BB - 2010 Minutes

BANANA BAY CONDOMINIUM ASSOCIATION, INC.

BOARD OF DIRECTORS’ MEETING

TUESDAY, AUGUST 10, 2010

1. Call to Order /Establish Quorum of Directors:

Meeting was called to order by Jim Millican at 6:00 pm in the clubhouse.

A quorum was established with Jim Millican-President, Bill Pemberton-Vice President and Jim Miller-Director in attendance. Lisa Mullooly-Secretary and Irene Nishimura-Treasurer were unable to attend. Kathy Watts represented Reconcilable Differences. Three owners were also in attendance.

2. Approval of Minutes:

Jim Miller made a motion to approve the minutes of the June 22, 2010 Board meeting as written. Bill Pemberton seconded the motion and it passed by unanimous voice vote.

3. Financial Report:

Irene Nishimura was not present to give a report. Jim Millican stated one unit under foreclosure has a renter so the association is collecting funds towards the balance owed. Another unit has contacted management with a request to settle for a lesser amount than what’s owed. The Board feels this is not an option at this time and that the association is entitled to the full amount allowed by law.

4. Unfinished Business:

Carport Update: Kathy reported that American Eagle has ordered the materials for the section 4 carport replacement. The stainless steel screws have also been ordered and they will be replacing the screws used in the new carports in Sections 1, 2 & 4 with the stainless screws specified in the prior contracts. As soon as we receive word the materials are in, we’ll notify residents about moving their vehicles.

5. New Business:

Elevators: Kathy reported that during the state inspection, it was noted that the AC, fire alarm and elevator were all on the same circuit and they should not be. This could be one of the reasons the breakers trip during storms. We’re in the process of getting bids to separate the 3 circuits and have a year to do the upgrade.

6. Committees:

Grounds: Jim Miller stated everything is running smoothly.

Bids/Building: Jim Millican reported he has contacted another insurance carrier for a bid on the association’s insurance in order to confirm the best price is coming from Ranew Insurance.

7. Owner Input:

Retention Pond: Carol Haberman stated she was concerned about the retention pond and if it would overflow. The Board reassured her that the retention pond is functioning correctly and it has never overflowed.

Parking: Rosemary Stroda reported there was a new resident in her building and that there was a little confusion about what their assigned parking space number was. Rosemary was given the assigned numbers and she communicated that to the resident.

8. Next Meeting Date:

The next meeting will be held on September 21, 2010 at 6:00 pm.

9. Adjournment:

There being nothing further to discuss Jim Millican adjourned at 6:30 pm.

Respectfully submitted,

Kathy Watts, CMCA, LCAM #27668

Community Association Manager

Reconcilable Differences, Inc.

BANANA BAY CONDOMINIUM ASSOCIATION, INC.

BOARD OF DIRECTORS’ MEETING

TUESDAY, JUNE 22, 2010

1. Call to Order /Establish Quorum of Directors:

Meeting was called to order by Jim Millican at 6:00 pm in the clubhouse.

A quorum was established with Jim Millican-President, Bill Pemberton-Vice President, Irene Nishimura-Treasurer, and Jim Miller-Director in attendance. Lisa Mullooly-Secretary was unable to attend. Kathy Watts and Brandi Lowder represented Reconcilable Differences. Five owners were also in attendance.

2. Approval of Minutes:

Bill Pemberton made a motion to approve the minutes of the May 25, 2010 Board meeting as written. Jim Miller seconded the motion and it passed by unanimous voice vote.

3. Financial Report:

Irene Nishimura reported that as of May 31, 2010, the operating account, which pays the bills, had a total of $11,711.41 and the reserves had a total of $441,000. The reserves total will show money being taken out next month due to the carport repair project.

-Irene reported that there is one expense account that is presently over budget. This expense account is the Building Services, Services and Supplies line item that was used to pay for the materials (T1-11 Board) for the deck repair on Unit 1302 and the siding replacement on buildings 1700 and 1800 as well as the payment to LB Drywall for the labor. Jim Millican added that Bob used some of the T1-11 to replace the rotting wood in the mailbox kiosk in Parking Lot 1.

-Irene reported that the CPA has finished the 2009 audit, and it is available to any owner who would like a copy. The owners can call Reconcilable Differences to get a copy.

-Jim Millican reported that the new legislation SB 1196 will go into effect on July 1st. Because of the changes in collections for Associations, RDI has composed a letter that notifies delinquent owners of the Association's recourse for nonpayment. Jim read the letter aloud. In summary the letter states that the Association will be paid the rents the owner receives from rental units that are 90 days delinquent. The letter further states that the Association can disallow access to amenities such as the pool, revoke voting privileges, and turn off cable access on owner occupied units that are 90 days delinquent. The Board discussed and agreed to composing a second letter for non-rental units that notifies the owner of these consequences of nonpayment. The Board discussed the fact that that while the attorneys have not come to a consensus about denying cable for delinquent accounts, it will stay in the letter and be addressed on an individual basis. It was also discussed that the owner of rental units will be given about 2 weeks to respond. If the owner does not respond, a letter will be sent to the tenant that will explain to whom and how their rent will be paid until the delinquent account has been brought current. Irene requested some modifications to the letter that moved the paragraphs around for smoother flow and added a sentence notifying the owner they will be required to pay for the re-installation of the cable once the account has been brought current. Jim Millican motioned to accept the letter with Irene's modifications. Jim Miller seconded the motion. All in favor.

4. Unfinished Business:

Carport Update: Kathy reported that American Eagle had told her they would keep her informed as the permits are pulled and as the project progresses.

5. New Business:

Elevators: Jim Millican reported that there have been a lot of problems with the elevators lately due to the elevator service company's (Thyssen Krupp) poor maintenance and service. Therefore, we have reported Thyssen Krupp to the State, who should perform a formal inspection. Since filing this complaint with the State, Thyssen Krupp executives have been seen working feverishly on the elevators. However, since this contract is up for renewal, the Board will be putting this service contract up for bid. Jim explained that we have a consultant with 25 years experience dealing with elevators and elevator service companies who is going to help us. Jim announced that he will be attending the Space Coast Condominium Association meeting this Saturday to get information on how the new legislation is affecting elevator codes as well as the other areas of the Condo Act that are affected by the new legislation

-Jim Millican explained that an owner got stuck in one of the elevators and the emergency alarm bell could not be heard outside the elevator. Kathy reported that she is trying to get a bid for new bells that will be audible outside. The contractor stated the housing for the bells will have to be replaced every couple of years. However, Jim stated that being on the river, Banana Bay does not have as bad of a salt environment as the condos on the beach, so he believes the bell and the housing won't rust out in just a couple of years. Angie Miller pointed out that if you get stuck in the elevator, you should not call the Fire Department as they will break the elevator door unnecessarily causing a huge expense. Jim Millican agreed and explained that since they have discovered that using the elevator emergency phone may take at least an hour to get a technician on site, he and Bill are now on the call list of the elevator emergency phone monitoring company. If someone is stuck, then Jim or Bill can reset the elevator and possibly get the person out of the elevator in a more reasonable time frame without damaging the elevator.

6. Committees:

Grounds: Jim Millican reported that Bob fixed the car wash drainage problem. He explained that Jim Miller inspected the surrounding area during a heavy rain, and the drainage is working very well.

-Jim Millican reported that he, Jim Miller, and Bob checked the entire sprinkler system. They found that someone had turned off a section at the master control box, which is why the grass was starting to brown. They also found that one of the sprinkler heads had been adjusted by an owner to water just their area, so it was re-adjusted for maximum spread and benefit to the entire area. Not only is every area now getting a full spread of water, but he has asked Bob to use the materials on hand to construct a box over the master panel to restrict access.

-Jim Miller reported that he heard a radio report that the coconut palms, which we have a lot of, can still show damage from the winter weather for up to six months. Jim stated that Scott had confirmed this as well. Jim is setting up a walk-through of the townhouse side and will let Jim Millican know when this will take place.

7. Bids/Building:

There was nothing to report.

8. Announcements:

Jim Millican announced that potential buyers are looking at Banana Bay due to its financial health. He read aloud an email that was sent to Michelle from a realtor regarding units 804 and 704, which are in arrears by $3,445 and $3,235, respectively. The questions pertained to the percentage of units in foreclosure, upcoming special assessments, and whether the financial outlook was positive. Jim pointed out that since these units are not in foreclosure, if sold, the Association would receive the entire delinquent amount. Carol Haberman stated that she thought the Association had to have a lien on the units to get the delinquent amount from a sell. Kathy explained that we complete an estoppel prior to closing with the amount owed and that amount is then paid by the buyer at closing. The condo always has a lien running with the land; therefore we will always be paid unless the bank forecloses. We only need a lien if we are going to file a suit and try to foreclose ourselves.

-Kathy reported that Michelle will be going on vacation the first week of July, so the Board should contact Kathy directly for any emergencies. Kathy further reported that she will be going on vacation for a week upon Michelle's return.

9. Owner Input:

Angie Miller asked if something could be done about the walkway on the third floor of the 2400 building as the paint is chipping and stained and looks terrible. The last time the walkways were painted was discussed including the cost and the paint. The Board felt the walkways should have lasted longer then they have. Discussion ensued regarding whether the old paint would have to be completely removed (down to the concrete) or not. Kathy will do some research to see what affordable options are available to address this problem. In the meantime, as a short term fix, Jim Millican will have Bob inventory the amount of paint on hand that would match the walkways. If we have enough paint, we will use it to paint the area directly in front of the elevators on the third floor.

-Carol Haberman asked about the schedule for power-washing the fences and Kathy stated that it is on Bob's list and her patience is appreciated.

10. Next Meeting Date:

The next meeting will be held on July 20, 2010 at 6:00 pm.

11. Adjournment:

There being nothing further to discuss Jim Millican adjourned at 6:50 pm.

Respectfully submitted,

Brandi Lowder, Administrative Assistant

Kathy Watts, CMCA, LCAM #27668

Community Association Manager

Reconcilable Differences, Inc.

BANANA BAY CONDOMINIUM ASSOCIATION, INC.

BOARD OF DIRECTORS’ MEETING

TUESDAY, MAY 25, 2010

1. Call to Order /Establish Quorum of Directors:

Meeting was called to order by Jim Millican at 6:30 pm in the clubhouse.

2. Approval of Minutes:

Irene made a motion to approve the minutes of the April 20, 2010 Board meeting as written. Jim Miller seconded the motion and it passed by unanimous voice vote. Jim Millican announced that hard copies of the April 20, 2010 Board of Director's Meeting are available in the clubhouse, and Brandi distributed copies to the owners present.

3. Financial Report:

Irene Nishimura reported that at the meeting last month, an owner had asked for the final cost of the concrete restoration project. The contract total for both buildings was for $40,000; however, upon completion of the work and payment of the final bill, the total cost came out to $36,895.06. So, the project came in well within budget and has been paid in full. Irene then reported that there hasn't been much of a change in the financials. As of April 30, 2010, our total assets, which include our checking and savings, come to $437,457.76, of which $426,062.96 is in Reserves and the remaining $11,394.80 is in our operating/checking account. Irene pointed out that we did not have any unusual expenses in the month of April, just the ordinary bills such as electric, cable, water, Waste Management, etc.

-Irene reported that there are presently 7 units in foreclosure and the banks are moving very slow as it is to their advantage. Irene and Jim Millican pointed out that if Governor Crist signs the present condo bill into law, then we will be given the right to go after the rents without changing our condo docs. Irene stated that another good part of this bill is that if signed, then the association will be given the right to cut off access to amenities to any owner over 90 days delinquent in their association fees. This includes the use of the clubhouse, pools and possibly cable. The cable TV cut-offs will be handled on an individual basis, as it costs the association to do this. Carol Langmesser pointed out that shutting off the cable temporarily, similar to the snowbird service, is not as expensive. Irene stated that the present bill also states that any owner over 90 days delinquent will lose their voting right; the owner can come to meetings, but cannot participate.

-Jim Millican reported that he keeps an eye on the empty units in foreclosure. He has Bob keep the vegetation trimmed back and the courtyards cleaned out to keep unwanted pests out. They inspect inside and out to make sure no one has broken in, is staying there, or using the unit/courtyard. Basically, they keep these areas safe and presentable.

4. Unfinished Business:

Pool Repairs:

Jim Millican reported that there were a few cracked tiles in the north pool. The pool technician said we could put an epoxy on these tiles and that the Department of Health would be satisfied with this repair. Therefore, we got the pool repaired for under $100.

Carport Update:

Jim Millican announced that the Board was going to vote on carport contractors tonight...finally. He pointed out that this was for 1 carport and that the Board is aware that there are at least 2 more that will need to be done as finances allow. American Eagle did the last 3 carports and bid $40,500 on this one. Cosmopolitan showed interest, but never got a bid to us. Concrete Restoration Inc. was called 6 times, but we never received a bid from them either. Doug Wilson's bid was $37,935 and while their bid is lower, they are a large general contractor who would subcontract the job out. Bill stated that when Doug Wilson was asked if he had done a carport similar to these, he admitted he has never done a carport at all. JC Marshal's bid was $41,920. Jim Millican recommended accepting American Eagle's proposal. He explained that we had noticed that the screws used in the previous 3 carports were rusting. We contacted American Eagle who admitted that while they ordered stainless steel screws, they received a low grade, which will and did rust. American Eagle submitted a letter stating they would replace the screws at no cost to the Association. Jim Millican made a motion to accept American Eagle's proposal for $40,500 to repair the carport in section 4. Bill Pemberton seconded the motion and it passed by unanimous voice vote.

5. New Business:

Committees:

Grounds: Jim Miller reported that the coconut palms took a beating this winter; in fact, 2 have died. Scott quoted: to cut down the trees at ground level and haul away, $50 each; to cut down, remove roots, and haul away, $150 each; to plant another tree close to the stump is $600 each. The Board discussed that since these trees are not original to the condos, these trees do not by law have to be replaced. Jim Miller reported that the tree in the common ground adjacent to Unit 603, which is very close to a transformer, can be cut down to ground level, then Scott will put in a couple of plugs to expedite the dying of the roots, and haul away for $150. Jim Miller's concern is that in the past the owner of 603 has threatened anyone trying to cut this tree down. Jim Millican assured the Board that Mr. Conner is now aware that this is not his tree and will not cause any problems. Jim Miller made a motion to have Scott cut down to ground level and haul away the 2 dead coconut palms on the fairway for $50 each, and the fig tree adjacent to unit 603 for $150. Irene seconded the motion. All in favor.

-Jim Millican reported that there is a common area tree that is on the fence of unit 701. Jim Millican, Jim Miller, and Kathy will check on this during their walk through on Thursday, May 27, 2010.

-Jim Millican reported that Bob's next major project to be done before the rainy season is to level out the car wash area, which is blocking the drainage and causing flooding of the parking lot and the walkways.

-Jim Miller reported that the technician from Black’s Pest Control inspected the other 2 coconut palms in front of the entrance of the north pool that also took a beating this winter. The technician feels he can save them with a copper solution and has offered to do this over the next few days at no additional charge. Jim Millican asked Jim Miller to please extend the Board's deep appreciation of this complimentary service.

Bids/Building:

Jim Millican reported that he has had Bob purchase, seal, and paint some T1-11 board. There are several units that need siding, but 2 units (1 in the 1800 building and 1 in the 1700 building) must have the siding replaced. Jim is having Bob get this material ready, so when we contact the contractor, LB Drywall, there will be no waiting time to install.

-Jim Millican reported that the deck of unit 1302 was a more expensive repair than expected; more damage was found once the deck was torn down. Irene reported that she will have the exact costs on this next month.

-Bill Pemberton reported that we are having trouble getting the numbers installed on the mid-rises. We received a bid of $500, but the contractor's cherry pickers could not get up high enough. Irene suggested calling the Fire Department for contractors that have a lift with a higher reach since it is the Fire Department requiring these numbers at this height for emergency identification. Bill agreed to try this route.

6. Announcements:

Irene announced that the Board of Director's meetings will go back to their original time of 6:00 pm as this is most convenient for its members.

7. Owner Input:

Carol Haberman stated that she attended the open house on a unit in Banana Bay, which was empty. She has been watching the sales to keep an eye on the present market value in the immediate area.

-Carol Haberman pointed out that the report in the February 22, 2010 Meeting Minutes that she saved 2 hours drying time was in error. She stated that she has saved 1 hour in drying time since having her dryer vent cleaned out. Several owners agreed with Carol that their electric bills have decreased significantly since having their dryer vents cleaned out.

8. Next Meeting Date:

The next meeting will be held on June 22, 2010 at 6:00 pm.

9. Adjournment:

There being nothing further to discuss, Jim Millican adjourned the meeting at 7:13 pm.

Respectfully submitted,

Kathy Watts, CMCA, LCAM #27668

Brandi Lowder, Administrative Assistant

Community Association Manager

Reconcilable Differences, Inc.

BANANA BAY CONDOMINIUM ASSOCIATION, INC.

BOARD OF DIRECTORS’ MEETING

TUESDAY, APRIL 20, 2010

1. Call to Order /Establish Quorum of Directors:

Meeting was called to order by Jim Millican at 6:32 pm in the clubhouse.

A quorum was established with Jim Millican-President, Bill Pemberton-Vice President, Irene Nishimura-Treasurer, Lisa Mullooly-Secretary, and Jim Miller-Director in attendance. Kathy Watts and Brandi Lowder represented Reconcilable Differences. Twelve owners were also in attendance.

2. Approval of Minutes:

-Jim Millican made a motion to approve the minutes of the February 16, 2010 Board meeting. Bill Pemberton seconded the motion and it passed by unanimous voice vote.

-Jim Millican made a motion to approve the minutes of the March 2, 2010 Organizational/Board meeting. Lisa Mullooly seconded the motion and it passed by unanimous voice vote.

3. Financial Report:

Irene Nishimura reported that as of March 31, 2010, our cash assets total $425,090.89, which includes our checking account, the various CD's we have, and the Reserves. Out of that total, $410,978.76 is Reserve money. Irene pointed out that since this is our first meeting, she hasn't actually looked at all of our payments, but we are meeting our current obligations. She stated that what she wants to focus on tonight is the owner delinquencies. For the last 30 days we have $5,770 in delinquencies. Of that we have 7 foreclosures that represent $3,045, which is money not being collected each month until something happens with the unit. Irene stated that she thinks we have to focus on the other arrears, which for this one month total $2,725, and those over 60 days past due total $1,760. Irene reported that she has checked to see if any of these units in arrears are rentals, and that we are also going to find out if any in foreclosure are being rented. If so, Irene explained that she isn't sure if the Statute has been approved, but there was a recommendation that if a unit is in foreclosure and is being rented, we could go after the rent. RDI has been in contact with the attorney for the past few months about petitioning the courts to place the rent(s) in their registry.

4. Unfinished Business:

Pool Repairs:

-Jim Millican reported that the County Health Department has found some cracked/chipped tiles at the north pool and has cited us for them; therefore, these tiles must be replaced or we will be fined. Kathy reported that Price Rite is sending us an estimate to fix the tiles. An owner asked if the Board was only getting one bid. Jim Millican answered that it has been very difficult to get bids on any of our projects/repairs lately. In fact, we have been trying for a long time to get a carport bid on 1 carport. He then explained that there are only 6-8 tiles that are being replaced, so this was a relatively small job making it more difficult to get companies to bid it. He further explained that the pool won't have to be drained, but they may have to lower the water level for about a day. Therefore, if Price Rite's bid is in line, we will go with it.

-Jim Millican reported that as can be seen at the south pool, Bob has it ready to be painted. What you may not have noticed is the ingenious plan Bob came up with to guard the deck from the rusting table as the rust was starting to stain the deck. Bob cleaned and primed the table and added PVC and caulked around it so that it cannot even be seen and it looks very nice. An owner asked if the deck painting required a contractor's license. Jim Millican explained that Bob can do this as an employee, without a pool repair certification, and that Bob has previous experience painting the pool decks. He further explained that by having Bob, rather than a specialized contractor paint the decks, the Association is saving a lot of money.

Carport Update:

Kathy reported that she has called more than 4 contractors, who are supposedly submitting bids. She has called American 3 times for an updated bid and CRI 6 times. Doug Wilson should have a bid to us by the end of this week, and we have a bid from Marshall Construction. So, as soon as we can get some bids in, she will get them to the Board. Jim Millican stated that since this is taking so long, when we do finally get these bids in, the Board would probably have a special meeting to get this approved rather than waiting until the next monthly Board meeting. Carol Haberman, owner, asked if the bid was for all the carports. Jim explained that this was just for the one big carport for now. He acknowledged that the carports on Carol's side look terrible, and explained that this big one has to be done first and the rest would have to be put on hold for a while. An owner asked if Jim Millican had looked at the carport in section 1 that already has nail rusting, and Jim confirmed that he has looked at it. He stated that he has not discussed this possibly being under warranty with American Eagle, but plans to when we can get them to contact us and submit an updated bid for the big carport. Jim explained that he also plans to discuss the rusting issues with whoever will be awarded this contract.

5. New Business:

Committees:

Grounds: Jim Miller reported that while walking the grounds the other day, he noticed a lot of milk weeds had popped up. He called Blacks, who inspected this area and reported that this area was not sodded correctly as the old sod had not been completed removed before the new sod was laid. Jim Miller explained that this is the area in which CRI's equipment destroyed the grass. Lisa Mullooly reported that CRI put horrible sod on top of sand. Jim Miller agreed and stated that he made CRI remove the sand and lay sod, but the sand is what allowed the weeds to take over. Black’s has to spray each thistle individually, and they did about 50 of them today. Jim Millican pointed out that when CRI had damaged the sidewalk, he couldn't get any results until he got Claudia, Existing Structures, to get involved; therefore, Jim Millican will call Claudia to see if she can get CRI to repair this correctly.

Bids/Building: Kathy stated that there was nothing new to report. An owner asked what the final total was for concrete restoration. Kathy stated she didn’t have that figure with her tonight but it was under the budgeted amount and would send the information to the Board.

6. Announcements:

Dryer Vent Clean-out Options:

Carol Langmesser reported that she only has 10 people that want their dryer vents cleaned out and 1 of those canceled because she didn't want to wait any longer and had it done by another contractor. Carol Haberman reported that she was that 1 and that since she got it done she has saved 2 hours of drying time saving her a lot of money on her electric. She stated that she paid $115. Carol Langmesser said if we could get enough participation, we could get it done for as low as $75 per unit if all 4 in a building were to get theirs done at the same time.

7. Owner Input:

Carol Haberman asked that in light of the fact of the Riverside failure this week, does the Association have all their money in 1 bank. Irene explained that we have 4 CD's in various banks and because the CD we had in BB&T was getting too big, we pulled it out recently.

-An owner proposed forming a finance committee that works year round to keep an eye on the day-to-day operations and regular bills. Jim Millican stated that he didn't think this was a good idea last year and his opinion has not changed. Discussion ensued about the details that will be given at Board meetings, such as giving a report of the line items that are not regular utilities and monthly services; that owners can get a copy of anything they want from RDI; the monthly fee paid to the management company; the management company's hours and duties; and that the attorney explained the Board's duties, the benefits of the management company, and the excellent financial condition of the Association at the Annual Meeting (the minutes of this discussion can be viewed on our website).

8. Next Meeting Date:

The next meeting will be held on May 25, 2010 at 7:00 pm. If the carport bids are received before that time, a special meeting will be held.

9. Adjournment:

Jim Millican made a motion to adjourn at 7:20 pm. Irene Nishimura seconded the motion and it passed by unanimous voice vote.

Respectfully submitted,

Brandi Lowder, Administrative Assistant

Kathy Watts, CMCA, LCAM #27668

Community Association Manager

Reconcilable Differences, Inc.

BANANA BAY CONDOMINIUM ASSOCIATION, INC.

Minutes of the 2010 Annual Meeting

held Tuesday, March 02, 2010, at 7:00 p.m. in the onsite clubhouse

NOTE: The Meeting could not be held except for

the election of the Board of Directors

1. Call to Order:

Meeting was called to order by Jim Millican at 7:05 pm in the clubhouse. Jim Millican explained that we did not have enough proxies and members present to hold the Annual Meeting; however, Florida Statute does allow us to hold an election. He then turned the proceedings over to Neal McCulloh, Attorney.

-Mr. McCulloh said that the state Legislature changed the statute because so many condominiums for a long time could not hold an Annual Meeting; and, therefore, could not elect Directors. So the same Directors perpetuated from year to year, up to ten/twenty years. The Legislature wanted to make sure that the owners had the ability to elect their own Directors even at a reduced number of people casting votes. So the Legislature just picked an artificial number. If you don't have a quorum, the one item of business that you can conduct at a meeting provided 20% of the owners cast a ballot, is the election of Directors. So that is the only thing that can be done "officially" tonight.

2. Appointment of Impartial Committee to Count Ballots:

Mr. McCulloh confirmed that everyone had turned in their ballots, which they had. He held a formal election in that Carol Haberman motioned to close the balloting. Carol Langmesser seconded the motion and it passed by unanimous voice vote.

Mr. McCulloh asked for volunteers to count the ballots. These volunteers were:

Carol Langmesser, Owner

Carol Haberman, Owner

Sarah Davis, RDI

Kathy Watts, Manager

Mr. McCulloh requested someone to move that these four people be the ones charged with counting the ballots. Jack Marx made the motion by stating, "So be it." Irene Nishimura seconded the motion and it passed by unanimous voice vote.

Counting of Ballots Begins:

The ballot counters were separated from the rest of the members present but within sight and proceeded with opening the outer and inner envelopes.

3. Certification of Proxies & Establishment of a Quorum of Members for Annual Meeting:

A quorum was not established; however Jim Millican-President, Bill Pemberton-Vice President, Lisa Mullooly-Secretary, Jim Miller-Director were in attendance. Donna Sands-Treasurer was unable to attend. Michelle Dugan, Kathy Watts, Sarah Davis and Brandi Lowder represented Reconcilable Differences.

Management reported having a total of 45 units represented by proxy and in person. Check the sign in sheet and write: Management reported that 11 units were present in person and 34 were present by proxy, for a total of 45 units represented. Since a minimum total of 69 owners were needed, a quorum was not established.

The official election was held, however, since 50 ballots were received and a minimum of 28 ballots were needed to hold an election.

4. Open Forum-Comments and Discussion by Homeowners:

Mr. McCulloh stated that while the counting was being done and even though this will not be official, those members present took the time to show up, and he felt he’d try to answer whatever questions and issues the members had while the ballots were being counted.

Mr. McCulloh introduced himself as “Neal McCulloh from the Law firm of Clayton & McCulloh. We are the law firm that represents your Association. This is the area of law that we do. We represent over 675 Associations.”

Jim Millican pointed out that we also asked our CPA to attend this meeting. Ron Cole introduced himself stating he was from Cole & Associates. Jim Millican said that these professionals were asked to attend this meeting to answer all questions and clear up misunderstandings that the owners had.

Jim asked Mr. McCulloh if the Board members would be allowed to ask questions, and Mr. McCulloh answered that they could ask questions as owners, but not as Board members since this is not a Board Meeting, nor is it a Member Meeting. Mr. McCulloh stated that since the Organizational Meeting, which will be held immediately following the Election of the Board of Directors, was a Board Meeting and had to be held, we would address the sections of the Agenda we could not address during this informal question and answer session.

Lisa Mullooly asked Mr. McCulloh why he considered this Association in great shape when we have 7 foreclosures. She also requested that he give us some input as to what the other Associations and Boards he represents are going through. Mr. McCulloh explained that he does not mean to laugh at 7 foreclosures; but considering how many Associations he represents, many are in dire straits. He stated that our accountant can affirm that in the present economy, they both feel that any Association with 30% in arrears is doing good. Ron Cole agreed. Mr. McCulloh pointed out that the number of arrears our Association has comparatively is inconsequential. It is so minute that we are rated in the top 1% in how we are doing. Banana Bay doesn't have issues. He has Associations that have 40-50% or more in arrears (just condos, not HOA's) and both he and the accountant consider that percentage of arrears to be "the norm".

An owner asked Mr. McCulloh what we do about ours. Mr. McCulloh explained that the Association's Management firm, RDI, sends out two "please pay us in x number of days or we will have to turn it over to the attorney for collection" letter. Management tries to afford the owners the ability to pay without having to go to the law firm so the attorney's fees don't get tacked on to the owners. Then there is a Statutory Provision before you can lien. There is a 30-day Notice of Intent to Lien, which tells the owner if they don't pay in the next 30 days, the Association will lien and the owner will be responsible for all of the Court costs, attorney fees, interest, etc. If they don't pay in that 30 days, a lien is filed. Then there is another letter, which is a 30-day Notice of Intent to Foreclose, which gives the owner another 30 days before the matter goes into foreclosure. Then if it isn't paid in that 30 days, then we file foreclosure.

Mr. McCulloh stated that his law firm has just started a brand new process, and as far as he knows his law firm is the only one in the state doing it. His law firm used to monitor a mortgage foreclosure by answering the Complaint, getting in the pleadings, and letting them know when the foreclosure is over so the Association can demand 6 months of assessments or 1% of the original loan amount, whichever is less. What his law firm has done is that since so many Associations have been crippled, they are going to charge a flat $250, but they are going to try to get back 100% of the assessments, costs, attorney's fees, and late charges on a contingency basis. What that means is unless the Court awards it, the law firm doesn't get it. Unlike a personal injury case where the attorney gets a percentage of whatever monies are awarded, Clayton & McCulloh only get their attorney's fees if the Court awards it. If the Court doesn't award attorney's fees, then they don't get anything above the $250. The law firm is at complete risk rather than the Association being at risk. This is the same $250, but the law firm is working harder to get more because they are taking all the risk in getting their fees over the $250. They are doing this because, quite honestly, many of their associations, not Banana Bay, can't really afford a lot more in collections. (Later in the meeting Mr. McCulloh explained that if his law firm does the monitor, so far they are actually trying to monitor the pre- $250 payment and just go forward; and they are not re-charging since changing the procedure.) Clayton & McCulloh started this process for two reasons; one being that the Associations were getting crushed. Reason number two is that in the mortgage foreclosure, the Association only gets their six months once it is over. The Association was getting shafted and then getting shafted again. He explained that many of the mortgage companies did not want to take Title to the foreclosed properties because the property values have dropped. If the mortgage company takes Title, then they may have to pay the 6 months plus all future assessments and take a loss on their loan. So, the mortgage companies are not taking Title, which in turn causes the other owners to pay for the common expenses, and allows the mortgage company to avoid getting charged any future assessments. The mortgage company plans to wait until the property values increase or the economy comes back and they can sell the unit. Another words, burn the rest of the owners. That's the game. So, his law firm has devised a way to try to protect their clients. It is predicated with a bunch of technicalities. Technicality #1: A lot of these foreclosures, which you have probably heard, are being warehoused. In other words, there are a zillion of these foreclosures started. The banks start the foreclosure paperwork, but they don't want to foreclose in their own name because they have so many and would have to then be responsible for the monthly association fees. A lot of times they are signing the Right to Foreclose to another company. So, this company in this name is foreclosing. But if you will go look at Florida Statute 718, what you are going to see is that there is a Safe Harbor Provision and the Safe Harbor says, "Okay, mortgage company, if you foreclose or your assignee forecloses, you only have 6 months of assessments you must pay." Mr. McCulloh stated, "Notice what I say: Mortgage company or Assignee. It didn't say 'the company you gave the Right to Foreclose to'; and we are getting the Courts to go with it. Not every time, but we have had a lot of success." Technicality #2: The Safe Harbor Provision. If anyone wants to go look it up, you see that it talks about assessments. It does NOT talk about a Safe Harbor. Another words, you don't have to pay interest, costs, attorney's fees, late charges. So the Safe Harbor for the mortgage companies is on assessments only. There are 2 options. If there is a mortgage foreclosure, we get to fight with the mortgage company. However, what his law firm can do and has been doing is that where it makes sense they have been trying to complete the Association's foreclosure or; hopefully, as we file a law suit and proceed under the Association's foreclosure, the owner will step forward and pay or the Association hits the buyer with the arrears. It is complicated because you have the mortgage foreclosure and then you have your own lien and foreclosure. They can overlap, but they don't have to.

Mr. McCulloh stated that one of the things that a lot of the condominium associations are now starting to do because the mortgage companies are filing their suit and letting it sit for 1-3 years before they complete it. Mr. McCulloh stated that these are going to take even longer because (as he has heard) the condominium market is not coming back. So when the mortgage company is not proceeding on its case, should the Association take Title on its foreclosure? The Association takes Title and leases the unit until the mortgage company forecloses us out. In the meantime, the Association keeps all of the rent, does NOT pay the Mortgage Company, nor does it pay the taxes. There are a lot of things the Association can do. If you encounter situations where you have a delinquent owner (not paying assessments), who is renting their unit and just keeping all of the rent (those are the ones that usually make the other owners and the Board extremely irate); in other words they are not contributing anything, but keeping all of the funds, which isn't fair; we can amend your documents to include what is called an Assignment of Rent Provision. An Assignment of Rent Provision says, in essence, in the event an owner is delinquent in paying his fees and that owner has rented his unit, then the Association is entitled to collect rents directly from the tenant, and the tenant shall pay his rent directly to the Association until such time that the owner's account is brought current. If you read Florida Statute 718.303 Condominium Statute and Subsection, it says that every owner and every tenant shall comply with this Chapter and the Association's Governing Documents. The tenant is also obligated to comply with your governing documents by law. So, if you amend your governing documents to state that the tenant must pay his/her rent directly to the Association. Then we get to argue that it is in violation of the law for the tenant not to forward his/her rent directly to the Association. This is a strong provision. Truthfully, we are not trying to go to the tenant. What we are trying to do is have that implemented so the Association can point out "Here's our documents and here's the Statute. You have one of two choices. You can work with us and pay the assessment or we take all of it."

Irene Nishimura, owner, asked Mr. McCulloh how much of the rent we are allowed to get, only the amount of our monthly maintenance fee or all of the rent the tenants were paying to the owner? Mr. McCulloh answered that under the Assignment of Rent Provision, if you go to the tenant and implement, the concept is that the tenant pays the Association 100% of the rent until the account is brought current. Mr. McCulloh stated that there are all kinds of challenges, but it is a pretty strong argument and it puts a lot of pressure on the owners to work with the Association.

Bill Pemberton, owner, asked how hard it is to get this into our condo docs. Mr. McCulloh said that he would have to look up the exact figures, but it is either 2/3 or the majority of a quorum to amend documents. In other words, it is a member vote. This vote can be done by proxy. An owner stated that delinquent owners would vote against this amendment. Michelle pointed out that the good-paying owners, which are the majority at Banana Bay, would vote yes. Mr. McCulloh stated that even the owners that are renting are abiding by their duty. The person that will be the most irate is not the live-in owner, but the good investor who is continuing to pay his assessments against the investor that is not. The one that is going to vote the fastest for this amendment is the good investor who is paying his assessments. You only have 7 foreclosures, so this vote should not be a big issue.

Jim Millican and Michelle confirmed that there are 7 in foreclosure and 5 are slow-pays for a total of 11 delinquent accounts. Bill Pemberton asked how many out of the 7 foreclosures have renters in the unit, and Michelle answered that there is presently only one.

Jack Marx, owner, stated that Mr. McCulloh had said that there was a mortgage foreclosure and another type of foreclosure. What is the other type? Mr. McCulloh explained that under the Association's Declaration, the owners have to pay assessments and the Association has the right to lien your unit and to foreclose on your unit. Please understand that the owner generally has two debts on their unit, the Association assessments and a mortgage. Therefore, the mortgage company can foreclose on the mortgage, and we (the Association) can foreclosure on our documents and the lien. Rosemary then asked how many out of our 7 foreclosures are by the Association Michelle reported that we have 2, and Mr. McCulloh explained that while all 7 are in mortgage foreclosure, 2 of these are also in Association lien foreclosure.

Mr. McCulloh said that the Banana Bay Condominium Association is in a really good position with having only 11 delinquent accounts. He said that his law firm has an association coming in with 95% delinquencies. Several owners stated that it was really a shame that almost all of the owners that have been so worried and complaining about our 11 delinquent accounts couldn't be at this meeting to hear this. Mr. McCulloh stated that not only is Banana Bay doing really good, but we are still able to do the maintenance and repairs that need done. Many associations have had to put all of their maintenance and all of their repairs on hold. Every year that he attends the Banana Bay meetings, he hears us plan our projects and ongoing maintenance for the coming year. Mr. McCulloh further stated that Banana Bay is in at least the top 5%, if not the top 1%. Ron Cole agreed with this and with Mr. McCulloh's statement that neither of them are surprised by 30-45% in delinquencies.

Michelle asked Mr. McCulloh to explain what happens after the Association takes Title of a unit through foreclosure. Mr. McCulloh stated that when the Association forecloses on a unit, the Association takes Title. What's next? There is this big concern and turmoil that if we take the Title, we (the Association) have to pay the mortgage. NO! You didn't sign on the dotted line for the mortgage. You are not obligated to pay the mortgage. Generally, what you do is: You know how the mortgage companies are short-shafting you. Now you turn around and say, "You did this to us, now we are not paying you." You also are not going to pay the taxes. Why? Because you know that eventually the mortgage company, which has priority over the Association, is going to get off of their duffs and complete their foreclosure. When the mortgage company files their mortgage foreclosure, they sue the Association. It is not to get money. It is to let the Association come forward for collection of their delinquent account or forever hold their peace. In other words, the mortgage company is saying, "if you want to preserve your interest, step into our case." However, if the Association completes their own foreclosure while they (the mortgage holders) are sitting there on the sidelines, the Association now has Title. You can turn around and rent the unit and keep the rents. Mr. McCulloh stated that if the Association does it, they call it a "Fire Rental" because the Association wants to, first, get someone in there quickly. Second, they want to start getting money. Third, and most importantly, eventually, this mortgage company is going to come and foreclose you out. When is that going to happen? No one knows. Therefore, the lease will have a special provision stating that in the event the mortgage foreclosure comes through, the lease terminates. So, the Association is going to rent the unit at a reduced rate to get someone in there quickly and because it is possible the mortgage company could eventually foreclose. This provision allows the Association to terminate the lease quickly and not be in breach of contract. This is becoming a much more sought after revenue especially since the mortgage companies are taking so long to foreclose.

-Mr. McCulloh explained that he does not want to overstate this method. There is always a downside:

The attorney fees will be around $1500.

It is going to take the Association a year to complete their foreclosure. Mr. McCulloh explained that all of the law firms are backed up. For example, his law firm cannot expand fast enough to handle all of the questions. In fact, Clayton & McCulloh had to literally take on another 22,400 square feet because of how much they keep expanding the collection department. Mr. McCulloh stated that foreclosures use to take 6 months, but now they cannot get one completed in less than a year. However, we are banking on the Association's foreclosure being completed in a year, and on the mortgage company's foreclosure not being completed for 2 to 3 years.

Another reason you may not want to do it is if you have a dilapidated unit that can't be rented and is going to cost a fortune to fix up. Then all your going to do is pay the attorney and not be able to do anything.

Irene had a question for CPA Ron Cole: In the last meeting, the members were told that he had recommended that the Association should write off approximately $34,000 now; and some of the members took issue with that recommendation. Could you please explain how you calculated that amount? Ron explained that we don't "write off", rather we make an allowance. We know that out of the Accounts Receivables, the Association is only guaranteed 6 months of arrears by the Safe Harbor Provision when a mortgage foreclosure is completed. Therefore, out of over $50,000 in Accounts Receivables, the Association will not be able to recoup approximately $30,000.

Rosemary asked if we have any empty deteriorating units. Jim Millican reported that there are a few that he and Bob (maintenance) have been keeping an eye on. In fact, if he is still on the Board, he and Kathy will be doing a walk-through when he gets back from Utah to determine how many are empty and what clean up and/or maintenance are may need to be done. In the meantime, he has directed Bob to clean up the courtyards of the empty units rather than pay the landscapers to do it. This is being done to keep the critters out, such as raccoons and rats; to check for break-ins thereby keeping the owners living around the empty units safe from any possible transients; and to keep up the community's appearance.

Jim Millican thanked Neal McCulloh and Ron Cole for answering all of our questions. Jim pointed out that it was really a shame that the people who do complain so much were not here for this. Mr. McCulloh reiterated that Banana Bay really is a success story because of the low percentage of delinquencies as well as the fact that this Association is continuing to take on projects and keep the buildings and the grounds up.

5. Presentation of 2010 Board Members:

Mr. McCulloh announced that the 4 ballot counters have finished. Therefore, he asked each of the ballot counters if they agreed with the tally. Each counter confirmed that they agree with the final count.

Kathy Watts, Master Counter, announced that the 2010 Board of Directors are (in alphabetical order):

Jim Miller

Jim Millican

Lisa Mullooly

Irene Nishimura

Bill Pemberton

The members applauded this announcement. Jim Millican pointed out that many members forget that the Board of Directors are volunteers who are elected by the members. He stated that each of these volunteers give their time, blood, sweat, and tears; basically putting themselves out there to be abused. However, everyone up here truly cares about Banana Bay and its members although some members do not believe that.

6. Association Protocols Explained:

Jim Millican stated that in the last meeting, he read a letter from an owner who is threatening to sue the Association because she wants her railings replaced now. He re-iterated some of the discussion from this meeting and asked Mr. McCulloh to please explain to the members the attorney's opinion of this situation. Mr. McCulloh stated that the ongoing maintenance provided by the Association is in compliance with the Association's documents as well as the Florida Statute 718.113. Ironically, owners periodically think that they should be able to determine what level of maintenance occurs when, how often, how soon, and at what level. NO! Your Association is a corporation. Corporations don't act by individuals. They don't act by the shareholders. They don't act by the members. They act through a Board of Directors. The Board of Directors will make 98% of the decisions for this Association including what maintenance is done, when, by whom, and at what cost, how and the extent thereof, period. I understand that the Board member took a remedial measure dealing with the balcony's railings. They had it inspected and figured out which ones were unsafe and needed to be replaced now. That is properly within the determination of the Board. The Board has determined to act, to maintain the condominiums. It is my understanding that this owner said, "Wait a minute, x-y-z got new railings. I didn't get new railings. I'm entitled to new railings. The appearance of the railings is different because those are new and mine are old so there is a difference in color. Therefore, the Board/Association MUST replace my railings." Answer: No. The Board of Directors shall make these decisions, period. Mr. McCulloh stated that it is his opinion that it is improper for the Board to give away these decisions. Can they form a committee of people with more knowledge to make a decision? Sure, but it is for the Board to determine what gets done and when. For example, the landscapers are up there and Mr. Smith (fictitious name) thinks that what is being done in this area looks better than the what is being done next to his home; therefore, Board, you must elevate the services here to commensurate with what is being done there. No. Board, maintain. That is what the Board is elected to do, to make those decisions, to make those business judgments. I, as an attorney, am never going to supplant my decision with the Board on that kind of a decision because it is a business decision. Nor do I expect the Department of Professional Regulations to do it; nor do I expect the Courts to do it. Why? Because it should be within the sole discretion of the Board of Directors. The Board will make the decision and do NOT allow an individual owner to change what you believe to be right. It is important for the Board to have massive credibility. We all need to know that we can rely on our Board to make those decisions and to make the hard decisions where there may be an incredible lawsuit or something that someone is claiming is unfair. Compliments, Board. Make the decision. Don't be pushed into doing something you don't want.

Mr. McCulloh stated that he recalls a similar situation when Banana Bay was undergoing the carport renovation project. It had to be done a section at a time over an incredible amount of time (that seemed to be taking forever). Seriously, it was a major project. During this project there were several complaints such as "mine isn't being done fast enough" or "mine is slightly different". Michelle pointed out that some materials were no longer available on some sections, and some owners complained about uniformity. Mr. McCulloh explained, "The Board made the decision. The end. Sorry owners. When you buy into a condominium, you are buying into a system and structure whereby the maintenance level of the common elements will be determined by the Board." If you want to say it is a safety issue; fine. That is understandable. The whole reason we replaced the railings we replaced was because these were a safety issue. By the way, even if you can't replace with the identical thing, you go to the closest available. It doesn't mean that now, just for appearance reasons, you have to change all of the other ones. Do I expect that whoever will probably be next won't get them as quickly as this person? Sure, unless for some reason like where these are located they might be more susceptible to degradation. It is possible that one or more of the railings that have already been replaced may have to be replaced again before this person gets new railings due to some being more exposed to the elements than hers.

An owner asked why the members can't be told the name of the person who is threatening to sue the Association over the railing replacements. Mr. McCulloh stated that he knows the members have the ability to find out who this person is. He recommends; however, that the owner make a request in writing to the management company. He is not comfortable giving this information now because this is not an official member meeting. Jim Millican pointed out that since he read the letter aloud in the last meeting, including the name of the writer, it would be in the minutes.

Mr. McCulloh pointed out that if the members ever expect their Board of Directors to never make a mistake in terms of following the statutes and their documents, they are being unrealistic. They are going to make lots of them. Sorry. If you ever expect your management company to not make a mistake, you’re crazy. They are going to make them. If you ever expect his law firm to never make a mistake, you are all definitely crazy. They will make them. He stated that he doesn't want to make everyone scared especially considering the fact that his law firm represents over 675 associations. He has personally given several lectures before the Bar in this area as well as at the University of Miami, which holds the largest seminar for attorneys who love this area of law. We WILL make mistakes as we are human. He stated that he does intend to make far fewer mistakes than any other law firm, but that does not mean that we are not human. There is a reason he has pointed this out to the members. The area of law we are talking about and the sheer volume of the documents and number of amendments as well as the frequency of changes in the law in this area is ridiculous. Mr. McCulloh held up a huge binder of the Association's documents and asked the members if any of them seriously believed that any member of the Board has all of this memorized. The reason Mr. McCulloh couldn't give us the percentage needed to amend our documents earlier is because our condo docs have 14 billion amendments, which makes everything even more convoluted. If that isn't bad enough, Florida Legislature wants to change the laws every single year, and they love to say, "This year it is 'x' and next year it will not be 'x' and we will go back to 'x' the following year." The point is mistakes are going to be made, and it is so easy to make small typos and mistakes. Mr. McCulloh stated that his opinion on elections is that there is going to be a mistake. Guess what. We have a small mistake, and that is what we are going to disclose. When management was doing the ballots, they printed out "x" number of ballots at the management office. Then at the last minute, they were short a couple ballots, so they quickly printed these out and accidentally pulled up last year's ballot instead of this year's ballot. Therefore, there are a couple of mistakes on 3 ballots: 1) the date was 2009 instead of 2010; and, 2) Donna Sands was included after she withdrew her Intent to be a Candidate. This doesn't matter because there was only 1 ballot received that had these mistakes, and 1 ballot doesn't amount to a hill of beans. We are disclosing this because the Board wanted to make sure everything was out in the open for the members. Mr. McCulloh explained that there is a gray area with Florida Statute 718 where it discusses what is to be included on the ballot. It doesn't talk about what happens if a candidate withdraws their intent after the ballot has been mailed out. So now there is an issue as to which ballot should be used, but it doesn't really matter. Could someone stir the pot? Sure. Does he expect it to go anywhere? No. Could it? Sure. Let's not forget that in today's world with Statute 718, your election for a Board of Directors is every year. Has anyone noticed how fast our Courts move? Does anything get done in a year? Has anyone noticed how fast the DBPR moves or the State Attorney's office? Basically, while someone could take it to Court, there would be another Board in place by the time it was actually heard.

Jim Millican closed this chat session at 7:55 p.m.

Minutes of the Organizational Meeting of the

Banana Bay Board of Directors

Held Immediately After the Election of Board of Directors

On March 2, 2010, in the onsite clubhouse

1. Call to Order:

Jim Millican called the meeting to order at 7:55 p.m.

2. Appointment of New Board Members:

President: Lisa Mullooly made a motion to appoint Jim Millican. Bill Pemberton seconded the motion and it passed by unanimous voice vote.

Vice President: Lisa Mullooly made a motion to appoint Bill Pemberton. Irene Nishimura seconded the motion and it passed by unanimous voice vote.

Secretary: Irene Nishimura made a motion to appoint Lisa Mullooly. Bill Pemberton seconded the motion and it passed by unanimous voice vote.

Treasurer: Lisa Mullooly made a motion to appoint Irene Nishimura. Jim Miller seconded the motion and it passed by unanimous voice vote.

Directors will consist of: Jim Miller.

3. Accounting:

Jim Millican pointed out that this is an official Board of Director's Meeting; therefore, we can discuss any new or unfinished business. Michelle stated that since Ron Cole drove all the way out here from Orlando, we would like to let him speak so he can get home. She further stated that we really thought that we would at least get our normal, if not higher than normal, attendance to ask their questions of our accountant and calm their fears about the foreclosures and arrears. Several owners voiced their surprise that more owners didn't attend stating that not only do our regular Board Meetings have a larger attendance, but there were quite a few owners with accounting questions.

Ron Cole, CPA, Cole & Associates: Ron reported that the audit is in progress; no problems have been found, and barring any surprises, it should be completed in 3-4 weeks. Ron stated that he seconds Neal's comment in regards to the health of this Association. He works with over 500 associations across the region and Banana Bay does NOT have issues. To them, 7 collections is negligible. The Board thanked Ron Cole for his time to attend this meeting.

4. Unfinished Business:

Jim Millican reported that we had some concrete work done on the mid-rises, and that is where the railings came in. This was preventative maintenance that will save us money down the road. It came in on budget so far, and he believes it will end on budget.

-Jim Millican also reported that the next project is the carports. There is one that is going to have to be replaced, and it is going to be expensive.

-There are some small projects, one of which is the pool decking. Bob, maintenance, has learned to do the pool decking resurfacing and has finished the south deck. Several owners commented that it looks really good. Jim Millican reported that Bob is saving the Association a lot of money by doing this himself.

-Jim stated that there was some blockage of the retention pond drainage. This was taken care of within an hour of it being brought to the Board's attention.

5. Next Meeting Date:

The next meeting will be on April 20, 2010 at 6:30 p.m.

6. Adjournment:

Lisa Mullooly made a motion to adjourn at 8:02 p.m. Irene Nishimura seconded the motion and it passed by unanimous voice vote.

Respectfully submitted,

Brandi Lowder, Administrative Assistant

Kathy Watts, CMCA, LCAM #27668

Community Association Manager

Reconcilable Differences, Inc.

BANANA BAY CONDOMINIUM ASSOCIATION, INC.

BOARD OF DIRECTORS’ MEETING

TUESDAY, FEBRUARY 16, 2010

1. Call to Order /Establish Quorum of Directors:

Meeting was called to order by Jim Millican at 6:32 pm in the clubhouse.

A quorum was established with Jim Millican-Vice President, Donna Sands-Treasurer, Lisa Mullooly-Secretary in attendance. Jim Miller-Director was unable to attend. Kathy Watts and Brandi Lowder represented Reconcilable Differences.

2. Approval of Minutes:

Lisa Mullooly made a motion to approve the minutes of the February 2, 2010 Special meeting. Donna Sands seconded the motion and it passed by unanimous voice vote.

3. Financial Report:

Donna Sands reported that she has the final December financials and a draft of the January financials. After our last meeting, Michelle and Donna discussed the bad debt item that was making us show a year-to-date loss. Michelle had expensed $34,400 under the advisement of the CPA firm that we charge off as bad debt expense anyone who was over 180 days past due. Donna re-iterated her opinion from the last meeting that she felt this to be an exorbitant amount to write off. Michelle and Donna made a compromise to only charge off $9, 900, which was taking a percentage of the five highest delinquent accounts. So, the actual loss for the month of December is a little over $13,000, and we have a year-to-date gain of $2,661. This gain does move over to the equity portion of the balance sheet, and does not put us into a less equity position. We now end the year with a total equity of a little less than $47,000. Donna expressed that she feels a lot better doing the financials this way.

-Last year we funded our reserves $6,660 every month giving us a year end total of $408,962. However, we do have the on-going concrete project, which still needs to be disbursed from the reserves, as well as other projects. Donna pointed out that for the year 2009 we do end up in a good position.

-The draft for January shows a loss of $1300 right off the bat, which starts us in the hole. However, this draft does not show some of the line items/expenses that were built into the 2010 budget, such as the monthly bad debt line of about $800. If we built that in, we would actually have a loss of about $2,200. Again, Michelle did say this was a draft; so, we will have to go through it and analyze it.

-A/R is standing as of January at $52,095. We do know that we have $9,900 set aside in reserves, but we are not going to subtract from that until we know something final on all of these foreclosures. Not only are the foreclosures growing, but a lot of the short-term arrears are from people forgetting to pay the $10 increase in their monthly fees as well as a few more slow payers (30 days or less past due), but it is the foreclosures that are starting to hurt.

-This year reserves will get funded slightly less than last year: $14,000 or $15,000 this year, where last year was $16,000. Jim asked if the foreclosures were causing the decrease in the reserves funding. Donna answered that it was the expenses, according to this draft of January. We have an income of approximately $59,000 each month, but we spent $60,690 in January. Therefore, we need to check all expenses to see where we can cut back.

-Carol Haberman, owner, asked how many units are in foreclosure and how many are in arrears. This is a combined figure, but Donna answered that there are seven in foreclosure and three in arrears, all of which are in active collections with our attorney. Then there are a handful of short payments and slow pays for January only. One of the units in foreclosure is being sold and one has sold, which means we will get all of our money back.

-Jim Millican stated that Carol had asked about the rental percentage in the last meeting, and to answer her inquiry, rentals are 22% of the total units. We have 38 out of 136 units that are rented. Donna asked how we arrived at this figure. Kathy stated it was from the Owner's List, which lists each unit's status as permanent resident, part-time resident, or rental.

-Edna Maloney, owner, asked Donna how much money was collected in the month of January. Donna answered that if all units paid the correct monthly maintenance fee of $435, the Association would have an income of $59,160. In January we did not collect $5,835. Therefore, the income for January is approximately $54,000.

-Edna then asked who actually has the last word as to how the Association's finances are done; the Treasurer or Management. Donna explained that the Association and Management uses an accrual accounting method, which goes by GAP (General Accounting Principles). Edna asked if Donna was comfortable with this method, and Donna confirmed that she is comfortable as this is the correct accounting method.

4. Unfinished Business:

Concrete Restoration—Update: An owner asked Donna the estimated cost of the concrete project. Donna answered that we analyzed this prior to signing the contract, and we knew we would have the money for this in our reserves by the time the project was completed. Kathy stated that while the final payment has not been made yet, we have not gone over the budgeted amount. Jim Millican confirmed that the last paperwork he saw was well within the budget.

Screen & Railing Replacement: Jim Millican reported that there has been some controversy over screens and railings being replaced. He further stated that we have an owner threatening to sue the Association over her railings, so we put this decision in the hands of the engineers. Everyone knows each other in the mid-rises and a few of the Board members live in the mid-rises Therefore, to avoid accusations of favoritism, the Board gave the railing replacement decision over to the engineers as they would base their decision on safety rather than friendship or cosmetics. When we get to that in the agenda, he will read her letter and conduct an open discussion. An owner stated that she thought screens were owner responsibility, and Jim confirmed this.

Loitering Signs Update: Kathy reported that the signs have been erected at each entrance of the four parking lots. This allows the police to now question anyone they see loitering and to trespass a person, who shouldn't be here, on their own without a Board member having to sign. Jim Millican pointed out that this is a real plus because we have had a bad guy running around and the trespass on him, which lasts two years, has expired; but the new trespass procedure will supersede this.

Pool Repairs: Kathy reported that the south pool railing that had come loose has now been repaired. She further reported that instead of paying for all of the pool lighting required by the new pool lighting statute, we have changed the pool hours from dawn to dusk. We have posted these hours on both of the pools' signs as required by the statute. Also, to comply with the citation from the pool inspection, the size of the "No Diving" lettering on the both pools' signs has been increased.

-Jim Millican reported that we have obtained the materials needed and have Bob repairing the pool decking on the south pool. Because Bob can do this, we saved a tremendous amount of money.

-Jim Millican reported that we are trying to find a solution for the pump noise issue that was discussed in the last meeting. We have spoken to the pool contractors, who have stated that using insulation on the cover makes it too heavy for the hinges. Jim has suggested to the Board, as well as discussing with Bob, building a fence around the pump to help block the noise. We already have the material (except the small hardware, such as screws), and we could build the fence into an "L" shape approximately the same height as the rest of the fencing. Not only would it act as a sound barrier, but it would give a better appearance as it would hide the pool equipment and the chemicals, and will be built in the same manner as the courtyard fencing.

5. New Business:

Purchase Order Procedures: Jim Millican reported that Kathy designed a new purchase order for large purchases made by maintenance, such as the pool decking materials. This will allow us to keep better track of these purchases. Kathy pointed out that a Board member will have to approve these purchases by signing the purchase order, and Kathy will keep a log in the same manner as the Action Requests log.

Resident Letter - Railing: Jim Millican reported that a letter was hand-delivered to him from Evelyn Romano, Unit 2307. He read the letter aloud, which states that there were new railings installed into units that were not included in the initial engineer's report. It further reports that Evelyn's railings are a dirty brown rather than black, citing as not complying with the uniformity section of the Rules and Regulations, and that the recent replacements made her railings stand out, which depreciated the unit's value. The letter ends with a threat to obtain an attorney if her railings are not replaced. Jim pointed out that she wants new railings because hers aren't pretty; therefore this is a cosmetic issue and not a safety issue. An owner commented that she should use the attorney money to replace her railings.

-Jim stated that Evelyn's railings were inspected by the engineers and are not loose. When all of this started, we received a bid of $18,000 to replace all of the railings. Jim further stated that the Association simply does not have the money to replace all of the railings at this time, and the Board plans to proceed with a railing replacement project in the next couple of years. This was relayed to Evelyn, but she refuses to wait for this project. Because the Association cannot afford to replace all of the railings, only those that were deemed unsafe by the engineers were replaced during the concrete restoration project. Point in fact: the railings at unit #2312 were replaced although they were not included in the initial engineer's report because when the concrete restoration began on her unit, the railings literally fell apart beyond repair, and had to be replaced. The railings that were either loose beyond repair, or had pickets missing were deemed dangerous by the engineers.

-An owner suggested that we repaint all of the railings, which would comply with the uniformity complaint. Several owners, including Jim Millican, commented that when their railings were looking bad, they repainted them, and it made them look great. Bill Pemberton pointed out that we would need scaffolding, which is too expensive for only one unit and too dangerous to have Bob up there painting. There was a great deal of discussion concerning our options, as well as the cost of painting versus the cost of obtaining an attorney and possibly going to court. Jim stated that we have not contacted our attorney regarding this issue, nor will we unless we are contacted by another attorney. The Board decided to table this discussion until Kathy gets pricing on painting the outside of all of the railings in both mid-rises from Paul, CRI; and the Board can ask the Association's attorney about this during the Annual Meeting in March.

6. Committees:

Grounds: Jim Millican reported that an over-active woodpecker has pecked a golf-ball sized hole through one of the two palm trees located between the mid-rise buildings. The damage is so severe that the tree trimmers would not trim it because it could cause it to snap off. Lawns By Scott (LBS) will remove the damaged palm tree for $225. He stated there is an oak tree next to a townhouse that has grown so large that the roots are intruding into the walkway and the limbs are hitting the roof. The owner of this unit has requested its removal. LBS will remove this tree for $75. Bill Pemberton made a motion to have the oak tree and the damaged palm tree removed by LBS for the quoted price. Lisa Mullooly seconded the motion and it passed by unanimous voice vote.

7. Announcements:

Dryer Vent Clean-out Options: Kathy reported that during the last meeting, an owner had asked about dryer vent clean-outs. Jim Millican pointed out dryer vent clean-out is done at volume pricing in the townhouses each year like the A/C condensation line clean-out is done in the mid-rises each year. Kathy spoke with Dryer Fire Prevention, and while it is at the owner's expense, each owner will receive volume pricing discounts when they participate in this schedule. The more units, the cheaper the price. Carol Langmesser is the contact person. There is some confusion as to the way the bids are worded. It states that if all four units within a townhouse opt to have their dryer vents cleaned out, it will be $70 per day, where one unit would cost $115 per day. Kathy will speak with Dryer Fire Prevention to clarify if this is per unit per day or just per day. Edna stated she only paid $35 for dryer vent clean-out and Jim pointed out that we have used the same company for several years. Edna will give RDI her dryer vent contact information; Kathy will compare pricing, clarify the wording, get this information to Carol, and distribute fliers ASAP.

8. Owner Input:

Edna Maloney, owner, asked the Board the status of forming a finance committee as well as determining the duties of this committee. Jim Millican answered that these decisions will not be made until after the Annual Meeting and the 2010 Board of Directors has been elected.

9. Next Meeting Date:

The next meeting will be the Annual Meeting, which will be on March 2nd, 2010 at 7:00pm.

10. Adjournment:

Bill Pemberton made a motion to adjourn at 7:43 pm. Lisa Mullooly seconded the motion and it passed by unanimous voice vote.

Respectfully submitted,

Brandi Lowder, Administrative Assistant

Kathy Watts, CMCA, LCAM #27668

Community Association Manager

Reconcilable Differences, Inc.