BOARD OF DIRECTORS MEETING

Management Report

Monday February 12, 2024

6:30PM – CLOSED SESSION

The Board is scheduled to meet to discuss rule violations, pending litigation, Unit Owner account issues or personnel matters.

7:30PM –  OWNER FORUM

The Board of Directors and Management will welcome and address feedback and questions from Unit Owners.

CALL TO ORDER – Board Meeting Open Session

The meeting chair, expected to be Board President Michael Parrie, will call the meeting to order.

Confirm Quorum

The meeting chair will confirm a quorum of Board Members is present. Board Members and representatives from Management will be introduced.

Commission Reports

Commission chairs or members so designated will be invited to update the Board and Owners on business and activities.

Attached to the report for Board review is the most recent Home Improvement Commission report.

Board Report

The meeting chair may give a report on current Association business and activities of interest.

Action Items
1. Closed Session Business

This agenda item is provided for any resolutions proposed resulting from Closed Session discussion.

2. Minutes – Special Meeting of the Unit Owners January 8, 2024

Attached to the meeting report for Board Member review, are the proposed minutes for the Special Meeting of the Unit Owners to Review the Proposed 2024/2025 Operating Budget held on Monday January 8, 2024, as submitted by Property Manager Timothy Patricio, for Board consideration.

A sample motion: “I move the Board of Directors of the Park Tower Condo Association hereby approves the minutes of the Special Meeting of the Unit Owners to Review the Proposed 2024/2025 Operating Budget held on Monday January 8, 2024.”

3. Minutes – Board Meeting January 8, 2024

Attached to the meeting report for Board Member review, are the proposed minutes for the Board of Directors Meeting held on Monday January 8, 2024, as submitted by Property Manager Timothy Patricio, for Board consideration.

A sample motion: “I move the Board of Directors of the Park Tower Condo Association hereby approves the minutes from the Board Meeting held on Monday January 8, 2024.”

4. Updated 22.1 Disclosure

Attached to the report for Board Member review is the updated 22.1 disclosure through January 2024 for formal Board approval. To answer a question I received, although it is February, this 22.1 disclosure is current through January because that month is closed. We don’t report February activity in the 22.1 until the month is closed.

You will also note within the 22.1 it references the reserve balance as of the end of December. This is because although January has closed, we do not get and review January bank statements until February. So those are under review as we speak.

The 22.1 Disclosure, is a standard document we provide upon request in the event of any sale and make available for inspection to the prospective purchaser. This incorporates:

(1)           A copy of the Declaration, by-laws, other condominium instruments and any rules and regulations.

(2)           A statement of any liens, including a statement of the account of the unit setting forth the amounts of unpaid assessments and other charges due and owing as authorized and limited by the provisions of Section 9 of this Act or the condominium instruments.

(3)           A statement of any capital expenditures anticipated by the unit owner’s association within the current or succeeding two fiscal years.

(4)           A statement of the status and amount of any reserve for replacement fund and any portion of such fund earmarked for any specified project by the Board of Managers.

(5)           A copy of the statement of financial condition of the unit owner’s association for the last fiscal year for which such statement is available.

(6)           A statement of the status of any pending suits or judgments in which the unit owner’s association is a party.

(7)           A statement setting forth what insurance coverage is provided for all unit owners by the unit owner’s association.

(8)           A statement that any improvements or alterations made to the unit, or the limited common elements assigned thereto, by the prior unit owner are in good faith believed to be in compliance with the condominium instruments.

(9)           The identity and mailing address of the principal officer of the unit owner’s association or of the other officer or agent as is specifically designated to receive notices.

As a matter of routine, we continue to update this regularly, and will present it periodically for Board review and formal approval.

A sample motion: “I move the Board of Directors of the Park Tower Condo Association approves the 22.1 disclosure as drafted with the best available information through January 2024.”

5. Rules Review Commission Membership & Liaison

The Board should formally appoint the members to the Commission and a Board Liaison.

Following are the Owners of record who have volunteered:

Pamela Andersen, Unit 1810

Kevin DePhillips, Unit 1503

Larry Hamilton, Unit 3901

Phoebe Helm, Unit 1511

Sheridan Hodges, Unit 401

William Oren, Unit 5314

Mariya Vitomska, Unit 2404

Ed Walsh, Unit 2306

William Whelehan, Unit 607

A few considerations:

The Board could choose to accept all the volunteers, simply placing current Ownership as the only criteria for participation. You could also limit the number of appointees if there is a concern that too large a group might not be manageable for such a task. In the past there have been Boards that set a minimum time the Owner should have resided in the building. One Board set a limitation that there should not have been any recorded rule violations within the prior 12 months. You can integrate any such criteria into the resolution.

On top of members, the Board should appoint a Liaison to schedule, organize and chair meetings (with as much assistance from Management as is needed).

The Board may also consider setting some guidelines for review. Most importantly we strongly suggest a deadline. Since amendments to the Rules will require a mailing, a deadline coinciding with other possible mailings would be efficient. Also, you could set areas of particular focus that should be considered, any potential new rules to be debated or any other guidelines if necessary. This does not need to be done now. Members could simply review the Rules and send notes for consideration, if you agree to that as part of the process. As we discussed previously, Management will complete a page by page review as we’ve done in the past and provide this to the Commission.

A sample motion: “I move the Board of Directors appoints _________ to the Ad Hoc Commission for Review of the PTCA Rules and Regulations [inject any criteria here ‘so long as’], and _________ as the Board Liaison, and hereby instructs the Commission to complete their review and present proposed amendments by _________.”

Again, any guidelines and areas of focus can be issued in separate instructions that don’t necessarily require a resolution. The Board could set a date by which members have to present individual suggestions of their own.

6. 2024/2025 Commercial Package Insurance Program

Attached to the report for Board Review is the proposal from Alliant Insurance Services for renewal of the Association’s Commercial Package Insurance program. Of particular importance is the information on pages 3-9 which summarizes the options for renewal and proposed premiums. On pages 8-9 they list the various markets that were approached for quotes and the results.

The key information follows:

Also previously forwarded to the Board for review was a narrative from our Alliant broker Nancy Ayers with highlights on some of the policies and various proposals their team sought and received, as well as key changes to any deductibles or policy limits. It reviews markets they went to that declined to bid, and the reasons which you will see were often because the building is un-sprinklered or because the carrier felt they could not be competitive and therefore did not want to take the time to go through a complicated bidding process.

It is as clear now as it has been in recent years, the real culprit for increases in rates continues to be forces in the market outside the Association’s control.

Management is prepared to recommend Option 2, which includes the change in Excess D&O carrier to Ironshore. I’ve highlighted the relevant lines in the diagram above. The good news, with this change the total proposed premiums of $528,324 fall just below the approved budget for insurance for the 2024/2025 fiscal year which is $533,100.

It is fair to note that during budget discussions we indicated that Travelers was pushing back on the Insurable Value Appraisal, which was done in 2023 and indicated a replacement cost of $235,200,000. Travelers was using $253,662,095 last year, and wanted to increase it for inflation. However, they agreed to keep at $253,662,095. When you consider inflation and other unknown variables, this actually seems reasonable.

A sample motion: “I move the Board of Directors of the Park Tower Condo Association approves renewal of the Association’s annual insurance program for the 2023/2024 fiscal year, as proposed and recommended by Alliant Insurance Services Option #2, for all policies including Property Insurance, General Liability Insurance, Equipment Breakdown Insurance, Crime Insurance, Director’s & Officers Insurance, Cyber Liability, Workers Compensation Insurance and Umbrella Insurance, at a total combined premium expense of $533,100.”

7. ASTOUND Fiber Wiring Plan

Attached to the report for Board review and discussion is a Scope of Work describing the basic plan for ASTOUND’s proposed Fiber-to-unit upgrade.

As of the drafting of this report, we are awaiting a much more detailed plan and timeline. We were expecting this sooner and are hoping it will arrive in time for us to complete an initial review, ask any questions we have and then forward it to you in time for the meeting. We already have had several calls and discussions with the ASTOUND construction team and leadership. If we do not get the plans in time there will still be much we can discuss.

For now, the Scope of Work attached for the Board is just a preliminary outline of the expectations.

Side Note – The much anticipated Cable/Internet price decrease will be effective March 1st. The agreement that was negotiated indicated the price drop would go through once either the equipment upgrade for 1G or the Fiber build out was completed. However, we pushed back because of the time that it has taken to get final details together on the fiber plan. So, they capitulated. Owners will see the new rate on their March statements. We will need to make sure we make a final decision on the fiber build once we have the plans, in a reasonable amount of time.

8. Elevator Cab Remodeling

Attached to the report for Board Member review are the proposals considered by the Home Improvement Commission for remodeling of the interiors of Cabs 1-5. (It was determined that remodeling work in cabs 6, 7 and 8 would be unnecessary, though the planned door safety operator replacements will include all elevators except 5. Elevator 5’s operators were completed in 2022.)

Also attached Board Members will find a cover worksheet which breaks down a summary of the RFP responses. The grand total for all the proposed work with each bidder follows:

Eklund’s                               $319,032

Imperial Interiors             $296,778

OTIS Elevator                     $269,285

There are some elements of each bid you will find that have to include oversight of work by OTIS, since they are the contracted maintenance provider. One of the liability elements of the contract requires their involvement with much if not all work we might do to the elevators. This includes safety elements connected to the weight of the cabs. Balancing of the weights will have to be done for example, and that can only be done by OTIS at this time.

We were also asked to consider the possibility of adding ADA Speakers which would introduce a Speech element to the elevators, consistent with those at other high rises and buildings with recent cab remodeling and elevator upgrades. Particularly newer buildings where this is now required. This too would be done by OTIS and they bid $24,031 for cars 1-6.

That would bring the totals to:

Eklund’s                               $343,063

Imperial Interiors             $320,809

OTIS Elevator                     $293,316

These efforts were originally budgeted for 2023/2024, but the Home Improvement Commission chose to prioritize the Hallway Project. Once that was planned, design efforts began for the cabs. And you will see the proposals are fairly apples to apples in terms of the design and materials thanks to the use of an RFP. However, the total budget was $250,800. In part, the difference is due to inflation. The project does include materials with volatile pricing over the past several years.

The Home Improvement Commission recommends proceeding with OTIS Elevator, and they agreed also the speakers should be done while we are doing the interiors. Assuming the Board agrees, the next step will be for the Commission to refine the actual material choices to be used. Presumably they will be considering samples at upcoming meetings for giving direction to the contractor. Final sample choices would be presented to the Board for consideration.

A sample motion follows: “I move the Board of Directors approves the remodeling and repairs to the elevator interiors of cabs 1 thru 8 as proposed by OTIS Elevator Company and recommended by the Home Improvement Commission, for _________, including remodeling of cabs 1 thru 5 and door safety operator replacements for all cabs except 5.”

To include the speakers, the appropriate total can be used and a motion can mention to also include approval of the proposal to install ADA speakers for speech capabilities.

9. Construction Requests

Attached to the report for Board Member review are remodeling packets for the following Unit Owners’ construction projects:

Unit 1407 – Hard Surface Flooring

Unit 3201 – Kitchen & Bathroom Remodeling

Unit 4712 – Kitchen Remodeling

Unit 5111 – Kitchen & Bathroom Remodeling

A sample motion follows: “I move the Board of Directors approves the remodeling plans for 1407, 3201, 4712 and 5111 as submitted by the unit owners, following the recommendations of the chief 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

1. Treasurer’s Report

Attached to the Report for Board Review is the December 2023 Balance Sheet and Statement of Income & Expenses as reported by the Habitat Company.

Fund Balances End of December 2023

Operating assets totaled $2,043,055 and the Reserve cash and investments were $4,939,670 for a total of cash and investments of $6,982,725.

December 2023 Revenue and Expenses

Total Operating Revenue: $621,532

Total Operating Expenses: $483,715

Income (Loss) From Garage: $18,255

Contribution To Reserve: $164,975

Total Surplus/(Deficit): $(8,904)

Investment Activities

Management has continued exploring opportunities for maximizing the interest on Association funds and  getting competitive returns on investments.

Working in consultation with the Board Treasurer and Board President we identified two opportunities which do not interrupt needed cash flow, and keep with our plan to ladder our investments over time. Specifically, for the Operating Fund we purchased a 6 Month Treasury Bill at 4.975% for $225,653, and for the Reserve Fund we purchased a 12 month Treasury Bill at 4.68% for $225,226 and a 12 month CD through First Financial Bank at 4.85% for $237,000. Attached to the report for Board Member review are the WINTRUST confirmations for these transactions.

It would be appropriate for the Board to ratify this action, and reaffirm the policy for Management to consult with Treasurer and Board President for ongoing investment considerations.

A sample motion: “I move the Board of Directors of the Park Tower Condo Association approves the purchase of a 6 Month Treasury Bill at 4.975% for $225,653 for the Operating Fund, and a 12 month Treasury Bill at 4.68% for $225,226 and a 12 month CD through First Financial Bank at 4.85% for $237,000 for the Reserve Fund, and affirms that management continue consulting with the Board Treasurer and President between Board Meetings when making any new investments or future adjustments to such investments.”

We have two investments expiring in February and have been working with the team at WINTRUST and the Board Treasurer to decide how to reinvest. We continue being able to find rates between 4.5% and 5% for the time being.

2. Management Report

a)       Business and Activities – Property Manager Tim Patricio will review current business and activities of interest.

b)      Engineer’s Report – Property Manager Tim Patricio will review activity of interest from the Maintenance team.

c)       Recent Sales Activity – Property Manager Tim Patricio will review the most recent Sales. The current Sales & Lease reports are attached to the meeting report for Board review.

At the time of drafting this report, the updated Monthly Activity Report and Sales and Lease Reports is not yet available. Once they’ve been updated, they will be forwarded to the Board for review.

ADJOURNMENT

There being no further business, the Board will consider adjourning the meeting.

A sample motion: “I move the Board of Directors adjourns the February 12, 2024 Board Meeting at ____PM.”

OWNER FORUM

The Board of Directors and Management will welcome and address feedback and questions from Unit Owners.

The next Board Meetings are scheduled for Monday February 26th and March 11th at 7:30PM. At this time, all such events are anticipated to be held in the 2nd Floor Party Room unless otherwise posted.