A signed copy of these and all minutes going back to the 1980’s are available from the Management Office upon request.

Special Budget Board of Directors Meeting

In Attendance

Bob Pierce, President; Phoebe Helm, 1st Vice President; Sandra Goldberg, 2ndVice President; Herbert Hellauer, Treasurer; Dan Harvey, Property Supervisor; Christina Epple, Property Manager; Mavis Mather, Assistant Manager

Time meeting started (7:18 pm)

Comments Regarding Agenda (Board response in italics)

Miriam Moss – Once again I would like to state that the Budget and Finance Committee did not review and recommend the budget as the letter states.  There are three ways that the Association can cut costs: 1) The health club expenses of $12,135 when added to the payroll is $126,600 in expenses for the health club with only $76,000 in income.  2) Why are we budgeting $400,000 in driveway repairs when we haven’t finished the garage membrane, the elevator modernization, the pool resurfacing, etc.  3) Why spend $6,000 in the management office when we just got new furniture.  I feel that if the Board seriously considered these options that the budget could be reduced to a 4% increase. The Board thanked Mrs. Moss for her comment.

Allen Gustafson – Somehow the Board should cut this budget down to a 3% increase.  An 8% increase is ridiculous, cut down or remove the reserve contribution.  If you have to put money in the reserves next year not this year. The Board thanked Mr. Gustafson for his comment.

Vince DiFruscio – This building is not getting any younger and our reserves are too low already.  This is not a luxury building anymore and I would rather pay more to make this a luxury building. The Board thanked Mr. DiFruscio for his comment.

Mary Ann Kinney – Lorraine Meyer is out of town but asked me to bring up the following points.  This budget lists $210,000 in elevator repairs but we spent $240,000 last year, there is $86,000 listed for chiller improvements but the chiller is only 10 years old, why do we need to replace roofs, how many roofs do we have, the front circle drive will cost too much and we cannot afford it.  We only have $1.3 million in reserves and our priority should be to build this up rather than diminish it. The Board thanked Ms. Kinney and Ms. Meyer for their comments.

Nancy Smith-Ledvina – Last year the assessments were increased to cover the gas prices and we thought that the increase this year would not be so high.  Why is there another large increase this year? The money for the gas was not put into reserves to pay back the due to from.  In order to avoid a special assessment last year two months of reserve contributions were withheld to pay the gas bill.

Vince DiFruscio – The raise in assessments for last year was for the gas prices.  In order to keep the assessments low the budget did not include the deferred contribution for the previous years gas cost. The issue is that the assessment increase last year did not include the differed reserve contribution and were only raised to include the new gas prices.  The Board contributed $312,000 instead of $400,000 in 2005, this past year only $400,000 was contributed.  The left over $88,000 was never budgeted to be repaid.

Miriam Moss – Regardless of where money has gone we are $700,000 in arrears of the budget and this will keep happening unless we cut expenses and put off some projects. The Board thanked Mrs. Moss for her comment.

Ron Moss – The Board should finish one major project before beginning another one.  We don’t know what the future economy will be like and should not commit to something without being able to commit all the way. The Board thanked Mr. Moss for his comment.

Cy Peiser – It’s easy to blame someone else for this increase; it took lots of strategy to get this increase down to an 8% increase.  What I would like to know is if Christina could suggest any areas of the budget that are excessive that we could cut out 100%? No there is nothing that is excessive in the budget. Have we saved on anything in the budget? We have cut insurance significantly, when Draper and Kramer took over this building the proposed cost for the garage project was $410,000.  This project was differed for two years and the same scope of work with an addition of 4 new drains had increase another $168,000.

John Curran – I served as President on a Board for a small condo association.  The reserve contribution needs to be topped off.  Funding for reserves should be the paramount concern. The Board thanked Mr. Curran for his comment.

Robert Biddle – I had asked the management office for an explanation of this 8% increase and the factors that went into it.  Going through the budget why is there $410,000 for the front drive project? The front drive project is a reserve expense and is not included in the 8% increase.  The line item for reserve contribution is the only reserve portion of the budget that is reflected in the 8% increase. There are major increases in flowers, landscaping, security equipment maintenance contracts, and additional roof repairs which is not the same as the reserve section.  Just to be clear I think that some of the major repairs can be pushed back for a couple of years to build reserves. The Board thanked Mr. Biddle for his comment.

Nicholas Nopoulos – Why are these numbers listed like the $410,000 for the driveway if competitive bids have not been received? We had an architect that has drawn plans and the construction itself will go through a bid process and there will be competitive bids.

Sandra Goldberg – There were no competitive bids for the architects.  One architect was chosen and paid $5,000 for a rendering of the driveway project without bids.

Nicholas Nopolous – I work in design and I would be willing to look at the lobby and put together a design plan if the Board is interested. The Board thanked Mr. Nopolous for his offer, they will take it into consideration when they consider the lobby project.

Nancy Smith-Ledvina – I think that it’s a good thing to find more people who want to get involved in the building.  We need to step up the maintenance and give them more tools to help with the larger work load.  Owners should always be aware that the assessments are creeping up in this area as the taxes increase in the area as well.

Adoption of 2007/2008 Budget

Upon due motion by Sandra Goldberg and seconded by Phoebe Helm, the Board voted to approve the proposed 2007/2008 budget with an 8% increase as distributed to the unit owners.  Bob Pierce, Phoebe Helm, and Herbert Hellauer voted in favor; Sandra Goldberg opposed.  The motion passed.

Adjournment

Upon due motion by Sandra Goldberg and seconded by Phoebe Helm the meeting adjourned at 8:10 pm.

Bob Pierce, President

Phoebe Helm, 1st Vice President