Thursday, February 25, 2016

Summary of the ECA Board Meeting February 23, 2016

Board Present: Sharon Bobb, Patricia Batey, Clifford Cohen, Peg Downey, Jim Jones, John McNerney, Steven Schattman

Others Present: Gates Hudson Interim General Manager David Ostrander, Gates Hudson  Vice President of Operations  Larry Hirschman, ECA Legal Counsel Jeremy Tucker, Walter Mendoza (Mendoza Ribas Farinas & Associates), Robin Manougian (Insurance)

President’s Report (clink link for all details of President’s report) Here are highlights of the Report:  
President (1) explained that the Board had decided that on-site residency should be a condition of employment to protect the Elizabeth property and residents because of catastrophic emergencies that have happened, especially the flooding in past months.  It is a pro-active step to protect the residents and the Association;
(2) announced selection of Goldklang Group, the transition audit firm;
(3) reviewed procedures for having work done in units;
(4) introduced Reciprocal Aid proposal with 4620 and the Carlton so the three condominiums agreed to shelter temporarily residents during fires and other emergency evacuations—more comfortable than being sheltered in buses;
(5) commented that it was “particularly troubling” for the ECA to try to achieve savings through a line of credit while, at the same time, spending down the reserves and asked Board and Finance Committee to focus on building a sufficient reserve fund. The President asked Larry Hirschman to prepare a financial plan and draft budget sufficient to fund all of our requirements and to include replacement reserves so as to place the Elizabeth on a sounder financial footing.

Legal Report:  Jeremy Tucker reported that there is progress on collections.  He reminded the community that the Board meetings are for conducting Association business and discussion needs to be among the Board members.  Residents' comments will now be heard after the Legal, Financial, Treasurer’s, and Management Reports so residents will have all the information needed on which to comment.  Counsel stated that the auditor has informed him that L&N needs to comply with furnishing documentation for the audit and also that the auditor has caught some things that the previous audits did not see.

Financial & Transition Report:  Larry Hirschman stated that the January financials have still not yet been received from L&N but expect them shortly.  The Gates Hudson plan is to provide the monthly financials to the Budget Committee a week ahead of their budget meeting to provide ample time for review.

Management Report:  Dave Ostrander stated he will review candidates to fill the two Concierge vacancies to avoid more overtime from regular Concierge employees on weekends.  He did not comment on the items in the Management Report that was made available to attendees. Copies of this report and Hirschman's Financial Report are available at the Concierge Desk.

Treasurer’s Report:  John McNerney stated that the Line of Credit acts in place of a reserve fund and has saved us in interest payments.  He noted that the financial statements from L & N are expected by Feb. 29.  And that the budget process would begin soon.

Resident Comments:  Molly Frantz noted that contrary to what was in BuildingLink, there was no Conversations with the Board last month.  She also inquired about acid smells that some residents have noticed.  Al Muller suggested that during the budget preparation process, if an item is added, perhaps another item can be reduced or delayed.  Two residents brought up flooding in their apartments and wanted to know to whom to address these issues: the answer is go to the Onsite General Manager.  

Budget & Finance Committee:  Pat Peyser noted that past audits were always late and that the former management company did not provide ample information.  She is pleased that the financial information to be provided by Gates Hudson will be matched across reports.  Her committee asked Gates Hudson to develop a five-year financial and management plan to avoid further deterioration in our building.

Design Committee:  Alex Kielty reported that there will likely be a town hall meeting on March 14 to see the finalized hallway design to be recommended to the Board by the Committee and Hartman Design.

Fitness Committee: Steven Schattman reported on a request to install wi-fi in the gym.

Cliff Cohen apologized for any misunderstanding about Conversations with the Board and said they had been suspended for a couple months but would be resumed on the second Monday evening of each month at 7:00 p.m.

Peg Downey reported that the Village Council Mayor has resigned and one of the potential builders to develop parcel 6 across the street is no longer interested.  Al Muller added that one builder with 40% holdings is trying to obtain another 20% so that a development plan can go forward.

Walter Mendoza reported that there are several ongoing projects in the building—the chilled water for the free cooling system, which would allow us to have air conditioning on warm days even in winter, is 80% complete. He is getting a permit from the county for the new phase 2 fire alarm system, but the contractor has already started work. The new design for proper ventilation of the corridors is 80% complete.

Mendoza also spoke about the domestic water pipes and pinhole leaks.  He passed around samples of copper pipes with ceramic coating that are on the market:  ePipe and Curaflow.  Mendoza used ePipe in his offices.  Curaflow takes longer to dry.  EPipe is less expensive and also faster to dry and is ready for use sooner.  These systems have been used in Europe for many years.  He suggested that this epoxy is a possible answer to our domestic hot water pipe problem of pinhole leaks and is not sure we have to do anything with the domestic cold water pipes at this time.  He also stated that this epoxy will fix everything and not have problems in the future, whereas if we fix pipes in one part of the system only, problems will appear in another part of the building.

He also noted that the pipe which failed in December on the 18th floor in the East Tower was for the building heating system and that piping is quite damaged.  The bad news is that asbestos is present in insulation and needs to be removed before work can be done on any pipes.  He will obtain proposals for asbestos abatement, then carry out visual observation of pipes, mostly in corridors—hoping he won’t have to enter any individual unit.

Molly Frantz asked him about the link between the corridor ventilation and the impact on individual fan coil units.  He responded that there is a very close relationship between the corridor ventilation and apartment humidity: if there is not proper ventilation in the corridor, it is impossible to maintain a 50% relative humidity in the apartments.  

Robin Manougian reported on the insurance claim of $320,00 from the December flooding and said that our current company, Greater NY Insurance Company, is paying out more claims than it is receiving in revenue.  She stated that Walter Mendoza’s items are our priorities now, that the infrastructure of the building is beginning to fail.  We need to have higher deductibles and probably increased premiums.  But we need to fix the infrastructure problems to get the deductible down and she is looking for carriers that will want to insure us.  She suggested that Mendoza outline a plan of repair and give his proposal to the Board and to her--so that she can present this proposal to insurance carriers for renewal of our policy in May.  


A resident asked Mendoza what has to be done before the corridor renovation and Mendoza responded: everything.

There were 4 motions put before the Board and all were approved:
—$15,000 to Mendoza Ribas Farinas & Assoc. to provide design & construction adminstration services for 2 new corriodr ventilation, dehumidification, heat and air conditioning units.
—Approved Otis Elevator Co to complete MD DLLR Punch List items by repairing one elevator per day during the mid-day hours of 10 a.m. and 2 p.m. at no additional cost to the ECA.
—$28,134 to Otis Elevator Co to install 70 escutcheon tubes on 4 passenger elevators as mandated by the MD DLLR.
—Approved agreement among Friendship Heights Village high-rise residences to provide mutual aid in emergencies.

Wednesday, February 24, 2016

Gates Hudson Financial & Transition Report—February 23, 2016


 The following report was prepared by Larry Hirschman, Gates Hudson Vice President of Operations for the ECA Board Meeting held February 23, 2016.

The Elizabeth Condominium

Financial & Transition Report
February 23, 2016



1.    The January 2016 monthly financials have not yet been received from prior management, we have been told they will be available by the end of this month.  Upon receipt they will be reviewed by me and the Gates Hudson CFO Carty Massey and a report will be generated for the association.

2.    Upon receipt of the January financials, I will prepare a draft budget for review by the Budget & Finance Committee. This draft budget will include monthly funding to the replacement reserves, increased property insurance expense, loan payment expenses and a review of cost savings opportunities. Additionally, we will also prepare a replacement reserve budget for anticipated and future capital improvement projects.

3.    Gates Hudson will be preparing a financial plan for review by the Board of Directors.  Again, this plan will be focused on building replacement reserves, funding options for future capital expenditures and an overall plan for building financial health for the association.

4.    Upon meeting with the Budget & Finance Committee, Gates Hudson will have the monthly financials available one week prior to the regularly scheduled monthly committee meeting.  This will enable the committee ample time to review the financials in advance of the meeting.  We will also provide sample financial statement formats for review by the committee in an easier to read format.

5.    The audit report for FYE 2015 has not been completed.  The audit firm is awaiting information from prior management.  I have reached out to the audit firm and asked that they forward me the outstanding items in an effort to assist in obtain this information.  I will keep you updated on the progress.

6.    Gates Hudson Services will be conducting an extensive property walkthrough/inspection within the next 30 days.  This will include an assessment of all mechanical systems and recommendations for the future.

7.    Owner account balances have been received from prior management and balance confirmation letters have been sent to owners.  Should you have a credit balance on your account and would like to request a refund please bring you letter to the onsite office and your request will be processed.  These instructions are also contained in the letter you received.

In an effort to save the association mailing expenses, I will hand deliver the refund checks to the office and they will contact you upon arrival so that you may pick up your check.  The onsite office will mail refunds directly to offsite owners.

8.    I have received emails and telephone calls from owners who expressed concern that they mailed payments to the lockbox in January and they had not been cashed.  The lockbox was not active until February 1st as this is the commencement date of the management agreement and therefore checks received at the lockbox were held and created a delay in depositing the funds. Future payments will be deposited as received; this is all part of the start up process.

9.    Overdue insurance claim reimbursement requests have been processed and hand delivered to those owners.



10. Email addresses for General Manager (ecagm@elizabethcondo.com) and  Assistant General Manager (ecaagm@elizabethcondo.com have been established.