Inflation and the Billion Prices Project at MIT

For those of us who are interested in inflation, and who also have a few concerns about the government reporting methods, this might be of interest.

The Massachusetts Institute of Technology has had a project underway since 2007, to monitor the prices of many goods, in several countries. The project "collects prices from hundreds of online retailers around the world on a daily basis to conduct economic research. We currently monitor daily price fluctuations of ~5 million items sold by ~300 online retailers in more than 70 countries."

The statistical information is showcased on the webpages as examples of average inflation indexes. The goal at MIT is to develop "econometric models that leverage the data to forecast future trends and conduct economic research."

BPP DATABASE KEY FACTS
-Statistics updated every day
-5 million individual items
-70 countries
-Started in October of 2007
-Supermarkets, electronics, apparel, furniture, real estate, and more.

The MIT project tracks online retailers. So, as soon as prices change, so do the statistics in the BPP project. If accurate, the BPP data would be available much faster than the government data, which lags because the government statistics are released two weeks after the month in question.

Charts available, which compare the BPP data with the Consumer Price Index (CPI-U) include:

• Daily Online Price Index
• Annual Inflation
• Monthly inflation

Here's a snapshot of the "Annual Inflation" chart, for the U.S., taken January 25, 2011:

To view this information, go to the following link and select "USA" from the pull-down menu. Then click on the "Show" button.
MIT - BPP - Daily Price Indexes

References, Errors, Omissions, Comments:
1)Other countries are available at the MIT site. 
2) I find it interesting that the MIT data and the U.S. government released data track.  I'm unsure of exactly what is included in the MIT pricing, and what might not be. It does include fresh food. I'll be doing more research on this as time permits. 

Inflation Update - As Applied to Gasoline

Here's an update to the price of gasoline, posted several times on this and another blog. 


I'll repeat some of that post here, with an updated chart. 


Last year, there was a lot of talk about "deflation" and this caused some to think prices were dropping. Some did, but many prices did not, and gasoline is one that has trended upwards and reached a peak in 2008, and then plummeted before recovering in 2007. Prices today are about where they were in spring of 2007. 


My chart has some short term 'ups and downs' which are small vertical lines. These are attributable to business road trips, during which I purchased gasoline at lower prices in other states. All of those purchases are included here.  

This is based upon the gasoline receipts for one of my automobiles. As I have stated previously, I collect data on certain things. In finances, that includes my household's "consumption and spending habits". I use several tools; this chart was created using data entered in a spreadsheet. I update it monthly using my gasoline receipts. Why do this? If you don't, won't or can't measure something then you certainly can't control it. Or, as we used to say in the early days of mini-computing "garbage in = garbage out". Some truisms are universal, but we are at a point in our development as a culture where we have forgotten how we got to where we currently are. Too bad for us and our future generations.

There are two lines on the graph. The red line is the actual price of gasoline from the period February 3, 2005 through January 20, 2011. The black line is a trend line, which displays the actual trend in prices and as you can see, is trending continuously upwards. I also calculated the average of prices on an annual basis and compared those averages to determine the price increase per year. These annual price increases were then compared to determine the percent price per year.

Average cost per gallon annually was:
2005 = $2.50
2006 = $2.74
2007 = $3.04
2008 = $3.24
2009 = $2.82
2010 = $2.98
The interesting thing here is that the price of gasoline has been increasing at a rate of about 2.2% per year, which is in line with the very low inflation we had been experiencing. However, gasoline prices today are about 11% higher than they were at this same time, last year. Does that signal an increase in inflation? We know that the floods and weather issues around the globe will depress crop yields. That should result in price increases at the grocer.


Average inflation is usually in the range of 3.0 to 4.0% per year.  The averages, however can be deceiving. Do you remember the angst in 2007 and 2008 when gasoline prices "spiked"? Peak price I paid per gallon was $4.419. Even so, the average increase in gasoline prices per year, 2005 to the present, are low, less than 3% annually! What this means to the consumer it that when economists speak of "averages" it is useful to be aware that these averages can include severe periods of higher or lower numbers. So while the average is benign, the spikes are painful. Moral: "Be Prepared". Today's low prices may be replaced with higher prices in the future and may include price spikes. So don't spend those savings acquired by low prices. Save them for the day when prices return to the normal rate of inflation, which is possibly as near to today as those July 2008 price spikes. If they are, then we could again face more steeply rising prices in the summer. As the "experts" say, economics forecasting is not an exact science. 



The government also adjusts the methods for calculating inflation. Today's low 1.5% inflation, if calculated the way the government did it in 1990, would be reported as 4.5% inflation. If we used the methods available in 1980, then inflation would be reported as 7.5%. So at times, the "official" government inflation figures can be deceiving. I won't comment if this is deliberate or not. That's a matter of opinion.

References, Errors, Omissions, Comments:

1) Inflation was running about 2.0% per the government CPI-U. However, it has dropped recently and is now reported at 1.5%. We'll see what the January numbers show. You'll note that gasoline has trended upward since fall. The vertical red lines in the fall and again in December 2010 were due to lower prices during business trips. Gasoline in our area did not decrease in price. 

2) Click this link for other posts on the "inflation" topic:

http://briarcliffelakes.blogspot.com/search/label/Inflation

Possibilities, 2011

This is my first post as a board member in 2011, and builds on the post "Closure, 2010".

On Friday, January 7, I received a request from the association president, with the other board members, regarding the agenda for the association meeting to be held January 13.

I responded that I had not yet received the "packet" from management for November and December. However, I did make several suggestions for the meeting agenda. I have since received an emailed copy of the information "packet", all 142 pages! I spent part of the weekend reading that and making notes.

So, what are the possibilities for 2011?

I met with management and the maintenance company last week, to discuss projects and issues about the property, which can be addressed in 2011. A summary of what was discussed will be in the "Management Report" in your January newsletter. However, not all of what we discussed is included there. Why not? Primarily it's a lack of assigned space in the newsletter.

In 2011, I intend to continue my support of those efforts of the board to address "core" issues. Those issues include:

• Items pointed out in the "reserve study."
• Items unresolved in the "reserve study."
• Expanding the conversation among the board about distinctions including my very frank email to our president on December 23rd.
• Improving communications, understanding and education of our association by the unit owners and residents.
• Improving oversight and review of finances at Briarcliffe Lakes Manor Homes. That will require more financial long term planning, and the application of these plans to the short term budgeting meeting held each fall. 
• Continuing an inquiry into how to improve this association.
• Promoting a fully staffed board, with specific duties, responsibilities and accountabilities for each member. We currently are understaffed, with one "official" vacancy, and one "unofficial" as a member has been ill, and has no accountabilities beyond attending meetings and voting. We need additional help in certain areas. Finances, review of work orders, review of contracts, additional evaluation of the condition of all aspects of the property, etc.
• Promote the collective rights and privileges of 336 unit owners, and continue a dialog of how items promoted by members of the board, for the purpose of placating or benefiting a single owner, may actually occur at a cost to the other 335, and might also be detrimental to the association. "Cost" might not be simply in dollars, but might be in terms of community. Attempting to placate specific owners, can raise overall costs, as for example, when an owner complained and was given additional guttering on the building they occupy. If we gave every owner, in a similarly configured building, the same gutters, costs of the roofing projects would rise. Etc., etc. , etc.
• Be an advocate for speedy resolution of problems or issues, without compromising a thorough discussion of the pros and the cons. 
• Improved planning and preparation. I've noticed that tasks seem to "drop out" and are not completed. This is an indicator of an understaffed board, but there are other contributing factors. 
• Continue the long term financial planning process which was stimulated by the reserve study. That study left many questions unanswered, or partially answered. 
• Shift from a financial planning model based primarily on today's needs, to the needs of the association in 10 and 20 years; for example, this association does not fund reoccurring projects. By that, I mean that nearly all reserve funds are budgeted for the current project cycle. For example, there may be insufficient funds being set aside to replace the roofs completed in 2005 through 2009, in 15 years. That requires a series of long term spreadsheet, reinvestment of any earnings on reserves, a commitment to long term funding, etc.  
• Improved coordination and collaboration with management and our contractors. I've noticed a tendency on the board to exclude management when making fundamental decisions. My perspective is: 1) Assess and define the nature of the issue or problem, 2) Perform the research necessary to support that assessment, 3) Consult the professionals, including management and our contractors, 4) Consult other board members with expertise in the area in question, 5) Approach the entire board with the problem well defined, provide that information, provide an assessment of resolution. 6) Make specific requests of the board. 

Of course, you might be inclined to view some of this negatively. I suggest that most board members are doing "their best" under the circumstances, and within the limitations of their ability and at current staffing levels. This could improve, with additional and qualified staff.


Impediments to Possibilities in 2011
Previous boards, which is to say, boards since 2001, were adjusting fees to save about 3.5% overall as reserves, each and every year. The board in 2009 decided that was not necessary, and decided on a 0% fee increase. This was corrected with an approximate 6% fee increase for 2011 earmarked for reserves. If the association continues to save sufficiently for reserves, we will achieve the core projects in a timely fashion. If the board does not, or if unforeseen circumstances intervene, we will not have the funds required for these projects.

Perhaps the most important of these "core" projects is the roofing project. We can defer some problems and that includes minor driveway issues. A failed roof means extensive interior damage.

What are the possibilities at BLMH for 2011?

1. A formal "emergency notification" program including improved communications methods.
2. Expansion of the newsletter to include articles on condominium living at BLMH. Topics could include "What is a PUD", "Association Living", "How the Work Order System works", "Duties and Responsibilities of Residents", "Long Term Plan for BLMH" (in which "long term" is defined as more than 10 years), etc.  
3. Preparation of a formal "sales and marketing" informational document for BLMH. I suggested this as a unit owner, but there was little support from the board. It will take a lot more enthusiasm to generate this. 
4. The completion of an additional 3 to 6 roofs in 2011. Three have been identified as having problems and are recommended by the professionals for replacement in 2011. If funding permits, and the board agrees, management suggests three more be replaced in 2011. We have in excess of 30 roofs remaining with an average age of 17 years. 
5. Driveway replacement will continue in 2011. Management has recommended that driveways be replaced in 2011, specific location to be determined by survey in better weather.
6. Possible commencement of a seal coating program at BLMH. This will be for driveways completed in 2010. According to management and professionals, this should not occur in less than one year from first installation of asphalt, to avoid damaging it. I have been told that this should be applied in the spring. My experience has been to apply in the early fall. If spring is the time, then the 2010 driveways will be about 6 months of age in spring 2011. Is that too early?
7. The beginning of a street repair program in 2011, commencing with proper sealing of cracks, to protect the sub-base and extend the life of the streets. Probably, there will be some warranty repairs on the north end of Lakecliffe. This may not be completed in one year, because of costs. 
8. Resumption, in 2011, of the program to replace brick window sills with limestone sills. This project was suspended in 2009.  
9. Perform a complete survey of all garage floors in 2011, to determine specific condition of each, and to develop a replacement program. No such plan currently exists, and it's unrealistic to assume these will last 40 or 50 years without maintenance or replacement, in some cases. We do have evidence to support that statement.
10. Plan a repair to one waterfall area, which has severe problems, and install a new deck with pipe beneath to divert the stream. This will resolve the problem if completed in 2011, and maintain the walking path.
11. Continue development of a drainage plan for the association. That plan will include further inspection, the cutting of swales to divert water away from buildings; it will include re-pitching of some driveways at the time of replacement, it will include the use of less mulch and more sustainable approaches such as ground cover, to reduce cost and the formation of soil deposits which divert water to the wrong areas. I will again attempt to convince the board of the benefits of a narrow concrete strip on one side of the driveway. Principal purposes are to provide a path for drainage from the roof, and get ice and snow off of the driveway without plowing the grass. Garage floor repair/replacement may be coordinated with the replacement of certain driveways.
12. Begin a survey of the condition masonry on the property. Determine what is to be done, which is to say, the best course of action, with the funds available. Our masonry reserves were very underfunded. The reserve study brought this to the forefront, and management and I are in agreement about the long term issues if this is ignored. To my knowledge, the weeping mortar at BLMH is not repairable using standard tuckpointing techniques. 
13. Develop a long term plan for our trees, if the LD is amenable and in agreement. We have had preliminary discussions of this, and as part of the budgeting meeting, this was discussed with the board in attendance. That plan will coordinate care and replacement, and provide guidelines, and further explore funding levels and replacement methods and timing. 
14. Begin a serious inquiry into reducing Operating and Maintenance costs at BLMH. There has been a modest discussion that I am aware of. This is a very difficult subject. Lowering O&M costs implies taking some risks via experimentation with different methods, or lowering services. Which are palatable to owners? That's the big question. Any such program must include accounting systems to monitor actual costs and actual reductions. It's too easy to slide O&M items into reserve funded "capital" projects, or into next year's budget, or, simply to stop some types of maintenance. Both immediate benefits and long term problems must be properly and candidly evaluated. 
15. Develop in 2011 a comprehensive plan for the recharging of electric vehicles of all types at BLMH.
16. Complete in 2011 an investigation of alternative methods of heating the water closets in the garage. Principal goals are 1) improved safety and 2) lower utility bills. Total installed costs to be determined and evaluated. 
17. Expand the discussion of what residents may, or may not do, at BLMH to assist the association and defray costs. Some associations, according to statistics from the CAI, have allowed such expanded participation. According to management, this is not without risks; e.g. a resident falling down a flight of lobby stairs as they try to vacuum them. To date, the most vocal resident interest has been about things of a personal benefit, such as "personal gardens", which do not defray costs and have a potential for problems.  
18. Initiate a program to install an inexpensive plaque (paper with plastic overlay) in each garage. This will list the dates, by year of all major projects on that building. This will be updated annually, and will be located near the hallway door. This will provide information to owners, support sales, and will be "self documenting" of projects. I have discussed this with management, and they approve. 

None of the above will be accomplished unless there is leadership and collaboration on the board. I certainly will not be able to accomplish this alone, and some of the above are beyond my direct areas of accountability. Management can't focus solely on these items, either. So we'll see if there are any shifts this year, or if we'll just "muddle through" and maintain the property "the best that we can." In which case, many of these things will be passed to future boards, who will then have less time to plan and prepare, and save the necessary funds. 

I think the above, and more, is achievable. But it will take a fully staffed board, with the requisite skills, and a lot of work. That means, it will require a transformation to occur. 

Comments, Corrections, Omissions, References

Note 1.  I have suggested all of the above, and more, to the current board and to management. Some will undoubtedly occur. Some will not. As a group of volunteers, I can understand the hesitancy to take on this work.

Note 2. Not all of what I suggest has even been acknowledged by the board. At times, I suspect I'm considered to be a bit of a nut case.  But I've been told that it's most important that "we all get along." Does that mean that the primary interest and thrust is to assure that only people of a specific mind set are to be allowed on the board? Well, I'm here. So, where will this take me if that is the modus operandi of various board members? The easiest path, is simply to ignore me. Be polite, say "hello" and then press the "delete" button when my emails arrive. With a lot to do, and insufficient time, I'll be prioritizing these tasks. Right now, the emphasis is planning. Next comes specifications and specifics for roofs and driveways. Once that spring arrives, it will be full speed ahead, or we'll be cutting swales in December 2011, or worse!
Note 3. Items to be watchful of are those that can negatively impact finances. That includes changes in those owners who are in arrears for fees, status of foreclosures, anything else that impacts collections, etc. This is an area in which I see distinct problems with a board that attempts to work with owners as individuals. For example, if we were to become more lenient in collection attempts for late fees, that reduces funds available for the O&M budget and for reserves. Who benefits and who loses? Obviously, the owners who are paying their fees will have to make up any shortfalls, at some time. Or, we delay and curtail programs. I quoted the CEO of the CAI in my December 21 post. I also emphasized that information to the entire board via email. 

Closure, 2010

Well, it's been an interesting several months, in my first official capacity as a member of the Board of Managers of BLMH.

It's always a good idea to look at what worked, what didn't and make a few observations about such an experience at the end of the current year, so that, as part of my "continuous improvement" regimen, I can formulate and prepare for the coming year, and make adjustment.

So here goes!

I think it's useful to state my perspective on assuming the duties of a board member.

• I think it's a job, that means work, and as they say "rolling up the sleeves."
• I think it's an opportunity to be of service to others, but I am no one's servant. There is a difference between a "steward" and a "servant".
• I think owner and resident safety is paramount. 
• After that, comes the appropriate use of finances. That's YOUR money we are spending, and we are stewards on your behalf. 
• I think it's necessary to prioritize tasks. We have limited funds, and limited time. Our owners pay their fees with an expectation that we use their money well. That means, maintain the property and its value, take care of "core" problems, and do the work fairly and equitably, so all owners benefit. I realize some owners think that a good use of association money is addressing their personal agenda. I think a good use of money is addressing association maintenance and capital projects. There will be disagreement, and I welcome it. 
• I'm but one of seven members of the board. That means, I can expect to accomplish some things, and be prevented from accomplishing other things. Compromise is necessary and expected, but never when safety is involved. 
• I'm simply "passing through" and am here for a limited amount of time.Whatever I do, it's in part, carrying on and building upon the work of my predecessors, and it's also about building a bridge to the future. 
• This association may be here for another 100 years. I'm part of the team that prepares us and designs that future. 
• This is not a popularity contest. 
• The needs of individual owners, and that includes their requests, should be compared to the needs of the association, which is to say, the needs of the other 335 owners, as part of the decision making process. 
• I have the governing documents, the Illinois Condominium Act, our management and our skilled contractors to aid and guide me. So I should use them, and I do and I will! 
• This is a partnership, with the board, our management, our contractors, and our owners. Anything that is accomplished, will be limited by the skills, capabilities and commitments inherent in that partnership.
• I'll do my best, and if possible, accomplish incredible things. But no matter what, the job must be done and the results achieved. 
• It's not about me.
• This may be work, but if it is more difficult than need be, that's an indication of a board that is not functional. 

I knew this job would be "work" and what has occurred in 2010 was generally, not a surprise. Perhaps the greatest surprise on assuming my position on the board, was the reserve study. I was given a copy shortly after the election. I was disappointed by some aspects of the study. That included what I would call "inconsistencies," some dubious conclusions, and some incompletions.  I spent a lot of time in a dialog with management about the study, wrote several "executive summaries" for the board and a lengthy letter to management and the board. I  found it necessary to spend an inordinate amount of time to reach some rational conclusions with the information contained in the report. It was necessary to create a series of spreadsheets for the board. Some of the results were published here as charts. There is more to do in 2011.

I was initially to be simply a "Director" and "Vice-President" of the association, but the resignation of the Architectural & Maintenance Director vacated that position. At my attendance of  the first association meeting on November 11, as a Director, I was formally asked to assume that position, and accepted. I was then given some of the documents for projects in 2010. So that position is now my primary accountability.

Many of the Architectural and Maintenance programs are in "full swing" here at BLMH.  Fundamental decisions about the roofing project were made several years ago, were re-iterated by the board last year, and will not have any substantial changes. I see little freedom to make decisions in that area. However, if there were some significant cost saving or income generating possibility, and that includes energy generation, I would certainly consider it and bring it before the board. In December, I discovered that several downspouts were incomplete. That work will be done if weather permits, or if not, will wait for spring.

The driveway re-paving project was accelerated last year. On assuming the duties of A&M Director, it became a priority to complete that work in 2010. That included the cutting of swales for those buildings involved in the driveway and roofing projects. That work was delayed, in part by the unscheduled change in A&M Directors, and also by the late schedule of the project, and a sudden change in weather. However, swales were cut in early December.

Finances are an integral part of any board members duties. I'm not the treasurer, but just about every time I vote, I'm spending some of each owner's money. So, as I see it, I need to be really aware of how finances "work" in this association. So that means, I reviewed each and every bill and work order in the November "information packet" provided to each board member. That was the first packet made available to me, and I'll do that each and every month. In November, I discovered an approximately $1,500 overpayment. I also discovered several work orders in which it appears that unit owners were given services they should have paid for. More on this in future posts.

I had the opportunity to prepare my first article as "Architectural Director" for the January newsletter. I used the space that is available for that purpose, to provide information and guidance to all owners. I see the newsletter as providing key information to all owners. Using it, I have the opportunity to:

• Provide information about key projects.
• Advise owners on how their money is being spent on maintenance and projects.
• Advise owners on priorities as A&M director. 
• Provide guidance or information to owners.

The limited space of the newsletter, means that whatever I provide must be carefully worded, to provide the information and tone of what I am attempting to convey. Readers of this blog have an opportunity which most owners do not. This information will not be included in the newsletter because there is insufficient space, and because this blog is a personal effort, and not recognized by the board or the association. In October 2010 I was given the opportunity to assume the duties of "webmaster" of the official BLMH.org website. However, I was also told by our president as part of the larger conversation about what duties I might perform on the board, that splitting accountabilities between two individuals (i.e.; A&M director) was unworkable. So I declined because it would seem that such a change would mean splitting the duties of the CD among board members. 

My first article for the newsletter was about the water main break on Gloucester. If requested by the president, CD and other members of the board, I will provide other articles on subjects that are requested, time and other duties, permitting. 

I was surprised by the cost of the driveways that were completed in 2010. This was much higher than the estimates of the reserve study, and depleted the reserves for this purpose, by an amount much larger than would be expected on a percentage basis. For example, if 15% of the driveways were replaced, it would be expected that about 15% of the reserves would be spent. But that was not the case.

This led me to make an independent survey of the driveways at BLMH, and with 50 foot tape measure in hand, I measured about 25% of the driveways and calculated their areas. I then used aerial photos and by comparing the measured driveways to all of the others, determined the total area of the driveways. This was reported in a post on October 7. I provided this information to management and the board.  In this manner, I determined that in 2010 the board spent 53.57% of the paving reserves on 14.59% of the driveways, based on the driveway area. This was alarming to me.

Drainage has been an ongoing issue at BLMH. I suspect some of this may be of our own doing. There has been increased application of mulch in recent years, I believe. I've been told that each 6 inches of mulch decays and becomes 1 inch of soil. Mulch will "float" and flow with rain water to the low points of our wonderfully hilly and manicured grounds. That sometimes means, it is deposited against buildings and at other times, in areas that impede the flow of water. As a consequence, it seems we have more water moving in the wrong direction, and accumulates against buildings, enters garages, or flows across entryway walks.

That water then sometimes rises to above the foundation and then enters buildings, or garages, or carries mulch across the walks, where it is deposited where people walk. I have been advocating more sustainable approaches for several years, and that includes increased ground cover in lieu of mulch. I have begun pressing my case. This will require agreement of the Landscaping Director and of course, the board.

We have approximately 800 trees here at BLMH. I've had a number of discussions with the board and management about how to treat this asset. A lot of the "ambiance" and appearance of BLMH was achieved with the many varieties of trees on the property. The issue as I see it is this. We didn't have a program for accruing funds for programmed replacement of trees. Is this necessary? Consider that many of these trees are ornamentals and have limited practical life spans. They were all planted at about the same time. That implies that groups of trees on the property will reach the end of their useful lifespan simultaneously. So what to do and how to plan and prepare? That discussion began in 2010. Management is in favor of continued removal of willow trees, which apparently have a habit of breaking off or falling. That could create serious damage to buildings. That discussion also began in 2010.

On assuming my duties, one of the first issues was a structural repair at 1731. This had been discussed by the board in 2008, but had gone nowhere. The residents have been experiencing cracks in their walls, and it was time to get this done. That's what I mean by "setting priorities." I can understand that a cracked garage floor is a problem. However, a settling building, which results in "staircase" cracks on several wall of masonry, problems with windows, and spreading cracks in internal ceilings and walls, is a serious thing. Worse still, if this problem is not resolved, the structural issues will increase in severity, with larger cracks and more damage. This increases the repair costs. So I took it upon myself to make this problem a priority. Work was delayed because of problems with the proposals, and I raised some serious concerns. Management did obtain appropriate and accurate proposals, and the board was amenable to the problem and agreed to select and award a contract at the November 11 meeting. That work, I understand, will proceed in January 2011. I'm looking forward to the final outcome, and am hopeful the company selected is successful and there is minimal secondary damage. Structural repairs of this type, involve some uncertainty. A concerned owner asked about this during the November meeting, and with the board's permission I read a statement contained in the proposal of the selected bidder to all present.

A minor fire in a utility water closet in a garage, which was caused by wiring or the space heater,  was an opportunity to begin looking at alternatives. Heat tracing might be such an alternative, and preliminary discussions with management and maintenance occurred. However, this will requires funds and perhaps some experimentation. At BLMH there are secondary considerations because of the quantity of buildings. It's not one or two water closets. There are about 84. So costs can escalate. I am also inclined to make incremental changes so as to be assured there are no secondary problems. Another item to explore in 2011.

A fire at a neighboring association gave us all an opportunity to think about fireplace safety. There have been requests for conversion to wood burning from time to time. I am opposed to this, and I think if all owners were aware of the differences of gas- and wood-burning fireplaces, and the consequences and safety issues, they also might be concerned. I made several posts here, and was involved in the preparation of an "Urgent Safety Notice" for owners and residents. This was posted in each building and I have been told, will be included in the January newsletter.

The former LD undertook with management, the installation of lower wattage CFL light bulbs in 2010. This was an "experiment" and at the November association meeting, it was pronounced that the results are acceptable. So this will now migrate to all buildings. I can't state what the precise reduction in energy or lighting levels will be.

Last year, there were several garages in need of new floors. This came up for serious discussion at the same time as the reserve study, and the budget for 2011. I discovered that there had not been a recent survey of garage floors. In other words, this association does not really know the condition of all garages. I approached the board and suggested that we delay repairs in 2010 until we completed a survey in 2011. My rationale was the fact that we might not have sufficient funds to do all of the necessary driveways and there may be other driveways in even worse condition than those discussed in 2010. The board agreed.

That's one of the problems in an association such as ours. With board turnover, and more than enough to do at all times even with a full board, there is a lot of information that "drops through the cracks" both figuratively and literally. So we don't always know all of the facts. On assuming my responsibilities, I discovered just how little the board really knows about some aspects of the condition of our property. We have maps of all of the trees on the property, but when one is removed, is the map updated? We sometimes get input from unit owners about problems with their concrete patios, or a garage floor, but do we have a spreadsheet with information and a rating system on all and that includes the history of repairs? Management has a lot of information, and that has been passed to earlier boards. But it's not always readily available for a new board member. On assuming my position on the board, I asked several board members if there was a chart listing the dates of our roofs. I mostly got blank stares. An earlier A&M Director had requested that information in 2006, and I was fortunate to obtain a copy of management's response. But this data seems to get lost, or doesn't get passed from board member to member. I can understand why. If a board becomes adversarial, and in the recent past, our association's board has been, that's little incentive for members to cooperate.

However, in 2010 I did my best to cooperate with previous members and current members, and it's all about doing the job, as far as I am concerned.

So I suggested the A&M Director prepare several spread sheets in 2010 and he passed those to me at my request. I'll update them or improve them, and they will, in turn, be passed to future directors and boards. That's the way it should be, shouldn't it?

I've completed a task agenda for 2011 and have provided some insight into that, to our board president. I'll be expanding it as necessary and I'll provide some information to you, the reader, on this site, as part of future posts.

For example, that task agenda included researching  the impact of electric vehicles here at BLMH.Those vehicles will require a lot of electricity to recharge. Recharging in our garages, using association electricity for that purpose, is akin to providing "free gasoline" to some owners, at the expense of other owners. That's not a good use of association money and of YOUR fees.  I've had several conversations with owners here at BLMH about this, have completed significant research into the issues of electric vehicles here at BLMH. I've made a preliminary appraisal and discussed this with management and our maintenance company. I've gotten their expert opinion, I sent an "executive summary" to the board members, and as a consequence, a brief statement was sent to our Communications Director for inclusion in my 290 word allotment in the January newsletter. I'll have more on electric vehicles and possible consequences posted here in the near future.One member of the board suggested that we delay until an owner purchases such a vehicle. I disagreed. I'm opposed to being a reaction to events at BLMH, and would like to minimize that. I also suspect an owner might like to be aware of the issues and possible costs of recharging an electric vehicle in the garage, before they purchase one. That's the position I've taken with the board.

The budgeting process for 2011 required two workshop meetings, attended by most, but not all of the current board members. The Operations and Maintenance budget was trimmed to what I would say is "a minimum." This was done with the goal to minimize the fee increase. To accomplish this, required some reductions in services, and a few assumptions. In football, they would call this a "hail mary pass." The reserves budgeting was increased, but by less than that recommended by management, as a consequence of the "reserve study." I prepared various charts and diagrams for presentation as part of a "slide show" at the November association meeting. Because of time restraints, this was presented after the conclusion of the meeting. If I discount board members and the spouses of such members, and management, about six people stayed after the formal close of the meeting, for that presentation. That's about 1.8% of the ownership. So I conclude that "budgeting" might be of  little interest to 98% of the owners at BLMH.

At the request of the CD, I prepared a pie chart of the O&M budget for inclusion in the December newsletter. This newsletter "never happened."  I now understand the chart I prepared will be issued with the January newsletter.

I would say the board did its best to come to a minimal fee increase for 2011. I also know that some owners will consider any fee increase, to be "too large" an increase. All I can say is, I am aware of the problems facing our owners because of the economy, the 0% COLA increase for those on social security, and so on. I am also aware of the need to maintain this property. I find it interesting that an owner, whose building received a new roof in 2010, made the statement that "I hope I get a new driveway [soon]." That money will have to come from somewhere, and specifically our reserves. It's absolutely necessary to continue building those reserves, to accomplish the major roofing and driveway projects this association has undertaken. If we don't, a situation akin to "musical chairs" will occur, and some owners won't have a place to sit when the music stops. In our case, when their roof or driveway is assessed as needing replacement, there won't be funds available unless we collect and save them as reserves.

Finally, there has been very limited discussion of modifying "emergency" procedures and communications methods here at BLMH. This was prompted by the water main break on Gloucester. Perhaps in 2011?

So, that's a very brief, and very abridged, summary of my first three months as a member of the board.. There has been some work, and it has been very interesting.

Consider the possibilities of the synergy between an energized and pro-active board, management, the contractors and our owners and residents. Wow! That's what will make this association what it is in 2011! I'll be posting on "Possibilities, 2011" soon.

Comments, Corrections, Omissions, References

Note 1.  I was given no opportunity to make a statement at the November 11 meeting. It was "let's get to work." So I have accepted the direction of the board, and work it is. I've taken the opportunity to provide my perspective as a new board member in this post.