Cloverleaf Center Condominium
Reconvened Annual
Meeting &
Board of Directors
Meeting
November 16, 2011
7:00‐9:00 PM
Upcounty Regional Services
Center Conference Room A
12900 Middlebrook Road
Germantown MD
Minutes
I.
At 7:05 PM, Farouk Youssef called for a vote
of those assembled to open a Reconvened Annual Meeting, and the assembly responded
with unanimous assent.
II.
The Reconvened Annual Meeting was announced
by a notice to all Unit owners, and by a sign at the entrance to the community.
Those present at a Reconvened Annual Meeting constitute a quorum of the
Association.
III.
Mr. Youssef moved to approve the minutes of the
2009 Annual Meeting. The Association approved the 2009 minutes unanimously.
[Note: There was neither a quorum at the 2010 Annual Meeting nor a Reconvened Annual
Meeting in 2010.]
IV.
Kreg M. Williams (20518 Bridger Way) has
declared his candidacy for election as a Plex Unit Director for a term of two
years. Mr. Youssef asked if there were any other candidates who wished to
declare from the floor. As there were no other candidates, Mr. Williams was
elected by acclamation.
V.
Discussion, by which a member might bring
any business before the Association.
a.
Dividing the Association into two parts has long
been debated by some TH members who see themselves as a different class and not
compatible with the Plex class members. There is a perception that the TH owners
are penalized for the costs of lawsuits, elections and construction.
i.
The Developer created and filed the Declaration by
which the community functions under the laws of the State of Maryland and
Montgomery County. To change the Declaration now would require the same filing process
and adjudication. That would cost about $12,000, and would need to be driven by
Unit owners. The stated requirements to terminate the Condominium project are in
the Declaration, Article X Section 5(a).
ii.
What evidence is there for the perception that
TH owners pay for some of the Plex unit owners’ expenses? The budget has been
set up according to the governing documents. The Board has repeatedly and heatedly
discussed the budget and scrutinized the perceptions of fairness of the assessments.
If anyone can show unfairness in the budget, the Board will correct it. How do these
perceptions compare to the factual numbers?
1.
Perception that Cloverleaf Center III
Condominium, which owns most of the land, does not pay a fair share: The Shared
Use Agreement obligates CCIIIC to pay a 22/172 fraction of shared facilities expenses.
The Plex and Townhouse owners divide the remaining shared facilities expenses 70%
to 30%. CCIIIC may have other obligations beyond that Agreement.
2.
Perception that the assessments for attorney fees
are unfair:
a.
Legal costs for common expenses are divided 70/30.
b.
Costs related to a single class of ownership are
assessed to that class of ownership responsible for the expense (e.g., the cost
of the Palmer Brothers settlement, which was charged to the Plex unit owners.)
c.
Division of attorney fees related to collections
is difficult in actual practice. A single case may span several budgets.
i.
The Board agrees in principle to such a
division, and with the proposed 2012 budget Summit shall henceforth categorize
collection expenses and income by class of ownership.
ii.
If a class of ownership is assessed the entire cost
of a collection, that same class must benefit from any recovery of income related
to that expense.
3.
Perception that there may have been overlapping
coverage between the Association’s master insurance policy and the policies of individual
Unit owners.
a.
The Board will scrutinize the insurance
question.
b.
Unit owners should scrutinize their insurance
coverage.
c.
The budget formulas the Board uses for the
master policy are complex because of the various types of coverage.
d.
The Board may amend a budget item at any time.
4.
Perception that the strain of assessments on the
Condo-Townhouse units is the cause of our loss of FHA approval.
a.
The delinquency rate of 23% may be over-stated.
Our collections attorney recently settled three delinquency cases. Are these
cases still delinquencies? If future accounts receivable are to be considered delinquencies,
then all Unit owners would be delinquent.
b.
The Bylaws give the Board the right to declare
who is delinquent.
b.
Excessive costs to Unit owners for forms related
to refinance.
i.
Summit recently asked $125 for a signature on a refinance
package, rather than the cost stated on May 18, 2011 ($35-$50.)
ii.
Another Unit owner has been charged $287 to
answer his agent’s question regarding delinquencies (Summit’s documented answer
was “74%”) on a refinance package. The owner has not yet been repaid.
VI.
A motion was made to adjourn the Reconvened Annual
Meeting to an open meeting of the Board of Directors. The motion was approved
by voice vote at 7:50 PM.
--------------------------------
I.
Mr. Youssef immediately called the Board of
Directors to order.
II.
Establishment of a quorum of the Board
a.
Farouk Youssef (TH)
b.
Andrew Kim (Plex)
c.
Peter Franke (Plex)
d.
Noorul Hinaya Jainoor (TH), and
e.
Kreg Williams (Plex) were present and
established a quorum of the Board.
III.
Election of Officers
a.
Secretary: No volunteers. Mr. Kim recommended
that we hire a note-taker. Mr. Franke stated that there may be funds in the proposed
budget to pay a note-taker, but the duties of the Secretary are specified in
the Bylaws. Mr. Youssef emphasized that the nature of the business during
closed Board meetings (e.g., delinquencies) requires a Secretary, an Officer of
the Association.
b.
Treasurer: Mr. Franke volunteered. Vote: 5 Aye,
0 Nay.
c.
Vice-President: Mr. Kim volunteered. Vote: 5
Aye, 0 Nay.
d.
President: Mr. Youssef volunteered. Vote: 5 Aye,
0 Nay.
IV.
Words from the President to the Association
a.
Mr. Youssef:
i.
We now know, based upon an email between the
out-going President and the CCOC that proves the point that in July, 2009, the
Association was on the brink of bankruptcy and receivership. We have come so far,
and I am surprised that once again there is a lack of attendance for a budget
meeting. Our annual operating budget is on the order of $250,000. You need to
scrutinize that for every penny. I would like for everyone to meet and speak
their minds. The budget is important.
ii.
The Project will be a headache. We need
participation and encouragement to go those extra miles. I have done what I
could do as President. I’ve sold myself on the corner, met with the President
of Becht Engineering, and gone to Court with Palmer Brothers to save you
$65,000. After the snow, I got you $20,000. I ask only for your participation.
Speak to your neighbors: Tell them “Shame on you” if they’re not paying their
dues. We give to the budget exactly what we spend. The project is now
$1,700,000, which I negotiated down from $1,900,000. I twisted arms to get that
down. Everyone knows that $14,100 will not cover that project.
iii.
We need to base ourselves on what the judge’s
order said. Up to now, until we had a reputable engineering study to get a
number to restore buildings that are 16-17 years old, we have been able to appraise
the project with only one available number, $14,100. We first thought that we
could patch the roofs, like the Cowards, but the contractor informed us that
our shingles are no longer legal, so we cannot get a permit, and must change
them. The six buildings will be refurbished from the roof down. Construction
costs are about $21,000 each. [Note: Plus loan costs.]
iv.
I will prepare a communiqué to all 98 Plex unit owners
in a few weeks to explain exactly what the project is about. The Board will amend
the $14,100 stated in the resolution, and file that with the CCOC, because of
the prior case. If people disagree, they have the right to collect signatures from
50% and call for a special meeting of the Plex unit owners, at which we will
decide.
v.
The engineering study and the loan are a chicken
and the egg type of problem. Once again tomorrow, I will meet with another
banker, one who is willing to give us money because we can pay him money. I ask
that you bite the bullet and that you ask your neighbors to pay their dues. I
will step down on October 26, 2012, and ask that someone else step up at that
time to continue the good work.
b.
Discussion:
i.
Mr. Kim: The special assessment will be for 8 to
8½ years at $235 a month. If a former owner has paid $14,100, the new owner
will pay the difference.
ii.
Mr. Edakandi: Will 8 to 8½ years include the interest?
Mr. Youssef: Yes.
iii.
Mr. Owen: Can we find another means to refinance,
like a two year lump sum (self finance?) I ask the Board not to obligate the payback
liabilities.
iv.
Mr. Youssef: In 2007, the decision was made that
the community needed renovation. During the study for the project in 2007-2008,
$65,000 to $80,000 was spent, and Palmer Brothers’ claim for Bldg 1 was
borrowed from the reserves. We were left holding the bag for that.
V.
Management report (Elan Krueger)
a.
Board meetings have been scheduled at 7 PM at
the Upcounty Regional Services Center on the third Wednesday of the month for
the first six months of 2012.
b.
The Board has four business items on the agenda:
budget, insurance, grounds maintenance, and the representation letter.
VI.
Continuing Business
a.
Contracts
i.
Master Insurance Policy: SFIG renewal due
November 30. The $16,000 claim has been subrogated, but is counted as a claim
on the policy. SFIG would renew at present cost with $7000 deductable or $5000
deductable for $30,000. Manougian offers a $5000 deductable with higher
umbrella. CAU offers a $5000 deductable and $10,000,000 umbrella. Mr. Krueger
provided CAU’s cost of General Liability, $2420 for $1,000,000. Mr. Youssef
moved to contract Manougian for the Association’s master insurance; Mr.
Williams seconded. Vote 5 Aye, 0 Nay.
ii.
Landscaping and snow removal: Brickman offered to
renew both contracts at the existing rates; Stolberg proposed contracts
totaling about $7200 less. Mr. Youssef expressed reservations about the ability
of Stolberg to respond to snow removal as well as the larger Brickman. Mr.
Williams said we have to try something new. Motion to approve Brickman,
contingent upon reduction of cost by $4000. Vote: 5 Aye, 0 Nay.
iii.
Motion to approve Summit Management contract for
2012 at $34,200 (includes postage, certified letters, and box storage.) Vote: 5
Aye, 0 Nay.
b.
Audit: The Treasurer and President signed the
2010 Representation Letter and handed it to the Manager for his signature and
forwarding.
c.
2012 Operating Budget
i.
Open discussion: Several Unit owners opined for
lower cost landscaping and snow contracts, and commented on Brickman.
ii.
Motion to approval of the 2012 operating budget.
Vote: 5 Aye , 0 Nay.
VII.
New Business
a.
ACC
i.
13061 Bridger Dr (D’Arrigo); garage door
replacement: Picture does not match existing style. Request denied pending
clarification.
VIII.
Motion to adjourn to a closed session (8:53)
IX.
Closed session
a.
Noted that 10% interest will be collected on a
recent judgment.
b.
Discussed response to a pending CCOC action.
X.
Adjournment (9:15)
December
8, 2011, 7:30 PM
December
19, 2011, 7:45 PM
Farouk Youssef, Kreg Williams, and Peter Franke, IAW Article
III, Sections 9, 10, 15, and elsewhere, met in a public location on the above
mentioned dates and drafted a communiqué to the community explaining what the
project is all about and drafted a Resolution to amend Resolution 2010-1 of
March 17, 2010 to reflect the actual cost of the project. Andrew Kim and Hinaya
Noorul Jainoor were unable to attend either meeting.
