Updated Surplus Numbers

Updated Surplus Numbers
Updated Surplus Numbers: Actual surplus 2018 per audit was $85,163.
Boards 2011-2018 implemented policies and procedures with specific goals:
stabilize owner fees, achieve maintenance objectives and achieve annual budget surpluses.
Any surplus was retained by the association.
The board elected in fall 2018 decided to increase owner fees, even in view of a large potential surplus

Average fees prior to 2019

Average fees prior to 2019
Average fees per owner prior to 2019:
RED indicates the consequences had boards continued the fee policies prior to 2010,
BLUE indicates actual fees. These moderated when better policies and financial controls were put in place by boards

Better budgeting could have resulted in lower fees

Better budgeting could have resulted in lower fees
Better budgeting could have resulted in lower fees:
RED line = actual fees enacted by boards,
BLUE line = alternate, fees, ultimately lower with same association income lower had
boards used better financial controls and focused on long term fee stability

Friday, January 20, 2017

A walk down memory lane. We had "change" here, too, and a swamp


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I see some parallels today.

First, there's change in Washington today. It was unexpected and unwelcome by many. Eight years ago a lot of people in the U.S. voted for "hope and change." As the Obamas leave, flying literally into the sunset by going west to California, Ms. Obama has been very vocal with promoting that this is now "The end of hope." But I need to point out that the Obamas leave much, much wealthier than they were only eight years ago. Credible sources put their net worth at about $25 million. Not bad for public servants.

Eight years ago we had a handful of politically astute people in this association who fed upon owner dissatisfaction and the populism of the Obamas. They fomented some of that dissatisfaction, just as the Obamas talk about "the end of hope." These politicians ran for our board on a slate of "Change." They saw an opportunity to ride on the coattails of others, which I assume is their method of succeeding in life. They were correct, their approach succeeded and four of them were elected.

Yet, within two years they had all departed. One left to pursue personal interests elsewhere, but remained to live on the property a few months of the year. Three resigned from the board when they were held accountable, and decided to ride on the coattails of others, yet again.

In some ways the ROCs were from the same mold as the "snowflakes" of today. They pursued an agenda of "change" in which they attempted to fire management, our maintenance contractor and empower the tenants living on the property. They wanted to give tenants the same rights, privileges and powers as the owners who pay the fees and bills. They didn't seem to be very eager to hold owners accountable for paying their fees.

In 2008 it was supposed to be a new dynasty in Washington. So too at our little association. One of the new board apparently had decided to run the HOA as our new "management." In other words, clean up. They promised garage sales, parties on the grounds, free donuts and coffee and lower fees. Those who couldn't or wouldn't pay could be given a pass.

They were the forerunners of the snowflakes of today.

They didn't expect that the hard working middle class in our HOA would get a champion. They were wrong.

I've been working for 54 years. I was not about to allow these self serving, misguided individuals to take my wealth, or the wealth of 335 others and gamble with it, to their personal benefit. Buying a home or condominium is one of the largest purchases one might make in their lifetime. We have dozens of retirees living in our association. I was well aware that the politicians would fly away when things got tough, to leave the rest of us to pay the bills.

That's what the Obamas did today. With a $200,000 annual government stipend and worth about $25 million, they have done very well. From years of personal and practical experience, I knew that is what the politicians do and I also knew that the rest of us would pay for this, and we will.

So too for our little association. Fortunately, the snowflakes on our board left before they could inflict long term financial damage.  I have expended thousands of volunteer hours to right this. The snowflakes too get the benefits. But we are required to treat all owners equally, and I do. It is immaterial if I like them, or if they keep the rules or pay their fees. Our association has the means to deal with this and we do. But I don't have to like these people, I don't and I never will. Perhaps the most difficult task I've had is to treat them civilly as I am required to do with all owners. In fact I despise them.

For our country, it isn't so simply. In addition to the $ Trillions collected in taxes and spent in the last eight years, the Obama Administration borrowed about $10 trillion more. We, the citizens are on the hook for this. We will pay. There will be serious consequences.

In our HOA, had the ROCs had their way, each and every owner would be on the hook for thousands of dollars. It almost happened. But then I'm no politician. I'm a businessman, an advocate and I do operate as a fiduciary as a board member. No helicopter flights into the sunset for me. Nor do I get paid a handsome salary, or book fees, or speaking fees or any kind of HOA funded retirement. So our HOA is solvent, has fee increases of about 1-1/2 percent per year, has about $1 million in the bank and is very well maintained and does operate in accordance with long term reserve studies.

I'm no Trump, but I did my best to drain the swamp at BLMH. Yet there are entrenched politicians. Yes, there are those who struggle to pay their fees. But we each choose to live here. A few do complain just like the Hollywood elite and they don't leave. Perhaps they should. This is a big country and there are many places to live. Some are better than freezing one's ass in the financially decrepit, politically and financially mismanaged State of Illinois.

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