Failing and Failed Streets - Ultimately a failure by boards?

 

When a street fails and the stone base is damaged,
complete replacement becomes necessary.
This includes portions of the stone base, as well as all layers of asphalt. 
It may also require curb and basin repairs or replacement.
It is expensive.

The Notes are an important part of this post.  Three or more of the current board members participated on boards 2012-2018, made decisions or were present when they were made, and they experienced what is depicted in the photos (Note 5).  

For more posts about street repairs, go to Note 10. 

This post is a case study and I use the streets of the association as an example. 

A lot of association money, which is to say, owner fees, has been spent repairing and replacing streets at BLMH since 2002.  In fact, streets installed at great cost during 2002-2003 showed signs of premature failure in 2007.  (Note 6). That was one of my motivations to join the board. It has been my position that owners can ill afford the fees required to deal with premature failures of major projects, which are a consequence of board and contractor failures.

Boards will argue that they aren't professionals.  Considering the size and age of the association, my position has been:

1. We need capable professionals on the board. 
2. We need more skillful and capable boards.
3. Board members should be aware of their limitations and act accordingly during votes.
4. Boards must be comprised of individuals who will act as fiduciaries on behalf of all owners. Some board members think they represent and act on behalf of, and in the best interests of, the association, which is a not-for-profit corporation. They don't. They represent the owners who are the shareholders.

I'm a proven, competent professional and I joined the board in September 2010.  I enrolled a Certified Public Accountant to join the board in 2011.  See the "Board Leadership" insert at the end of this post (Note 9).  However, prior leadership and some board members weren't enthusiastic about the changes. In fact, an earlier president once complained during a meeting that "Norm is spending all of the money."  That was a distortion because all undertakings were via vote of the entire board.  Directives were then issued to management.  Some board members decided to stonewall and delay.   As a consequence capable board members left in frustration. The CPA left the board, a maintenance director left, and I left in September 2018. It is no surprise to me that the boards 2019-2022 reverted to earlier methods. 

That reversion is now complete with the decision of the 2022 board to replace of the management company.

Better Methods Achieve Better Results - A Prequel to the Street Projects

By 2008 it was apparent that Lakecliffe, a recently replaced street, was failing prematurely. Significant and extensive patching was required.  Management acknowledged in the July-August, 2013 newsletter that "the [previous] replacement of this street [Lakecliffe] only lasted 5-7 years and required repairs thereafter." (Note 6).

I led the negotiations with the contractor and the association obtained four years of resurfacing and patching at no cost. I couldn't reverse what had occurred, but I could do what was necessary to extend the life of the street so that the roofing project could be completed, other necessary work in the association be done, and plans could be made for a proper replacement. 

As a board member September 2010-September 2018, I pressed the boards to hire competent professional engineers and project engineers to determine the life of the streets and the best means and methods to conduct repairs. The goals included:

1. Maintain the streets which are vital for resident access.
2. Spend the fees collected thoughtfully and carefully.
3. Develop long term programs using facts, data and expert opinions. Avoid guesswork. 
4. Stabilize fees using better maintenance and financial controls.
5. Avoid unnecessary delays which exacerbate problems and result in more costly failures.

In fact, one board member suggested during a board meeting in 2013: "Norm, you could prepare the specifications for the streets."   I forcefully declined.  That approach is precisely why our streets failed prematurely.  Instead, I promoted the retention of a professional engineering firm  and a firm to literally dig deeper into the streets to determine the cause of failures using core samples. I enrolled the board to vote do so. Some reluctantly voted "Aye". 

Of course, that meant spending money. Some board members are "penny wise and pound foolish", and remain resistant to this day. Oh, and don't let their professional credentials or professed experience fool you.  It is best to observe them in action and ignore their "Candidates Form" as elections approach. But too few owners are sufficiently motivated to monitor the board.  

Streets Replaced, the Schedule, Owner Communications and Expenditures

In 2013-2015 Lakecliffe and Salisbury were replaced in their entirety with a properly engineered street designed for 20-30 years or more of good life with proper annual maintenance. To achieve this would require crack filling, application of preservative GSB-88 and periodic top layer milling and replacement.  That maintenance has not occurred, but a bid was obtained in 2018 and this was scheduled for 2019.

Professional engineers and project managers were retained over a period of  three years to provide overall guidance and to see that the Lakecliffe street project was properly designed and installed 2013-2015.

Work continued on some of the other streets with less engineering supervision during 2016-2018. This was in accordance with plans provided by the engineers and the reserve studies. All immediate major work was to be completed by 2022. However, boards 2019-2021 disrupted that plan. It is unclear if subsequent repairs will be completed by 2025.

For example, Thames was resurfaced in 2018.  Curb and basin work was done on Harrow and a large section resurfaced 2016-2018. A large section of Dover was resurfaced and asphalt patches were applied on Plymouth. In the year 2018 $102,934 was spent on street repairs.

However, this work is incomplete. In fact, Plymouth, Dover and Harrow were to be completely resurfaced 2019-2022.  Gloucester would be completed by 2025.

Boards were aware of the condition and financial requirements to complete the repairs in a timely manner. (Note 3). There were a number of surveys and professional reports. These were supplemented by surveys conducted by me and our soon to be former managers. 

I prepared the following chart. It summarized the situation and projected $229,290 for the initial phase of street repairs in the period 2018-2022.  The 2019-2021 boards included two members who were present for all these discussions and decisions, including the reserve studies. They discussed these charts during association meetings.    (Note 7).

Owners were also made aware. This was a topic in newsletters and board meetings, and I include a link here to the July-August, 2013 newsletter. 

Click for:  July-August 2013 Association Newsletter

Coincidentally, the 2022 board has voted to replace that management company and that manager. 

Reserve studies commissioned 2010, 2011 and 2015 provided additional financial insights and guidance. Lakecliffe and Salisbury were replaced in 2014-2015, Thames in 2018,  but other streets remained. 

Here is the plan that owners and boards were well aware of:

1. Sequential expenditures required for remaining street repairs to be completed 2018-2022:  $229,290
2. Total, possible expenditures for street repairs to be completed 2016-2025: $467,026.

However, delays could be even more costly, and the board members know that.  Anyone who was a resident 2013 to the present day experienced the consequences of previous delays and poor decisions. 

This is a chart presented by me used during the annual meeting held in September 2016.  It provides a 10-year expenditure summary of all major categories using reserves of the association.  To create it I used all of the condition reports, surveys and financial information that was available to all board members. 

My chart presented to owners during the September, 2016 Annual Meeting
(c) N. Retzke 2016-2021
 

Delays to Street Repairs increase Costs; coordination issues

I left the board in September 2018, as did the treasurer and maintenance director. This left other experienced board members, two with decades of experience to lead and complete the plans, part of which were outlined in the "Guidance" insert of the August, 2018 Newsletter (Note 8).

Subsequent boards 2019-2021 have failed to complete the initial phase of the program. It is unclear what the board intentions are. 

The problem with delays is that the repairs become more costly as the street base deteriorates. As the stone base deteriorates, the repairs required become more extensive and that drives costs upward. 

Boards also knew that we have been in a "sweet spot" regarding inflation. Low inflation facilitated repairs at lower cost and saved our owners a lot of money.  That too, has helped to stabilize fees.  But some board members are oblivious.  I suspect the board of 2022 will face higher costs and more resource competition. 

Awareness of such forces was also a motivation in my decisions and those of the presidents, treasurer and maintenance director 2015-2018.  As competition for resources heats up, it becomes more difficult to find and schedule competent contractors.  Resources include competent contractors as well as materials.

Such inflation concerns and potential price increases,  as well as the condition of streams and water consumption was a motivation to do substantial stream repairs in the period 2016-2018.  This work had been delayed to so as to complete the roofing project as well as Lakecliffe and Salisbury street and related water main replacements during the period 2012-2018. Some board members could not understand the urgency and I am convinced they never will. 

So many roofs were completed in 2014 that it was prudent to delay major street repairs. However, street patching continued  while the roofing project was being completed. It was impossible to properly evaluate and manage the street construction and consider the coordination of roofers, pavers, concrete, etc.  There were other repairs underway including walks, driveways, garage floors, stream repairs, basins, curbs, common area bridges and patios and so on. Here's an annual count of the roofs completed while I was Architecture & Maintenance director.  Leak reports and extensive surveys both outside the roofs and inside the attics determined the condition and sequence of replacement:

• 2011 = 6 roofs (six 8-unit)
• 2012 = 6 roofs (five 8-unit and one 4-unit)
• 2013 = 6 roofs (five 8-unit and one 4-unit)
• 2014 = 8 roofs (eight 8-unit buildings).
• 2012-2018 drainage work related to all roofs (84 entries and other areas).

The Board Decision Cycle can be an Impediment

I always attempted to determine annual projects during the winter and lock-in board decisions in the first quarter of each year. This allowed the board to obtain bids and get contractor commitments and better prices.  Contractors are motivated to give better prices in the winter or early in the year, so as to build a schedule and establish some certainty for their company and schedule their workers. 

Most boards don't begin annual planning until after the Spring thaw and that is too late in the year to begin.  Consider the board decision cycle which can require many months:

1. Board discusses projects and alternatives, tables decisions by a month or more. 
2. Board decides which projects to complete during the current year.
3. Board directs management to get bids, etc.
4. Board reviews bids and if necessary gets clarifications.
5. Board selects the contractors.
6. Work is finally scheduled. 

Major Expenditures including Streets in 2018

Inflation concerns, pricing and stream condition was a serious motivator to do substantial stream repairs in the period 2016-2018.  This work was delayed so as to complete the roofing project as well as Lakecliffe, Salisbury and  Thames streets and related water main replacements during the period 2013-2018. Some board members could not understand this and I am convinced they never will. 

Presented during the 2018 Annual Meeting
I kept owners informed. Image (c) N. Retzke 2018-2021.

Streets Schedule, Additional Information and Being Fully Informed

I prepared and provided additional information to the board and to owners about the status, estimates  and costs of  street repairs. I won't provide detailed spreadsheets here, because they include information that potential bidders would find interesting and might influence future bids.

The boards of 2013-2018 took a lot of steps to be fully informed about the condition, remaining life, and costs and annual expenditures to deal with failed and failing streets.  We made a lot of decisions about streets, including commissioning sophisticated tests to determine why some were in such poor condition and others were failing (Ref: 2013, 2014).  A consulting engineering firm retained for this purpose advised the boards during that period that streets needed to be replaced, and extensive repairs made by 2022.  I've included photos and a table in this post. (Notes 3, 4, 5).

Using professional guidance, extensive street replacement and repairs were made during the period 2012-2018. This phase of the work was supposed to continue and all street asphalt work was to be completed by 2025. This was considered sufficiently important to be an item in my "Guidance" Newsletter insert to owners and future boards in 2018. That was my final newsletter.

The boards of 2019, 2020 and 2021 decided not to do these repairs. Dover, Plymouth and Gloucester show even more checkering today, and whole sections are failing. The board also decided not to apply GSB-88 preservative to Lakecliffe.  That's a proven technique used to extend the life of streets in Wheaton and by other nearby communities. I obtained a proposal in 2018 and it was to have been implemented by the board of 2019.

It is a fact that road deterioration caused by delays to road repairs, including a lack of crack filling, will result in higher replacement costs (Note 2). Higher costs mean higher owner fees.

Spreadsheet Details

There is a spreadsheet behind the chart "Projects 2018 Major Categories". That chart is shown in this post and it uses extensive data.  The spreadsheet included the actual cost for:

1. Cost of asphalt, curbs and sewer Lakecliffe Project 2015.
2. Cost of replacement of asphalt and curbs, Lakecliffe Project 2014.

The spreadsheet included the cost of asphalt, curbs and gutters for:

1. Cost of Thames asphalt, per bid.
2. Estimated cost for Harrow asphalt work.
3. Estimated cost of Dover asphalt work.
4. Estimated cost of Plymouth asphalt work.
5. Estimated cost of Gloucester asphalt work.
6. Additional estimated costs of concrete curbs and gutters.
7. The total cost of all of the above.

To prepare the spreadsheet I included the lineal feet of each roadway, the percent of roadways for each of the streets and extrapolated costs for:

1. Lakecliffe + Salisbury.
2. Thames.
3. Harrow.
4. Dover. Plymouth. Gloucester.
5. Total lineal feet of all streets in the Association.

Notes:

Note 1. Three of the 2019-2022 board were present during the annual meeting which included extensive presentations about costs, projects and planned expenditures, Other board member(s) were owners at the time and were also present. Two of the 2019-2022 board members were on the boards for all decisions, votes,  presentations and reports discussed in this post. 

Note 2. Boards in the period 2013-2015 were made fully aware of all of the issues of association roadway factors. This included deterioration, the consequences of delays to repairs, and the potential failure of roadway stone base.  The association hired a professional engineering firm, conducted additional professional tests of all of the Roadways and so on.  All of that information was discussed at length by the boards at the time.  The current board has two members who have decades of experience and were present for all of those discussions, reports and presentations. They were also on the board and present during the entire replacement of Lakecliffe, Salisbury and Thames, and the water mains beneath. Yet, they decided not to do the curb, basin and street repairs and resurfacing of Dover and Plymouth scheduled for 2019 - 2021. Based upon condition, Gloucester could be done as early as 2022.

Note 3. A thorough engineering study of the streets was conducted in 2014. The data in that study was provided to the board and this information was used as part of the decision making process to completely replace Lakecliffe and Salisbury in 2014-2105. It was also used to resurface Thames in 2018, to make extensive repairs to Dover and Harrow Ct. , and to patch Plymouth. Studies recommended additional repairs or complete replacement of Dover, Plymouth and Gloucester.   Only partial repairs have been made to Harrow Ct.

Note 4. Street Survey - My summary spreadsheet of the engineering studies. Note that 5 inches of asphalt is considered the minimum for residential streets per the Consulting Engineering firm that prepared the reports.  BLMH streets had a total asphalt thickness of as little as 2.0 inches:

Note 5. This is what happens when boards and contractors fail.  I had to clean up the mess in the following photos, which required the entire replacement of Lakecliffe and Salisbury.  Thames was resurfaced and additional, large patches covering entire street sections were done on Dover and Harrow.  The boards 2019-2021 decided to ignore the engineers (the two most senior members of those boards have decades of experience on the board. They were present and voted during all of the street repairs after 2013 and were fully briefed and involved in all street decisions and voting.). 

Checkering leads to holes. That's a yardstick in the photo

Checkering leads to holes - that's a yardstick in the photo

A patch may provide a short-term solution,  but the
problem will spread, damaging the street base

Delaying the replacement of asphalt leads to 
more serious street destruction
which is more expensive to repair

Ultimately, the entire street including all patches will fail,
 because the stone base is damaged, has failed, and cannot
support the asphalt resting upon it.

When a street fails and the base is damaged,
complete replacement becomes necessary.
This includes portions of the stone base, as well as all layers of asphalt. 
It may also require curb and basin repairs.
It is expensive.

Note 6.  FUPM was the property manager during the street work that occurred 2002-2003.  G&D Property Management later replaced FUPM. G&D was the manager during the street replacement project 2010-.

Note 7.  I suggest that the reason boards made expenditures 2010-2018 include earlier board inaction or decisions:

1. A lack of urgency by long term board members: "We can do it next year, or the next, etc.".
2. A need to catch-up when avoidance becomes impossible, or owners become angry. Eventually failures of infrastructure can no longer be ignored. Owners wake up.
3. Board decisions 2002-2005, including the faulty replacement of streets during that period. Most financial resources were allocated to the expensive roofing project which required perhaps $2 million including roofs and associated drainage. 
4. A failure of boards to perform other timely repairs and maintenance.
5. A preference of earlier boards to defer and "kick the can down the road" to later boards.
6. An inability to set meaningful priorities.
7. Personal agendas.
8. Putting beliefs ahead of facts.
9. An desire by board members to maintain personal appearances and to be re-elected.
10. The age of the association and infrastructure. 

Note 8.  "Guidance" Newsletter insert, August 2018:

Click for  Guidance Insert August 2018

Note 9. Board leadership (presidents) 2001-2019:

Note 10. Street Posts in chronological order, oldest first, most recent is last:

Lakecliffe Failure – some Notes:

1. Click for:  Lakecliffe Rebuilding Update

2. Click for: Street Historical Information

Lakecliffe Street Engineering Study:

3. Click for: Engineering Study  

Lakecliffe Street Construction – Part 1

4. Click for:  We Aren't Kidding

5. Click for:  Day 1 Construction - Lakecliffe

6. Click for:  Day 2 Construction - Lakecliffe

7. Click for:   This looks Expensive

8. Click for:  Lakecliffe - Expensive Repairs

9. Click for:  Lakecliffe Construction Preparations

10.  Click for: More on Lakecliffe and the Need to Replace

11.  Click for: Votes to Complete the second half of Lakecliffe

Lakecliffe Street Construction - Part 2

12.  Click for:  Lakecliffe Construction August 8

13. Click for:  Lakecliffe Construction August 11

14. Click for: Lakecliffe Contruction August 12 

Lakecliffe Street Construction - Conclusion

15.  Click for:  Lakecliffe Construction Project Conclusion

Salisbury Street Construction

16. Click for:  Salisbury Court Street Construction

Thames Street Construction

17. Click for:  Thames Street, Waterfall and Streams Repairs

===

(c) N. Retzke 2021

Zoom meetings - Limitations, Concerns, Impact on owners, and Annual Meeting

 

Zoom Meeting PC Screen

Zoom has become a popular means and method for remote group meetings, spurred by the realities of the CCP Covid-19 pandemic.  The board of the association adapted this approach as a method to comply with legal requirement to hold open Association meetings.  At this time the board could return to open meetings in a public setting they have chosen not to do so. Or, they could the meetings in an open setting and simultaneously use Zoom for remote attendees. 

The monthly meeting was held on September 9 via Zoom and annual meeting was held on September 23, 2021 via Zoom. An agenda was posted by management online for the September 9 meeting. No agenda was posted for the September 23 meeting.

For the annual meeting most of the board was present via Zoom, as were the candidates and a handful of owners.  The Zoom meeting was only about 30 minutes in length.  The main task was about the election, and results were announced. Several questions were asked by owners.  One owner inquired about the torn up landscaping and improvements at the Northern entry. "There have been additional 6 weeks delays in materials." was the board response. There was no discussion of the water main project. As usual, the board could not or would not answer complex questions and so an owner gave up and said "I will email management about this." Such emails are supposed to be included in the monthly packet, but there is no way to know if the board reads them.  Using that approach delays a response by 30 to 60 days.  LOL.

For whatever reasons, it is my understanding that the annual meeting a couple of days ago via ZOOM was attended by most of the board and only a handful of owners who were not board members, or board candidates.  That's indicative of the consequences of a lack of board commitment to robust communications by the board. 

Zoom Open and Equal Access?

Knowing some of the board members, I wonder if management provides them with the computer technology so they can attend these remote meetings.  That raises a question about open and equal access. Boards are prohibited from creating multiple classes of owners. With Zoom, local owners who lack the technology are prevented from attending.  The pandemic is no longer available as an excuse. 

Owners need to provide ZOOM enabled communications technology at personal expense.  This may not be the case for board members, who may have technology and support provided to them by management at owner expense. 

One advantage of Zoom is that it does allow remote owners to attend the meeting. However, it requires a high-speed internet connection, or significant data using a smart phone or tablet.  It also requires appropriate technology. Not all owners have these things. Such technology is an expense for owners. I do wonder if management is providing technology to board members so they can attend Zoom meetings.  It would be more equitable to hold an "open" meeting which owners can attend by driving to the park district as in the past. In addition, that meeting could be broadcast via Zoom. Such an approach would expand access. Those who lack the technology could physically attend while others could simply attend via remote access. 

Clearly, not all board members understand the need for robust communications. Boards are prohibited from creating multiple classes of owners. All owners should be communicated with equally and fairly.  Not all owners attend monthly meetings. For truly remote owners this may be impossible, and it is my understanding that about 25% of the ownership does not live on the property. Some are thousands of miles distant.

For whatever reasons, it is my understanding that the annual meeting a couple of days ago via ZOOM was attended by most of the board and only a handful of owners who were not board members, or board candidates.  That's indicative of the consequences of a lack of board commitment to robust communications and is also indicative of where owners lie with such tech. 

Low owner involvement is an issue for this association. I'm sure there are those on the board who would argue "Why hold an open meeting in a public setting if most owners won't attend?"  How convenient for the board.

Zoom Limitations

Today, with the arrival of ZOOM meetings, it may be easier for all owners to attend, if they have the technology available. However ZOOM also provides a shield for boards.  A common refrain from the board when asked questions is "We'll get that to you." One owner (not me) is still waiting for the financial information she requested nearly two years ago.  

A few years ago I would bring my digital projector and other demonstration aids to the Association meeting. A large white board was available. Owners could be given hand-outs and even copies of the meeting agenda. Today what we get is literally the talking heads. 

I think boards will be more inclined to abuse the closed door "Executive Privilege" portion of the meetings. I can state from personal experience this is considered by some board members to be a convenient way to avoid discussion of certain things in front of owners.  Discussions do include items not on the published agenda. For example, when I was on the board, using the privileged information provided by management to the board in the monthly packet, I prepared a spreadsheet of the state of delinquent owners. It included the number of owners and the dollars delinquent. There were no names, individual lists or other protected information in that sheet. 

I would discuss this as a summary during the open portion of the meetings. Some board members resisted this, preferring to table this information for discussion during the closed door portion of the meetings. 

I'm of the opinion that this is an abuse of the privilege. Owners are entitled as shareholders to know the financial condition of the association and impediments to the financial health. Names, addresses and so on are protected information because the owners involved have specific legal and privacy rights. 

September 9, 2021 Agenda as posted on website by management

BRIARCLIFFE LAKES MANOR HOMES CONDOMINIUM ASSOCIATION BOARD MEETING AGENDA  September 9, 2021 

I. Approval of the August 12, 2021 Meeting Minutes 

II. Treasurer's Report 

III. Work Orders

IV. Sales Report 

V. Correspondence 

a. Architectural request 

b. 2 email correspondence 

VI. Old Business 

a. Front Entrance (in process) 

b. Windowsill (in process) 

c. Paving Schedule (update) 

d. 1661 Dover Ct Foundation repair (update) 

e. Water Main Report (pending) 

VII. New Business (action items) 

a. Insurance renewal (September 1 st) 

b. Tree Removals (Sava Tree) 

c. North Entrance Landscaping Proposal (Clarence David’s) 

d. 2022 – 2026 Landscaping proposal (Clarence David’s) 

e. Management agreement 

 VIII. Committee Reports

a. Rules & Regulations

b. Architectural & Maintenance

c. Newsletter 

d. Landscaping 

e. Welcome

f. Water Main

IX. Homeowners' Comments

X. Executive Session

a. Violation report (hearing for census fine)

b. S621A Leak between unit Legal opinion (Board discussion) 

c. McWilliams (all emails) 

d. Delinquent accounts 

XI. Adjournment

==

(C) 2021 Norman Retzke

Board President Presentation

Reserve Fees 2002-2016 - Part of Video

I'm posting a link to a video because of the change to the HOA approach to online access.  Certain information will not be available but to BLMH owners.  The website WWW.BLMH.org was removed by management at the direction of the board a few days ago.  A new "portal" for the association is under construction and will be very limited in scope.

I began this blog on September 7, 2008.  There are presently 705 published posts. 

I may expand it with the removal of the BLMH.org website by the current board.  Odd timing, as the election is a few weeks away and any new board members will have no say on this.    Older newsletters were removed earlier from the website. With the ending of the website they are all gone.  I may upload them with links here. 

The diagram above is from a video I created for owners. I've included a link to the video in this post.

After significant effort by me, and equally significant effort by opposing forces in our HOA I was elected to the board of this HOA in 2010.  Eight years later I declined to run in September 2018. There were valid reasons, including the departure of the other board members who were the motive force for most of what was accomplished during that period. I saw no point in being a part of the board of 2018 and beyond because I saw no commitment to transfer the water mains to the City of Wheaton by that board. For example, even the most recent "candidates forms" for the 2021 elections doesn't mention the water mains and the newsletters which had been published every other month were changed immediately after my departure from six times per year to four.  I did create and send a MS Word template document for the newsletter to the board at the time of my departure.  I also provided a link to board members via email to management about a variety of important issues, with data.

There hasn't been a lot about the Water Mains transfer to owners in the last year and the board seems to hide behind management. Yet, the board makes all decisions.  

When I was on the board I could only do so much considering the headwinds posed by a few other board members. One voting block of three did its best to stonewall my efforts. 

I had taken on the production of the newsletter in 2011 because of my commitment to communications with our owners, who are our shareholders and do pay all of the bills via their fees. I left the owners and the board with a "Guidance" insert in the August-September 2018 newsletter and I created an elaborate presentation similar to the one in the link on this post. It was presented to any owner who attended the September 2018 annual meeting, as were all of the others from the period 2010 to 2018.

For anyone interested, here is a link to a YouTube video presentation which is a version of a presentation I made to the owners of our HOA in September 2016.  This is not representative of the methods and communications of the current board. In fact, with the removal of the website older newsletters, etc. are no longer available to the general public. 

President's address to Owners, September 2016

 (c)2021 Norman Retzke

Final Board Meeting as President

The final board meeting as president came and went. It was attended by five board members and two former board members. One spectator asked me if I would reconsider running for the board of 2019.  Two board members were unable to attend.

I've spent several days following up on loose ends, and getting ready for the annual meeting on the 27th. I dusted off my 2016 video and have been working on an update to that presentation. It's difficult to say what needs to be said in only 5 minutes.

Here's the summary video for my annual meeting presentation of 2016. That was a longer presentation.  [Note: This is not a video of the presentation I made to the owners and to the board in September 2016.  This is a graphic depiction of the data I presented during that meeting, with voice-over. On October 11 it came to my attention that a micromanaging control freak on the current board is concerned about the wealth of information which I possess and that I might put it out on the web from time to time.  Frankly, the board of 2019 has much larger and more important things to deal with, but when micromanagers rule, well, they tend to invent issues and then deal with resulting trivia!]

In fact, this video was also prepared and published in accordance with this subsequent blog post:

Creating a Smooth Board Transition in a HOA

The treasurer and I have honed the finances through August with management assistance. I've worked on the projections for project completions and the most likely reserve funding level as of December 31, 2018.

There's a lot to talk about. Hope I won't be wasting my time or anyone else's for that matter. As of Midnight September 27th my board commitment of eight years will be complete.

Sometimes Twice is the Charm - Budget Passed

BLMH had the second election last night. This time we did achieve a quorum and so the candidates were elected. This allowed the owners to make the decision, rather than be a board of appointees. We now have seven board members, the first time in a few years.

About 20 owners attended the meeting. We didn't repeat the presentations for the first "annual meeting" because this was a two part meeting with the second part the normal business monthly meeting. So any owner who didn't attend the September annual meeting missed those presentations.

I'm pleased that the owners decided to vote in sufficient numbers to have a valid election. Frustrating? Yes. This redo added a lot of work at a time that the association is attempting to finalize budgets, outdoor maintenance and repairs, and plan for 2018. As I stated in an earlier post, it must be wonderful to live in La-La Land; that's a magical place where people simply show up to do the work as volunteers, while the majority pays their fees and sits back. Of course, it could be worse. The vast majority of our owners are financially responsible and do pay the monthly fees in a timely manner. So we can be thankful for that. 

As part of the business meeting the proposed budget was passed. Prior to that owners were asked if they had any comments and there were none from the floor.

I've begun working on project lists, task agendas and financial plans for 2018.

Approaching the HOA Election 2017

There will be some surprises at the 2017 association annual meeting. I guarantee it.

As I write this the annual HOA election is approaching. Our association operates on a calendar year, yet we hold elections in September and the new board, or the re-elected old board will promptly sit down in October and jockey for positions. They will also create the budget for 2018. That budget will determine owner fees commencing January 1, 2018.

This year we have three open board positions out of seven. However, all of our board members have been on the board for at least two terms. One has been on the board for more than 30 years, with a brief vacation when overthrown and the board of 2008 was elected in a "palace revolt".

It will be interesting to see who runs for the three open positions.

I will be making some serious announcements at the annual meeting, and an equally serious presentation. About a third of our owners may attend. We have a substantial number of new owners. I won't reveal my presentation here, I may post it after the election. However, I don't want to promote an apartment dweller mentality in our HOA. So it is likely the posting of my presentation will be delayed by about a year.

After the election, the first task for the board will be to determine positions.  I've been the president for several years, simply because the leader of the group which previously screwed it up didn't want to take responsibility and because some board members decided a new path was the better one.  So we came to a "truce" and I was the lucky winner.

2018 will be a new year. Perhaps we'll return to the tired, politically motivated past?

I have worn the dual hat of "Architecture&Projects" director as well as "Architecture &Projects &Maintenance" and also as "president".  The position actually encompassed "architecture, projects and maintenance" but under my suggestion one of our newer board members has taken on the maintenance aspects. Maintenance is part of the "Operations & Maintenance" budget. Architecture & Projects is related to the "Reserve" budget, which pays for all of our infrastructure/capital project expenditures. A lot of coordination is required between "maintenance" and "projects" directors.

In our HOA nearly 75% of the annual fees goes into maintenance, landscaping and architecture/projects. Which is why our fees and budgets got so far out of kilter by 2001. Back in the "good old days" boards focused on Operations & Maintenance and glossed over Reserves and long term projects. So the average increase in fees to handle O&M was about 1.5% each year. That is, until they board began planning the roofing project. From the period 2001-2010 that board increased fees for reserves by about 65% each and every year. Reserves rose from about 6% of our annual budget and owner fees, to a peak of more than 33%.

That's the price owners pay for letting boards run wild. It gets worse. In 2010 a new board, unfettered by the shackles of the old guard, commissioned a reserve study. First ever. That study revealed a scary scenario. As a consequence, the board of 2010 further increased the fees for reserves. As the newest board member I acquired a target on my back. One little old lady screamed "I hate you" as I walked the property.  I actually saved their butts, while the real instigators, the boards prior to 2008 ducked and played political games. So much for one's oath about "fiduciary duties." I concluded that "stupid is as stupid does."

These fee increases have since stabilized. Why that is so is one of my topics for the annual meeting. Will such fee moderation continue is another. Has the past few years been merely the "eye of the hurricane"?

Video: A detailed look at HOA budgets, with real numbers and valid concerns

This post provides a glimpse into the finances of our Association. It provides insights into the budgets and the problems of budgeting. It includes a short video.

Sit back and enjoy the show.

As I write this the annual HOA election is approaching. With three open positions it will be interesting to see who steps up to be a board member. In this HOA, there is a real lack of interest in doing so. About a half of the owners vote, and about a third attend the annual meeting. Will this year be different?

Another Association Election

The election results are in and again we won't have a full board. I now tell owners when they complain that the person responsible for their issue, or a lack of performance, or whatever, sits in that vacant seat.

Oddly, the owners expect the board, which is fewer than 2 percent of the owners, to overcome the problems caused by the 10% who are behind in their fees. Meanwhile the 98% sit back and some complain.

At the annual meeting we completed early and so I asked owners to state any issues. What was the major issue? Apparently, one of our streams has trapped some ducklings. So an owner complained about that. Yes, it must be wonderful if that is the most significant issue we face here.

When I am asked what is the single greatest problem facing our association, I point to owner apathy. If history is correct, there will be a severe upheaval in the near future. What do I mean by "near"? Well, as a board member I routinely create 10 years plans, based upon our 30 year plans. Far too many of our owners apparently have no plan beyond next year. That is one explanation for the foreclosures, delinquencies and so on that occur and reoccur. It is also an explanation for the "sit on our duffs" mentality of far, far too many owners.

On the other hand, there is a real need for affordable and nice housing in the area, so perhaps we'll one day have a majority of owners who live elsewhere and rent their units to others.

HOA Annual Meeting - The State of the HOA

The annual meeting of Briarcliffe Lakes Manor Homes Condominium Association was held on Thursday September 24. Each board member gave a summary of the state of the HOA from the perspective of their individual responsibilities. The summaries included:

• President's Perspective
• Vice-President's Perspective - Projects, Architecture and Infrastructure
• Maintenance Director's Perspective
• Treasurer's Perspective
• Rules & Regulation Director's Perspective
• Landscaping Director's Perspective
• Welcoming Director's Perspective

There were some surprise announcements. But only approximately 10% of the HOA owners were in attendance in the audience, so most of the owners were not present for the announcements or the perspectives and summaries provided by each of the board of directors. However, the board of directors and management have properly fulfilled their duties. Owners have obligations too, and that includes attending the annual meeting. I suppose that some one might say the the six newsletters are so jam packed with information that there is no need to attend the meeting. However, our HOA business meetings span about 20 hours per year. They are jam-packed with information and believe me, 18 pages of annual newsletters (front and inside) cannot cover these meetings. Some owners have complained about transparency in the past. Coming to meeting would seem to be the best way to be informed. But many decided they were "too busy."

A quorum was reached and the elections held.

The HOA will now have only six board members. The president's position has been vacated.

Commentary:
As I have stated previously, the facilitator to the success of a condominium association is the owners. Owners can also be the greatest impediment. Board members are owners, too. So the quality of the HOA is determined entirely by the owners.

At BLMH it has been a struggle to fill the board positions with working members. We have had place holders from time to time. Because of the low interest by owners, we have had some board members "work for free" contributing hundreds of hours per year. We have also had some board member return year, after year after year. We now have one board member who has been doing this for about 38 years with a brief absence when the owners declined to re-elect her during a particularly rough patch. At the time we were entering the worst recession since the great depression, fees were up, we were in the early phase of a roofing project which would require another ten years to complete and but begun with less than 10% of the necessary funds in savings, we faced a major and early street replacement, etc. The ownership attributed all of these problems to the board. The economy surely didn't help the mood.

It's simply too easy for many owners to pretend this is an apartment complex or a retirement community. Owner involvement ceases with the paying of fees.  That's one reason why we have such low owner attendance at meetings. Boards may also have been their own worst enemies. I also am of the opinion from past experience that more owners would attend if there was something personal in it for them. For example, about 7 years ago a board attempted to bribe owners with free coffee and donuts. Some owners have come with their complaints and their hand outstretched and palm up. A compliant board a few years ago attempted to grant every wish and demand. It is unfortunate, but these hand outs require higher fees. And fees are really in short supply; we will spend every dollar we've collected simply do do the absolute necessities. No kidding! There is no "slush fund" with which to grant the personal wishes of owners, unless a board decides to avoid completing the roofing project, or stop driveway repairs, or let owners clear their own driveways of snow, etc. That would be okay for a few, as long as their driveway was plowed and if they already have a new roof, etc. why, then it is not a problem at all!

BLMH - Annual Meeting 2013

Last week our association held the annual meeting. Those owners who attended were given concise and candid "state of the association" presentations by our president, treasurer, welcoming director, landscaping director, rules & regulations director and architecture & maintenance director. Management of course did a presentation. After the presentations unit owners were given the opportunity of a "question and answers" exchange with the board and management.

The meeting required less than two hours. We moved quickly through the business at hand and owners were attentive and courteous. The presentations and discussions were candid, honest and forthright.

My report as A&M and vice-president was exactly what I promised via our September newsletter. It took about 20 minutes and topics included:

• Expanded use of maintenance cycles and programmed maintenance. Why?
• What are the priorities? (and how are they determined?)
• Water main failures, a pre-emptive approach to dealing with this.
• IDNR-OWR (Illinois Department of Natural Resources) has declared Lake 4 to be a dam. “Briarcliffe Lake Dam is a Class I (high) hazard potential structure and requires a dam safety permit.” What does this mean for the association?
• Flood of April 2013 and aftermath including Wheaton's "Briarcliffe Watershed" Study.
• Lakecliffe Blvd paving failure; why, how, and financial consequences. Repaving and repair decisions.
• Status of Fireplaces and my position.
• Status of Roofing Project including drainage improvements.
• Status of Driveway Repaving Project.
• Status of Garage Floor Replacement Project. 
• Status of Financial Reserves for projects. (Very long term planning - some projects have scheduled completion dates of 2032!).
• Delinquencies, foreclosures and the negative impact on association finances.
• Status of Thames waterfall decking and paths project. 
• Status of Plymouth waterfall and pond. 
• Miscellaneous (limestone sills, sidewalk scraping, storage on the property, etc.). 
• Rules, Regulations and Maintenance (discussed by R&R director). 
• The future of the Newsletter.

The president made the statement that I had put in, by his calculations and review of my emails, etc. about 650 hours doing association business in the past year. I appreciated the acknowledgement from the entire group. I've made it no secret that this has been a very difficult year. I have found myself with competing, mutually exclusive time commitments. In fact, I've put in more time than estimated and I do have a business to run, clients with specific needs (I was in a production facility yesterday) and of course there is this blog and the research, etc. that it takes to produce it. In such a situation setting priorities becomes "difficult to impossible."

I have concluded I could work 24/7 if I chose, but I have no intention of doing so.

I also had to make a difficult decision this year to forego another volunteer position, in which I probably could have made a larger difference.

However, my current volunteer commitment at BLMH will end in September 2014. I have made no decision and no promises for the future.

Annual Meeting 2012 - Part I

The association annual meeting was held on September 27, 2012. As is required personal notices and invitations were mailed to all owners. We also posted notices in the lobbies a few days prior, as a reminder.

This meeting provides the owners with the opportunity to hear the "state of the association" in the boards' own words. This year the meeting spanned about 2-1/2 hours and included summaries provided by each board member, as well as extensive information on finances, projects, fireplaces, details pertaining to COD construction on our eastern property line, and the future. There were no free donuts and no koffee klatch (it's never "free" because fees would pay for these things.)

I'll provide some observations of the meeting in this and the next few posts.

Topics for the meeting included:

• Introduction of the board and our manager
• President's Comments
• Treasurer's Comments
• Welcoming Director's Comments
• Rules & Regulation Director's Comments
• Landscaping Director's Comments
• Architecture and Maintenance Director's Comments

Other special topics included:

• Fireplaces Moratorium and Status Update
• College of DuPage Construction Update

Low Turnout Disappointment
This year, the meeting was lightly attended. I do want to publicly thank every owner who attended. As a board member I appreciate your interest in your association and your willingness to set aside an evening to spend with your board and management.

The low turnout was not surprising, but a low turnout is always disappointing. The majority of owners did not attend.

Why was turnout so low? Perhaps the lack of freebies? I'm not sure what was on TV that night, and that's always a factor. I've noticed that attendance seems to be better when there are "significant personal issues" for owners. For example, in 2008, with the mushroom cloud of the financial meltdown hanging over our heads, a national presidential candidate running on the platform of "change" and a group here at the association promising the same, we had higher turnout and more interest.

This year, even with a problem with our COD neighbor, the continuing fireplace moratorium, and so on, there was not a lot of interest. Is this possibly a consequence of other, better forms of ongoing communications, specifically our expanded and more detailed newsletter? Or is it simply apathy? I don't know.

Two Upset Owners
Before the meeting even began, I had two individuals "in my face" to complain about a lack of seal coating on their driveway this year. It was not a discussion. It was a demand, as in "What are you going to do about this NOW?"

Note: This year we seal coated all driveways that has been replaced in 2010. The selection process for those driveways was made by an earlier, wiser board which included one individual who was sometimes described by other board members as the "sage" of the board! The purpose of this seal coating is to preserve and protect. It is not about beautification. At this point in time 2/3 of all driveways have been repaired including crack filling and seal coating (this began in 2011), or have been replaced and seal coated. The project will continue next year and additional driveways will be repaired or replaced in 2013. This has been communicated via the newsletter and described in depth during association meetings. Of course, most owners don't bother to attend these meetings.

Was this particular exchange of any significance? I think it was. My initial response to our dear, irate owners who were in my face at the meeting was "I suggest you talk to the board that made that decision." One of that former board was seated a few feet away and I made it a point of responding at a volume so that person and anyone else within earshot could hear the conversation. Then the method for selection this year was questioned. My response "Do you read the newsletters?" When this also failed to get me to make the concession that was demanded, one owner made the remark describing the association as a "Project." That was the last straw.

I'll have a post devoted to this particular exchange, owner demands and hostile, belligerent behavior.

Finances, Architecture and Maintenance (A&M), and Rules & Regulations (R&R)
I'm going to skip ahead of the meeting to the presentation I made to the attendees. I had prepared a detailed, 13-page report for the meeting. This included sufficient information were it necessary to provide details to owners. However, my formal presentation was a verbal summary. Anyone who reads the newsletters and association meetings did not get any surprises. However, I did elaborate on a few things. The report I delivered was very brief but did include these areas:

1. Financial support of A&M.
2. Progress in major projects - 2 year summary.
3. Progress in other maintenance areas - 2 year summary.
4. The near future - What should be expected. 
5. Cost increases for Owners and the Association - Water Rates.
6. Observations on Rules and Regulations violations.

Finances as the Foundation for Architecture and Maintenance
I very briefly discussed finances from the perspective of "What do we get for our money." Our budget has two components. 1) Operation and Maintenance, and 2) Reserves for capital projects.

I expressed to the owners who were present that I see some "daylight." In other words, I am cautiously optimistic. This optimism has nothing to do with the economy, or how I or anyone else "feels." It's all about the numbers and the current completion levels.  I also expressed to the owners who were present the dangers of "falling behind" in finances or maintenance. Once we fall behind it becomes difficult to catch up. After two or more years, it may become impossible. Why? Who has the financial resources to pay extra each month to make up for that funding shortfall? I'm one of the owners who is on the board who is absolutely opposed to "special assessments." These are to be a last resort, and are to be avoided. I'm going to elaborate on the presentation and provide some background information in this post.

What's the Meaning of a Word - "Difficult"
When describing finances, or a financial situation, or to describe an architectural or maintenance issue, we will sometimes use the word "difficult." That is a really rich word and it has a deep, significant meaning behind it. During meetings, owners seldom get a 5 minute dissertation on a problem by the board. So certain words are used such as "difficult" to embody the complexity, cost and issues. I'm going to elaborate here on the meaning of the statement "difficult" as it pertains to some aspects of finances in the association.

Finances are a long term proposition. It requires collecting a fee of about $50 a month from each owner and saving that amount for at least a decade to pay for roofs. Ten years ago, this association was collecting less than $200 each month from most owners, and had no reserves of consequence for roofs. The reserves were not sufficient to replace streets, roofs, driveways, water mains, exterior and interior painting, garage floors, patios and decks, shoreline maintenance, tree care and landscaping improvements. Those monthly fees also had to pay for electricity and street lighting, association water, stream maintenance, landscaping and mowing, snow removal, and for any and all other repairs, including temporary roof repairs, doors, etc. .

In 1999 with new management to provide guidance the board began ramping up fees to pay for ongoing Operations & Maintenance, and save for identified projects including roofs.  There is another way, and that is to simply make special assessments each time a roof is done, or a driveway, or a water main blows, etc. Of course, owners don't like that either. Some owners have promoted the idea that the association should take on a mortgage or loans when necessary. I've published the higher costs for owners if the association chooses that financial path. Banks do charge interest to provide us the use of that money, and fees from owners will be required to repay any loan principal and interest.

Borrowing and going into debt seems oh, such a comfortable way to deal with today's problems. Or at least it was for a decade. That "lost decade" was the one in which people racked up $tens of thousands in credit card debt and used their home equity like a piggy bank. Then in 2008 the music stopped. This is precisely why so many "homeowners" in the U.S. found themselves in a very "difficult" situation as serfs on property owned by the banks.  It seems it wasn't "free money."

Maintenance Update; "Save and Spend"
Our last major roofing project, which added a second layer of shingles on top of the first, occurred during 1991-2000. Roofs can be expected to last about 18 years. Our new roofs may last longer because they include ice and water shield, improved attic ventilation, etc. The present age of the second layer of shingles on our existing roofs is in the range of 12-21 years. Overall age of our existing roofs is 35-36 years.

Selection and replacement is not based on age. It's based on condition, and we had a roof fail at about 11 years, while we do have several over 20 years of age. The goal is to avoid damage to the building, owners contents, moisture and mold damage, and so on. Leak reports, exterior and interior (attic) inspections, etc. are all guides for determining possible remaining life, and dealing with problems. I've been tabulating problems for several years so I can track leaks and problems. While it is the goal to replace, this association continues to do roof repairs where necessary. This project will continue for another five years or so until all roofs are replaced.

Our driveways had not been seal coated for years. Some were being patched. We did have some garages with problem floors, we did have some driveways with problems, some concrete patios and last year a complete wooden deck was replaced, and so on. As downspouts are being moved off of driveways, drainage improvements are made to carry water away from the new downspout discharge. After doing the roof, serious driveway repairs or replacement usually occur. We've had a few gutters relocated prior to roofs, if the condition of driveway warranted replacement. Water standing on driveways is a serious problem.

Many of these maintenance items are predictable. We can determine with relative ease how long these things will last, and we can budget for their repair and replacement. That's actually the easy part. The difficult thing is collecting fees and amassing the reserves to maintain this association.

In a society which generally does not believe in saving, getting owners to contribute extra money for fees so we can save for these required (by statute) repairs is not easy. Board members are owners. So we bring our baggage and personal beliefs with us. I imagine it's been difficult for some board members to consider saving for the association if they themselves don't practice personal savings. For anyone living out of a checkbook and with little personal savings, seeing an association with a significant sum set aside as "reserves" can be considered wasteful. Some of these people will become board members in associations and when they do, they'll attempt to run the association in the same manner as their personal lives.

Once the association savings begins to grow, some owners will covet that money. After all "I could use that for a new furnace, or a new car" Yes, but where will the money come from for that replacement roof? "Oh, that's someone else's problem," or "I don't think I need a new roof this year." Sure, and when the roof leaks and damages the owner's contents, the association will be required to replace to primed drywall. So not only will your fees be used to replace a roof, additional money will be required to replace ceilings, walls and possibly even electrical "owned" by the owner of those units. In other words, the money required to do repairs and replace roofs is greater than that required to simply replace roofs.

We're a Nation of Gamblers
So while saving may be relatively straightforward, more difficult is getting a board into place that will do these things, rather than run a "popularity contest." Collecting money does not make one popular in an association. Saving money for the future does not make one popular with owners who want to flip or bail. I think the reader gets my drift.

When we read about HOAs which are financially struggling, or are dealing with special assessments, I can understand how that happened. It's a difficult and fine line to determine how much to collect from owners. Too little and special assessments are guaranteed. Too little and the association will fall behind, then have to catch up by raising fees higher than might be expected. This may financially stress the owners.  Most would agree that small and steady fee increases are easier to deal with.

Once an association falls behind there are really difficult choices to be made. None are easy or good. Raise fees in large steps to catch up, have special assessments, or delay maintenance and repairs are available choices. In extreme situations, all of these may be used simultaneously. In such a situation the board faces the difficult decision of balancing fee increases and assessments with delayed projects. While this occurs, the association may struggle to keep up with repairs. In extreme situations, it may not be able to pay monthly bills. Board members should not have to be the only ones who make these difficult choices. Nor should they be the target of unhappy owners. But sometimes they are. After things fall apart, in my experience there will be endless owners who will say "How could this happen?"

Financial planning is a long term requirement, and a long term commitment.  Yes, sometimes things can occur that create a step change in the finances of the association. Most situations occur gradually. Occasionally an association may fall behind in finances and then, at the most inopportune time, will encounter something financially unexpected. Murphy's Law is well understood and "The worst possible situations will occur at the most inopportune time." Even if sudden problems don't occur, an association may bleed to death, while the board and owners argue about how to deal with the situation, or the owners are unawares or unwilling to face the future. After all, some will say, "I don't plan on being here in five years." Back in the "good old days" of house flipping, it was easy to walk away and leave others to hold the bag. No longer.

It was pointed out during the annual meeting that all board members are owners, and pay fees. We are in exactly the same situation all owners find themselves to be. We all deal with the financial consequences of fee increases or breakdowns. But the board is a group of "fiduciaries" who are supposed to be stewards for this association. In 2012, as in 2008, that's much easier said than done. Unlike 2008, the problem today isn't the board. It's a few of the owners.

Savings for a Decade
This association has been collecting fees and saving money for a decade while ramping up the roofing and driveway projects. In 2007 we did not have nearly enough. But owners were a bit fed up with rising fees, and swelling coffers. A problem in an HOA is this. Back in the "good old days" prior to 2008, some owners didn't want to contribute their fees for reserves. I guess the idea was to sell before the bill arrived for that new roof, driveway, etc. For a short time we had a board that was willing to tell people what they wanted to hear, and that was "We have enough money."

The financial meltdown and real estate implosion put an end to that scheme, but it did take a while for the reality to sink in. People could no longer flip out. People couldn't sell their unit for what they believed it was worth. Some were trapped here, and some were angry. Most settled down once the reality sunk in, and things shifted slightly. 1) Some owners got serious about finances and maintenance, and 2) Some owners decided to lash out at the board prior to 2008, or anyone who talked about fee increases. After all, "They did this to us."

Ah yes, some politicians tell us that we live in the age of victims, where the rich did it to the rest of us! I'm a firm believer that there is no place for politics in an HOA. It would be oh, so much easier if we could get owners to stick to the numbers!

In 2007 management was publicly speaking about additional reserve requirements. So it seemed there wasn't enough money to do the really important projects including roofs. So what can an individual owner do? One can sell, but if that isn't possible, as occurred in 2008, there remain a number of options and one of the more effective ones is to get a board in place that can be manipulated and is compliant. In other words, one that will "take care of the squeaky wheels." No one really expected this terrible economy to last very long. Even President Obama said he'd get the job done in three years. So all that was necessary was to "kick the can down the road" for five years or so, real estate prices would be back and then owners could bail and leave the new purchasers holding the bag. Sounds elegantly simple, doesn't it?

Well, it wasn't simple, and I didn't buy it. Not the politics, the quick fix or the "squeaky wheels." I was one of those who expected it would require at least 5 years, and could take 7-10 years for the economy to recover. Real estate prices will eventually turn up. But how long will it take for them to return to the stellar prices of 2007? I won't be holding my breath. With this comprehension I shifted my plans accordingly. It was very apparent that parties, daffodils and mulch were not going to handle the problems facing this association.  As a former board member who had been "run off on a rail" in 2008 was fond of saying, "You can paint a pig, but it remains a pig." In other words, paint is not a substitute for a new roof, driveway and street repairs.

By 2010, I and a few very concerned and financially savvy owners prepared a "wake up call" of a financial letter, which we sent to all 336 owners via U.S. Mail at our personal expense. I may publish a few excerpts here as a reminder of the facts.

So here we are, five years after the onset of that terrible recession, and the association is making great progress, and there has not been a special assessment. For each owner this means that when they do make that decision to sell, there will be no lien on their property, and no assessment balance to pay off.

Are Things All That Good?
Well, let's see. The economy continues to struggle with really high unemployment, real estate continues in disfavor and prices are low, people everywhere are generally disgruntled and there is a national election about a month away. The international scene is a mess. I think that there might be "bad news" or "negative news" overload for a few of us!

So how are things in this association? Well, the fees saved as reserves have been ramped up are being used to fund the roofing and other projects. About 2/3 of our driveways have been repaired and seal coated, or replaced and seal coated. About 1/2 of the roofs have been replaced, and the accompanying front drainage improvements will be completed before winter. Lakecliffe has been repaired, two pump pits have been replaced, there is a plan to complete the repairs to the stream in the vicinity of waterfall #2 with a new patio with walks to replace stairs and an old bridge in that area.   The longest duration project is the roofs which could take another 5 years to complete. The board will conduct a budget workshop in October to review all of this and develop the budget for 2013.

Are People Happy? 
Who knows? As a board member, I'm not here to make your life work, or anyone else's, for that matter. When I purchased, I don't recall reading in the Bylaws about how we should all "be happy and completely satisfied." I've got my hands full dealing with my own problems. My spare time is completely absorbed being of service to this association.

"How are people doing?" That's possibly a more relevant question. We do have some statistics which can guide us as board members. Each month I prepare an updated spreadsheet of delinquencies since January 2008, with information provided by our treasurer. This is distributed to the board. Our treasurer provided owners at the annual meeting with a good summary.

We have delinquent owners and some disgruntled owners, we have experienced foreclosures, we have had modest sales.  I suspect some owners remain here simply because they cannot sell their units for the price they would like. Prices are substantially below the peak of 2006. It's a great time for recent buyers.

Asking owners "how are you?" can be construed to be a request for complaints. "I live on fixed income," etc. Because not one of us in this association is authorized to print  money, we each live on "fixed income." What varies is the source of that income. For many it is from work. For some it is from pensions, annuities and social security. With thanks to the politicians who were complicit in creating this mess via their easy money for homes schemes, and to the Federal Reserve which regulates the currency, savers are being punished. That includes this association which gets little interest on its money. Thank you, Congress, Mr. Greenspan and Mr. Bernanke!