Highview Condominium II
Board Meeting
August 13, 2001
Meeting Minutes

The August 23, 2001 meeting of the Board was called to order on August 13, 2001 at 8:00 p.m. by Robert Boynton, President. In attendance were Board members Vincent Alfano, Robert Boynton, Paul Chelsen, Carl DiLorenzo, Judi Kepics, Frank Mattera, and Miriam Montalvo. Also in attendance, managing agent Gene DeGidio of Maxwell-Kates. Board members not in attendance: Victor Bellini and Stephanie Greenberg.

Estimates for capital repairs were discussed.

· Forty windows are known to require lintel repair. There was discussion of lintels so that all present should understand the nature of the problem. A window's steel lintel is a part of the building's structural framing, bridging/bearing the weight of brick above a window. It is not visible. Any sign of water damage to an interior wall just above a window represents a deterioration in the mortar of exterior bricks and then water getting behind the brick. As the water travels down behind the brick, it stops when it hits the wide horizontal surface of the steel lintel and then often moves to the interior wall. Repair involves removal of a minimum of three courses of brick above a window, inspection of the steel lintel for structural deterioration (rusting), and replacement and pointing of the brick to seal against further damage.

The forty identified windows represent residents who notified management of water damage to walls above windows. The Board questioned whether there are other apartments with similar damage that have not notified management. It was agreed that building super Rafael Luque would request entry into all apartments and inspect for signs of similar damage. By his inspection, additional windows may be added to the repair list. In addition to Rafael's interior inspection, it was also suggested that the contractor offer an estimate for performing a thorough inspection of the full exterior brick work in addition to the specifically contracted repairs. Repairing lintels and brick work involves significant scaffolding set-up costs and all similar problems should be addressed at one time. Boynton, Chelsen, and Alfano volunteered to meet with DeGidio and contractors to finalize the plan.

According to DeGidio, the majority of exterior damage is on the building's rear wall where the wind is greater and where there's less direct sun to dry out the leaks before freezing in winter.

· In addition to lintel repairs, several areas requiring brick pointing have been determined and will be repaired at the same time. Current estimates for the lintel and brick work are in the range of $25k-$30k.

· There are several cracks in the foundation scheduled for repair. It appears that these cracks received cosmetic repairs in the past, but have never been adequately repaired. DeGidio estimates that the cracks can be effectively repaired with an epoxy mixture injected under high pressure for approximately $3k. In addition to the epoxy injection, a drainage system will be installed in front of the building. This will require the removal of landscaping to the west of the front door (half of the building's front face). Estimated cost of excavating, installing a drainage system (which DeGidio recommends can be done by Raphael with the rental of special equipment) and replacement of shrubbery is estimated at $15k.

· Other planned repairs in the garage, including the replacement of sewer access drain covers and a storm drain grating, will be performed by the building's super. The cost of repair should be covered by the building's general maintenance budget. These needed repairs represent significant hazards.

· Replacement of the building's entrance security system was discussed. It was acknowledged that the 4-digit access code system is not secure. Delivery people and recently, a group of teenagers loitering in the lobby, with no connection to any current resident of the building, have been seen using personal access codes.

Replacement of the current 4-digit access code system with a proximity reader system and access cards has been investigated. Upgrading the system would also include the current garage access system which has had several major problems in the last couple years. The new system would log all entries according to individual code and could be compared to video recordings in cases of any reported illegal activity. For the first time, listings on the entrance directory could be changed/corrected by the super. The Board was reminded that security in New York City is not a minor issue and carries issues of legal liability for the building in any case of the building's obvious negligence. Best estimates are running between $6k- $8k.

As part of the entrance system issue, related problems with the building's telephone terminal box are being investigated. According to both our security system vendor and Verizon repairmen, it is an arrangement that many Verizon repairmen are not familiar with. The result is often disruption in entry service to units entirely uninvolved with an initial service call and then followed by a string of several $100 service calls by our security vendor and Verizon.

Boynton reported on several meetings with Alarmingly Affordable and attempts to discuss the issue with Verizon representatives. It has been brought to Verizon's attention that their disruptions have involved disabled residents - an issue to which the City of New York takes particular legal interest. Boynton reported that he anticipates meeting with representatives of both Verizon and Alarmingly Affordable in the next few weeks.

· The Board approved $250 for electrical work that will separate the lighting timer for the lobby from the exterior lighting. This will allow the lobby to remain well lit morning (6-9 a.m.) and early evening (5-8 p.m.) without requiring all exterior lighting to be turned on.

· Plumbing repair estimates will be available by the time of the next Board meeting for aging riser valves and a leaking sewer pipe just above the mail room. The sewer pipe leak had been identified several years ago as only water condensation on the outside of pipes. Rafael Luque investigated and was able to locate the crack in the pipe.

· Additional repairs were discussed that involve safety issues and possible building/ fire code violations (poorly closing stairwell fire doors, improper operation of the garage's exhaust fan, a light switch in gas meter room, and possibly inadequate boiler room ventilation).

Paying for the needed repairs was discussed.

The mix between special assessments and utilizing the building's reserve fund was discussed. Several long-term owners have indicated a preference for special assessments when large expenditures are necessary, rather than systematically increasing the capital reserve fund for such expenses through the common charge.

Most recently, the $70k bill for repairing the roof three years ago was paid for by a special assessment spread over six months (approximately $1k per apartment, based on unit points). Such past examples were not on the scale of a life-span replacement. Many owners would not be able to afford their share of a $200k emergency repair as a short-term special assessment and that regular savings to the capital reserve account must be re-established. There was a lengthy discussion and a variety of concerns expressed by Board members.

The Board was reminded that last summer Finnerty Management explained that ten years ago the budget's common charge provided for an annual addition to the reserve fund for capital replacement (boiler, roof, and other major replacement costs) according to the life-span of systems. Although building operation costs continued to rise during the last ten years (especially energy costs), common charges have not increased and the savings plan has eroded to zero.

The building's last capital reserve review was conducted by an engineering firm in the mid 90's. At that time, the firm reported that the building was not saving enough to handle capital replacement costs. Since the report, no corrective financial action has been taken.

The current common charge provides for us to "break even" and the current reserve fund of $105k has only increased through bank interest. There are no longer additions to the principal. The Board was reminded that when the VoiceStream contract was signed last year, it was their initial intention to save the $1,500 per month lease income from VoiceStream for capital reserve. However, increases in the building's utility costs alone (gas, electric, and fuel oil) have exceeded the $18k annual income from VoiceStream.

Although not currently in need of replacement, the $200k boiler has exceeded its technical life span. The roof, re-covered 3 years ago, will require a full replacement in about 10 years at a current dollar estimate in excess of $200k. Last summer, Tom Finnerty estimated a cost of $50k per wall (for each of 4 walls) for exterior work that had been deferred because of inadequate funds.

There was a discussion with DeGidio about loans for major expenses. DeGidio's opinion was that condominiums often have difficulty in obtaining large loans. He also pointed out that our current $105k reserve fund should not entirely be considered a capital project reserve, but also an operating reserve. DeGidio was asked how much a condominium should maintain as an operating reserve. He indicated three months. Since our annual budget is approximately $200k, our operating reserve should be about $50k. Therefore, our capital reserve should be considered to amount to only about $55k.

The Board agreed to make a comprehensive decision about financing in September. It was noted that Highview II enjoys a very positive reputation for its fiscal well-being. Many condominiums do not have a reserve fund at all. In most cases, these buildings have not been condominiums long enough to reach the capital repairs of life-span estimates that they should be preparing for in the years to come.

The status of the laundry room contract was discussed. The Board approved with minor changes. As approved, all washers and dryers will be replaced with new units, an additional dryer will be added, the room will be renovated at the vendor's expense, the usage charge will remain the same, and there will be an up front $5k signing bonus for the building. The monthly fee paid to the building will decline from $700 to $675 in order to maintain the unchanged usage fee. The building will continue to bear the cost of utilities for the room (water, gas, electricity). Kepics and Bellini will review the final agreement before signing.

Delinquency of common charges was discussed. DeGidio affirmed that legal actions have been initiated against two owners as prescribed by the Bylaws.

There was discussion of an outdoor bench, approved at a previous Board meeting, but currently on hold. Boynton explained that several owners and former Board members had expressed objections to the planned bench. These residents (all former Board members) noted the numerous complaints that they had received over the years from residents about people congregating in the lobby and in front of the building, with shouting and other activity that disturbed lobby level residents and units just above the entrance area. Current Rules & Regulations prohibit such activity and the Board was requested to enforce the rules.

Fire/Smoke Detection: Owners are required by New York City building code to maintain active smoke detectors in their units. (A special notice permanently posted in mailroom explains the law and owners responsibilities/liabilities.) These detectors within individual units are the building's only smoke detection system in the building. The building's sprinkler system services only the building's parking garage. There are no central alarms in the building. In the hallways, there is emergency lighting; but no system to either detect smoke or prevent fire.

In response to this concern, the Board investigated a central system last summer that would detect smoke and fires in individual and common areas, and offer alarm boxes on each floor. Even without the costs of central monitoring, estimates were in the range of $70k. In the hopes of avoiding such major expense, as a simple preventative measure, the Board voted to provide a new battery for each unit's smoke detector, installed and recorded by the building super to ensure that residents keep the alarms in effect.. There will be no cost for this service to individual owners and the super will replace batteries twice annually. A file will be maintained assuring that all units have had a replacement within the last six months, and that all detection units are in place and functional. If owners find this service an inconvenience, the Board agreed to reconsider the costs of other solutions to assure the entire building's protection.

Miscellaneous items:

· The front awning's replacement has been completed.
· The Suggestion Box was replaced in the mailroom after a two year absence.
· Twenty-four residents have requested (and received) accounts to access the www.Highview2.com website. The website now has the past year's Board meeting minutes, a copy of the Bylaws, email to the Board, email to Maxwell-Kates for repairs, and pictures of Carlos Otey's retirement party. Minutes from past years, information on air conditioner and window unit replacement (costs, vendors, owners in the building with new units to speak with) is being added.
· An unauthorized antenna lead on the exterior of the building was noted and will be removed by the super.
· A welcome party for our new super Rafael Luque and his family will take place at 8:00 p.m. on Wednesday, September 12, 2001. An invitation notice will be distributed to all owners and tenants.

A date for the next Board meet was not set. It was agreed that a meeting would be called as soon as final estimates were available for approval and consideration of funding.

The Board meeting was adjourned at 10:40 p.m.