THE ELIZABETH CONDOMINIUM ASSOCIATION
4601 North Park Avenue
Chevy Chase, MD 20815
Minutes of Board of Directors Meeting April 19, 2010
Board Present:
Woody Cunningham ....................President
Alexandria Kielty .........................Vice President
Monique Fridell ...........................Treasurer
Judith Barth ................................Assistant Treasurer
Jeffrey Axelrad ............................Secretary
Charles Bressler ...........................Director
Dr. Alfred Muller .........................Director
Others present:
Scott Murdoch ............Community Manager, Legum & Norman
Michael Horan ...........Property Manager, Legum & Norman
Jason Fisher ...............Legal Counsel
Lisa Rowan ................Recording Secretary, On the Record
Call to Order: Mr. Cunningham called the meeting to order at 6:45 pm.
Opening Comments:
Mr. Cunningham noted that the board members received many constructive comments in regard to the budget process.
Statement from Board Treasurer:
Ms. Fridell pointed out a change in the budget, in which an additional expense of $16,000 was added for personnel. The change was discussed at the board’s last meeting.
Ms. Fridell addressed increased condo fees in the proposed budget and stressed that the operating expenses will stay virtually even with inflation. The increase will help to build the association’s reserves. There is financial risk no matter what percent of increase is decided. The only way to increase reserves without increasing fees is to cut expenses, and the board is not willing to cut expenses. If fees are low, competitive condo fees are appealing; however, a shortage of funds in the reserves could lead to decreased care of the building. This could affect long-term market value. With sustained high condo fees, the risk of delinquencies increases, as the Elizabeth saw over the past year.
Comments from the Floor:
A resident noted that she wrote a letter to the board regarding the swimming pool contract. She has concerns about a distracted lifeguard and does not approve of the proposed 10.7 percent increase in the pool contract budget. Mr. Cunningham responded that this increase is for the projected cost and that a contract has not yet been signed for the pool. Her letter will be taken into consideration.
Board to Discuss and Approve New Budget for Fiscal Year 2011:
(R) Ms. Fridell moved to increase the condo fee by five percent and accept the budget as amended. Mr. Muller seconded.
Ms. Fridell explained that she analyzed the affect of different increases on reserve contributions and the five year plan. Five percent, she said, is a reasonable compromise between risks and benefits, rather than the 7.5 percent increase that was announced to residents.
Mr. Axelrad was in favor of a 7.5 percent increase, citing the building’s age and need for repairs and upgrades. A greater increase in condo fees will build the reserve fund and reduce the potential need for a line of credit. He opposed the five percent increase.
Mr. Muller was in favor of a three percent increase as a reasonable balance between reserves and the many fixed incomes in the community. He voiced his support for Ms. Fridell’s motion as a compromise.
Ms. Barth noted that a five percent increase would be the most harmonious answer for the building, although she did not believe it was the best solution.
Mr. Bressler and Ms. Kielty also showed interest in having higher condo fees in order to build reserves but were prepared to accept a smaller increase.
Mr. Cunningham commented on the upcoming engineering assessment. The study will determine priorities for improving the building. The even pacing of projects will help to spread the costs over a longer period of time. Mr. Cunningham supported the five percent increase.
The fiscal year 2011 budget passed 5-2.
(A) Ms. Fridell asked that management distribute the amended budget to all residents. Management agreed to do so.
Adjournment:
Mr. Cunningham adjourned the meeting at 7:20 p.m.
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