August 18, 2016

Budget and Common Maintenance.  I reviewed the financial report for July and there seems to be some reasonable questions that should be asked of our Board and Manager.

What stands out to me is the money spent on maintenance.  According to the minutes of the July 19, 2016, meeting, our President reported that there were several unexpected issues that surfaced for which no money was budgeted.  She says that most of the issues have to do with the age and condition of our buildings.  And she speaks of an assessment or increased maintenance fees that RPM and the Board are considering.

According to the July 2016 Financial report, the money spent for Common Maintenance for the 1st 6 months of this year is  $20,849.  And this does not include the money that  will be paid for the paint job on the exterior of 113/213, rumored to be $3,800.  The budget allotment for the year is $12,000.

RPM has introduced a new budget item:  "Unbudgeted Maintenance Repairs" with an expenditure total of: $2,195.50.

The total expenditures for both maintenance categories for the six month period is  $23,044.50.  In the last 4 months the Association has spent approximately $15,050 on maintenance.

In the laughably, inappropriate Unbudgeted Maintenance Repair item, the General Ledger for June 2016, shows a payment for $158 to our cleaning service - J.W. Services, an entry that really belongs as a Janitorial expense.

The other payments made in June  for the Unbudgeted Maintenance were to  Bravo:

• $1,762.50 for waterproofing  Unit 113 
• $275 for a 25% deposit on waterproofing Unit  110.

Common Maintenance shows payments to Bravo:

• $587.50 with the notation of 25% down - presumably for Unit 113
• $825 for waterproofing for Unit 110.

Lousy bookkeeping aside, those are 2 contracts folks: $2,350 and $1,100 - each with a 25% down payment - you don't make a down payment without a contract. 

The Bravo contracts are two that we know were processed in June.  We also suspect that a contract with Dyco for their chip/crack report was processed, perhaps in May.  It is rumored that Professional Rehabilitation Services (PRS) received a contract for $1,300 for inside repairs in Unit 113, probably in April.  And we have the exterior paint job on Units 113/213, another contract with Bravo for $3,800 that was completed this month.  These are contracts that we are reasonably certain were done in the last couple of months.  How many more contracts are out that we don't know about?  Most of the above are contracts could be/should be presented to the Board and the owners for approval.  None except possibly the PRS contract can be construed as "emergency" and that would be a stretch. 

When it comes to contracts for the Circle, Janet and Kimberly are stealth operators - contract proposals  fly in, are processed and contracts fly out, and nobody is the wiser!

Just out of curiosity, I reviewed the Board minutes for the last 6 months.  I wanted to find out if the Board was keeping us fully informed on maintenance expenditures.  Here is what I found:

• In February no maintenance expenses reported.
• In March- the Board approved a contract for $1,500 to Dumala to work on the drain pipe from the roof of Building A to the ditch. Also, a contract for $5,214 was signed to replace the water valve leading into our Circle plus other plumbing needs associated with the water line break into the clubhouse.
• April - power washer was purchased - price not disclosed.
• May - A contract?? was reported with Dyco to examine our buildings to determine the level of potential water intrusions through chips and cracks in the exterior walls.
• June - no Board Meeting, although from the financial reports presented above, we know that at least 2 contracts to Bravo, worth $3,450 were processed during the month.
• July - Bravo soffit work contract was discussed but not approved by the Board for $3,800.  And a wind mitigation survey was apparently approved for $600.   

As far as the minutes are concerned, that is the maintenance information available to the owners.   Obviously, little or no accounting of the maintenance money or contracts has been presented at the Board Meetings in the last 4 months.  That includes the contracts that we are reasonably confident were processed during that period.  

Now, as noted above, Janet and Kimberly are talking about a need for an assessment or budget adjustment because of the maintenance expenses.    Shouldn't the owners know what the maintenance issues are, that is costing us a whole lot of money, before we consider an assessment or increased maintenance fees?  If Janet and Kimberly are going to be wanting extra money from us, then, I think, we should have a little quid pro quo from them and demand a full accounting of maintenance contracts and expenses!  And we should require that all contracts, short of a real emergency, be presented to the Board for approval and published in the Board minutes!

Flood Insurance News.  Recently there have been a few articles in the local paper regarding flood insurance.  It seems that the huge increases in flood insurance (ours have doubled in the last 4 years) are set to continue.  We won't know for sure until the November bill becomes due.   Obviously large increases mean larger maintenance fees.  And this is not the fault of the Board since FEMA dictates the flood bill.  Private insurance has yet to impact condominiums.  It doesn't look good, if we are to believe what the papers are saying.

Just my opinion!
Andy Johnson

August 14, 2016.  

The deed has been done.  Our President has apparently signed a contract to have the exterior of Units 113 and 213 painted.  Aided and abetted by our Professional Manager, she has proclaimed - apparently -  she has made no public accounting of her actions - that those units had to be painted without Board approval because it was an emergency! And painters started on D building yesterday, front, back and side, a job that will likely cost over $5,000.

Never mind that the issues involved with 113 extend back to 2014 when $5,200 was spent on an emergency basis on a system designed to carry away water from the slabs of 104 and 113.  How did that work out?

To define this situation as an emergency is really stretching credulity..  How 213 was included in this is even more remarkable.  Two thirteen has had absolutely no water issues from cracks, caulking or otherwise.  I can say that because the owner of 213 agrees and has suggested that there is an alternative reason for the difficulty with the water intrusion in 113.  I can say that because I checked 213 regularly for any sign of water intrusion and there was none;  the aroma in that unit is sweet without a hint of mustiness associated with water intrusion, mold or mildew.

So where do we go now?  Are there any more "emergencies" that are on the horizon for more paint jobs?  Are we finally going to have an accounting of the actions taken in the last couple of weeks about this water intrusion issue?   Will there be a Board Meeting so that the rest of the Board and the owners can express their views?

Mind you - there has never been a full discussion of the need for painting 113 or even for painting of  all the buildings. This problem was first mentioned in the Manager's report in the Board Meeting of  July 19, when Kimberly mentioned that requests for proposals were being taken for the building paint job.  Janet, in her President's Report, mentioned the need of a possible assessment for multiple building repairs.  There was no mention of a contract or even a need for painting of 113/213.

As Janet's memorandum says, which is quoted in the most recent Blog post, the experts she has called in to assist with identifying the problem do not agree on exactly what is happening.  And we have owners here in the Circle, with construction experience that strongly disagree with an attempt to paint our buildings because of a very questionable decision that water intrusion in our units is caused by cracks and chips.

Whether you agree that painting the buildings is a "necessity" as Janet believes, or not, you have to be  concerned about the way this whole thing went down.  A President using their power to act in this manner without even the benefit of  a serious public discussion, is behavior that should not be sanctioned.

This is a very contentious issue.  Our President should be seeking the advice and consent of the Board and the owners and not taking action, much less questionable emergency action, on this problem.  Our President should be giving this problem some very careful thought.  CYA should be on her mind!

Just my opinion!

Andy Johnson

August 11, 2016

I'm sure that there are a lot of questions regarding my Blog since it was issued.  So I am happy to report that the Blog was very successful, and I have to give thanks to Kathy Corey who sent emails to all the owners of whom she had an email address.  The Blog got widespread attention because of Mrs. Corey's actions, which occurred  before I wanted to release it.  I sent it out to a select few owners to get feedback on whether those owners thought the Blog was of some value and if it should be continued.  Mrs. Corey beat me to the punch and released the Blog link before I was ready.  It helped  that the rant that Ms. Corey sent along with the Blog address, probably got the owners attention and curiosity which helped increase the viewing numbers.  To date, the statistics show that  the Blog has been viewed over 110 times.

I'm happy to report those numbers because, for better or worse, it highlighted the interest that the owners are taking in the business of the Circle.  Our owners are the bedrock of the community - engaged and participating owners  are the ideal and necessary if we are to keep the community together, thriving and making our home a better place to live!

Today's editions is a combination of news and views of events following the last Board Meeting.

The Building Painting Project.  Our own Wikileaker, sent me a copy of a memorandum authored by Janet regarding many things but in particular, the Painting Project.  There is one interesting item in the memorandum which gives me pause.  If my reading of the memo is correct, it appears that Janet has already started the process of painting the building without Board approval.

The portion of the memo in question is reproduced below:

Water/Moisture Issues - Units 110/113 - Kim has had 3 contractors and an engineer come out to try and determine the cause of the water/moisture.  Of course, they have varying opinions and uncovered the potential issue of footings under the FL rooms.  Unit 113 doesn't seem to have a problem in the back of the unit; it seems to be concentrated on the side and front of the unit.  Units 113 and 213 are being painted and sealed with the Dyco product as it has been speculated that the moisture may be coming through the walls and not up from the ground.

This is a very contentious issue as we have 2 male owners in the Circle that have been associated with the construction industry, that are adamantly opposed to the paint project.  As highlighted above in the memo, her own experts apparently do not agree with the cause of the problem.  Additionally, the owner of 213 insists that he does not want his unit painted and he does not wish to see $60,000 spent on what he says is not a solution to the problem.

When you look at this problem logically, the units that Janet has cited as having water intrusion issues due to paint chip problems - 104, 105, 110, and even 113 - are really issues from water coming into the units under the slab.   I say that the money can best be spent on the sealing the buildings against the growing issue of mold, mildew and water arising from water intrusion under the slabs.

There is no emergency associated with this problem.  A Board Meeting should be called and a serious discussion of the issue should be done before action of any kind is taken..

Foreclosure of 214.  Janet has informed me that that there was indeed a report on the foreclosure in the May Board Meeting, which is contrary to what I reported in my Blog.  I had checked (and rechecked) the minutes of that meeting and found no mention was of 214.  She tells me that it was reported that there was no new information in the foreclosure process.

And that, to me, is news, very troubling news.  At the March meeting, IIRC, the last meeting that I was a Board Member, we had a very animated discussion about 214 and the role that Ms. Hathorn had played.  I had reported that Anne had admitted to me that the filing had been held up because an assistant who was supposed to do the filing, did not do so.  Also, she had received a payment plan from the owner of 214, so she was holding up the process until she was able to determine if the plan was legitimate.  Both the Board and the audience was outraged at the delay and many felt that Ms. Hathorn should be fired at once.  It was decided that she should be allowed to finish the process and then alternative legal representation should be found.  The status of the foreclosure was still: not filed!

So in the Board Meeting of May 2016, it seems that somebody did contact Ms. Hathorn to check on the status.  However, it seems very definite that the $64,000 question was either not asked or not answered:  Has the foreclosure been filed?

Failure to ask that question and to bring the answer to the Board Meeting resulted 2 months delay in the processing.  Somebody was asleep at the wheel!

C Roof Contract.  The Board approved a contract with ThunderBay to repair C Roof.  My personal belief, is that that was a poor decision.  And I really have only myself to blame.  I received both the Martin proposal and the ThunderBay proposal during my period as President.  And, unfortunately, I passed those proposals along to the new Board, never thinking that when the details of two contracts were compared, that ThunderBay would emerge the winner!  I should have trashed the ThunderBay proposal.

The details of the contracts are starkly different:

ThunderBay was proposing a repair contract,  to spray foam over the roof to: "elevate the surface as required to reduce the amount of ponding water on the roof surface." The proposal was designed to give the original roof an additional 10 years of life - more than that was a bonus.  They would not be removing the drains, a consistent source of leaks in roofs in the circle. The warranty was for 10 years but didn't cover any leaks resulting from drain problems.  The financial terms were changed to spread the cost over a longer period.  The cost was $37,772.

Martin Roofing was proposing a new foam roof.  They offered a new roof warranty of 10 years with a warranty extension available at additional cost.  As a new roof, it was designed to give us 20 years of life.  The drains would be removed eliminating a potential leak problem.  They offered no change in their payment terms.  The cost was $27,400..

Martin's proposal was the same as their proposal to Buttonwood and their Circle elected to have all 6 of their roofs done with foam by Martin.  We had a foam roof on B Building which gave us satisfactory performance for 20 years.  Since we are dealing with foam in both contracts, it appears that the difference was the fact that ThunderBay proposed to put 2 coats of protective coating on the foam surface.  Two coats of coating is a deal breaker?  Then get Martin to put on 2 coats in his proposal - it would probably still be a lot less expensive than the ThunderBay proposal.

In my little world, the new roof offering 20 years of life  trumps a repair roof offering 10 years of additional life.  However, there was very little discussion of the merits of either proposal except for the comment that Kimberly made that Eric had told her that there was a problem with Martin's roof due to bird pecks.   The contracts had been distributed to the Board Members giving them an opportunity to read and, hopefully, understand the contracts - I doubt that they did since you have to look close to see the word "repair" in the contract.  The details of the contracts were not read to either the Board Members or the audience.  No discussion of the relative merits of the proposals took place,  The approval process took five minutes or less from introduction to approval.  And the Circle got stuck with, in my opinion, a bad contract.  My bad!

Another bad is the statement that I made in the 1st post re: C Roof Contract.  Kimberly has stated that there would be more foam coverage in this contract than the repair contract that I got from ThunderBay last year.  That appears to be true and I was incorrect in the statement that I made regarding that issue.  But what does that mean?  Well, apparently the roof will be closer to being completed covered with foam - but it still leaves the building vulnerable to those drain leaks.  The point of the contract proposal was to eliminate the ponding - this contract will do that.

That's it for today.  I plan on continuing this Blog and posting as issues of importance arise.  If you are interested in following the Blog, you might want to bookmark this page.

Andy Johnson

Aspen Circle News and Review

The purpose of this blog was, initially, to highlight Board activities and critique actions that I thought warranted criticism.  The Blog was not created just for the sake of criticizing but to point out the actions that were questionable in the hope that the information in the Blog would contribute to making the Board more accountable to the owners.  It was done also, to inform those owners who are unable to make the meetings (particularly the snowbirds).  And to help those who have gone to the meetings and come away not understanding what took place.

I've decided that their is value in opening the Blog up to other activities as well.  Those semi-serious activities that are happening in the Circle, whether Board related or not.

Again, this Board represents only my opinion and does not necessarily reflect the views of other owners in the Circle. 

Board Meeting of July 19, 2016

C Roof Contract:

Kimberly, in introducing the 2 contracts up for bid (Martin and Thunderbay), stated that she had talked with Eric, the owner of ThunderBay, about Martin's work.  Eric had told her that, in his experience, he has seen holes (bird pecks??) in the roofs that Martin has done.  Kimberly presented that information to the Board.  Presenting a contractor’s opinion of a competing contractor's work in a supposedly neutral contract review process is not correct and is unethical.  A response to this charge made by Eric was neither obtained from Martin nor presented to the Board. 

The contract proposal by ThunderBay for the C roof was presented simply as a contract proposal for Roof C, not as it is:  a repair contract.  This contract is designed to extend the useful life of the roof (a ten year option), not as a full, new roof as was Martin's proposal (a 20 year option).  This is, in fact, the same repair contract that was presented about a year ago with different warranty and payment  options.   

ThunderBay will not be removing the 3 drains but spraying foam to "elevate the surface as required to reduce the amount of ponding water on the roof surface".  In other words, it is simply dealing with the ponding problem on that roof.  Not removing the drains is significant because the warranty presented by ThunderBay will not cover leaks involving the drains.  We know that a significant number of roof issues that we have had in our buildings, have resulted from drain problems.  In fact, at least 1 of the roof issues that C has experienced since this roof was installed in 2006, was from a drain currently installed on that roof.   Also, there is nothing in the contract language that suggests a greater area will be sprayed which was stated as fact at the meeting.

The Board unanimously approved the ThunderBay contract proposal.

The Martin proposal would have removed the drains, thus eliminating potential problems in the future.  A foam roof alternative should not be rejected out of hand as it has been proven to be a viable and less expensive option for flat roofs - as we know from our own experience with a foam roof on Building B.   

If there was a legitimate problem with the Martin proposal and their work or any contractor, and it is verified (and not based upon a competing contractor’s comment), then simply table the item and get another proposal. 

This is a commentary on the way the contract was presented and the facts that were glossed over to arrive at the decision that was made.  If the Board Members were legitimately aware that they had approved a repair option for C roof, then so be it.  The problem is that there was no airing of the issues involved in this contract before the vote.  There was absolutely no discussion by the Board Members, of the contract prior to the vote.  The details of the contract were not presented to the rest of the Board and definitely not to the audience. This is not a process that should be generally followed when bidding proposals are up for approval!

Props to the Board for getting a reduced Maintenance Agreement with ThunderBay saving the Association $1,200 yearly.

Water Intrusion Issues: 

The President reported that there are issues with cracks/chips in the paint of some of the buildings leading to water intrusion issues in a couple of units.  I understand that she was referring to the units of 104, 105, 110 and 113.  The management answer to preventing the water intrusion issue is to waterproof the buildings by a new paint job with a product from a contractor that would prevent water intrusion due to chips and cracks in the exterior.  The paint job would cost $16,000 per building and, with six buildings, I understand that we are talking about a total of somewhere above $60,000.

Now I am aware of the issues with 113, a legitimate crack/chip problem that dates back to 2014. The reason for the large expense associated with repairing that unit is due to the leak not properly diagnosed in 2014, allowing mold and mildew to build up until the problem became very severe.   

However, the problems in 104, 105 and 110, as far as I know, are not due to chips and cracks in the exterior paint; but are issues related to water coming into the unit from under the slab.  So, in 10 years since the last paint job, we have had issues with 3 units  with water intrusion difficulties due to cracks and chips (I would add 116 and 216 to that list since they had unexplained water intrusions last year) and only 1 has been verified!

Now $60,000 is a lot of money to spend for the possibility (not probability) that there may be more water intrusions in the future related to cracks and chips.  

To paint all of our buildings for the possibility of the protection it would provide for a couple of units, does not seem to be cost effective.  We are scheduled for a paint job in another 10 years.  Why not see what happens and make repairs as they come up instead of panicking about the possibility that one or more units may suffer water intrusions.  Fix the water intrusions as they happen, and do it very quickly.  The leaks resulting from cracks and chips are small, not of a gushing nature and easily repaired when found quickly.  The Association is now aware of the problem and, if any unit experiences water intrusion due to the cracks and chips, then fix it!  

We should take a wait and see approach.  Handle each issue as it presents itself, and budget for the extreme paint job when it is due (in 10 more years). If this problem continues and rises to the level of epidemic proportions, then proceed with the drastic action that is currently being proposed but not before!

Foreclosure - 214

In March of this year, Ms. Hathorn admitted to the fact that her assistant had failed to file the paperwork necessary to process the foreclosure on Unit 214.  Further, she indicated that she was holding back on processing the foreclosure in lieu of a payment plan that she had received from the owner.  This information was reported at the March 2016 Board Meeting.  At that meeting, I resigned due to health issues and informed Ms. Hathorn that Kimberly would now serve as her contact person for the Association.

In May, another Board Meeting was scheduled and, per the minutes of the Meeting, no mention of the Unit 214 foreclosure was made.  Now, in late July, we find that there was again a delay of filing, again due to a possible payment plan.  Four months after our attorney was scheduled to file the foreclosure paperwork, and still that paperwork had not been filed!  A motion was made and approved by the Board that Ms. Hathorn be told to file the foreclosure within 2 weeks.

So the questions are:  What happened between March and July that resulted in the delay of filing?  We have been told that the holdup was the supposed payment plan but that can't be all that has occurred in that time span.  Who has been monitoring the foreclosure process during this period?  Why wasn't this delay reported to the owners in the May Board Meeting?

Obviously, this delay has caused some serious problems for the Association, particularly in the financial area.  Hopefully, the latest Board motion to file within 2 weeks has been accomplished by Ms. Hathorn.  And, hopefully, our management is now monitoring the situation so that we can finally move forward in the process!