Minutes, Management 2024 01 07

Topics: proxy requirements, budget, reserve, alternate income sources

Sunday, January 7, 2024, 10:00 a.m. to 1:00 p.m.  Rescheduled from Tuesday January 2.

Present: Vinnie, Cheryl, Kay (notes), Scott, Jorge (10:30), Ben, Kerry, Mary

Action Items

Ben will prepare a proxy form. 

Ben & Vinnie will contact Dale to calculate the reserve.

Vinnie will do a spreadsheet and graph of the reserve.

Cheryl will notify necessary person on Carol's behalf about changes in her HO6 due to deductible (talk to Marina about who).

Proxies

Ben checked the Bylaws. To approve the budget 67% of the vote of the undivided interest (owners) must vote either in person or by proxy.  To be official, a proxy must designate a specific person, be submitted in writing, with a signature, and submitted to the Association Secretary or their designate (so therefore the note-taker) prior to or at the start of the meeting.  The quorum requirement is "67% present in person or by proxy" so attending on zoom doesn't count.  If 67% is not present, the meeting is adjourned for 24 hours, reconvened, and whoever is present counts.

Q. How did we deal with this in 2021?  A. We ignored it.

You can specify how your proxy votes or leave it to their judgment.  A person can attend on zoom but not vote on zoom and doesn't count toward quorem.

Scott says the law changed this past year, and the requirement is now based on people present at the meeting not total number of owners.  Does condo law trump bylaws?

Ben is preparing a proxy form.  For this meeting, as people are adjusting to us following this, Cheryl would be willing to act as a runner to take proxy forms to people who are on zoom and on site.  Email the form.  Also print & put a copy on doors?

Budget

There is inadequate time before the first January ACM to meet distribution requirement to allow us to vote on the budget proposal. Second ACM is the 28th.

The budget draft has all committee budget requests funded.

December expenditures haven't been added into the actuals yet.

Budget has to be out by 3 p.m. on the 18th. Next Management is the 16th. If Vinnie isn't elected on the 10th he will still show up on the 16th.

Cheryl will ask Marina who to notify on Carol's behalf about the change in insurance deductible and the needed change in the HO6.

Better to present a single option as Management's recommendation.  Maybe include information on why we aren't recommending certain options.

Insurance. The insurance line is adjusted to reflect change in premium from change in deductible. The Common House Committee's request includes c.h. supplies, which is usually under non-committee expenses; Vinnie had put it all under requests (discretionary) but will revise to split the request between discretionary and non-.

Attorney. The proposal doesn't include attorney fees.  Scott recommends $1500. Add to draft.

Reserve.  The amount going into the reserve doesn't need to match the expenditures on a year-by-year basis, so long as it averages over time and never goes negative.  OTOH we have some expensive repairs coming up that will sharply draw down the reserve, earlier than the analysis planned, potentially dropping our level of funding to 33% of recommended amount. OT3rdH we are putting off some remodeling the reserve planned for soon.

The recommended increase to the reserve by itself is an 15% increase in fees.

Vinnie & Ben are sending new numbers to Dale-the-reserve-guy.  Ask him to expedite the calculations even if we need to pay extra, so we have them by Wednesday if possible, absolutely by the second ACM.

Do we need to wait until we have Dale's calculations before budget discussion? Decided, no.  How confident are we that our estimates of the amount needed in the reserve?  Quite a bit, since we aren't required to follow the analyst's recommendations.

Vinnie will do a spreadsheet for the reserve and graph showing the annual balance expected, for presentation during budget discussion.

Maintenance request.  We need a licensed bonded property inspector checking uninhabited units, of which we now have two.  Can we charge the cost to the owner?  If water is turned off, is it turned off outside the house? With the heat off, a turn-off inside the house can freeze and break.

Income. The budget draft has none of the new suggested revenue streams, since none of them are secured.

If misc. fees (guest rooms, extra vehicles, garden beds) are increased in the 2024 budget, they are only good for 2024 unless we have specific language in the budget proposal saying fee increases are until changed.  A problem with budgeting them into expenses is that implementing may change behavior.  What would we have earned on a guest room fee if we assume a change in fee results in changes in number of guests?

The law allows a 0.5% reinvestment fee, which goes into the reserves.  The management company Ben talked to said a $500 transfer fee is about as high as anybody charges.  We can include as many transfer fees in our budgeted income as we can justify; that is, if we historically average two sales per year, it's okay to plan two transfer fees in our income. Are we required to have community approval before implementing a reinvestment fee?  Management can create a rule that is good for 90 days before the community must approve it.

Our CCR says hourly fee for not working can be three times minimum wage.

Vinnie's count is that there are fourteen units with more than one vehicle.

Most of the usage-based fees are going to upset someone. Naturally somebody who uses a particular amenity more than others will prefer that the cost be paid entirely from everybody's fees rather than partly by a usage fee.  Catering to a particular person's feelings by not implementing a particular fee while overriding someone else's concerns on another itself can be upsetting. 

Can justify pay-or-play updates, guest room charges, and vehicle fees based on expenses and usage in other communities. For now do not include the garden bed fee. 

For fairness and accountability, the chicken club should be paying for its water (while the hydrant is on in warm months).

41.74% increase without new fees, 29.18% with new fees and grant for AED.

Idea:  fee for storing personal items in workshop.

Moving part of the reserve to CDs gave us an additional $3K in interest. 

Retreat.  Having an outside facilitator can make a huge difference in participation and community cohesiveness -- Having discussions about concerns specific to our community guided by somebody really neutral.  The last time we did a retreat with an outside facilitator was about 2018. It would be budgeted on the Procedures line item. 

The resources from cohousing.org aren't a fully effective alternataive. They are free to us as a Partner but the issue is getting people to use them, and to use them collectively so we have group discussions.  Devote an ACM to watching and discussing one of cohousing.org's recorded webinars?

Management Election

Kay, Cheryl, and Jorge are continuing on Management and Scott's and Vinnie's position are up for election.  Vinnie replaced Colleen