Clogged Condensate Lines & Leaks

I don’t know about you but every time I leave my apartment when the air-condition is on and the humidity is high, I worry about the HVACs above me and their condensate lines. Will I come home to water damage?

It’s time to ask management about the schedule for clearing the condensate lines and when our filters will be changed and on what schedule?

Yes,  I know that apartments above me have already experienced water leaks from condensate lines being clogged. Until the condensate lines are cleared, there may be many more leaks to come

ACTION Requested: 2019 FHV Election

The Friendship Heights Village Council Election is Monday, May 13, 2019.

Carolina Zumarán-Jones, our Elizabethan neighbor, is running for re-election and deserves our support.

Background:

—Seven seats are open with eight candidates running.

—In theory, each Council member represents one of the eight buildings making up Friendship Heights.

—The goal of this election is to get a cooperative set of Council members who will work well together, given the discord that happened in the recent past.

—The election of the entire Council Board only happens every two years.

Why You Should Vote:

—Friendship Heights Village is a special tax district with a significant budget that comes from your tax dollars. This budget supports such services as the free shoppers shuttle bus, all sorts of programs at the FHV Center (i.e. blood pressure screening; live music programs; free film screenings; book club, classes—Tai Chi, language learning, arts, etc.), security (parking regulation and Montgomery County Police presence because of our support of a Police Field Office on North Park Avenue), maintenance of three neighborhood parks for our enjoyment; snow removal; compliance for ADA requirements (family friendly streets); venue for all National and State elections.

—Preservation of our green spaces (parks) is a critical concern and one that FHV Council takes seriously if we elect the best people.

—Addressing the needs of a changing demographics: we have more young people and more elderly people. We want Council members who will address both populations.

Recommended candidates to vote for:

Kathy Cooper, Paula Durbin, John Mertens,  Michael Mezey, Bruce Pirnie, Melanie Rose White, and Carolina Zumarán-Jones.

Why one candidate needs to be retired:

At the last Council meeting, the sitting Board voted  (4-3) to censure Michael Dorsey for uncivil behavior, making the Council meetings unproductive.

Do you civic duty and vote. Polls at the Village Center are open 7 am to 8 pm.

Election Results

The Tribe has spoken:


Jimmy Whalen
Zlatan Beca
Elisa Siegel
Jimmy Whalen – 37.54%
Z Beca – 36.10%
Elisa Siegel – 32.74%
Al Muller – 22.98%
Molly Frantz – 18.94%
Babs Eisman – 3.8%

New Officers:
President – Lyle Schwartz
Vice President – Z Beca
Treasurer – Chris Wemple
Secretary – Mak Dehejia



The smoking ban passed.
Qualifications for board membership tabled.

Summary of ECA Board Meeting April 23, 2019

Board Present: Zlatan Beca, Makarand (Mak) Dehejia, Monique Fridell, Al Muller, Lyle Schwartz, Rhonda Taller, Christopher Wemple

Others Present: ECA General Manager MaryAnn Hall, Assistant Manager Romaine Cureton, Jeremy Tucker (ECA Legal Counsel, Lerch Early & Brewer)

Highlights of the meeting:

Legal:

New directors must take CCOC training within 90 days. It is an in-person 4-hour class at night or on weekends in Rockville. Online training not currently available.

Management Report

Garage Project:

General Manager is asking that work on the weekend be allowed to speed up the project. This will involve some jack hammering, beginning at 9 AM.

Budget:

1% or 2% increase in condo fee? These options were deliberated.  Mr. Beca favored 2% or even 3% increase; Ms. Taller explained her concerns that this is an old building and often in need of repair; Ms. Hall pointed out that one catastrophic flood could wipe our comfortable financial position.  Al Muller repeatedly argued for a 1% increase.  In the end, the vote was 4 to 3 for a 1% increase.

Window Cleaning:

Will take place May 2-3.

Meeting Location:

The Board discussed where to best have the monthly meetings and decided that  the West Lobby is preferable because there is more room and it gives better access to people with walkers. Fire and Safety issues were of a concern in the party room which is only rated for 49 people, and where there is only one safe exit in case of fire.

Spring landscaping:

Spring flowers will be installed the week of May 6.

Other Business

Embezzlement Report:

The Board distributed a written summary of the embezzlement reports and summarized the findings under all doors. There were three such reports: ECA, Gates Hudson, and forensic audit firm. The reports emphasized that the fraud was perpetrated by one highly placed and trusted employee of Gates Hudson and that since learning of that event, Gates Hudson has worked to tighten its internal controls as has the Elizabeth, in accordance with recommendations. All embezzled funds have been returned with interest, and all funds expended in connection with the embezzlement, to include time spent by our Counsel and our General Manager, were paid by Gates Hudson.

The Gates Hudson contract was renewed for one year in March.  It will be up to the new Board to consider an RFP for Management Companies (to include Gates Hudson) when the time comes next year.

Motion: unanimously approved some changes to the budget including a significantly large amount for elevator repair which Otis said we do not need to do until 2021. Monique Fridell asked for a letter from Otis be attached to this change.

Motion:

1% condo increase was approved 4 to 3.

Motion:

Approved unanimously the budget with 1% condo fee increase.

Committee Reports

Newsletter:

Copies are at the Concierge Desk and have been emailed from BuildingLink.

Fire & Safety:

Instructions for residents in case of fire or fire alarm sounding were reviewed by the Fire Educator.  He suggested the instructions be simplified and easy to read for people whose eyesight is not sharp or who are not fluent in English, and to use more graphics so that people  can still understand the instructions.  The Committee needs the support of a graphics artist to follow up on these suggestions. 

Additionally, it was suggested that the Elizabeth should plan a program of regular education for residents, like Town Halls, on the subject of what to do in case of a fire, or fire alarms, so that people know that it is their responsibility to prepare for such an event.  Those who need assistance evacuating in case of fire, should have an exit plan at the ready, and people ready and able to assist them.  The responsibility belongs to each and every resident.

Again, residents ask that the Management office make full  use of  BuildingLink for notification of fire status since the fire alarm often sounds for a long time and only the Fire Department can turn off the alarm after doing a full investigation.

Comments from the Floor

— Rhonda Taller spoke of the importance of the upcoming election and selecting the right individuals to serve on the Board.  Elections have consequences

— One individual mentioned that the Management Office needs training on BuildingLink.

2019 Candidates for the Elizabeth Board—Recommendations

On April 15, 2019, the Elizabeth Condominium conducted its annual Meet the Candidate event to allow those running for the ECA Board of Directors to publicly  state why they are running for the Board and what they hope to achieve. Peg Downey served as the moderator and Stephanie Olshan assisted in organizing written questions that Ms. Downey would ask the candidates. Gary Costello acted as timekeeper. Each candidate was given three minutes for an opening statement, 2 minutes for a closing statement, and 2 minutes to answer a question.

Six candidates are running for three seats. All are resident owners, two are currently sitting Board members up for reelection (Beca & Muller), one is a former Board member who quit before her term was up, and three would be newcomers to the Board. Everyone running was present at Meet the Candidates. Their statements can be seen at: http://theelizabethcondo.blogspot.com/2019/04/2019-meet-candidates-remarks.html.

The candidates are:

Zlatan Beca

Babs Eisman

Molly Frantz

Alfred Muller

Elisa Siegel

James Whalen

Thank you to the six candidates for running for the ECA Board of Directors. Being a Board Director is usually a thankless task/challenge so I want to be sure at least one thank you is voiced to those running.

I have been owner since 1978 and regularly attending monthly board meetings since 2007 when I noticed how rundown our building had become. I have been writing this blog since 2008 when I realized that communications in the building were lacking and I have served on the Board as a Director. With that experience, I offer my recommendations for these three candidates because I see them as the new leadership for our future—all are professionals who bring valuable skillsets, expertise, and experience: Zlatan Beca, Elisa Siegel, and James (Jimmy) Whalen.

Here are my reasons for picking these three:

Zlatan Beca is a sitting Board member who has served as president for two years. His performance record demonstrated that he sincerely wants to balance the budget and “improve the health of the Reserve Fund.” Under his leadership, we have seen aggressive pay down of our large loan. He has said in his Meet the Candidates statement that he supports projects, like hallway renovation, which will help improve our property values, while also taking care to keep the condo fees “steady and in line with the Cost of Living Adjustment.” After all, we know that you can only make repairs and building improvements with adequate funding.

Elisa Siegel currently manages a $10 million budget and leads a team of 55 professionals as well as contractors and vendors. Ms. Siegel brings 40 years of experience in communications, reputation management, and public relations, a valuable skill set not yet represented on the Board. She has pledged to apply her expertise to restore our damaged reputation, including development of a public website to better position our condominium in the real estate market. At Meet the Candidates night, she said,  “If elected, you can count on me to take a fiscally responsible approach to balancing the essential needs we have today with the important work we must continue to sustain our future, including rebuilding our reserves, completing necessary repairs to our infrastructure, undertaking preventive and regular maintenance, completing much-needed renovations to our hallways, and rebuilding our brand as a luxury building.” As she said in her opening Candidate’s statement, “These steps are all essential to improving our property values, which is one of the Board’s primary fiduciary responsibilities.”

James (Jimmy) Whalen is the current Chair of the ECA Budget and Finance Committee. Since taking this position, he has managed to conduct meetings that run efficiently by promoting a good culture in meetings that avoid non-productive activities and negativity. His accomplishments include reconstruction of the Monthly Financial Reports so that they are more concise and easier to understand. He has helped build an investment strategy that includes a laddered CD portfolio to get interest from our reserve cash. Jimmy Whalen is already making a difference relative to our finances. He would be a welcomed addition to the Board.

Here are my reasons for why these candidates are not the best choices:

Babs Eisman as a 30-year resident has made contributions to the social well-being of our community and I would urge her to continue her participation with ECA committees. The candidates I am recommending bring a greater set of skills and experience than Ms. Eisman’s statement indicates.

Molly Frantz and Alfred Muller have both served on ECA Boards and have records that need to be taken into account.

Molly Frantz

—On Financial Matters

Those who regularly attend monthly board meetings have often had to suffer through endless questions from Ms. Frantz that hold up our monthly board meetings. Her line of questions usually indicate that she does not understand the answers given. On April 10, 2017, Ms. Frantz challenged the audit prepared by Jeremy Powell of Goldklang Group CPAs. On April 20, 2017, owners were provided the auditor’s response to her claims via an email from BuildingLink.  The auditor wrote that based on Generally Accepted Accounting Principles and his own cash flow analysis, he concluded, [her] “… analysis contained several material omissions and errors in her formulation which lead her to an improper finding.”

Among the errors in Ms. Frantz’s analysis cited by Mr. Powell were the following:

·      “Notably, and as discussed below, Ms. Frantz’s analysis does not take into account payments to vendors and to the bank that flow from the balance sheet.  

·      Further, as I explained to the community, the loan payments are not reflected expenses on the income statement, because the payments reduce an existing liability. 

·      We also found it difficult to follow Mr. Frantz’s analysis and conclusions in certain places, as she combines reports which reflects information calculated differently, but we did our best.”

Mr. Powell concluded, “… Ms. Frantz’s analysis incorrectly combines different financial reports, which calculate the financial position of the Association differently, to arrive at her conclusion.  Based on our review, all funds are properly noted and reconciled in the Association’s financial statements.”

This is just one example of her inability to understand and communicate financial matters.

—On Working with Others

In 2011, Ms. Frantz quit the Board saying that the Board was too toxic to work with. She stated in her resignation letter dated August 16, 2011, that she experienced, “A board replete with personal ill-will, petulance [sic] behavior, hidden agendas, and a penchant for taking offense at the slightest opportunity…The personal toll of working in such a dysfunctional environment has been enormous.” This seems to indicate that she does not have the necessary temperament to serve on any board of directors.

—On Our Current Auditors

It should also be noted that Ms. Frantz stated in her Meet the Candidates question and answer session that she would like to replace the Goldklang Group as our auditors because she feels they didn’t do enough to prevent the embezzlement that took place by a trusted senior employee of Gates Hudson. It is important to understand that it was one employee who carried out the fraud and not the company. In fact, this company showed integrity by immediately notifying the Elizabeth of the embezzlement, rapidly returning all funds with interest, paying all associated expenses, and taking step to further tighten their internal controls.

At the time of that discovery, Jeremy Powell and Howard Goldklang spoke at a Board meeting about the difference between regular auditing of financial statements which their firm does for us, and forensic auditing which is a detailed examination that looks for irregularities in accounting and financial procedures. The bottom line is that embezzlement is a sophisticated crime perpetrated by one or more trusted and often highly placed employees who have access making it possible for them to circumvent controls in place. As such, it is difficult at best to detect.

—On Our Current Management Company

Ms. Frantz also stated she wished to replace Gates Hudson, our property management group, for its role in the embezzlement. As stated above, this was a fraud perpetrated by a single individual. Gates Hudson had no role in the embezzlement. It’s rare that monetary restitution happened so quickly for ECA and that an organization like Gates Hudson enacted new safeguards without hesitation. Unfortunately, embezzlement happens all the time. CNBC reported in 2017 that workplace crime costs US businesses $50 billion per year.  In 2019, a former Montgomery County official was sentenced in a $6.7 million embezzlement scheme.

Alfred Muller

—On Our Reserve Fund

In 2013 as a Board member, Alfred Muller supported drawing down the existing reserve fund which soon led to a Reserve Fund balance of approximately $1000. This is a position he has continued to defend. This action resulted in the Elizabeth almost losing our master insurance, making it impossible for us to secure FHA certification, and making our building unattractive to prospective buyers due to our poor financial profile. Worse, the lack of sufficient reserves placed the condominium at great financial risk in the event of a costly infrastructure or equipment failure. The line of credit could not be used for anything other than the replacement of our windows and balcony doors as stated by the terms of the loan.

According to Condominium Association Institute (CAI) guidance on reserves to board members, “Setting aside adequate reserves for the future is an extremely important part of the board’s responsibility. It is important to remember that boards that fail to adequately fund their reserve accounts have breached their fiduciary duty to the association.”

—On Financial Management

By way of background, ECA boards approved a zero percent (0%) increase in condo fees in 12 separate years during the period July 1984 through 2009. This failure to adequately provide sufficient funds to maintain the property led to the deteriorating infrastructure that we suffer with today.

As an example, in FY 2009, Al Muller voted for a zero percent (0%) increase in condo fees. In fact, as he did in the Budget Town Hall meeting April 10, 2019, he has continued to push for the lowest possible increase in condo fees (1%) than what is currently being considered (2%-3%) by the Board Treasurer and Budget & Finance Committee. (Note: the increase in condo fees has not been voted on yet.) It appears that Dr. Muller thinks that keeping assessments from going up is the primary obligation of a director rather than ensuring that there are sufficient funds to properly maintain the community.

Montgomery County Commission on Common Ownership Communities (CCOC) in its chapter entitled “The Wrong Way to Budget” counsels that keeping condo fees down at the expense of maintenance and upkeep is transparently foolish because everything structural and mechanical requires more maintenance and repair as it gets older. The CCOC further advises that this practice will “diminish the appearance of the community and make it a less desirable place to live. This will adversely affect its resale value relative to nearby communities that are better maintained.” This is precisely what happened to the Elizabeth.

As his record shows, Al Muller works to keep condo fees down at the expense of adequate maintenance and sufficient reserves. For these reasons, I do not think Al Muller is the right person to lead us to improved property values and a financially stable future.

You are urged to vote for Z Beca, Jimmy Whalen, and Elisa Siegel—owners who will work to improve the financial position and infrastructure of The Elizabeth, our property values, and our quality of life.

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