Board Meeting Monday August 12th
August 12, 2019
BOARD OF DIRECTORS MEETING
Monday August 12, 2019
2nd Floor Party Room
Agenda & Report
6:00PM – CLOSED SESSION (Management Office)
7:00PM – Budget & Finance Commission Financial Review
7:30PM – OWNER FORUM – 15 minutes, 2 minutes per person
The Board and Management will address feedback and questions from Unit Owners.
OPEN SESSION – Call to Order
Roll Call – Confirm Quorum
The meeting chair, expected to be Board President Michael Parrie, will confirm a quorum of Board Members is present. Board Members and representatives from Management will be introduced.
Commission Reports
Chairs or others so designated will be invited to update the Board on Commission business and activities.
Board Report
The Board President may review business or other matters of interest with the Board and audience.
Action Items
Closed Session Business
This agenda item is provided for any resolutions proposed resulting from Closed Session discussion.
Minutes – Board Meeting June 24, 2019
Attached to the report for Board Member review, are the proposed minutes from the Board of Directors Meeting held on Monday June 24, 2019, as submitted by Timothy Patricio, Property Manager.
A sample motion: “I move the Board of Directors approves the minutes from the Board Meeting held on Monday June 24, 2019.”
Rules and Regulation Review Commission Appointments
There are 5 volunteers Commission which liaison Jean Shamo proposes for appointment:
Terry Gorman, Unit 3307
Roxana Malene, Unit 3503
Ann Hicks, 3901
Angela Gottschalk, Unit 4601-03
Ileo Lott, Unit 5011
A sample motion: “I move the Board of Directors approves the appointment of Owners Terry Gorman (3307), Roxana Malene (3503), Ann Hicks (3901), Angela Gottschalk (4601-03) and Ileo Lott (5011) to Commission formed for the review of the Association’s Rules and Regulations.”
2020/2021 Budget Calendar
Attached to the report for Board review and consideration, is a proposed Budget Calendar for work and activities related to creating and reviewing the PTCA Budget for the upcoming 2020/2021 Fiscal Year.
A sample motion: “I move the Board of Directors approves the proposed Budget Activity Calendar for the 2020/2021 Fiscal Year, as proposed by Management.”
2018/2019 Audited Budget Surplus
The Board accepted the audit of the 2018/2019 Financial Statements at the June 24th Board Meeting. Attached to the report for Board Review, is a page from the draft audit showing the Excess of Operating Revenue over Expenses for the 2018/2019 fiscal year, which was $170,687.
We suggest the Board approve transferring this net Operating Surplus to the Association’s Reserve fund. We believe this is warranted, in part due to unexpected expenses related to the bike room masonry, replacement of the plaza sign and work to the market flooring. Furthermore, future possible work in the building such as garage concrete and membrane replacement will be large investments with the possibility of unknown conditions warranting consideration.
To make such a transfer, the Board should recognize this was a surplus of operating funds from assessment income collected from owners, but that upon due consideration the Board believes for the financial health of the reserve, these funds should be kept for future capital needs of the building. The following motion for resolution sets for such consideration, and is consistent with past advice from legal counsel.
A sample motion: “WHEREAS, the Board of Directors (the “Board”) of Park Tower Condominium Association (the “Association”) is the governing body of said Association and is charged with the direction and administration of the Property subject to that certain Declaration of Condominium for Park Tower Condominium, as from time to time amended (the “Property”); and
WHEREAS, the Declaration provides that the Association is obligated to maintain, repair, and replace the common elements located in the Property; and
WHEREAS, an accounting for the 2018/2019 fiscal year revealed that there is an accumulated amount of cash in excess of the amount required for actual expenses (“excess”) in the amount of $170,687; and
WHEREAS, the Board has reviewed the status of the Association’s capital reserve account; and
WHEREAS, the Condominium Property Act requires, pursuant to section 9 (c) (2), the Association to maintain reasonable reserves for capital expenditures and deferred maintenance for repair or replacement of the common elements located in the Property; and
WHEREAS, the Board has considered the following factors relative to the reasonableness of the Association’s reserves:
1) The repair and replacement cost, and the estimated useful life, of the property which the Association is obligated to maintain, including but not limited to structural and mechanical components, surfaces of the buildings and common elements, and energy systems and equipment;
2) The current and anticipated return on investment of the Association’s reserve funds;
3) The amount that the Association’s most recent capital reserve study provides should be on deposit in the capital reserve account;
4) The financial impact on the unit owners in the market value of the condominium units of an immediate assessment increase to fund the reserves and
5) The ability of the Association to obtain financing or refinancing as a supplement to the capital reserve account; and
WHEREAS, after due consideration of the foregoing factors, the Board contends that their fiduciary duty demands that the excess funds be transferred into the capital reserve account.
NOW, THEREFORE, BE IT RESOLVED that the Park Tower Condominium Association Board of Directors approves the transfer of $170,687, the identified year-end operating fund surplus cash for 2018/2019, to the Association’s reserve account, after taking into consideration the criteria for establishing a reasonable reserve set forth in Section 9(c)(2) of the Illinois Condominium Property Act, in order to more properly fund said reserve account.”
2nd Floor Deck Pergola Lighting
The Home Improvement Commission recommended the installation of Edison Bulb string lights along the 2nd floor deck pergola canopies. Cut sheets of the options for consideration are attached.
If authorized, we anticipate purchasing 2 to 3 30’ outdoor string lights per canopy for accent lighting. There is funding of about $10,000 for deck area lighting and improvements, and this was a planned operating project for consideration this year. We expect the expense will be no more than $500, with in house installation of the lights.
Because adding lighting in this location is a very visible alteration of a common element, we request the Board formally authorize this activity.
A sample motion: “I move the Board of Directors approves a budget of no more than $500 for the purchase of ‘Outdoor Edison-Style String Lights, for installation on the 2nd Floor Deck pergola canopies, as recommended and directed by the Home Improvement Commission.”
Service Animal Request
Attached to the meeting report for Board review is a request from a Unit Owner for authorization to keep a Service Animal in the unit, as well as a written opinion in response from the Association’s legal counsel.
A sample motion: “I move the Board of Directors approves [or] denies a Unit Owner’s request for a service animal.”
Security Camera Addition
Management requests the Board of Directors consider authorizing a budget not to exceed $3,500 for supplemental improvements to the Security Camera network, including an additional camera proposed for installation next to the staff’s time clock.
With the transition to ADP Payroll, we will no longer be using the Dayforce bio-metric timeclock, which takes pictures of the employees as they punch in should they need to be referenced. A new camera is a simpler long-term solution for virtually the same layer of protection and accountability.
A sample motion: “I move the Board of Directors authorizes a budget of $3,500 for camera installation as proposed by management, including the necessary materials, wiring and integration into the existing surveillance network and software.”
Outdoor Pool Cover
In a meeting with our team and pool vendor All Seasons, regarding our pool facility, we discussed the concrete repairs we’ve needed to do on a fairly routine basis each Spring the past 2 years. Our action plan is to provide more ample and reliable protection of the surface from the elements. Last year, the staff has covered the pool with a make shift cover using a tarp and sand bags. One blew away despite the sand bags, and another was torn up beyond recognition.
The collective recommendation is to install a more permanent cover, professionally sized and anchored. We received a bid from All Seasons to do this for $2,420. This is a small enough expense to be handled through our Operating Budget, but the protection it will provide could very well pay for itself within a season should it prevent the damages we dealt with the last 2 winters.
A sample motion: “I move the Board of Directors approves the proposal from All Seasons Pools & Spas, as proposed for a cost not to exceed $2,420, to install an anchored pool cover for the outdoor pool.”
HVAC Repairs & Replacements
This year, $643,700 is budgeted from the Reserve Fund for a variety of HVAC related projects. Our staff is working diligently to get each of the planned projects underway. A handful are ready for the Board to authorize. We have a couple of previously unknown conditions as well, but we believe based on all the preliminary planning and numbers that we can expect to remain under or very close to that budget.
Of that number, $94,200 was earmarked for Garage HVAC/Ventilation. Several things need to be done:
a. We need to tie in the Carbon Monoxide Detectors to the exhaust system, so if a detector goes off the louvers open and a fan comes on that provides fresh air. This actually was not specifically budgeted, however, a City Inspector recently visited and said to be fully code compliant we need to do it. As previously reported to the Board, we got a quote from our control system vendor, Kroeschell Engineering (attached), and they proposed $4,165 to do the necessary tie ins. Because of the relatively small expense, as well as the City’s visit and that this is health and safety related work, after consulting the Board President, we already scheduled this work. We request the Board ratify this measure.
A sample motion: “Be it resolved the Board of Directors approves work to tie in the garage carbon monoxide detectors to the garage exhaust system as proposed by Kroeschell Engineering at a cost of $4,165.”
b. On the same proposal, Kroeschell proposed the alarms be tied into our control system. This is not necessary, however this would alert us sooner if there was a problem in the garage and thereby improve our response time should there be a problem. To do the necessary wiring and software update, will be $4,225. Because this was elective, we did not proceed with this part of the proposal.
A sample motion: “Be it resolved the Board of Directors approves work to tie in the garage carbon monoxide detectors to the building automation control system as proposed by Kroeschell Engineering at a cost of $4,225.”
c. Duct work running through the 1p garage was found to be rotted and deteriorating, and actually compromised in a couple locations. Meaning, heated or cooled air is actually over mixing with fresh air, and wasting energy. We got 3 bids for this work:
DEMCO $9,860
Oak Brook Mechanical $4,974
WJ O’Neil $11,250
A sample motion: “Be it resolved the Board of Directors approves work to replace a deteriorated section of airway duct work in the 1P garage as proposed by Oakbrook Mechanical at a cost of $4,974.”
d. The two fan motors serving the exhaust system were specifically a part of the $94,200 earmarked here. We’ve gotten an initial bid to replace these, from WJ O’Neil, for $19,700, and our engineer is awaiting two more proposals. They will be an improvement from the old fans, in that VFD’s will be installed, which should result in relatively significant energy savings. We request the Board set a budget of $40,000 to do this work and we will proceed once we get the two additional bids.
A sample motion: “Be it resolved the Board of Directors approves a budget of $40,000 to complete the replacement of two garage exhaust fans, and approves for management to accept a proposal within that figure once two additional competitive bids from reputable vendors are received.”
e. Not specifically budgeted, but in need of work, we have a malfunctioning condenser pump, serving the main chillers for the AC system. The problem is resulting in wasted water and reduced chiller efficiency. We have two bids for a rebuild and are awaiting a third:
FTI Pumps $4,273
Omni-Pump $4,575
Omni-Pump will actually include some additional work polishing the pump shaft and case rings, so we are going in their direction of their estimate at the moment. The team is just waiting for one more bid.
A sample motion: “Be it resolved the Board of Directors approves a budget of $4,575 to rebuild the AC condenser pump, and approves for management to accept a proposal within that figure once a final competitive bid from reputable vendors is received.”
Construction Requests
Attached to the report for Board Member review are remodeling packets for the following Unit Owner construction projects:
#2101-Full Unit Remodel
#3111-Flooring Remodel
#3611-Flooring and Kitchen Remodel
#5406/07-Bedroom Remodel
A sample motion follows: “I move the Board of Directors approves the remodeling plans of unit 2101, 3111, 3611 and 5406/07, as submitted by the unit owners, following the recommendations of the building engineer as outlined in their written specifications and in accordance with the Rules and Regulations and remodeling guidelines of the Park Tower Condo Association.”
Business Reports
Treasurer’s Report
Board Treasurer Jean Shamo is expected to review recent fund balances and financial information of interest.
Fund Balances End of June 2019
Operating Funds $745,726 (increase of $88,371 from prior month)
Reserve Funds $1,855,358 (decrease of $244,334 from prior month)
Total Cash and Investments $2,601,084 (decrease of $155,963 from prior month)
June 2019 Revenue and Expenses
Total Operating Revenue: $518,724
Total Operating Expenses: $466,280
Income From Garage: $34,576
Contribution To Reserve: $144,975
Total Deficit: $57,956
CD Transaction
Management acted in consultation with the Board Treasurer to purchase a CD at First Virginia Community Bank for 12 months, at the recommendation of First Service Residential, totaling $208,633 with a 2. 5% yield. See the attached “Reserve Portfolio Analysis” from First Service Residential, referencing this CD.
A sample motion follows: “I move the Board of Directors approves the purchase of a $208,633 Certificate of Deposit with a 2.5% interest rate yield for 12 months with First Virginia Community Bank, for the Reserve Fund investments, scheduled to mature on or just after August 6, 2020.
Management Report
The Property Manager, Tim Patricio is expected to review Business and Activities of interest, and the most recent Sales Activity.
ADJOURNMENT
There being no further business, the Board will consider adjourning the meeting.
A sample motion: “I move the Board of Directors adjourns the August 12, 2019 Board Meeting at ____PM.”
OWNER FORUM – 15 minutes, 2 minutes per person
The Board and Management will address feedback and questions from Unit Owners.
Next Board Meetings Expected Monday August 26th, and Monday September 9th 7:30PM. All meetings in the 2nd Floor Party Room unless otherwise posted.
About the Author: Tim Patricio
Park Tower Horizons
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