Present at the meeting: Seth Levine, Judi Barth, Charles Bressler, JImmie Cockburn, Molly Frantz, Ilo-Mai Harding, Al Muller, Scott Murdoch, Jason Fisher (Attorney), Jim Santos, Chris Kiefer, Recording Secretary.
President’s Remarks: He welcomed a large gathering of owners and said he was glad there was a renewed interest in the Association. His expectation for the meeting was to restore harmony among members of the ECA. He also announced that Scott Murdoch has left Legum & Norman. Chris Kiefer of Legum & Norman came to the meeting to represent L&N management. A new community manager has not yet been appointed.
Treasurer’s Report: None
Past Minutes: April minutes were approved with all in favor except Dr. Cockburn. May minutes have not been reviewed because of some technical problems.
House Manager’s Report
There were a number of items requiring Board action & approval. Check with the Management Office for the Memo to the Board dated June 17 for more details.
These items were acted on:
--Approved: Worker’s compensation insurance policy renewed but moved to J. Manougian Insurance Agency which gave the ECA a significant discount over last insurance company.
--Approved: Draft ECA Contractor Guidelines will be sent to owners for comment with the expectation that the Board will vote on final version at the July meeting. One item to pay attention to is a possible fee for getting approval for the contractor an ECA member proposes to hire to work in his/her unit.
--Approved (Cockburn opposed): House Manager given go ahead to hire a company to shred old Association & Management documents.
--Approved: House Manager recommended not filing an insurance claim against damage done in tier 11 since the high deductible negated the possible monetary payment of consequence.
--Approved: Through email, the Board unanimously approved replacement of high- & low-zone circulating pumps for domestic hot water. Board made public endorsement for the official record.
--Approved: Additional money required for marble floor maintenance.
The House Manager will be scheduling a professional to come to the Exercise Facility (on lobby level on the East Side) to demonstrate new equipment. Stay tuned for that announcement.
Old Business: None
New Business:
On behalf of the Library Committee, Judi Barth asked that a sign be installed near the library cabinets that shows this is the library. Board approved this request.
The Library Committee meets every Wednesday from 10 am to noon. If you would like to help with their project to make book identification more tidy, just show up in the West Lobby in the library area.
Election of new vice-president: In a deal that was cut to stop Charles Bressler from presenting his petition that was requesting a special meeting to dissolve the current board of directors, it was agreed that Al Muller would step down as vice-president and the Board would vote in public on the election of Bressler as the new vice-president. The vote passed with five approving and two abstaining (Barth & Harding).
Comments from the floor:
--In the spirit of preserving the best interest of the Association, people generally praised the Board for finding a way to bring order back to the Association business and to move forward with the many critical problems of an aging building.
--A number of people voiced discontent about the 10 percent increase in our condo fees and questioned the legally of how things were handled. It is expected that next week, ECA members will get official notice of the 10 percent increase and the increase will go into effect July 1.
--The issue that the Board does not respond to letters sent by ECA members was raised again.
Next meeting July 18, 2011.
Monday, June 27, 2011
April 2011 Minutes of ECA Board Meeting
THE ELIZABETH CONDOMINIUM ASSOCIATION
4601 North Park Avenue
Chevy Chase, MD 20815
Minutes of Board of Directors Meeting APRIL 18, 2011
Board Present:
Alexandria Kielty .........................President
Dr. Alfred Muller .........................Vice President
Monique Fridell ...........................Treasurer
Molly Frantz ...............................Assistant Treasurer
Charles Bressler ...........................Secretary
Judith Barth ................................Director
Seth Levine .................................Director
Others Present:
Scott Murdoch ...............Community Manager, Legum & Norman
James M. Santos ...........ECA General Manager
Call to Order: Ms. Kielty called the meeting to order; a quorum was present. [This statement about a quorum has been raised as problematic to the ECA Board. The call to order is also missing the official start time.]
APPROVAL OF PREVIOUS MEETING MINUTES:
MOTION Dr. Muller moved to approve the minutes of the March 21 Board of Directors meeting, as amended. Seconded by Mr. Bressler and adopted unanimously (7-0-0).
PRESIDENT’S REPORT:
Ms. Kielty, recalling the distribution of the proposed FY2012 budget to owners for review and comment, reminded everyone that the proposed budget will be considered for adoption by the Board at a special meeting scheduled for Wednesday, April 27, at 7:30 p.m. She urged that all owners be present at that meeting. She also extended her thanks to Mr. Jim Rich, who was responsible for developing the recent survey of residents. The response thus far has been good. She asked that those who have already responded urge their neighbors to do so. Finally, Ms. Kielty also reminded everyone present that the 2011 Annual Meeting of the Association is scheduled for Wednesday, May 4, at 7:30 p.m. She encouraged all owners to attend to ensure a quorum in order to conduct necessary business before the Membership.
TREASURER’S REPORT: Ms. Fridell had no report.
OLD BUSINESS:
Proposed FY2012 Budget
Ms. Fridell reviewed the spreadsheets she has prepared on various scenarios relative to the funding of capital repairs and replacements over the next five-year period. Ms. Fridell clarified that the significant difference between the current Reserve funding scenarios and those previously discussed is the inclusion of about $2.5 million in expenditures—to include an estimated $300,000 for new building canopies and $164,000 for water consumption submetering of the building’s commercial units—over and above the projects already scheduled for the next five-year period. It also defers to beyond 2016 about $2.3 million in Reserve expenditures to help offset the cost of replacement unit windows and balcony doors. The challenge has been to generate the funds necessary to ensure that the building is well maintained while keeping condominium assessment increases reasonable. Under the current scenario, the Association will not have the Reserve funds necessary to fund scheduled capital repairs and replacement in some years, even if the Board approves a 10 percent increase in monthly assessments for the coming year.
Ms. Frantz clarified that her revised calculations assume a 5 percent increase in assessments for FY2012, all of which will be allocated to fund Reserves. Thus, based on that updated calculations, the net amount to Reserves is about $200,000 greater than originally estimated. Further adjustments are being made to the figures to account for already-approved or ongoing capital projects, the final costs of which should be available shortly.
Ms. Fridell further suggested that when thinking about the appropriate level of Reserve contribution in the coming years, the Board must consider that the five-year plan calls for about $1.5 million in capital expenditures per year.
Dr. Muller noted that whereas the future will be challenging, for the first time ever, and thanks to Management and the Treasurer, the Board has a Reserve Study and Schedule that includes all of the capital repairs and replacements that will be necessary in the foreseeable future and viable cost estimates for each, serving as an important planning tool. He urged, nonetheless, that no action on the budget be taken tonight but rather that the revised spreadsheet, which allows for certain variables, be distributed to the Board for review and further massaging.
Ms. Kielty added that the state of the Reserve Fund should not come as a surprise to owners as the Board has for some time been discussing capital repairs and replacement needs and has discussed the possibility of proposing to the ownership a special assessment to help pay for these needs. Ms. Fridell noted that whereas there has been some opposition to a special assessment, she believes that to be the most prudent approach to raising the monies needed to fund capital projects, not annual increases in monthly assessments. She calculates that if the Association approves a $1.4 million special assessment—the figure she calculates is necessary to ensure that the Association’s Reserve Fund balance does not dip into negative territory within the next five years—the average cost per unit would be about $4,000. Based on her proportion of shares of a two-bedroom unit, her cost would be $4,430, payable over a two year period. She figures that she would spend about that to replace the four windows and one balcony door in her unit.
Mr. Bressler, who has lived at The Elizabeth since the middle 1970s, noted that inadequate Reserve funding and inflation over the decades, coupled with significant deferred maintenance has led to the Association’s current position—i.e., the need to undertake a number of significant and costly projects for which funds are not readily available. And, whereas these projects need not be undertaken at once, the Association cannot afford to continue to defer projects indefinitely. He suggested that the Association no longer has the options of delaying the inevitable, and urged that the Board consider a 10 percent increase in assessments in FY2012, the entire proceeds to be allocated to the Reserve Fund. He added that replacing unit windows, doors, and HVAC systems will result in significant utility cost savings; these savings should be factored into the calculation of how and when these projects are to be undertaken.
Dr. Muller suggested that replacement of the canopies and submetering of the commercial space, be deferred. He also noted that whereas Ms. Fridell is correct in that a one-time special assessment is ultimately less costly than annual increases in condominium assessments, he is concerned that there are a number of owners whose cash flow would not accommodate a special assessment.
Ms. Kielty reminded the Board that questions of which projects to pursue, which to defer, and how best to fund them will be the focus of the April 27 meeting. At that meeting, the Board can also discuss with owners the suggestion of a one-year hiatus on capital projects.
Ms. Frantz commented with regard to the submetering of the commercial units, that if WSSC requires the submetering of commercial units to ensure that the Association can continue to benefit from lower residential rates, then it would behoove the Association to undertake this project quickly as the added cost of water and sewer at commercial rates will have a significant impact on operating costs. And, while there has been some discussion that WSSC may grandfather in older communities, not requiring commercial space submetering, it would be prudent to keep the funds in the Reserve schedule should submetering be required after all. If submetering is not required, the funds can be reallocated to other projects. Dr. Muller countered that if indeed WSSC requires submetering, the Association can use operating contingency funds—which are intended for such purposes. He would argue against collecting from owners more money than is needed to operate and maintain the property.
Ms. Fridell noted that, setting aside particular projects, the fact is that there has been an upward trend over the past several years in the building’s capital expenditure needs, in large part due to its age. According to an analysis prepared by Ms. Frantz, whereas capital expenses ranged between $400,000 and $600,000 per year in previous years, the last two years saw expenditures in excess of $1 million per year. During the current year, $2 million was estimated, but was later reduced due to Board decisions to defer certain small projects. The Reserve Schedule now before the Board calls for about $1.5 million in capital expenditures per year over the next five-year period.
Projects Update: Mr. Santos reported that as approved by the Board at its last meeting, Management has arranged for the installation of a new server to power the property’s surveillance equipment, and a new engine for the Association’s garage floor sweeper. Moreover, the common area doors have been rekeyed with a new fob-controlled system, and additional fob readers have been installed. These should facilitate authorized access to the property while improve controls against unauthorized access. In response to Mr. Bressler’s inquiry, Mr. Santos clarified that access to the Arcade, garage lobbies and guest garage level will be better controlled and that notices will be sent to residents so that they are aware that access for those common areas will require a fob. Guests wishing to access the property from those areas can use the intercom system, which connects to the front desk.
In response to a query regarding new microphones for use during Board and other meetings, Mr. Santos noted that there had been some problems with the microphones that were purchased initially. These were sent back and new ones should be available at the Board’s next meeting.
In terms of forthcoming projects, Mr. Santos noted that he is scheduling several spring cleaning and painting projects. The staff also will be focusing, over the next fiscal year, on upgrading the emergency alert systems and updating the Association’s emergency and evacuation plans, among others projects.
Fitness Room Upgrades: Mr. Santos reported receipt of an initial quote for replacing and adding several pieces of equipment in the Fitness Room from Heartline Fitness, the maintenance contractor on the existing equipment. Mr. Santos noted that Associa, Legum & Norman’s parent firm, has an arrangement with Heartline Fitness that will result in cost savings to the Association of about 40 percent, thus allowing for additional equipment. A Committee of residents is advising Management on what equipment is most appropriate for the community. Mr. Santos expects to have a final proposal for the Board’s consideration at its next meeting, well within the $17,000 budget for this project.
NEW BUSINESS:
Managing Agent Services Contract: Mr. Murdoch clarified that whereas the renewal language in the Association’s current contract with Legum & Norman (L&N) provides for annual increases of CPI plus 1.5 percent, currently 4.5 percent, L&N is now proposing a three-year renewal, with no increase over current rates in the first year, and a three percent cap on increases in the second and third years. He further clarified that whereas L&N is revising its contract document, the changes are not substantive. It will, most importantly, continue to include the standard clause providing a 60-day termination without cause. The current contract expires on June 30, 2011.
The Board generally agreed that whereas there have been several issues with regard to L&N’s financial management services, the Association has benefited from the relationship with Legum & Norman and that renewal of the contract is appropriate. The Board, nonetheless, agreed that the proposed new contract be reviewed by legal counsel before it is executed. Of special concern is the ability to terminate, at least the financial services aspects of the contract, should there not be the necessary improvements in L&N’s financial management in the months ahead. The Board requested that Mr. Murdoch provide a copy of the proposed new contract to the Association’s legal counsel for review.
MOTION Dr. Muller moved to approve the proposal to renew the managing agent arrangement with Legum & Norman, for a term of three years, with no increase in the first year and a 3 percent cap on increases in the second and third years, subject to legal counsel’s review and advice. Seconded by Ms. Fridell.
Ms. Fridell noted that while she supports renewing the contract based on the site management team, she continues to have serious concerns regarding L&N’s performance of the important financial management functions. As her term on the Board will be expiring, she urged that the new Board and Board Treasurer make it a priority to address these issues definitively in the next fiscal year. Issues include collection of delinquent assessment accounts, on which the L&N accounting/financial management staff has been less than proactive and which, were it not for the active involvement of the site manager, would be a greater problem for the Association; a number of basic bookkeeping and accounting errors, even beyond the miscoding of expenses, which resulted this past year in a significant number of adjustments made in the audited financial statements; and the accuracy and usefulness of the monthly financial reports, which have to date required close review by staff and the Treasurer to ensure that the Board is given a clear picture of the Association’s financial position at all times. This latter point is of special concern to Ms. Fridell as it is imperative that the Board trust the accuracy of the monthly financial statements, particularly if there is no one on the Board with accounting or financial management expertise. To their credit, it is her understanding that L&N is installing new financial management software that should help address some of the issues cited over the past months but it is important that the Board remain vigilant. Thus, Ms. Fridell recommended that the next Treasurer set down a number of critical performance improvement goals for L&N on the financial management front and that if these are not met within a reasonable time, the Board consider engaging another firm to undertake the financial management function or bring that function in-house.
Ms. Frantz added that whereas she concurs that the management team represents an enormous added value to the community, she too has concerns about the financial management aspect. She clarified, however, and Ms. Fridell concurred, that there is no question about fraud or malfeasance, but rather questions of sloppy bookkeeping and an apparent lack of knowledge of basic accounting principles. Of particular concern to Ms. Frantz is L&N’s inability to properly apply assessment payments made on several units with one check. That is but one example of a simple accounting function that has thus far not been handled properly. Ms. Frantz too urged that the incoming Treasurer treat the resolution of these issues as a priority in the coming year. Finally, Ms. Frantz expressed her discomfort approving a contract that she has not had the opportunity to read.
Ms. Kielty noted that whereas she agrees that there are persistent financial management issues, the problems experienced during the last audit were in part due to the Association undertaking the audit too early in the year and during a time of transition, when the management team was new to the community and it was in the middle of a major refurbishment project. She also noted that, as an individual not well-versed in bookkeeping and accounting principles, the financial statements generated by L&N are a vast improvement over what was presented under self-management, most particularly with regarding to the income and expenses analyses that are presented monthly. She also reiterated that despite the various accounting issues cited, there have been no questions of fraud or unnecessary expenses. Ms. Fridell concurred that the monthly analyses presented are indeed useful, but these are the result of significant work on her and Mr. Murdoch’s part.
VOTE ON MOTION The motion to renew the managing agent services control with Legum & Norman for a term of three years, per the terms proposed and pending legal counsel’s review was a adopted by a vote of 6 ayes, 1 abstention by Ms. Frantz, and no nays.
Landscape Contract:
MOTION Ms. Frantz moved that the Board ratify action taken between meetings by e-mail to approve the proposal presented by Ruppert Landscaping to undertake Phase 1 of the master landscape plan, at a cost not to exceed $16,650. Seconded by Mr. Bressler and adopted unanimously (7-0-0).
Mr. Santos clarified that the final expense will be somewhat lower as the contractor will apply the cost of the landscape design to the cost of its implementation. The irrigation system repairs are under separate contract. For the benefit of residents present, Mr. Santos clarified that a master landscape plan was commissioned, to include an inventory of existing plantings and a redesign of the planting areas with more appropriate plant material, greater symmetry, and a refreshed and aesthetic appearance. Phase 1 of the plan addresses the entrance to the building—to include the circular drive, the beds on either side of the entrance, and the planter box on the east side of the building.
Whereas Dr. Muller had no objection to the proposal, he urged against taking action on contracts by e-mail, except in emergency circumstances. Ms. Frantz thanked the members of the Landscape Committee for their work to improve the appearance of the community.
Master Insurance Coverage: Mr. Murdoch recalled that last year, the Board adopted the proposal submitted by John Manougian Insurance, transferring coverage from the Firemen’s Fund to Greater New York Mutual, at an annual premium savings of $53,000. He further recalled that L&N typically solicits competitive quotes for insurance coverage every two years; given the significant savings realized last year with Manougian, competitive quotes were not solicited. Manougian Insurance proposes renewal of the existing coverage, with the addition of coverage for the Association’s above-ground diesel fuel tank (which supplies the new generator) and increased artwork coverage at a total premium cost of $105,106.04, a further reduction over the current year’s premium cost $2,031.96.
MOTION Dr. Muller moved that the Board accept the recommendation of Manougian Insurance to renew the Association’s master insurance coverage—to include general property and liability, Directors’ and Officers’, crime and employee dishonesty, diesel fuel tank liability, and fine art coverages—through Greater New York Mutual at an annual premium cost of $105,106.04. Seconded by Ms. Barth and adopted unanimously (7-0-0).
Ms. Kielty noted, for the record, that Manougian Insurance has acknowledged that the frequency of claims has been reduced dramatically since 2009, which has positively impacted the Association’s ability to obtain necessary coverages at reasonable cost. The Association’s agent also has offered to meet with the Board later in the summer or early fall to review new legislation, that becomes effective on October 1, that makes it easier for Associations to adopt a bylaw amendment requiring unit owners obtain HO-6 coverage—condominium homeowners coverage. Such coverage extends over owners’ personal property, any betterments and improvements in their unit, and personal liability.
COMMITTEE REPORTS:
Landscape: Mr. Rich noted that now that the landscape improvements contract has been approved, the Committee will work with Management and the contractor, as appropriate, to ensure that the improvements occur as quickly as possible.
Chairman’s Contributions: Ms. Kielty reported that with the help of the “Making a Difference Committee” and James Santos, the Committee has identified several charitable organizations who are interested in and willing to pick up donations of items from the community. The National Alliance on Mental Health (NAMH) has agreed to schedule pickups of items that can be resold through the NAMH thrift shop. A Wider Circle, an organization that assists the homeless, also will pick up donations of household items, such as furniture, small working appliances, kitchenware, and linens. Finally, the Committee is making arrangements for the recycling of other items, such as electronics, clothing, books, and magazines. A series of bins will be located on the East and West G-1 garage levels for the collection of such items and notices will be sent to all residents regarding this program.
COMMENTS FROM THE FLOOR:
A resident objected to the removal of certain comments from an Elizabeth resident’s web-based blog. Ms. Kielty clarified that the Board and staff does not endorse nor manage the web-based blog.
A resident who has resided at The Elizabeth since 1975 commented that the current Management Team—Messrs. Murdoch and Santos, and Ms. Powell—is a much-welcomed improvement that all residents benefit from. She cited particularly Mr. Santos’s technical expertise, which has resulted in significant improvements in the operation of The Elizabeth’s physical plant. She expressed her delight at the Board’s intent to renew its arrangement with L&N for three years.
With regard to possibly adopting a one-year hiatus on capital projects, she strongly recommended against the Board taking such action, calling it an extremely poor business decision given that conditions have never been more favorable—that is, the cost of materials, labor, and money will never be less expensive than it is now—to address the many long standing issues that have been deferred in the past. She recommended against such a hiatus, urging instead that the Board move forward with whatever is necessary to take care of the property’s repair and replacement needs.
A resident commented on the recent questionnaire, questioning the purpose of the second item, which asked whether owners were residents or non-residents, and noting that several of the questions appeared to be leading—that is, eliciting certain responses. He suggested that the results of the questionnaire be broken down by type of respondent—owner resident and non-resident owner—and that the results are made available to interested owners in digital format and in print form.
Mr. Rich noted, with regard to the upcoming elections, that he has prepared a series of questions to which he would like each of the candidates to respond. These will assist the candidates as they prepare for the Meet the Candidates session and will give the community a good sense of the candidates’ qualifications and positions on issues.
A resident commented on the recent debate as to whether there should be doors on the library shelves. He favored no doors and suggested a more appealing labeling system to address concerns about the appearance of the shelves. A representative from the Library Committee reported on the work underway to improve the appearance and organization of the library, to include a new labeling system.
ADJOURNMENT:
Ms. Kielty adjourned the meeting. [Time of the meeting not listed.]
The initial draft of these minutes was prepared by Yasmin Santiago.
Respectfully Submitted,
Charles Bressler
Secretary, Board of Directors
4601 North Park Avenue
Chevy Chase, MD 20815
Minutes of Board of Directors Meeting APRIL 18, 2011
Board Present:
Alexandria Kielty .........................President
Dr. Alfred Muller .........................Vice President
Monique Fridell ...........................Treasurer
Molly Frantz ...............................Assistant Treasurer
Charles Bressler ...........................Secretary
Judith Barth ................................Director
Seth Levine .................................Director
Others Present:
Scott Murdoch ...............Community Manager, Legum & Norman
James M. Santos ...........ECA General Manager
Call to Order: Ms. Kielty called the meeting to order; a quorum was present. [This statement about a quorum has been raised as problematic to the ECA Board. The call to order is also missing the official start time.]
APPROVAL OF PREVIOUS MEETING MINUTES:
MOTION Dr. Muller moved to approve the minutes of the March 21 Board of Directors meeting, as amended. Seconded by Mr. Bressler and adopted unanimously (7-0-0).
PRESIDENT’S REPORT:
Ms. Kielty, recalling the distribution of the proposed FY2012 budget to owners for review and comment, reminded everyone that the proposed budget will be considered for adoption by the Board at a special meeting scheduled for Wednesday, April 27, at 7:30 p.m. She urged that all owners be present at that meeting. She also extended her thanks to Mr. Jim Rich, who was responsible for developing the recent survey of residents. The response thus far has been good. She asked that those who have already responded urge their neighbors to do so. Finally, Ms. Kielty also reminded everyone present that the 2011 Annual Meeting of the Association is scheduled for Wednesday, May 4, at 7:30 p.m. She encouraged all owners to attend to ensure a quorum in order to conduct necessary business before the Membership.
TREASURER’S REPORT: Ms. Fridell had no report.
OLD BUSINESS:
Proposed FY2012 Budget
Ms. Fridell reviewed the spreadsheets she has prepared on various scenarios relative to the funding of capital repairs and replacements over the next five-year period. Ms. Fridell clarified that the significant difference between the current Reserve funding scenarios and those previously discussed is the inclusion of about $2.5 million in expenditures—to include an estimated $300,000 for new building canopies and $164,000 for water consumption submetering of the building’s commercial units—over and above the projects already scheduled for the next five-year period. It also defers to beyond 2016 about $2.3 million in Reserve expenditures to help offset the cost of replacement unit windows and balcony doors. The challenge has been to generate the funds necessary to ensure that the building is well maintained while keeping condominium assessment increases reasonable. Under the current scenario, the Association will not have the Reserve funds necessary to fund scheduled capital repairs and replacement in some years, even if the Board approves a 10 percent increase in monthly assessments for the coming year.
Ms. Frantz clarified that her revised calculations assume a 5 percent increase in assessments for FY2012, all of which will be allocated to fund Reserves. Thus, based on that updated calculations, the net amount to Reserves is about $200,000 greater than originally estimated. Further adjustments are being made to the figures to account for already-approved or ongoing capital projects, the final costs of which should be available shortly.
Ms. Fridell further suggested that when thinking about the appropriate level of Reserve contribution in the coming years, the Board must consider that the five-year plan calls for about $1.5 million in capital expenditures per year.
Dr. Muller noted that whereas the future will be challenging, for the first time ever, and thanks to Management and the Treasurer, the Board has a Reserve Study and Schedule that includes all of the capital repairs and replacements that will be necessary in the foreseeable future and viable cost estimates for each, serving as an important planning tool. He urged, nonetheless, that no action on the budget be taken tonight but rather that the revised spreadsheet, which allows for certain variables, be distributed to the Board for review and further massaging.
Ms. Kielty added that the state of the Reserve Fund should not come as a surprise to owners as the Board has for some time been discussing capital repairs and replacement needs and has discussed the possibility of proposing to the ownership a special assessment to help pay for these needs. Ms. Fridell noted that whereas there has been some opposition to a special assessment, she believes that to be the most prudent approach to raising the monies needed to fund capital projects, not annual increases in monthly assessments. She calculates that if the Association approves a $1.4 million special assessment—the figure she calculates is necessary to ensure that the Association’s Reserve Fund balance does not dip into negative territory within the next five years—the average cost per unit would be about $4,000. Based on her proportion of shares of a two-bedroom unit, her cost would be $4,430, payable over a two year period. She figures that she would spend about that to replace the four windows and one balcony door in her unit.
Mr. Bressler, who has lived at The Elizabeth since the middle 1970s, noted that inadequate Reserve funding and inflation over the decades, coupled with significant deferred maintenance has led to the Association’s current position—i.e., the need to undertake a number of significant and costly projects for which funds are not readily available. And, whereas these projects need not be undertaken at once, the Association cannot afford to continue to defer projects indefinitely. He suggested that the Association no longer has the options of delaying the inevitable, and urged that the Board consider a 10 percent increase in assessments in FY2012, the entire proceeds to be allocated to the Reserve Fund. He added that replacing unit windows, doors, and HVAC systems will result in significant utility cost savings; these savings should be factored into the calculation of how and when these projects are to be undertaken.
Dr. Muller suggested that replacement of the canopies and submetering of the commercial space, be deferred. He also noted that whereas Ms. Fridell is correct in that a one-time special assessment is ultimately less costly than annual increases in condominium assessments, he is concerned that there are a number of owners whose cash flow would not accommodate a special assessment.
Ms. Kielty reminded the Board that questions of which projects to pursue, which to defer, and how best to fund them will be the focus of the April 27 meeting. At that meeting, the Board can also discuss with owners the suggestion of a one-year hiatus on capital projects.
Ms. Frantz commented with regard to the submetering of the commercial units, that if WSSC requires the submetering of commercial units to ensure that the Association can continue to benefit from lower residential rates, then it would behoove the Association to undertake this project quickly as the added cost of water and sewer at commercial rates will have a significant impact on operating costs. And, while there has been some discussion that WSSC may grandfather in older communities, not requiring commercial space submetering, it would be prudent to keep the funds in the Reserve schedule should submetering be required after all. If submetering is not required, the funds can be reallocated to other projects. Dr. Muller countered that if indeed WSSC requires submetering, the Association can use operating contingency funds—which are intended for such purposes. He would argue against collecting from owners more money than is needed to operate and maintain the property.
Ms. Fridell noted that, setting aside particular projects, the fact is that there has been an upward trend over the past several years in the building’s capital expenditure needs, in large part due to its age. According to an analysis prepared by Ms. Frantz, whereas capital expenses ranged between $400,000 and $600,000 per year in previous years, the last two years saw expenditures in excess of $1 million per year. During the current year, $2 million was estimated, but was later reduced due to Board decisions to defer certain small projects. The Reserve Schedule now before the Board calls for about $1.5 million in capital expenditures per year over the next five-year period.
Projects Update: Mr. Santos reported that as approved by the Board at its last meeting, Management has arranged for the installation of a new server to power the property’s surveillance equipment, and a new engine for the Association’s garage floor sweeper. Moreover, the common area doors have been rekeyed with a new fob-controlled system, and additional fob readers have been installed. These should facilitate authorized access to the property while improve controls against unauthorized access. In response to Mr. Bressler’s inquiry, Mr. Santos clarified that access to the Arcade, garage lobbies and guest garage level will be better controlled and that notices will be sent to residents so that they are aware that access for those common areas will require a fob. Guests wishing to access the property from those areas can use the intercom system, which connects to the front desk.
In response to a query regarding new microphones for use during Board and other meetings, Mr. Santos noted that there had been some problems with the microphones that were purchased initially. These were sent back and new ones should be available at the Board’s next meeting.
In terms of forthcoming projects, Mr. Santos noted that he is scheduling several spring cleaning and painting projects. The staff also will be focusing, over the next fiscal year, on upgrading the emergency alert systems and updating the Association’s emergency and evacuation plans, among others projects.
Fitness Room Upgrades: Mr. Santos reported receipt of an initial quote for replacing and adding several pieces of equipment in the Fitness Room from Heartline Fitness, the maintenance contractor on the existing equipment. Mr. Santos noted that Associa, Legum & Norman’s parent firm, has an arrangement with Heartline Fitness that will result in cost savings to the Association of about 40 percent, thus allowing for additional equipment. A Committee of residents is advising Management on what equipment is most appropriate for the community. Mr. Santos expects to have a final proposal for the Board’s consideration at its next meeting, well within the $17,000 budget for this project.
NEW BUSINESS:
Managing Agent Services Contract: Mr. Murdoch clarified that whereas the renewal language in the Association’s current contract with Legum & Norman (L&N) provides for annual increases of CPI plus 1.5 percent, currently 4.5 percent, L&N is now proposing a three-year renewal, with no increase over current rates in the first year, and a three percent cap on increases in the second and third years. He further clarified that whereas L&N is revising its contract document, the changes are not substantive. It will, most importantly, continue to include the standard clause providing a 60-day termination without cause. The current contract expires on June 30, 2011.
The Board generally agreed that whereas there have been several issues with regard to L&N’s financial management services, the Association has benefited from the relationship with Legum & Norman and that renewal of the contract is appropriate. The Board, nonetheless, agreed that the proposed new contract be reviewed by legal counsel before it is executed. Of special concern is the ability to terminate, at least the financial services aspects of the contract, should there not be the necessary improvements in L&N’s financial management in the months ahead. The Board requested that Mr. Murdoch provide a copy of the proposed new contract to the Association’s legal counsel for review.
MOTION Dr. Muller moved to approve the proposal to renew the managing agent arrangement with Legum & Norman, for a term of three years, with no increase in the first year and a 3 percent cap on increases in the second and third years, subject to legal counsel’s review and advice. Seconded by Ms. Fridell.
Ms. Fridell noted that while she supports renewing the contract based on the site management team, she continues to have serious concerns regarding L&N’s performance of the important financial management functions. As her term on the Board will be expiring, she urged that the new Board and Board Treasurer make it a priority to address these issues definitively in the next fiscal year. Issues include collection of delinquent assessment accounts, on which the L&N accounting/financial management staff has been less than proactive and which, were it not for the active involvement of the site manager, would be a greater problem for the Association; a number of basic bookkeeping and accounting errors, even beyond the miscoding of expenses, which resulted this past year in a significant number of adjustments made in the audited financial statements; and the accuracy and usefulness of the monthly financial reports, which have to date required close review by staff and the Treasurer to ensure that the Board is given a clear picture of the Association’s financial position at all times. This latter point is of special concern to Ms. Fridell as it is imperative that the Board trust the accuracy of the monthly financial statements, particularly if there is no one on the Board with accounting or financial management expertise. To their credit, it is her understanding that L&N is installing new financial management software that should help address some of the issues cited over the past months but it is important that the Board remain vigilant. Thus, Ms. Fridell recommended that the next Treasurer set down a number of critical performance improvement goals for L&N on the financial management front and that if these are not met within a reasonable time, the Board consider engaging another firm to undertake the financial management function or bring that function in-house.
Ms. Frantz added that whereas she concurs that the management team represents an enormous added value to the community, she too has concerns about the financial management aspect. She clarified, however, and Ms. Fridell concurred, that there is no question about fraud or malfeasance, but rather questions of sloppy bookkeeping and an apparent lack of knowledge of basic accounting principles. Of particular concern to Ms. Frantz is L&N’s inability to properly apply assessment payments made on several units with one check. That is but one example of a simple accounting function that has thus far not been handled properly. Ms. Frantz too urged that the incoming Treasurer treat the resolution of these issues as a priority in the coming year. Finally, Ms. Frantz expressed her discomfort approving a contract that she has not had the opportunity to read.
Ms. Kielty noted that whereas she agrees that there are persistent financial management issues, the problems experienced during the last audit were in part due to the Association undertaking the audit too early in the year and during a time of transition, when the management team was new to the community and it was in the middle of a major refurbishment project. She also noted that, as an individual not well-versed in bookkeeping and accounting principles, the financial statements generated by L&N are a vast improvement over what was presented under self-management, most particularly with regarding to the income and expenses analyses that are presented monthly. She also reiterated that despite the various accounting issues cited, there have been no questions of fraud or unnecessary expenses. Ms. Fridell concurred that the monthly analyses presented are indeed useful, but these are the result of significant work on her and Mr. Murdoch’s part.
VOTE ON MOTION The motion to renew the managing agent services control with Legum & Norman for a term of three years, per the terms proposed and pending legal counsel’s review was a adopted by a vote of 6 ayes, 1 abstention by Ms. Frantz, and no nays.
Landscape Contract:
MOTION Ms. Frantz moved that the Board ratify action taken between meetings by e-mail to approve the proposal presented by Ruppert Landscaping to undertake Phase 1 of the master landscape plan, at a cost not to exceed $16,650. Seconded by Mr. Bressler and adopted unanimously (7-0-0).
Mr. Santos clarified that the final expense will be somewhat lower as the contractor will apply the cost of the landscape design to the cost of its implementation. The irrigation system repairs are under separate contract. For the benefit of residents present, Mr. Santos clarified that a master landscape plan was commissioned, to include an inventory of existing plantings and a redesign of the planting areas with more appropriate plant material, greater symmetry, and a refreshed and aesthetic appearance. Phase 1 of the plan addresses the entrance to the building—to include the circular drive, the beds on either side of the entrance, and the planter box on the east side of the building.
Whereas Dr. Muller had no objection to the proposal, he urged against taking action on contracts by e-mail, except in emergency circumstances. Ms. Frantz thanked the members of the Landscape Committee for their work to improve the appearance of the community.
Master Insurance Coverage: Mr. Murdoch recalled that last year, the Board adopted the proposal submitted by John Manougian Insurance, transferring coverage from the Firemen’s Fund to Greater New York Mutual, at an annual premium savings of $53,000. He further recalled that L&N typically solicits competitive quotes for insurance coverage every two years; given the significant savings realized last year with Manougian, competitive quotes were not solicited. Manougian Insurance proposes renewal of the existing coverage, with the addition of coverage for the Association’s above-ground diesel fuel tank (which supplies the new generator) and increased artwork coverage at a total premium cost of $105,106.04, a further reduction over the current year’s premium cost $2,031.96.
MOTION Dr. Muller moved that the Board accept the recommendation of Manougian Insurance to renew the Association’s master insurance coverage—to include general property and liability, Directors’ and Officers’, crime and employee dishonesty, diesel fuel tank liability, and fine art coverages—through Greater New York Mutual at an annual premium cost of $105,106.04. Seconded by Ms. Barth and adopted unanimously (7-0-0).
Ms. Kielty noted, for the record, that Manougian Insurance has acknowledged that the frequency of claims has been reduced dramatically since 2009, which has positively impacted the Association’s ability to obtain necessary coverages at reasonable cost. The Association’s agent also has offered to meet with the Board later in the summer or early fall to review new legislation, that becomes effective on October 1, that makes it easier for Associations to adopt a bylaw amendment requiring unit owners obtain HO-6 coverage—condominium homeowners coverage. Such coverage extends over owners’ personal property, any betterments and improvements in their unit, and personal liability.
COMMITTEE REPORTS:
Landscape: Mr. Rich noted that now that the landscape improvements contract has been approved, the Committee will work with Management and the contractor, as appropriate, to ensure that the improvements occur as quickly as possible.
Chairman’s Contributions: Ms. Kielty reported that with the help of the “Making a Difference Committee” and James Santos, the Committee has identified several charitable organizations who are interested in and willing to pick up donations of items from the community. The National Alliance on Mental Health (NAMH) has agreed to schedule pickups of items that can be resold through the NAMH thrift shop. A Wider Circle, an organization that assists the homeless, also will pick up donations of household items, such as furniture, small working appliances, kitchenware, and linens. Finally, the Committee is making arrangements for the recycling of other items, such as electronics, clothing, books, and magazines. A series of bins will be located on the East and West G-1 garage levels for the collection of such items and notices will be sent to all residents regarding this program.
COMMENTS FROM THE FLOOR:
A resident objected to the removal of certain comments from an Elizabeth resident’s web-based blog. Ms. Kielty clarified that the Board and staff does not endorse nor manage the web-based blog.
A resident who has resided at The Elizabeth since 1975 commented that the current Management Team—Messrs. Murdoch and Santos, and Ms. Powell—is a much-welcomed improvement that all residents benefit from. She cited particularly Mr. Santos’s technical expertise, which has resulted in significant improvements in the operation of The Elizabeth’s physical plant. She expressed her delight at the Board’s intent to renew its arrangement with L&N for three years.
With regard to possibly adopting a one-year hiatus on capital projects, she strongly recommended against the Board taking such action, calling it an extremely poor business decision given that conditions have never been more favorable—that is, the cost of materials, labor, and money will never be less expensive than it is now—to address the many long standing issues that have been deferred in the past. She recommended against such a hiatus, urging instead that the Board move forward with whatever is necessary to take care of the property’s repair and replacement needs.
A resident commented on the recent questionnaire, questioning the purpose of the second item, which asked whether owners were residents or non-residents, and noting that several of the questions appeared to be leading—that is, eliciting certain responses. He suggested that the results of the questionnaire be broken down by type of respondent—owner resident and non-resident owner—and that the results are made available to interested owners in digital format and in print form.
Mr. Rich noted, with regard to the upcoming elections, that he has prepared a series of questions to which he would like each of the candidates to respond. These will assist the candidates as they prepare for the Meet the Candidates session and will give the community a good sense of the candidates’ qualifications and positions on issues.
A resident commented on the recent debate as to whether there should be doors on the library shelves. He favored no doors and suggested a more appealing labeling system to address concerns about the appearance of the shelves. A representative from the Library Committee reported on the work underway to improve the appearance and organization of the library, to include a new labeling system.
ADJOURNMENT:
Ms. Kielty adjourned the meeting. [Time of the meeting not listed.]
The initial draft of these minutes was prepared by Yasmin Santiago.
Respectfully Submitted,
Charles Bressler
Secretary, Board of Directors
Sunday, June 12, 2011
Open Letter to Charles Bressler & Other Comments
Here are a series of comments generated by a letter written by Charles Bressler to members of the Elizabeth Condominium Association regarding the recent ECA Board action that reconfigured the officers. Because Mr. Bressler's letter attacked various sitting Board Members, that letter was not published on this blog. I will add other comments to this post as I receive them, provided the comments adhere to a civil exchange.
#1
FROM Wally Manheimer:
This is intended as an open letter to Charles Bressler and the board and to other residents of The Elizabeth in response to Charles Bressler's letter sent to many of us, dated June 8.
Dear Mr. Bressler:
I read the letter you sent out on June 8 and found it very disturbing. I think that bringing up Mr. Muller's past served no constructive purpose. The residents and owners of the Elizabeth have known about this for years, and in their wisdom have elected Mr. Muller to the board on several occasions. Regarding Ms Barth's service on the board I believe that with all the problems we are facing now, this is neither the time nor place to bring up whether renters should be able to serve on the board; perhaps that is an issue for another time, perhaps not. Ms Barth, who is a renter has been legitimately elected as a board member under the existing rules and she should be treated as any other board member.
Also the issue of the copier seems like a tempest in a teapot and I think it is terrible that this disrupted board business.
As regards Legum and Norman, I take you at your word when you said you endorsed renewal of their contract. However I also remember that when the issue arose a few years ago, you were strongly opposed to contracting with them, and believed we could continue to self manage. Self management may be fine for a new condo, but for a 40 year old building which needs significant repairs, I strongly believe expert, external management is a necessity.
As far as repairs go, you and I have spoken and I made my point to you that I think we should bite the bullet and do all the major repairs as quickly as possible. Every house or condo needs recapitalization after several decades. Since I believe it is unlikely that we will get 75% of the residents to agree to an assessment, I believe a bank loan is a good possible option, and I think that your investigating this has been a reasonable course of action. The interest rates will probably never be lower than they are now.
Most of all, I think it is irresponsible for any board member to resign. I think this action will damage our property values at The Elizabeth. I believe this would make banks reluctant to write mortgages on our property. If Seth Levine is now really moving out, and is neither an owner nor a renter, this is the only resignation the board should accept if it is offered. I think the board, and especially you and Mr. Muller should find a way to work together for the benefit of all of us. That is what you were elected to do.
Yours very truly
Wally Manheimer
Aps 1109 and 1110
#2
From Helen Secrest:
I'm fairly new here( two years) so have no axe to grind. Thank you for your thoughtful letter, with which I agree. One comment; Seth has moved out, but plans on retaining his condo. I believe Monique stayed on the Board in the same circumstances, so unless there is a written rule prohibiting this, the subject seems to be moot.
#3
From Wally Manheimer:
Thanks. I was not initially clear on whether Seth was still an owner or not. He is, so the matter is moot as you say.
Wally
#4
From Molly Frantz:
Mr. Manheimer -- Thank you for taking the time to express your views on Charles' letter.
I appreciate and understand your position on a Board member resigning. This is not a position I take lightly, but I believe it is the right action for me to take.
What took place on the 1st was very very disturbing. Without any attempt to resolve differences of opinion and/or concerns about Charles Presser's Presidency, four members of the Board undertook steps to replace him. I personally found the reasons quite questionable and believe they have not stood up to scrutiny. I believe replacing a Board Officer should only be undertaken after careful consideration by all the Board members and only for serious misconduct. To exclude any Board Member from the discussions to remove an officer says volumes either about the individual excluded, the individual(s) doing the excluding, or both.
What has taken place is like a marriage gone bad -- once trust is broken the relationship is never the same and the parties have to decide if the new paradigm is worth the effort and do the parties have good intentions going forward. The bottom line is that it has been made abundantly clear to me that I could occupy a seat on the Board but I would not occupy a role on the Board. I believe Seth, Al, Judi and Ilo-Mai hold the key to achieving what you want from a Board for the Elizabeth Condominium.
If you would like to discuss this further please call me.
Molly Frantz
#5
From Jim Jones:
Dear owners and members of The Elizabeth Condominium Association:
The letter of June 8 recently circulated by Charles Bressler, President of our Board of Directors until recently, is rightly causing some concern. I share that concern. However, unlike that of some others, my concern focuses on what the letter says, not on the fact that it publicly says them. I find the content of the letter—its relation of events—accurate. It is devoid of character assassination, in a milieu where motives to assassinate exist. If facts assassinate, then so be it. The truth often hurts.
As those who have read the letter now know, it provides a stark window on serious tensions within the new Board that took office on May 4, 2011, the day of our annual meeting. On the evening of that day, the new Board sat for the first time to elect its officers. Yet less than one month later, that Board delivered a “coup” resulting in a re-designation of officers.
The letter gives some idea of how this reversal came about, and why two newly elected members and one continuing member have indicated that they will officially tender their resignations from the Board on June 20th, the date of the next monthly meeting.
The chain of events engendered by this reversal, while legal in only the most primitive way, makes a mockery of any pretense to democracy and self-representation in our community. The reversal is not only highly irregular, but tilts toward the unethical, if not the sleazy. It should trouble all of us who own units in The Elizabeth.
I think that those who voted by secret ballot to remove Mr. Bressler should have the integrity to tell the community, one by one in an open Board session, their reasons for doing so. They should do so at the forthcoming Board meeting on June 20. They owe this to those who elected them, for they have lost credibility with many of us.
I see two possibilities for addressing this unfortunate state of affairs. First, as the letter points out, the ideal would on the one hand be for the re-designated Board to restore the slate of officers who were selected on May 4th. On the other hand, given what has happened, this may not be workable, with the “gang of four” who engineered the coup able to veto any measure for any reason, including reasons that have nothing to do with decisions in the best interest of our community.
Second, since it is unlikely that such a restoration will happen, or would be viable if it did, all Board members should have the decency to resign, and thereby open the door to new elections.
I would like to make two final points before closing. Bressler’s letter makes mention of changes in the By-Laws. Those were drafted more than 35 years ago, with some sections poorly written and ambiguous. Revising this outdated document should be part of modernizing The Elizabeth. I strongly agree with Bressler, for example, that only owners should be allowed to serve on the Board. Non-owners simply lack the fiscal incentive to act in the best interests of owners.
I have heard a lot of recent verbiage about property values. I have not heard a balancing concern about the quality of life for those of us to whom The Elizabeth is a home. It is not a stock or a mutual fund to be traded on financial markets, but rather a comfortable place where we can pass our days on this earth. And it should be a safe and secure place for us all, and a place where we can confidently raise our children, or receive visits from our grandchildren. And I might add that comfort and quality of life have a lot more to do with sound infrastructure—heating and cooling, for example—than with lavish and excessively costly refurbishment.
Let’s be candid. The results of the last Board election were not as some owners expected or wanted. The results have left lingering tensions and a residue of ill feeling. I suspect that this residue relates to the chain of events that Bressler describes. At this point, I need to be convinced otherwise.
Sincerely—Jim Jones, Unit #307
#6
From Sharon Bobb:
I agree with Mr. Manheimer’s response to Mr. Bressler as modified by Ms. Secrest’s email below. I see no reason for Mr. Levine to consider leaving the Board. As I understand it, he is keeping his condo here and is looking for a larger one to accommodate his new “family.” His move across the street is only temporary so he can be with his new “family” until he can purchase a larger condo in our building. Bringing this issue up is ridiculous! I fully agree with Mr. Manheimer on all other points.
Mr. Bressler explained to me that the Board took only one action during Executive Session on June 1 – to replace him as President of the Board. He further explained that he chose to resign from the Board; that this was not an action the Board took. Furthermore, Mr. Bressler also made clear that the Board took no action against Ms. Frantz or Dr. Cockburn – they chose to resign in sympathy with Mr. Bressler. So, to repeat, the Board took one action and one action only – to replace Mr. Bressler.
If the Board chooses its officers, it can surely choose new ones if it feels it is necessary to do so. According to the By Laws, the Board can do that with or without cause. Apparently, it did so without cause. Therefore, the Board had to elect a replacement. It elected Mr. Levine to replace Mr. Bressler, and Dr. Muller to replace Mr. Levine as VP. And, since the By Laws allow the positions of Secretary and Treasurer to be filled by the same person, it elected Ms. Harding to be Secretary and Treasurer. The Board then issued a new list of officers. The Board did not engage in name-calling. It did not spread vicious allegations about anyone.
As I told Mr. Bressler, I am against his circulating a petition. It is divisive and destructive. Mr. Bressler may be hurt – even angry – that he is no longer President. However, I find it impossible to justify the mean-spirited, vicious, vindictive letter that Mr. Bressler is circulating. Name-calling that amounts to character assassination, attempting to remove sitting Board members, fomenting discontent, attempting to divide our residents and asking them to choose sides – what on earth is going on here? All of this because he no longer carries the title of President? This is a disgrace!
None of us knows what really went on in Executive Session on June 1. Those meetings are confidential. We only have one side of the story. Whatever went on was between the Board and Mr. Bressler, and I, for one, resent being dragged into it by hateful notes slipped under my door or by divisive petitions being circulated. I especially resent efforts by anyone to use the events on June 1 as cause to damage our quality of life in the Elizabeth and what little sense of community we still have.
Mr. Bressler, as I see it, had only two responsible choices on June 1: to stay on the Board as a Director and continue to work on our behalf, or to walk away quietly. He chose to resign, followed by Ms. Frantz and Dr. Cockburn. If this is their choice, they, too, should walk away quietly. Most of us choose to live in peace and harmony, and to work to upgrade our home, enhance our property values, and improve our quality of life!
The Board should now choose three more people to add to their team – a team that will work together amicably, with demonstrated respect for each other, for Legum & Norman and for the residents.
Sharon Bobb
#1
FROM Wally Manheimer:
This is intended as an open letter to Charles Bressler and the board and to other residents of The Elizabeth in response to Charles Bressler's letter sent to many of us, dated June 8.
Dear Mr. Bressler:
I read the letter you sent out on June 8 and found it very disturbing. I think that bringing up Mr. Muller's past served no constructive purpose. The residents and owners of the Elizabeth have known about this for years, and in their wisdom have elected Mr. Muller to the board on several occasions. Regarding Ms Barth's service on the board I believe that with all the problems we are facing now, this is neither the time nor place to bring up whether renters should be able to serve on the board; perhaps that is an issue for another time, perhaps not. Ms Barth, who is a renter has been legitimately elected as a board member under the existing rules and she should be treated as any other board member.
Also the issue of the copier seems like a tempest in a teapot and I think it is terrible that this disrupted board business.
As regards Legum and Norman, I take you at your word when you said you endorsed renewal of their contract. However I also remember that when the issue arose a few years ago, you were strongly opposed to contracting with them, and believed we could continue to self manage. Self management may be fine for a new condo, but for a 40 year old building which needs significant repairs, I strongly believe expert, external management is a necessity.
As far as repairs go, you and I have spoken and I made my point to you that I think we should bite the bullet and do all the major repairs as quickly as possible. Every house or condo needs recapitalization after several decades. Since I believe it is unlikely that we will get 75% of the residents to agree to an assessment, I believe a bank loan is a good possible option, and I think that your investigating this has been a reasonable course of action. The interest rates will probably never be lower than they are now.
Most of all, I think it is irresponsible for any board member to resign. I think this action will damage our property values at The Elizabeth. I believe this would make banks reluctant to write mortgages on our property. If Seth Levine is now really moving out, and is neither an owner nor a renter, this is the only resignation the board should accept if it is offered. I think the board, and especially you and Mr. Muller should find a way to work together for the benefit of all of us. That is what you were elected to do.
Yours very truly
Wally Manheimer
Aps 1109 and 1110
#2
From Helen Secrest:
I'm fairly new here( two years) so have no axe to grind. Thank you for your thoughtful letter, with which I agree. One comment; Seth has moved out, but plans on retaining his condo. I believe Monique stayed on the Board in the same circumstances, so unless there is a written rule prohibiting this, the subject seems to be moot.
#3
From Wally Manheimer:
Thanks. I was not initially clear on whether Seth was still an owner or not. He is, so the matter is moot as you say.
Wally
#4
From Molly Frantz:
Mr. Manheimer -- Thank you for taking the time to express your views on Charles' letter.
I appreciate and understand your position on a Board member resigning. This is not a position I take lightly, but I believe it is the right action for me to take.
What took place on the 1st was very very disturbing. Without any attempt to resolve differences of opinion and/or concerns about Charles Presser's Presidency, four members of the Board undertook steps to replace him. I personally found the reasons quite questionable and believe they have not stood up to scrutiny. I believe replacing a Board Officer should only be undertaken after careful consideration by all the Board members and only for serious misconduct. To exclude any Board Member from the discussions to remove an officer says volumes either about the individual excluded, the individual(s) doing the excluding, or both.
What has taken place is like a marriage gone bad -- once trust is broken the relationship is never the same and the parties have to decide if the new paradigm is worth the effort and do the parties have good intentions going forward. The bottom line is that it has been made abundantly clear to me that I could occupy a seat on the Board but I would not occupy a role on the Board. I believe Seth, Al, Judi and Ilo-Mai hold the key to achieving what you want from a Board for the Elizabeth Condominium.
If you would like to discuss this further please call me.
Molly Frantz
#5
From Jim Jones:
Dear owners and members of The Elizabeth Condominium Association:
The letter of June 8 recently circulated by Charles Bressler, President of our Board of Directors until recently, is rightly causing some concern. I share that concern. However, unlike that of some others, my concern focuses on what the letter says, not on the fact that it publicly says them. I find the content of the letter—its relation of events—accurate. It is devoid of character assassination, in a milieu where motives to assassinate exist. If facts assassinate, then so be it. The truth often hurts.
As those who have read the letter now know, it provides a stark window on serious tensions within the new Board that took office on May 4, 2011, the day of our annual meeting. On the evening of that day, the new Board sat for the first time to elect its officers. Yet less than one month later, that Board delivered a “coup” resulting in a re-designation of officers.
The letter gives some idea of how this reversal came about, and why two newly elected members and one continuing member have indicated that they will officially tender their resignations from the Board on June 20th, the date of the next monthly meeting.
The chain of events engendered by this reversal, while legal in only the most primitive way, makes a mockery of any pretense to democracy and self-representation in our community. The reversal is not only highly irregular, but tilts toward the unethical, if not the sleazy. It should trouble all of us who own units in The Elizabeth.
I think that those who voted by secret ballot to remove Mr. Bressler should have the integrity to tell the community, one by one in an open Board session, their reasons for doing so. They should do so at the forthcoming Board meeting on June 20. They owe this to those who elected them, for they have lost credibility with many of us.
I see two possibilities for addressing this unfortunate state of affairs. First, as the letter points out, the ideal would on the one hand be for the re-designated Board to restore the slate of officers who were selected on May 4th. On the other hand, given what has happened, this may not be workable, with the “gang of four” who engineered the coup able to veto any measure for any reason, including reasons that have nothing to do with decisions in the best interest of our community.
Second, since it is unlikely that such a restoration will happen, or would be viable if it did, all Board members should have the decency to resign, and thereby open the door to new elections.
I would like to make two final points before closing. Bressler’s letter makes mention of changes in the By-Laws. Those were drafted more than 35 years ago, with some sections poorly written and ambiguous. Revising this outdated document should be part of modernizing The Elizabeth. I strongly agree with Bressler, for example, that only owners should be allowed to serve on the Board. Non-owners simply lack the fiscal incentive to act in the best interests of owners.
I have heard a lot of recent verbiage about property values. I have not heard a balancing concern about the quality of life for those of us to whom The Elizabeth is a home. It is not a stock or a mutual fund to be traded on financial markets, but rather a comfortable place where we can pass our days on this earth. And it should be a safe and secure place for us all, and a place where we can confidently raise our children, or receive visits from our grandchildren. And I might add that comfort and quality of life have a lot more to do with sound infrastructure—heating and cooling, for example—than with lavish and excessively costly refurbishment.
Let’s be candid. The results of the last Board election were not as some owners expected or wanted. The results have left lingering tensions and a residue of ill feeling. I suspect that this residue relates to the chain of events that Bressler describes. At this point, I need to be convinced otherwise.
Sincerely—Jim Jones, Unit #307
#6
From Sharon Bobb:
I agree with Mr. Manheimer’s response to Mr. Bressler as modified by Ms. Secrest’s email below. I see no reason for Mr. Levine to consider leaving the Board. As I understand it, he is keeping his condo here and is looking for a larger one to accommodate his new “family.” His move across the street is only temporary so he can be with his new “family” until he can purchase a larger condo in our building. Bringing this issue up is ridiculous! I fully agree with Mr. Manheimer on all other points.
Mr. Bressler explained to me that the Board took only one action during Executive Session on June 1 – to replace him as President of the Board. He further explained that he chose to resign from the Board; that this was not an action the Board took. Furthermore, Mr. Bressler also made clear that the Board took no action against Ms. Frantz or Dr. Cockburn – they chose to resign in sympathy with Mr. Bressler. So, to repeat, the Board took one action and one action only – to replace Mr. Bressler.
If the Board chooses its officers, it can surely choose new ones if it feels it is necessary to do so. According to the By Laws, the Board can do that with or without cause. Apparently, it did so without cause. Therefore, the Board had to elect a replacement. It elected Mr. Levine to replace Mr. Bressler, and Dr. Muller to replace Mr. Levine as VP. And, since the By Laws allow the positions of Secretary and Treasurer to be filled by the same person, it elected Ms. Harding to be Secretary and Treasurer. The Board then issued a new list of officers. The Board did not engage in name-calling. It did not spread vicious allegations about anyone.
As I told Mr. Bressler, I am against his circulating a petition. It is divisive and destructive. Mr. Bressler may be hurt – even angry – that he is no longer President. However, I find it impossible to justify the mean-spirited, vicious, vindictive letter that Mr. Bressler is circulating. Name-calling that amounts to character assassination, attempting to remove sitting Board members, fomenting discontent, attempting to divide our residents and asking them to choose sides – what on earth is going on here? All of this because he no longer carries the title of President? This is a disgrace!
None of us knows what really went on in Executive Session on June 1. Those meetings are confidential. We only have one side of the story. Whatever went on was between the Board and Mr. Bressler, and I, for one, resent being dragged into it by hateful notes slipped under my door or by divisive petitions being circulated. I especially resent efforts by anyone to use the events on June 1 as cause to damage our quality of life in the Elizabeth and what little sense of community we still have.
Mr. Bressler, as I see it, had only two responsible choices on June 1: to stay on the Board as a Director and continue to work on our behalf, or to walk away quietly. He chose to resign, followed by Ms. Frantz and Dr. Cockburn. If this is their choice, they, too, should walk away quietly. Most of us choose to live in peace and harmony, and to work to upgrade our home, enhance our property values, and improve our quality of life!
The Board should now choose three more people to add to their team – a team that will work together amicably, with demonstrated respect for each other, for Legum & Norman and for the residents.
Sharon Bobb
Sunday, June 5, 2011
The ElIZABETH Library
The Library Committe would like to welcome you to visit the Elizabeth Library. We have a fine collection of biographies,romances,mysteries,children's videos,nonfiction and novels all donated by our residents.
We welcome donations of books and magazines with the following caveats.
*Magazines should be of current issue and general interest. If you wish us to place a plain white label over your name and address,please advise us so.
*Books should be in good condition and of general interest. Please do not donate paperback books which are over ten years old.
Our space is limited so we must consider only those books which fit our criteria. Any books in good condition which we can not use are recycled to Montgomery County Thrift Store. Any profit from the store is given to county charities. If we can not use your books and you would rather recycle them yourself,please advise us so and we will oblige your request.
If you have any questions about the collection or donations,contact any member of the committee. They are Peg Downey, Peg Lower,Stephanie Olshan,Linda Robinson and Diana Brosnan. Again thank you for your past generosity.
Diana Brosnan
We welcome donations of books and magazines with the following caveats.
*Magazines should be of current issue and general interest. If you wish us to place a plain white label over your name and address,please advise us so.
*Books should be in good condition and of general interest. Please do not donate paperback books which are over ten years old.
Our space is limited so we must consider only those books which fit our criteria. Any books in good condition which we can not use are recycled to Montgomery County Thrift Store. Any profit from the store is given to county charities. If we can not use your books and you would rather recycle them yourself,please advise us so and we will oblige your request.
If you have any questions about the collection or donations,contact any member of the committee. They are Peg Downey, Peg Lower,Stephanie Olshan,Linda Robinson and Diana Brosnan. Again thank you for your past generosity.
Diana Brosnan
Tuesday, May 17, 2011
Summary of ECA Meeting May 16, 2011
Present at the meeting: Charles Bressler, Judi Barth, Molly Frantz, Ilo-Mai Harding, Seth Levine, Alfred Muller, Scott Murdoch, Jim Santos, Recording Secretary.
Absent: Dr. Jimmy Cockburn
President’s Report:
--Lowest turn out for the 2011 Annual Meeting. Need more proactive measures next year like starting earlier to encourage people to come to the meeting or submit their proxies.
--Reaffirmed 10 percent increase in condo fee starting in July.
--Upcoming projects or actions for the new board: work on house rules, focus on front desk service, refurbishment of hallways, replacement of windows/balcony doors.
--Caveat to owners before they start any apartment renovation to clear contractors with our House Manager.
--Activation of a roundtable discussion to promote better Association relations, some of the people to be included in this roundtable includes: Jeffrey Axelrad, Sharon Bobb, Woody Cunningham, Jim Jones, Alexandra Kielty, Steven Schattman.
--Activation of committees such as one for security (Dr. Muller will chair) and another for architectural issues (Maurice Trebach will chair).
--Suggestion box installed in mail corridor.
Treasurer’s Report:
--Operating Fund currently running a small surplus
--Reserve Fund at $1.7 million
--Delinquencies involve only one Association member.
--Working Session coming up for a 5 year Reserve Fund Plan is scheduled for Wednesday, June 1 at 6:30 pm
House Manager’s Report:
--Inattentive lifeguard replaced.
--Proposes purchase of blazers for all 6 front desk concierge staff.
Comments from the Floor taken before Old & New Business discussed
--New owner Barbara Pollack volunteered to be on newsletter committee.
--Discussion about issuing an official summary of actions & motions after each meeting, possibly posted in the elevators. Ms. Harding said she would to do this. Scott Murdoch said this would cause confusion. It was not clear if this suggestion would be enacted.
Old Business
--Fitness Equipment budget: original budget was $17,000 but additional equipment and cost increases (despite 40% discount negotiated by Legum & Norman) require an additional $4,000.
Motion to approve the budget for fitness center equipment passed after discussion about delaying the decision until the Board had the full list of equipment to be purchased in front of them. The Fitness Committee presented the list orally and Dr. Muller argued for not delaying this long overdue replacement/enhancement project.
--Contractor Approval Process: Because of insurance issues, Ms. Barth urged the Board to move forward with guidelines our General Manager proposed last summer. She made a motion and it was seconded but the Board was split 3 to 3. There was some discussion about allowing the Association time to review these guidelines since the guidelines will constrain owners. However, it should be noted that most buildings have rules about bonded/insured contractors and we have been remiss in not enacting such rules.
New Business
Arcade: Letter came from commercial owners complaining about neglect by the Board in replacing common area carpeting, glass fronts (wants more energy efficient) and lighting and making repairs to walls. General Manager will look into these matters.
Next meeting June 20, 2011.
Absent: Dr. Jimmy Cockburn
President’s Report:
--Lowest turn out for the 2011 Annual Meeting. Need more proactive measures next year like starting earlier to encourage people to come to the meeting or submit their proxies.
--Reaffirmed 10 percent increase in condo fee starting in July.
--Upcoming projects or actions for the new board: work on house rules, focus on front desk service, refurbishment of hallways, replacement of windows/balcony doors.
--Caveat to owners before they start any apartment renovation to clear contractors with our House Manager.
--Activation of a roundtable discussion to promote better Association relations, some of the people to be included in this roundtable includes: Jeffrey Axelrad, Sharon Bobb, Woody Cunningham, Jim Jones, Alexandra Kielty, Steven Schattman.
--Activation of committees such as one for security (Dr. Muller will chair) and another for architectural issues (Maurice Trebach will chair).
--Suggestion box installed in mail corridor.
Treasurer’s Report:
--Operating Fund currently running a small surplus
--Reserve Fund at $1.7 million
--Delinquencies involve only one Association member.
--Working Session coming up for a 5 year Reserve Fund Plan is scheduled for Wednesday, June 1 at 6:30 pm
House Manager’s Report:
--Inattentive lifeguard replaced.
--Proposes purchase of blazers for all 6 front desk concierge staff.
Comments from the Floor taken before Old & New Business discussed
--New owner Barbara Pollack volunteered to be on newsletter committee.
--Discussion about issuing an official summary of actions & motions after each meeting, possibly posted in the elevators. Ms. Harding said she would to do this. Scott Murdoch said this would cause confusion. It was not clear if this suggestion would be enacted.
Old Business
--Fitness Equipment budget: original budget was $17,000 but additional equipment and cost increases (despite 40% discount negotiated by Legum & Norman) require an additional $4,000.
Motion to approve the budget for fitness center equipment passed after discussion about delaying the decision until the Board had the full list of equipment to be purchased in front of them. The Fitness Committee presented the list orally and Dr. Muller argued for not delaying this long overdue replacement/enhancement project.
--Contractor Approval Process: Because of insurance issues, Ms. Barth urged the Board to move forward with guidelines our General Manager proposed last summer. She made a motion and it was seconded but the Board was split 3 to 3. There was some discussion about allowing the Association time to review these guidelines since the guidelines will constrain owners. However, it should be noted that most buildings have rules about bonded/insured contractors and we have been remiss in not enacting such rules.
New Business
Arcade: Letter came from commercial owners complaining about neglect by the Board in replacing common area carpeting, glass fronts (wants more energy efficient) and lighting and making repairs to walls. General Manager will look into these matters.
Next meeting June 20, 2011.
Thursday, May 5, 2011
SUMMARY ECA ANNUAL MEETING MAY 4, 2011
PRESENT at the meeting: Alexandra Kielty, Judi Barth, Charles Bressler, Molly Frantz, Monique Fridell, Al Muller, Jason Fisher, Scott Murdoch, Jim Santos, and recorder of meeting minutes.
PROOF OF NOTICE OF MEETING was read to all members by the secretary, following establishment of a quorum with 51% of members present in person or by proxy.
READING OF MINUTES OF THE LAST ANNUAL MEETING, May 5, 2010, was waived.
PRESIDENT’S REPORT: The following accomplishments by ECA were listed as having been accomplished:
1. Refurbishment of the lobby level by the Hartman Design was completed for $1million.369,547, under the $1.5 million budgeted. This includes improvements to infrastructure, lobby, party room, bathrooms, residential hallway, with replacement of windows and doors by HBW Engineering.
2. Installation of a new emergency generator costing $520,000 was completed despite numerous challenges.
3. An engineering assessment was done by Mendoza Associates with further evaluation needed. This long-term project will continue into 2012, with further evaluation of needs for heat, AC, and McQuay units. The McQuay unit improvements are limited by the individual ownership of the units.
4. A key fob system has been implemented, and new security and video cameras purchased to allow better security for residents and visitors.
5. A new landscape contract with Ruppert Landscaping has been signed, for long-term design, with phase one to be initiated this Spring. There will be an irrigation system implemented.
6. Improvements to the fitness center are planned to begin soon.
7. PERSONNEL: Mr. James Santos joined us June 2, 2010, from Legum & Norman as General Manager; Ms. Wanda Powell began November 1, 2010, as his assistant.
8. Long-term employees (35 years or over) were recognized and praised; Cynthia Edwards, Hollis Alleyne, and Jimmy Keating.
9. Financial state: a fiscal year reduction of 3% of the overall budget after a two year prior reduction.
10. On 4/27, the Board of Directors voted 5-2 for a 10% increase in condo fees for the coming year, noting that the ECA has never had a special assessment, and the Board did not think one could be done
11. Professional management by Legum & Norman was praised.
TREASURER’S REPORT:” Financially sound but more fragile”
Delinquencies below the limit set by the FHA. Over 50% of units owner occupied, rentals at 22%, No single owner of ECA holdings exceeds 10%. The Eiizabeth thus has an FHA seal of approval.
FINANCIAL CHALLENGES:
1. Management of the 5-year plan, with eye to increased spending from the reserves. Spending jumps to $1.5 million each year given the big projects.
2. Need to execute energy saving projects to reduce utility costs.
3. Continued oversight of Legum & Norman financial management.
4. Improve residents’ services, house rules.
5. Improve Board communications
6. Consider revising by-laws
RECOGNITION:
Outgoing Board members recognized, and received appropriate gifs.
COMMENTS FROM THE FLOOR:
Pam Dillon: Budget is null & void because it was not sent out 30 days in advance. Legal Counsel Jason Fisher refuted Ms. Dillon’s claim.
Maurice Trebach: Wanted to be on the record that windows & balcony doors need to be replaced and this was noted in the $25,000 engineering study performed by Mendoza-Ribas.
ELECTION
The following were elected to the Board: Charles Bressler, Dr. Jimmy Cockburn, Ilo-Mai Harding.
The new officers are:
President: Charles Bressler
Vice-President: Seth Levine
Treasurer: Molly Frantz
Secretary: Ilo-Mai Harding
Director: Judi Barth
Director: Dr. Jimmy Cockburn
Director: Dr. Al Muller
PROOF OF NOTICE OF MEETING was read to all members by the secretary, following establishment of a quorum with 51% of members present in person or by proxy.
READING OF MINUTES OF THE LAST ANNUAL MEETING, May 5, 2010, was waived.
PRESIDENT’S REPORT: The following accomplishments by ECA were listed as having been accomplished:
1. Refurbishment of the lobby level by the Hartman Design was completed for $1million.369,547, under the $1.5 million budgeted. This includes improvements to infrastructure, lobby, party room, bathrooms, residential hallway, with replacement of windows and doors by HBW Engineering.
2. Installation of a new emergency generator costing $520,000 was completed despite numerous challenges.
3. An engineering assessment was done by Mendoza Associates with further evaluation needed. This long-term project will continue into 2012, with further evaluation of needs for heat, AC, and McQuay units. The McQuay unit improvements are limited by the individual ownership of the units.
4. A key fob system has been implemented, and new security and video cameras purchased to allow better security for residents and visitors.
5. A new landscape contract with Ruppert Landscaping has been signed, for long-term design, with phase one to be initiated this Spring. There will be an irrigation system implemented.
6. Improvements to the fitness center are planned to begin soon.
7. PERSONNEL: Mr. James Santos joined us June 2, 2010, from Legum & Norman as General Manager; Ms. Wanda Powell began November 1, 2010, as his assistant.
8. Long-term employees (35 years or over) were recognized and praised; Cynthia Edwards, Hollis Alleyne, and Jimmy Keating.
9. Financial state: a fiscal year reduction of 3% of the overall budget after a two year prior reduction.
10. On 4/27, the Board of Directors voted 5-2 for a 10% increase in condo fees for the coming year, noting that the ECA has never had a special assessment, and the Board did not think one could be done
11. Professional management by Legum & Norman was praised.
TREASURER’S REPORT:” Financially sound but more fragile”
Delinquencies below the limit set by the FHA. Over 50% of units owner occupied, rentals at 22%, No single owner of ECA holdings exceeds 10%. The Eiizabeth thus has an FHA seal of approval.
FINANCIAL CHALLENGES:
1. Management of the 5-year plan, with eye to increased spending from the reserves. Spending jumps to $1.5 million each year given the big projects.
2. Need to execute energy saving projects to reduce utility costs.
3. Continued oversight of Legum & Norman financial management.
4. Improve residents’ services, house rules.
5. Improve Board communications
6. Consider revising by-laws
RECOGNITION:
Outgoing Board members recognized, and received appropriate gifs.
COMMENTS FROM THE FLOOR:
Pam Dillon: Budget is null & void because it was not sent out 30 days in advance. Legal Counsel Jason Fisher refuted Ms. Dillon’s claim.
Maurice Trebach: Wanted to be on the record that windows & balcony doors need to be replaced and this was noted in the $25,000 engineering study performed by Mendoza-Ribas.
ELECTION
The following were elected to the Board: Charles Bressler, Dr. Jimmy Cockburn, Ilo-Mai Harding.
The new officers are:
President: Charles Bressler
Vice-President: Seth Levine
Treasurer: Molly Frantz
Secretary: Ilo-Mai Harding
Director: Judi Barth
Director: Dr. Jimmy Cockburn
Director: Dr. Al Muller
2010 Annual Meeting Minutes
THE ELIZABETH CONDOMINIUM ASSOCIATION
4601 North Park Avenue
Chevy Chase, MD 20815
Minutes of Annual Meeting May 5, 2010
Board Present:
Woody Cunningham ....................President
Alexandria Kielty .........................Vice President
Monique Fridell ...........................Treasurer
Judith Barth ................................Secretary
Jeffrey Axelrad.............................Assistant Treasurer
Charles Bressler ...........................Director
Dr. Alfred Muller .........................Director
Others Present:
Scott Murdoch ...............Community Manager, Legum & Norman
Michael Horan ..............Property Manager
Jason Fisher .................Counsel
Patti Dubuque ...............Executive Vice President, Legum & Norman
Jana Bowcut .................Recording Secretary, On the Record
Call to Order: Mr. Cunningham called the meeting to order at 7:39 p.m. He stated that the main purpose of the meeting is to elect four new members to the Board. Prior to this meeting, the Board held a special meeting on the 2011 budget and voted for a five percent increase in condominium fees, most of which would be used to build the reserve fund. The budget was approved by the Board.
Proof of Notice of Meeting to all members: Mr. Axelrad read the Proof of Notice of Meeting, dated April 21, 2010, which was sent to all residents.
Approval of prior Annual Meeting Minutes:
MOTION Mr. Bressler moved, Ms. Barth seconded, to accept the minutes of the May 6, 2009, Annual Meeting minutes. The motion passed unanimously by acclamation.
Presentation of Certificate to Retiring Board Member:
Dr. Muller made the following comments in honor of outgoing Board President, Mr. Cunningham:
Your Board has asked me to say a few words, on their behalf, about a very special person who is retiring after many years of service to The Elizabeth.
As you all know, every Board faces a number of challenges and works very hard to solve them. For the last few years the Board has had some unique challenges, all at the same time: questions about management, refurbishment, and reserve funds, to name just a few.
In addition to these challenging issues, every Board President also faces the challenge of finding consensus among seven hard-working volunteers, who often have differing strong opinions, sincerely held and sometimes expressed in strong terms. It was once said that getting the Board to reach a decision is a little like “herding a group of cats.”
In the last few years our President, Dr. Woody Cunningham, has faced this daunting task with patience and dedication. By a combination of professional hard work, self-effacing modesty and good humor, he has prodded, pleaded and persuaded this “herd of cats” to make decisions during a difficult, but inevitable, time of transition at The Elizabeth.
By way of recognition, we would like, therefore, to present him with a small token of our appreciation, our respect, and our affection for all that he has done, and, hopefully, will continue to do in the future when we seek his wise counsel. Our Vice President, Alexandra Kielty presented the outgoing President with a Tiffany sterling silver magnifying glass.
President’s Report:
Mr. Cunningham’s report was distributed to all residents at the meeting and is attached to this report (Attachment #1). He stated that major issues confronting the Association will be: installation of the emergency generator, initiation of the construction/refurbishment, and some smaller projects such as the installation of backflow prevention valves for the water system.
Treasurer’s Report:
Ms. Fridell’s report is attached to this report (Attachment #2).
Committee Reports:
Refurbishment Committee: Ms. Barth reported on the renovation project, in that the budget was met and everything on the first floor will be renovated, except for the fitness room. HBW was selected as the general contractor and work will begin on June 2, 2010. The contractors are committed to meeting the deadline, and anticipate four to five months for completion. The renovation committee and advisory committee have arranged for a live auction on May 16, 2010, from 2-4 p.m. A preview of the items to be auctioned will be held on Saturday, May 15, 2010, from 3-5 p.m.
Social committee: Ms. Barth reported that the committee held a number of successful events over the past year: a community brunch, Halloween party, Christmas party and wine and cheese reception. The committee hopes to add additional events, such as a barbecue this summer.
Mr. Cunningham provided a brief overview about the activities of several other committees. The election committee made the recommendation, which was approved by the Board, to use the electronic balloting process. The engineering committee identified three possible consulting engineer groups, which the Board interviewed and then selected Mr. Mendoza’s Company. An ad hoc pet policy committee recommended new pet policies, some of which were approved by the Board. A physical fitness committee evaluated the types of exercise equipment needed and made an evaluation about the use of space in the fitness room.
Comments from the Floor:
A co-chair of the floor representatives committee thanked all of the floor representatives for their work over the past year. The next meeting will be held on Thursday, May 13, 2010, at 7:15 p.m. in the party room. Dr. Muller added that the Board had previously discussed giving a reception of thanks to this committee and hopes that the new board will carry this out.
A resident inquired about when the broken exercise equipment in the fitness room will be repaired. Ms. Kielty stated that she learned about these problems only recently and will obtain more information before the next board meeting regarding the status. She added that the exercise committee will present recommendations to owners for replacing some of the equipment within the next month.
Concerns were expressed about how long it took to establish quorum at the meeting. A resident attributed the delay to confusion among residents about how to hand-in proxies. Also, signs about the meeting were not posted in elevators the week before, Mr. Murdoch apologized for the delay and stated that it was due to each proxy being hand-reviewed by the three judges.
Nomination of Election Inspectors:
Mr. Cunningham proposed the following residents as election inspectors: Ray Quarterman, Jerry Feldman and Jim Vuko.
(R) A motion was made, and seconded, to accept the proposed election inspectors. The motion passed by acclamation.
Explanation of Ballot:
Mr. Murdoch explained that there were six candidates for four vacancies. Each term is for two years. He instructed residents to check the name of the person they would like to serve, voting for no more than four candidates. The new board member candidates were: Judi Barth, Alfred Muller, Seth Levine, Molly Frantz, James Jones and Hongbin Liu.
Adjournment:
The President adjourned the meeting at 9:45 p.m.
The initial draft of the minutes, upon which these minutes are based, was prepared by Jana Bowcut of On the Record.
Respectfully submitted,
Charles Bressler
Charles Bressler, Board Secretary
DATE APPROVED: ______________________________________________________
ATTESTED BY: _________________________________________________________
(Name) (Title)
(R) Resolution/Motion (A) Action
Attachment #1:
PRESIDENT’S REPORT
ELIZABETH CONDOMINIUM ASSOCIATION ANNUAL MEETING MAY 5, 2010
This report provides a summary and highlights of the many activities taken by the Board on your behalf between May 3, 2009 and today. More detailed information is available in the minutes of the numerous meetings held by the Board. Since July 1, 2009, the Board has had 11 regular open meetings and several open workshops.
TRANSITION TO PROFESSIONAL MANAGEMENT
We are beginning to see positive results from our move to professional management by Legum and Norman. Operating costs are down significantly below our approved budget for fiscal year 2010 by more than $70,000 and we expect less than a 2% increase in operating costs tor fiscal year 2011. As discussed below, we do expect major expenditures from the reserve fund for large projects during the next five years. Here again, though, we have seen significant benefits from L&N participation. They have a disciplined approach that requires multiple bids, a detailed analysis of the responses and a recommendation to the Board for vendor selection.
The transition from self-management to professional management has not been as smooth or speedy as we would have liked and we expect to see additional changes in the next year. The Board approved a contract renewal with L&N for fiscal year 2011 on April 19, 2010. Contract terms remain the same which includes an increase in the management fee by “an amount not to exceed the increase in the CPI (U) for the Washington Metropolitan area for the preceding twelve (12) month period plus one and one half percent (1.5%).”
MAJOR PROJECTS
This fiscal year, we have been involved in three major projects requiring significant expenditures from our reserve fund. We have completed most of the design work for the refurbishment and we expect actual construction in the lobby to begin in June. We have contracted with the HBW Company to do the Lobby and first floor construction work for $641,000, which includes work required on the Party room and the rest rooms. It also includes Lobby door replacements even though that cost will be allocated to a new fob or Keyless entry system. Bids are being received for that system and the new Board will select that contractor. We expect the cost of the First floor and Lobby renovations, including the costs of furnishings to remain well within our budget of $1.2 million. The emergency generator has been delivered, a contractor has been selected for installation, and the design has been submitted for county approval. We expect the installation to be completed this fiscal year. We initiated and completed a project to replace all horizontal piping in the lobby area including the necessity for an asbestos abatement to remove insulation and sealant. Total expenditures in FY2010 from the reserve fund are expected to be on the order of $1.1 million.
SMALLER PROJECTS
We have continued an excellent maintenance and engineering effort by our own staff and in addition we have completed a number of projects to enhance safety, security, and structural integrity. The lighting in the garage and other common areas has been replaced with lower wattage, higher efficiency lights that not only make those areas brighter, but also will reduce our electricity use significantly. Façade work on the East tower has been completed. The security camera system has been updated. Bids are being evaluated for water system backflow preventers.
FINANCIAL MANAGEMENT
The treasurer will report on the Elizabeth finances, but I do want to say that our financial health is good and the Board has worked hard to keep it that way for the future. As mentioned in my budget letter, the Elizabeth operating budget is well under control and we expect to maintain expenditures very close to the same in the next Fiscal Year. Our reserve funds are essentially managed by our treasurer, Monique Fridell, who is to be commended for her excellent efforts on our behalf. The Board has set a policy that calls for a minimum balance of $1 million in the reserve and the ability to borrow a million dollars in the event of a major catastrophe. The Board has just approved a new budget with almost all of the increase going to assure an adequate reserve fund without asking for any special assessments.
COMMITTEES
Various committees have been active this year and have provided valuable advice and recommendations to the Board. To highlight some of the results, the Board has made changes in the pet policies, adopted the electronic balloting process we are using tonight, made major energy conservation efforts, selected an engineering firm for assessments, developed a plan for improving the fitness facilities, expanded our social activities, and improved our security.
ENGINEERING ASSESSMENTS
We are currently conducting an engineering assessment that is evaluating our mechanical systems (boilers, chillers, pumps, fans, etc. including our heating, ventilation and air conditioning systems). The study also is evaluating structural integrity of the building including windows. The results are expected to include recommendations for saving energy and replacing aging equipment with new high efficiency equipment. As an example, the study has already shown that our old exhaust systems are continually causing large energy losses that can be corrected with new equipment. The study will be completed in a few weeks and will be used to update our current five-year plan.
UTILITIES
Utility costs remain high and represent almost one third of our operating budget. However, the weather, our conservation efforts, and lower gas prices will permit us to stay under the budget for this year.
PERSONNEL
Our continuing and loyal personnel have worked extremely well during the transition to L&N management. They also took the initiative during the winter storms to assure our safety and security by volunteering to work long hours. We have moved for the first time to a merit-based performance evaluation system and salary increases are in effect as of May 1, 2010. We have some necessary changes in the front desk operation and expect to see more improvements there.
BUILDING INSURANCE
With the help of our insurance agent, John Manougian, and the L&N Community Manager, we have been able to negotiate a new contract for building insurance that will reduce our costs by at least $35,000.
George W. Cunningham
President
Attachment #2:
TREASURER’S REPORT
Our financial condition as we finish FY 2010 is generally sound, although not without challenges. Sound means basically that ECA does not have most of the issues that are negatively affecting the condo association universe at this time.
• Delinquencies < 2%, far below the 15% limit for lenders, although our delinquencies have doubled this FY in absolute $ amounts • No history of assessments • Adequate operating budget and on track to come in below budget for the year • No debt • No foreclosures • Rentals = 82/353 or 23% of total units, maximum of 30% rentals • No single entity over 10% ownership, highest ECA = 0.9% • Commercial use < 20%, ECA = 3.5% The financial factors I cited above are the basic underwriting metrics that mortgage lenders look to and which is the bottom-line factor in the market value of our properties – i.e., if buyers cannot finance their purchases of ECA condos, there is effectively no market for our condos, and our property value suffers. FY 2010 Year to Date (YTD) Results
Over the past year, we have shifted most of our cash portfolio to Morgan Stanley Investment A/C from individual bank CDs, as directed by the Board. As of 4/30 (unaudited/unreported by L&N yet) we had approximately $ 2.3 MM in cash and investments. We have $500K in operating fund cash, which we have been accumulating over the last two years as part of our strategy to build approximately three months of operating expenses in operating savings. Our reserves currently stand at approximately $2.1 million in reserves. This FY we will have transferred approximately $700K to reserves, and expect to spend approximately $1.0 MM, principally on the refurbishment project, the lobby horizontal piping and payments on the emergency generator.
We had a significant increase in condo fees last year, based on the recommendation of the Reserve Study and the Board distributed a budget which reflected another material increase this year. I would like to stress that we are proposing to hold operating expenses flat and that whatever increase we agree upon tonight will be entirely dedicated to boosting our reserves. We have all received your comments, letters and your wrath, and many of you have shared your views on what increase you believe is “enough.” Frankly I think it is very difficult even for the Board to judge what number is “enough” without extensive financial analysis, a long-range Reserve Study and supporting engineering analysis (which we are currently commissioning) to project what our future reserve expenditures may be.
This is probably the most difficult decision that a condo Board has to make, and I would like to explain to everyone why there are financial risks no matter what number we decide upon. The condo fee increase is linked to the amount we save in our reserves every year. The only way to increase the reserve contribution without increasing condo fees is to cut operating expenses, which is something many condos have been forced to do, but which this Board to date has not been willing to undertake. If we keep the fees low, the short term marketability of our homes is boosted by competitive condo fees vis-à-vis our peers. However, this could lead to not putting enough in reserves, which might leave us of short of money to take proper care of the building, and ultimately our market values will fall. If we have sustained high fee increases as we had last year, we could make our homes uncompetitive due to high condo fees and we risk increasing delinquencies, as ours did in this last year. On the other hand, we would have more money to put into our reserves and into preserving the value of our homes and building. This is a very simplified explanation, but I hope it will help everyone understand that the decisions of the condo fee increase and the corresponding amount to contribute to reserves are a matter of individual judgment and risk tolerance, and there are no “right” answers.
I see the following issues as challenges for FY 2010 for the next Board:
• Execute the lobby phase of refurbishment project on time and within budget and begin hallway phase of the project.
• Execute energy savings projects, based on the recommendations of the Energy Conservation Committee and the consulting firm that we have hired and in accordance with the decision-making process that the Board has publicly described, in order to control utility costs which are 1/3 of our operating budget.
• Continue to manage the transition to L&N management, improve resident services, consistency in front desk professionalism and customer service, accuracy of financial reporting, management organization and discipline, house rules enforcement.
• Treat Reserve expenditures as a scarce and precious resource to be used extremely judiciously. The low interest rate environment is not allowing us to invest at decent interest rates. Our weighted average interest rate is below 2.5-3% long-term inflation rate. As long as we are investing below inflation, our reserves are losing value in real economic terms.
• Increase owner participation in governance and Board projects through committees.
• Improve Board/owner communication both in terms of explaining our decision-making and processes more clearly as well as providing more up to date communication tools such as a web site.
Monique Fridell
Treasurer
4601 North Park Avenue
Chevy Chase, MD 20815
Minutes of Annual Meeting May 5, 2010
Board Present:
Woody Cunningham ....................President
Alexandria Kielty .........................Vice President
Monique Fridell ...........................Treasurer
Judith Barth ................................Secretary
Jeffrey Axelrad.............................Assistant Treasurer
Charles Bressler ...........................Director
Dr. Alfred Muller .........................Director
Others Present:
Scott Murdoch ...............Community Manager, Legum & Norman
Michael Horan ..............Property Manager
Jason Fisher .................Counsel
Patti Dubuque ...............Executive Vice President, Legum & Norman
Jana Bowcut .................Recording Secretary, On the Record
Call to Order: Mr. Cunningham called the meeting to order at 7:39 p.m. He stated that the main purpose of the meeting is to elect four new members to the Board. Prior to this meeting, the Board held a special meeting on the 2011 budget and voted for a five percent increase in condominium fees, most of which would be used to build the reserve fund. The budget was approved by the Board.
Proof of Notice of Meeting to all members: Mr. Axelrad read the Proof of Notice of Meeting, dated April 21, 2010, which was sent to all residents.
Approval of prior Annual Meeting Minutes:
MOTION Mr. Bressler moved, Ms. Barth seconded, to accept the minutes of the May 6, 2009, Annual Meeting minutes. The motion passed unanimously by acclamation.
Presentation of Certificate to Retiring Board Member:
Dr. Muller made the following comments in honor of outgoing Board President, Mr. Cunningham:
Your Board has asked me to say a few words, on their behalf, about a very special person who is retiring after many years of service to The Elizabeth.
As you all know, every Board faces a number of challenges and works very hard to solve them. For the last few years the Board has had some unique challenges, all at the same time: questions about management, refurbishment, and reserve funds, to name just a few.
In addition to these challenging issues, every Board President also faces the challenge of finding consensus among seven hard-working volunteers, who often have differing strong opinions, sincerely held and sometimes expressed in strong terms. It was once said that getting the Board to reach a decision is a little like “herding a group of cats.”
In the last few years our President, Dr. Woody Cunningham, has faced this daunting task with patience and dedication. By a combination of professional hard work, self-effacing modesty and good humor, he has prodded, pleaded and persuaded this “herd of cats” to make decisions during a difficult, but inevitable, time of transition at The Elizabeth.
By way of recognition, we would like, therefore, to present him with a small token of our appreciation, our respect, and our affection for all that he has done, and, hopefully, will continue to do in the future when we seek his wise counsel. Our Vice President, Alexandra Kielty presented the outgoing President with a Tiffany sterling silver magnifying glass.
President’s Report:
Mr. Cunningham’s report was distributed to all residents at the meeting and is attached to this report (Attachment #1). He stated that major issues confronting the Association will be: installation of the emergency generator, initiation of the construction/refurbishment, and some smaller projects such as the installation of backflow prevention valves for the water system.
Treasurer’s Report:
Ms. Fridell’s report is attached to this report (Attachment #2).
Committee Reports:
Refurbishment Committee: Ms. Barth reported on the renovation project, in that the budget was met and everything on the first floor will be renovated, except for the fitness room. HBW was selected as the general contractor and work will begin on June 2, 2010. The contractors are committed to meeting the deadline, and anticipate four to five months for completion. The renovation committee and advisory committee have arranged for a live auction on May 16, 2010, from 2-4 p.m. A preview of the items to be auctioned will be held on Saturday, May 15, 2010, from 3-5 p.m.
Social committee: Ms. Barth reported that the committee held a number of successful events over the past year: a community brunch, Halloween party, Christmas party and wine and cheese reception. The committee hopes to add additional events, such as a barbecue this summer.
Mr. Cunningham provided a brief overview about the activities of several other committees. The election committee made the recommendation, which was approved by the Board, to use the electronic balloting process. The engineering committee identified three possible consulting engineer groups, which the Board interviewed and then selected Mr. Mendoza’s Company. An ad hoc pet policy committee recommended new pet policies, some of which were approved by the Board. A physical fitness committee evaluated the types of exercise equipment needed and made an evaluation about the use of space in the fitness room.
Comments from the Floor:
A co-chair of the floor representatives committee thanked all of the floor representatives for their work over the past year. The next meeting will be held on Thursday, May 13, 2010, at 7:15 p.m. in the party room. Dr. Muller added that the Board had previously discussed giving a reception of thanks to this committee and hopes that the new board will carry this out.
A resident inquired about when the broken exercise equipment in the fitness room will be repaired. Ms. Kielty stated that she learned about these problems only recently and will obtain more information before the next board meeting regarding the status. She added that the exercise committee will present recommendations to owners for replacing some of the equipment within the next month.
Concerns were expressed about how long it took to establish quorum at the meeting. A resident attributed the delay to confusion among residents about how to hand-in proxies. Also, signs about the meeting were not posted in elevators the week before, Mr. Murdoch apologized for the delay and stated that it was due to each proxy being hand-reviewed by the three judges.
Nomination of Election Inspectors:
Mr. Cunningham proposed the following residents as election inspectors: Ray Quarterman, Jerry Feldman and Jim Vuko.
(R) A motion was made, and seconded, to accept the proposed election inspectors. The motion passed by acclamation.
Explanation of Ballot:
Mr. Murdoch explained that there were six candidates for four vacancies. Each term is for two years. He instructed residents to check the name of the person they would like to serve, voting for no more than four candidates. The new board member candidates were: Judi Barth, Alfred Muller, Seth Levine, Molly Frantz, James Jones and Hongbin Liu.
Adjournment:
The President adjourned the meeting at 9:45 p.m.
The initial draft of the minutes, upon which these minutes are based, was prepared by Jana Bowcut of On the Record.
Respectfully submitted,
Charles Bressler
Charles Bressler, Board Secretary
DATE APPROVED: ______________________________________________________
ATTESTED BY: _________________________________________________________
(Name) (Title)
(R) Resolution/Motion (A) Action
Attachment #1:
PRESIDENT’S REPORT
ELIZABETH CONDOMINIUM ASSOCIATION ANNUAL MEETING MAY 5, 2010
This report provides a summary and highlights of the many activities taken by the Board on your behalf between May 3, 2009 and today. More detailed information is available in the minutes of the numerous meetings held by the Board. Since July 1, 2009, the Board has had 11 regular open meetings and several open workshops.
TRANSITION TO PROFESSIONAL MANAGEMENT
We are beginning to see positive results from our move to professional management by Legum and Norman. Operating costs are down significantly below our approved budget for fiscal year 2010 by more than $70,000 and we expect less than a 2% increase in operating costs tor fiscal year 2011. As discussed below, we do expect major expenditures from the reserve fund for large projects during the next five years. Here again, though, we have seen significant benefits from L&N participation. They have a disciplined approach that requires multiple bids, a detailed analysis of the responses and a recommendation to the Board for vendor selection.
The transition from self-management to professional management has not been as smooth or speedy as we would have liked and we expect to see additional changes in the next year. The Board approved a contract renewal with L&N for fiscal year 2011 on April 19, 2010. Contract terms remain the same which includes an increase in the management fee by “an amount not to exceed the increase in the CPI (U) for the Washington Metropolitan area for the preceding twelve (12) month period plus one and one half percent (1.5%).”
MAJOR PROJECTS
This fiscal year, we have been involved in three major projects requiring significant expenditures from our reserve fund. We have completed most of the design work for the refurbishment and we expect actual construction in the lobby to begin in June. We have contracted with the HBW Company to do the Lobby and first floor construction work for $641,000, which includes work required on the Party room and the rest rooms. It also includes Lobby door replacements even though that cost will be allocated to a new fob or Keyless entry system. Bids are being received for that system and the new Board will select that contractor. We expect the cost of the First floor and Lobby renovations, including the costs of furnishings to remain well within our budget of $1.2 million. The emergency generator has been delivered, a contractor has been selected for installation, and the design has been submitted for county approval. We expect the installation to be completed this fiscal year. We initiated and completed a project to replace all horizontal piping in the lobby area including the necessity for an asbestos abatement to remove insulation and sealant. Total expenditures in FY2010 from the reserve fund are expected to be on the order of $1.1 million.
SMALLER PROJECTS
We have continued an excellent maintenance and engineering effort by our own staff and in addition we have completed a number of projects to enhance safety, security, and structural integrity. The lighting in the garage and other common areas has been replaced with lower wattage, higher efficiency lights that not only make those areas brighter, but also will reduce our electricity use significantly. Façade work on the East tower has been completed. The security camera system has been updated. Bids are being evaluated for water system backflow preventers.
FINANCIAL MANAGEMENT
The treasurer will report on the Elizabeth finances, but I do want to say that our financial health is good and the Board has worked hard to keep it that way for the future. As mentioned in my budget letter, the Elizabeth operating budget is well under control and we expect to maintain expenditures very close to the same in the next Fiscal Year. Our reserve funds are essentially managed by our treasurer, Monique Fridell, who is to be commended for her excellent efforts on our behalf. The Board has set a policy that calls for a minimum balance of $1 million in the reserve and the ability to borrow a million dollars in the event of a major catastrophe. The Board has just approved a new budget with almost all of the increase going to assure an adequate reserve fund without asking for any special assessments.
COMMITTEES
Various committees have been active this year and have provided valuable advice and recommendations to the Board. To highlight some of the results, the Board has made changes in the pet policies, adopted the electronic balloting process we are using tonight, made major energy conservation efforts, selected an engineering firm for assessments, developed a plan for improving the fitness facilities, expanded our social activities, and improved our security.
ENGINEERING ASSESSMENTS
We are currently conducting an engineering assessment that is evaluating our mechanical systems (boilers, chillers, pumps, fans, etc. including our heating, ventilation and air conditioning systems). The study also is evaluating structural integrity of the building including windows. The results are expected to include recommendations for saving energy and replacing aging equipment with new high efficiency equipment. As an example, the study has already shown that our old exhaust systems are continually causing large energy losses that can be corrected with new equipment. The study will be completed in a few weeks and will be used to update our current five-year plan.
UTILITIES
Utility costs remain high and represent almost one third of our operating budget. However, the weather, our conservation efforts, and lower gas prices will permit us to stay under the budget for this year.
PERSONNEL
Our continuing and loyal personnel have worked extremely well during the transition to L&N management. They also took the initiative during the winter storms to assure our safety and security by volunteering to work long hours. We have moved for the first time to a merit-based performance evaluation system and salary increases are in effect as of May 1, 2010. We have some necessary changes in the front desk operation and expect to see more improvements there.
BUILDING INSURANCE
With the help of our insurance agent, John Manougian, and the L&N Community Manager, we have been able to negotiate a new contract for building insurance that will reduce our costs by at least $35,000.
George W. Cunningham
President
Attachment #2:
TREASURER’S REPORT
Our financial condition as we finish FY 2010 is generally sound, although not without challenges. Sound means basically that ECA does not have most of the issues that are negatively affecting the condo association universe at this time.
• Delinquencies < 2%, far below the 15% limit for lenders, although our delinquencies have doubled this FY in absolute $ amounts • No history of assessments • Adequate operating budget and on track to come in below budget for the year • No debt • No foreclosures • Rentals = 82/353 or 23% of total units, maximum of 30% rentals • No single entity over 10% ownership, highest ECA = 0.9% • Commercial use < 20%, ECA = 3.5% The financial factors I cited above are the basic underwriting metrics that mortgage lenders look to and which is the bottom-line factor in the market value of our properties – i.e., if buyers cannot finance their purchases of ECA condos, there is effectively no market for our condos, and our property value suffers. FY 2010 Year to Date (YTD) Results
Over the past year, we have shifted most of our cash portfolio to Morgan Stanley Investment A/C from individual bank CDs, as directed by the Board. As of 4/30 (unaudited/unreported by L&N yet) we had approximately $ 2.3 MM in cash and investments. We have $500K in operating fund cash, which we have been accumulating over the last two years as part of our strategy to build approximately three months of operating expenses in operating savings. Our reserves currently stand at approximately $2.1 million in reserves. This FY we will have transferred approximately $700K to reserves, and expect to spend approximately $1.0 MM, principally on the refurbishment project, the lobby horizontal piping and payments on the emergency generator.
We had a significant increase in condo fees last year, based on the recommendation of the Reserve Study and the Board distributed a budget which reflected another material increase this year. I would like to stress that we are proposing to hold operating expenses flat and that whatever increase we agree upon tonight will be entirely dedicated to boosting our reserves. We have all received your comments, letters and your wrath, and many of you have shared your views on what increase you believe is “enough.” Frankly I think it is very difficult even for the Board to judge what number is “enough” without extensive financial analysis, a long-range Reserve Study and supporting engineering analysis (which we are currently commissioning) to project what our future reserve expenditures may be.
This is probably the most difficult decision that a condo Board has to make, and I would like to explain to everyone why there are financial risks no matter what number we decide upon. The condo fee increase is linked to the amount we save in our reserves every year. The only way to increase the reserve contribution without increasing condo fees is to cut operating expenses, which is something many condos have been forced to do, but which this Board to date has not been willing to undertake. If we keep the fees low, the short term marketability of our homes is boosted by competitive condo fees vis-à-vis our peers. However, this could lead to not putting enough in reserves, which might leave us of short of money to take proper care of the building, and ultimately our market values will fall. If we have sustained high fee increases as we had last year, we could make our homes uncompetitive due to high condo fees and we risk increasing delinquencies, as ours did in this last year. On the other hand, we would have more money to put into our reserves and into preserving the value of our homes and building. This is a very simplified explanation, but I hope it will help everyone understand that the decisions of the condo fee increase and the corresponding amount to contribute to reserves are a matter of individual judgment and risk tolerance, and there are no “right” answers.
I see the following issues as challenges for FY 2010 for the next Board:
• Execute the lobby phase of refurbishment project on time and within budget and begin hallway phase of the project.
• Execute energy savings projects, based on the recommendations of the Energy Conservation Committee and the consulting firm that we have hired and in accordance with the decision-making process that the Board has publicly described, in order to control utility costs which are 1/3 of our operating budget.
• Continue to manage the transition to L&N management, improve resident services, consistency in front desk professionalism and customer service, accuracy of financial reporting, management organization and discipline, house rules enforcement.
• Treat Reserve expenditures as a scarce and precious resource to be used extremely judiciously. The low interest rate environment is not allowing us to invest at decent interest rates. Our weighted average interest rate is below 2.5-3% long-term inflation rate. As long as we are investing below inflation, our reserves are losing value in real economic terms.
• Increase owner participation in governance and Board projects through committees.
• Improve Board/owner communication both in terms of explaining our decision-making and processes more clearly as well as providing more up to date communication tools such as a web site.
Monique Fridell
Treasurer