President Roger Hirschland called the meeting to order at 7:12 pm at the Washington Marriott Hotel, 1221 22nd St., N.W. on May 12, 2008.

Attendees acknowledged the disbursement of the meeting notification

Reading of the minutes of the 2007 Annual Meeting was waived by consent of Membership. A typo was noted in the date, which will be corrected to 2007.

The President began by affirming that the Lauren remains a premium place to live. He introduced members of the board, the Lauren attorney, the property manager and the president of Simmons Management. The president reported that the board had met monthly and invited all owners to attend the meetings. Matters covered are sometimes mundane, sometimes interesting, but always important. In terms of financial status, he reported that the Lauren is on a sound footing. The board, and in particular the treasurer and the manager, have worked hard to resolve issues with financial accounting. Many of the issues - but not all - were related to transition problems encountered with the switch from Koger to Simmons. He thanked the treasurer, John Filice, who spent considerable time consolidating the CDs under one account at Smith-Barney, which gives the board better means of tracking maturity dates, interest earned, and total amounts in any one bank.

The HVAC special reserve fund is on track, and the president thanked Brian Larkin for creating the plan for this.

He announced that the long-running tax dispute with the District of Columbia was resolved to our advantage, with the tax office exonerating the Lauren from any old liability.

Regarding condominium fees, the president reported that most owners are highly responsible in making payments on time, but a few are not. The Board is aggressively pursuing delinquent accounts, and in keeping with long-standing board policy, is referring any that exceed two months' delinquency to our lawyer. Many of the apparent problems in the past year were due to matters relating to the Koger-Simmons transition.

The president announced that the board had received the 2005 and 2006 audits, and that copies are available for owners.

He reported that the 2006 audit, received May 12, 2008, had some not-so-good news related to time under Koger Management. He said Elizabeth VanderPutten would provide details in her report.

As to capital improvements, he reported on the waterproofing of the pool room (Unit 1006), which had been leaking chronically into units beside it and below. The cost was about $28,000. He announced that the board plans to replace the boiler and the hot-water heater this year, which will provide greater efficiency and be environmentally and economically advantageous.

The reserve study done in 2003 was updated in 2007. After tweaking some figures and dates, the board accepted the revised study, and will use it in determining the budget for 2009.

The president reported on several important activities handled by the Board this past year. The garage door finally required replacement. During the several-week period when the doorway remained open, the board hired a watchman to guard the building during evening hours. The new door is working well.

Trash removal was a new issue this year. The long-time current vendor gave notice that they will no longer service the building because of their perceived risk involved in driving into and out of the driveway. The vendor also cited difficulties with picking up bins in the tight space at the bottom of the driveway. The board looked into alternative means of trash removal, but none proved feasible or advisable. The board is negotiating with new vendors to provide service in the manner we've used all along.

Staff replaced large or dead bushes along the south side of the building and have done a super job in keeping the grounds looking pretty.

The president announced that webmaster Brian Larkin is going to give up the position after many years of faithfully creating and maintaining the site. He thanked Brian for the valuable work, and asked for a volunteer to take over the maintenance of the site.

Several owners or tenants experienced serious inconvenience and discomfort from neighbors smoking nearby laterally or vertically. Through the mediation of the property manager and the cooperation of the smokers themselves, the issues were resolved, for which the residents and the board are grateful.

The full version of the President's' Report is at http://www.lauren.org/presrpt08.htm 

Treasurer's Report (John Filice)

A. Reserves as of March 31, 2008:

B. Smith Barney Investment Firm:

C. Capital Improvements

D. Boiler / Hot Water Heater: 2008 Expenditure (Board approved replacement of boiler and hot-water heater)

F. 2008 Capital Projects Impact on Reserves

G. Budget versus Actual Expenditures

Over the past 5 - 10 years our budget estimates have fallen within 2% to 3%-plus or minus-of actual expenditures.

The full version of the Treasurers' Report is at http://www.lauren.org/am08b.htm

Elizabeth VanderPutten discussed the 2005 and 2006 audit reports. When the Lauren was first converted from rental apartments to a condo, there were difficulties in completing an audit because the records inherited from the owners, the developer, and our first financial management firm were, in non-technical language, a mess. After two years of intensive work by our auditing firm and by our treasurer at the time, who is a CPA, the Lauren received its first "unqualified audit," the highest praise an audit can have. For the next 25 years or so, the Lauren had unqualified audits.

Unfortunately, for 2005, she reported, the Lauren received a qualified audit. This was due to about $4,500 in disbursements for which adequate documentation from Koger were not available.

For the year ending 2006, the audit has more serious news. As to matters of concern noted by the auditors, she stated, in the words of the report: "Because of the significance of the matters ... the scope of the work was not sufficient to enable us to express and we do not express an opinion on the 2006 financial statements."

According to the report, the auditors could not find appropriate documentation for approximately $64,000 in cash receipts, missing homeowner assessment receipts and withdrawals. The auditors listed this amount as due from Koger Management. Subsequent to the completion of the audit, documentation was found that approximately $14,000 of this amount was credited in 2007 and will appear as income in the 2007 audit.

Based on the audit and on the board's own analysis, the board referred the matter to our attorney to seek redress either from Koger or from our insurance company.

The auditors recommended a series of actions that the board is either implementing or discussing:

* During 2006, the board did not get timely bank reconciliation statements. This was one sign of problems at Koger and led the board to search for a new firm. The board spent considerable time this year developing procedures to ensure regular receipt and review of bank statements. 

* The auditors recommended that the board review how interest payments on investments are recorded. The board has done this, and it is one reason for moving all investment accounts to Smith-Barney. A consolidated statement is sent each month to the board. 

* The auditors recommended developing a more systematic way of accounting for security deposits. The board is considering the recommendation that deposits be replaced with non-refundable payments.

There is good news.

* As the auditors note, we changed management firms. 

* The audit notes that the Lauren conforms with the industry guideline of having about 10% excess operating funds. This is important so that replacement funds are not diverted to operating funds. 

* Funds are accumulating in replacement reserves according to the remaining useful life of the building's components. Their listing of our assets and our own analysis are consistent, and at the end of the year we had $902,963 in cash. The auditors pointed out that the Lauren had $27,158 more in one bank than the $100,000 covered by FDIC. As noted by the treasurer, procedures are now in place to avoid this in the future. All reserve funds will be in interest-bearing accounts. 

* The auditors state that our handling of taxes is appropriate. 

* Our delinquent accounts were higher than normal. However, about $16,000 of the $24,553 reported unpaid condo fees were a result of the failure of Koger to deduct payments from the accounts of 34 owners who used automatic checking. This sum has since been collected, and our manager, backed by the board, is aggressively working to collect all owed assessments. 

* The auditors lauded the detailed minutes of the board meeting.

Actions in Progress

The Board is using a two-pronged effort to recover the unaccounted for funds. We have referred the matter to our legal counsel, and have filed an insurance claim. Joe Douglass reported that the claim will be pursued in the Koger bankruptcy case, but the outcome of that case is very uncertain. He also indicated that a claim is under review by the insurance company, but no coverage decision has been made yet.

Actions in Progress

The board is using a two-pronged effort to recover the unaccounted for funds. We have referred the matter to our legal counsel, and have filed an insurance claim. Joe Douglass reported that the claim will be pursued in the Koger bankruptcy case, but the outcome of that case is very uncertain. He also indicated that a claim is under review by the insurance company, but no coverage decision has been made yet.

The full version of the Audit Report is at http://www.lauren.org/am08c.htm

Second vice president Jeff Wertkin remarked about how much he had learned serving his first year on the board and being impressed by how many issues the board has to deal with during the year.

Erin Erlenborn, chair of the decorating committee, reported that the days of the "current look" at the Lauren are soon to be over. The board signed a contract with a decorator to help choose colors and design schemes for the hallways, elevator cabs, and lobby office. The goal is to have a "timeless look." Doing anything about the front doors, however, would be outside the scope of their work or budget. Replacing or enhancing the doors would be impractical. They cannot be extended into the street, while extending them into the lobby would reduce the size of the lobby. There will be a computer rendering of the design, which residents may view.

A Board of Electors was chosen through volunteers. 

• Roger Hirschland
• Elizabeth VanderPutten
• John Filice
• Dwight Clark
• Jeffrey Wertkin

Elizabeth VanderPutten mentioned that the board and manager are planning a cleanup of the storage areas in the basement. All boxes and items will have to be identified and tagged by their owners; unclaimed items will be discarded. The board will hire a hauling firm to remove abandoned items. Residents may also use the service to discard items from their own units. The date for this will be announced in the next few weeks.

Home | Menu