What really disturbed me was every board member voted for an unnecessary fee increase

I did send a long letter via certified mail to each board member and also to management.

The first paragraph of the letter is as follows:

"I suggest the board reconsider its decision to propose a fee increase. In this letter I explain why I am making this request. The numbers indicate a fee increase is unnecessary. Boards are duty bound as fiduciaries. I include reserves and recent reserve contributions, the 2018 budget which is projected to generate a substantial surplus, and a review of the purported 2019 $22,415 O&M increase which is overstated because it includes reserve item(s). Combined these indicate that this board is far too eager to raise fees. "

What prompted me to write the letter? The unanimous vote of the board for the increase. I suspect they each voted for personal reasons. Basically that is an "I can afford this increase" vote.

The problem is simple. As fiduciaries boards are not supposed to operate from their personal agenda. But some do. This board has apparently decided that the numbers and the responsibilities of fiduciaries really doesn't matter or apply to them. That's sad, but for the newest board members, I can understand how it is easier to follow the leader instead of running the numbers. That's what the lemmings do. Each board member is supposed to be a leader in their own right and vote independently. That did not happen.

Here are a few excerpts from my letter. If you were to read my letter and the accompanying spreadsheet it is obvious I spent more time on this budget than our so called "board of fiduciaries."  But then I also think the vote was based upon the personal agenda of each board member. Literally "I can afford this, so it is okay" and for the elites "That's all that matters."

I wrote to the board: "The facts indicate that a fee increase is unnecessary, and the proposed increase [1.88%] is actually approximately 1.66%. ($1,352,277 x 1.0165994 = $1,374, 724). As president I always crunched the numbers on my PC during the budget meetings and came prepared with written comments to the proposed, which were distributed to the board. These and other efforts supported creating the budgets which created surpluses."

I pointed out that "The president serves as spokesperson for the board of directors in most matters relating to general association business. As an officer of the association, the president has an affirmative duty to carry out the responsibilities of the office in the best interests of the association and as a fiduciary for the owners. As such, the president has special responsibilities to keep the entire board informed and to acknowledge conflicts of interest during the formulation of budgets, rules and so on. A failure to do so is a failure in the duties of president, which is even more significant than the duties of the remainder of the board."

"The board ignored the fact that the reserves requirements are being met.

The board ignored the fact that additional $hundereds of thousands of dollars have been contributed to reserves since 2012 [over and above the budgeted amounts]. This transfer was optional; boards in the past have transferred all budget surpluses to reserves. Under the circumstances a board comprised of fiduciaries should also discuss the possibility that any reserve funds exceeding “reasonable reserve requirements” be returned to owners. If this is not discussed that too is a breach of duty. Apparently the board failed to vote independently upon the merits of the proposed budget. Why was that? Did it play “follow the leader”? Did board members vote to support a buddy on the board? Or did they simply take the easy path, rather than do their duty? Each board member represents the owners only. Voting to support the agenda of a “friend” on the board is a breach of one’s fiduciary duties."

"The board failed to take into account the current situation for all owners in the Association. For example, did the board review and discuss the any recent evictions, foreclosures and seriously delinquent owners when making this decision? “ All budgets ....shall provide for reasonable reserves for capital expenditures and deferred maintenance for repair or replacement of the common elements. To determine the amount of reserves appropriate for an association, the board of managers shall take into consideration ......the financial impact on unit owners, and the market value of the condominium units, of any assessment increase needed to fund reserves…” - Illinois Condominium Act (complete text of this section of the Act is contained later in this letter.) "

"I can state that I, as president, introduced this as a discussion topic during a recent budget meeting. One board member who insists upon annual fee increases attempted to shut down this conversation by stating that “We are not supposed to cater to the lowest common denominator.” [Three of the current board] were present. Boards are supposed to represent all owners!"

 "The board is not mandated to make reserves “as high as possible”. Per the Illinois Condominium Act, the board must provide for “reasonable” reserves."

And so on.

I will post the entire letter here in the coming days.

Our owners do deserve better than this board seems capable of providing to them.

We Need to Live in the Present, But History is Important

While the board was discussing the budget for 2016, I made several remarks and one of the board members countered "But that was history!"

History is an interesting phenomenon. In fact, considering the age of this planet and the lifespans of human beings, what most of us do will generally have little impact upon the future. Therefore it is most important to live in the present, have as much impact as we can in the present, and avoid screwing the future. In a HOA that means making rules, maintenance, project and financial decisions that allow future owners to live unfettered from bad decisions, debt and the consequences of poor rules decisions.

Budgets are always difficult to prepare. It is unfortunate that boards are frequently so uninformed or unwilling to bone up on history. "History" can teach us important lessons and "history" can allow us to avoid serious financial pitfalls. The new board of 2008 was particularly uniformed about the history of this HOA and they fell into a financial trap set by previous boards. Today this HOA continues to pay for new roofs because of historical decisions made by the boards of 2001-2008. This HOA also experienced road failures about 15-25 years earlier than expected. But some boards don't want to know about history or use it.

I do use history as a guide because it is such a great teacher. It can guide us to avoid the pitfalls of the past and avoid the mistakes made by previous boards. Not everyone agrees with this approach and I suspect personal agendas do play a part in HOAs. Promoting a personal agenda and a legacy can really screw things up.

It is somewhat ironic that back in 2008-2010 when things looked really bad at BLMH that I was singled out for personal attacks because the word being promoted was "Elect Norm and he will raise your fees."

Nothing has been further from the truth. In fact, I've been the foremost champion in this HOA for fiscal responsibility, proper maintenance and the lowest possible and realistic fees.

I'm the one who championed the fee decrease for 2015 and it was based on solid research. In 2015 I again spent the many, many hours to come up with the basis for a budget for this HOA for 2016 with the two most junior members of the HOA who agreed to be on the "budget committee." Yet, I again find myself with them under personal attack. Why? Because we did the research which indicated that a 1.5% fee increase for 2016 would me more than adequate. Meanwhile, some board members argue for 3% to 5% annual increases. Based on what?

There is absolutely nothing in the three most recent reserve studies that indicates this is a requirement. Each of these studies have been imperfect, yet have been discussed and rebutted by boards thanks to the hundreds of hours I have put in to do this. That includes getting proposals for some of the issues raised in these studies. The advantage of physical surveys and obtaining proposals is they provide real substance to the issues of replacement costs, in real time.  This work was done with the participation of management which is the proper way to do this.

I've also done solid work on methods to alleviate possible concerns about some possible infrastructure issues 30 to 40 years hence. I've discussed this with management and presented it to the boards since 2013 not once, but annually.

We've shifted from a reactive approach to water main problems to a preventative maintenance position. We have replaced our "minefield" Lakecliffe Blvd with a solid, properly engineered and installed road. We are way, way ahead of the curve at this point, I've personally reinvigorated the maintenance of this HOA and we are doing a damn better job than the boards of 1990-2008 did.

Yet I again find myself under personal attack, and this time it is from within the board. Some old dogs cannot and will not learn new tricks, I guess, except undermining ones.

It is ironic. I'm the one who puts in the hundreds of hours in this HOA to do the work which ultimately defends the owners. I have no personal agenda, I do solid research and yet I am the one attacked.  It reminds me of that old expression "No good deed goes unpunished."

Fortunately, I don't have to live here. I can sell or rent my unit at any time. In other words, I don't have to spend all of that time dealing with this bullshit. I do really have better things to do and I can provide my services where they will really make a difference. I have learned the lessons of history. Too bad some have a personal agenda and will throw others, including this entire HOA "under the bus" in order to achieve it. But some will never learn from history.

I have warned owners about the pitfalls of not paying attention and participating in their HOA.

(Community) College of DuPage Builds New Road

The Community College of DuPage has built a new road which was described as "proposed." To my knowledge this was not discussed during announced and open zoning board meetings. That was the approach agreed with taxpayers and the county Zoning Board for all new construction on the campus.

The road is in the left of the aerial photo above. There has been a lot of construction on the Glen Ellyn campus since 2012. The new road on the campus required a large curb cut into Fawell/22nd Street and other modifications to the street. This obviously required the approval of the county and /or the Village of Glen Ellyn. One simply can't modify a public road. That approval was apparently given in 2013-2014. I know a lot of people drove on Fawell (22nd street) and saw the work going on. It couldn't be missed. To my knowledge no one asked how this was occurring. I didn't bother because I knew that the politics involved would be a real time waster on my part. The Breuder Brigade and its small army of communications staffers would thwart any attempt on my part. The county apparently preferred to look the other way. I do want to state that this is a wonderful example of how government at all levels is operating solely for special interests. There is absolutely no doubt in my mind that this publicly funded college, the "Community" College of DuPage is simply another special interest which has been operating for its own purpose. It remains to be seen if the college can return to its core mission. And at what cost to the taxpayers and the students.

This is a photo of the new entry road into the college. The buildings in the background are in Wheaton. The road was build along residential buildings and replaces grassy fields. This changes further the character of this residential neighborhood.

So how did this street happen? During the most recent public zoning hearings this new road was described as "proposed." It was never explicitly discussed and approved before residents. It runs along the Village boundary with Wheaton which is backed by homes and apartments. Such a road would require cuts to the curbs on Fawell/22nd street. It also required the removal of grassy medians. One should ask "How could these cuts occur without some approval?"

Here's the earlier "Facilities Master Plan" that was published by the college. This was used in an attempt to get DuPage County resident buy-in for the schemes of the college:

Here is a portion of the "Planned Development Site Plan" as provided by the college during the zoning hearings. This plan is "Revised June 18, 2012". The new road at the far left was connecting to item "A" which was defined as a "new parking lot" in the list of "proposed". 

So how did this road get built?  Here is one explanation. On July 17, 2013 I posted about an article in the Daily Herald. The article was in the Herald on July 14. The title was "A new day for once-feuding Glen Ellyn and COD?"

In the article there was a smiling photo of Glen Ellyn Village President Alex Demos. The article stated "Glen Ellyn's new village president says it's a new day for the village and College of DuPage -- two governmental entities that had a protracted and expensive legal dispute over jurisdictional matters for more than two years." Here is a published photo of Village President Alex Demos. Why is he smiling? Could it be that he personally worked to see that the curb cuts for the new road were approved by the village? All as part of the "new day." One wonders what other deals were struck with the Breuder Brigade. 

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