The Lauren Condominium Association

MINUTES OF THE BOARD OF DIRECTORS
FEBRUARY 25, 2009 [Amended 03/06/09, 03/27/09]

The meeting was called to order at 7:07 p.m. by Roger Hirschland. Present were other board members Dwight Clark, Elizabeth VanderPutten, and John Filice: property manager Walter Krolman; and for portions of the meeting unit owner Thomas Zawalich, and our financial manager Larry Simmons.

READING, MODIFICATION, ACCEPTANCE OF MINUTES OF THE MEETING OF JANUARY 27, 2009

The Board approved the January minutes as a true record of the prior meeting.

ACTION ITEMS

NONE

COMMITTEE REPORTS

Decorating Committee Report

The manager reported that several decorating bids have been received. He will develop a spreadsheet of the bids. The Committee will meet during the week of March 2, 2009. The goal is to have a signed contract by April 1.

DISCUSSION ITEMS

Boiler and Chiller replacement  

Engineering consultant Jack McNabb has sent out requests for bids with an expected return date of March 7.  

Gas Contract  

Manager Walter Krolman has signed a new gas contract.

Lobby Steps  

Safety treads on the lobby stairs were replaced by Cacho.

Master Antenna  

The current television antenna on the roof does not seem to be compatible with coming the digital change, even with a converter box on an individual television. The Board asked that the manager get estimates for maintaining the current level of service. The Board is seeking the least expensive way of maintaining the current level of service.  

Real Estate Taxes   

The Lauren did not pay real estate taxes in 2008 due to an apparent accounting error by the city.  The Lauren was not billed because of a payment in 2007 that D.C. credited to the Lauren incorrectly.  The Board has brought this to the attention of the D.C. government, and the president asked the manager to work aggressively to resolve this issue as quickly as possible.  

Owner Presentation on Assorted Water Problems   

Mr. Zawalich discussed water problems that have affected his three units. There were several unique causes all originating outside his units including: a sink failure in one unit, a pipe failure in another unit, and a sewage pipe failure in the third unit. There seems to be a chronic problem in unit 111 caused by the configuration of the HVAC condensate piping on the garage level. Cacho will replace the current piping with a run that has fewer turns. This will be completed by March 6.

SP-2 Zoning Compliance   

The Board noted that, for any non-residential use of units, the unit owner must secure and provide to the association all required governmental paperwork before starting operation. Furthermore, the onus is on the owner to abide by the criteria established for the permit that was procured (whether Certificate of Occupancy or Home Occupancy Permit).

ANNUAL MEETING  

The board selected Tuesday May 5 or Wednesday May 6 for the next annual meeting date, depending on availability of the facilities at the Marriott Hotel on 22nd Street .

NEXT MEETING  

The board scheduled its next meeting for Tuesday, March 24, 2008 , at 7:00 p.m. [That date was subsequently moved to Thursday, March 26, at 7 p.m.]

FINANCIAL MATTERS

January Late Charges  

Letters have been sent to owners who were incorrectly charged late fees in January, rescinding the fee.  

Discussion with Mr. Simmons, of the Simmons Management Company

The Board met with Mr. Simmons to discuss delinquency processing and charges from Simmons for processing these payments. The board and Mr. Simmons discussed the charges that Simmons bills the Lauren for processing late payments.  In accordance with the agreement with Simmons and Lauren policy, owners who are delinquent in payment by the 15^th of the month are charged $25, of which $15 is to cover Simmons’ cost and $10 is retained by the Lauren.  If fees are not paid by the end of the month, a second letter is sent, with another $25 fine, all of which goes to the Lauren.  The major issue between Simmons and the Board concerns when a condo payment is viewed as late.  In the past, the Lauren accepted payments at the desk up to the tenth of the month.  These were not always immediately forwarded to Simmons. Since these were received by Simmons after the 15^th, Simmons started delinquency processing.  Simmons did not charge a fee in these situations for 16 months (primarily while problems with the previous management firm were worked out), but then started charging the fees for any check received after the 10^th.    The board questioned these charges.

Following the discussion with Simmons, the Board noticed that the fees for delinquency processing were $810 while income for delinquency processing was $100.  The Board asked the Treasurer/ manager to discuss with Simmons this apparently distorted ratio based on the above discussion.

Expenses and Income

The board discussed the excess of expenses ($108,155) over income ($101,937) in the January Financial report prepared by Simmons. This $6,219 variance is within the normal range of monthly variations, and is due mainly to pro rated monthly budget estimates and the timing of various bills and posting of interest income. On the income side, the differences were found in interest payments and somewhat higher than anticipated laundry income. On the outlay side, the main factors were a somewhat higher payroll due to holiday pay, utilities for a five week payment, and prior year expenses.  

Treasurer’s Report, Month Ending January, 2009

A.      Total Cash :

Total cash available at the end of January 2009 was: $1,264,171.47

B.     Year-to-date operations, through the end of January 2009:

1. Total operating income was $101,937 per Simmons Management Financial Report for month ending January 2009.
   
2. Total expenses were $108,155:  
   
3. Laundry Income: 

a.      January coin deposits were made 2/2/09 and will be reflected on the February statement.                                                             $       0.00

b.      January “Net” Credit Card Income:                       $ 1,533,06

Total Laundry Income for January 2009    $ 1,533.06

C.     Fund Balances as of the end of January 2009

1.      Operating Cash balance as of the end of January, 2009: $ 14,697.00

2.      Reserve Funds:

a.      Unrestricted capital reserves:                   $    981,233.47

b.      HVAC dedicated replacement reserve 
fund booked Balance:                               $    268,241.00   

Total Reserves         $  1,249,474.47

Note 1 re Reserve Funds:

Monthly Condo Reserve Contributions for 2009 are $17,247

Note 2 re Reserve Funds:

The HVAC reserve fund includes a transfer of $ 42,376 from the general reserves as of January 1, 2009 plus a portion ($5,297 per month) of Monthly Condo Reserve Contributions.

D.     Miscellaneous Treasurer Notes:

1. 2006 Audit Re Koger Bankruptcy:

·         Travelers Insurance sent a January 16, 2009 , letter requesting further backup regarding the figure of $ 64,735 provided by Goldklang for the monies missing as a result of the Koger embezzlement.  Walter Krolman, Property Manager, is following up with Goldklang.

·         Goldklang, Cavanaugh supplied their worksheets, which show how they had determined the amount of loss. These were forwarded to Travelers Insurance via e-mail on 26 January 09.

2. 2007 Audit

·         Walter has inquired at Goldklang re final copy for our records.

·         Updated management representation letters have been signed and sent to Goldklang, Cavanaugh. Bank statements in lieu of certain non-received financial institution representation reports have been supplied to auditor. As these were the remaining missing items, we anticipate release of 2007 final audit promptly.

3. 2008 Audit:

·         Field Work Underway as of January 2009

4. Monthly Reserve Contributions

·         Simmons Management has been successfully conducting electronic transfers of our Monthly Reserve contributions.

5. Certificate of Deposit / Smith Barney Investment Activity

1.      The monthly Smith Barney statement of account for The Lauren Condominium Reserves has been reviewed and determined to be accurate.

2.      Interested owners are free to request a copy from our Property Manager in writing.

3.      CD purchases / activity during the month are reflected in the monthly statement.

6. CD Activity vis a vis Potential Capital Expenditures

The Treasurer and Property Manager discuss the following with Smith Barney on a regular basis:

a.      Current money market funds

b.      CD  Maturing Dates

c.      Non Smith Barney CDs to be moved into our Smith Barney account.

d.      Potential “Capital Expenditures” such as those listed below:

      Projected Lauren Needs / Capital Improvement Projects may total  

      approximately $ 430,000 through 2009.

·         Boiler: Approximately $150.000.00

·         Hot Water Heater: Approximately $80,000 per 2009 budget which is reflective of McNabb’s latest estimate.

·         Interiors: Approximately $200,000.00

e.      Currently, our reserve funds are enough to cover such Capital Improvements without concern of compromising our ability to address emergency matters.

f.        Smith Barney has recommended a “laddering” of CD investments that will allow access for needed capital expenditures as they arise.

E.     Remaining CD’s to be transferred to Smith Barney upon maturity:

1.      M&T: Matured1/14/09 (4.62%)                              $76,629.43 (Matured and 

                                                                                  transferred to Smith Barney  

                                                                                  Account January 27, 2009)

2.      Capital One: Matures 7/28/09 (4.88%)                 $72,691.50

3.      Principal Bank: Matures 2/8/10 (4.89%)               $74,389.98

4.      WA First Bank: Matures 7/24/10 (5.25%)             $ 77,735.79

RESPECTFULLY SUBMITTED

Elizabeth VanderPutten, Secretary