, #1806: Notices regarding air conditioning should be in boxes not elevators; he believes they are unattractive.
Martin Newhouse, #1002: Calcium/lime deposits have damaged his care and parking space. Ms. Farrell responded that this happened when Verizon installed FIOS in the building. She is in discussions with Verizon to whether they will cover the cost of damages relating to their installation. Dr. Muller moved that Management should proceed with reimbursing Mr. Newhouse’s damage expenses. Ms. Gann seconded the motion. Mr. Cunningham, Ms. Gann, Ms. Fridell, Ms. Kielty, Ms. Barth and Dr. Muller approved the motion. Mr. Axelrad was absent. The motion passed.
Henrietta Asen, #817: She wants better communications with residents. She has a box of used batteries and asked how to dispose of them. Ms. Farrell said we would collect them. She said water is coming into her unit #816 and wants to know when something will be done about the problem.
Judith Barth, #207: Management should send a letter to the front desk informing them not to use the intercom and to use the regular phone to contact residents.
Sharon Bobb, #911: She is concerned about spider bites from insects in the garage. Others have told her they have been bitten. She raised the issue of tax credits for energy savings and asked the Board to investigate. She wants the Board to issue a communication on security measures. She has requested this of the in the past to no avail.
Jean Marx, #214: She voiced concerns about her water leakage problems and asked that they be resolved.
The meeting was adjourned at 10:30 p.m.
[These minutes were prepared by Judith Gann, Secretary of the ECA, but Karren Alenier retyped these minutes lacking timely cooperation from the Board in sending her an electronic copy. Alenier has bolded some of the issues for ease of locating specific topics. The ECA Board Meeting Minutes is a public document and available in paper copy at the ECA Management office.]
Sunday, November 23, 2008
Test blog
I have emailed my Board colleagues requesting resolution/permission to have approved condo association minutes posted on this blog. I suggest doing it in pdf form, if that is possible. Al Muller