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Minutes of the Banana Bay Condominium Association
Member Meeting and Board Budget Approval Meeting
Thursday, November 17, 2016


Call to Order/ Establishment of Quorum of Owners by Proxy or in Person: The meeting was called to order at 6:07 pm. Michelle stated that 26 members were present in person and 62 attended by proxy.

Proof of meeting notice mailed to all owners and properly posted: Michelle confirmed that the agendas had been posted more than 14 days in advance, and all owners were mailed a packet of information including the draft budget and agenda on 10/29/16.

Owner Input and Questions about Funding Options: Todd Foley worked with Barbara to use a reserve study software and have a “pre-hurricane” pooling method of saving for future repairs. Then the hurricane hit and expensive repairs needed some of that savings.

Todd said “straight line funding” isn’t used in other states, and overfunds by more than 50%. Pooling or “cash flow funding” uses formulas and life expectancies to fund for the “next” replacement, instead of funding for all components’ next repair. He uses a 3% inflation rate, and adds 1% interest to the funds.

He highly recommends pooling, because it allows the board to use funds when needed, whether saved for that “line item” or not. 

The board also made sure a contingency of $200,000 is being funded in this pooling method so there are extra funds just in case of unexpected replacements.

It was reiterated that this report must be updated annually to ensure accurate amounts are being funded.
Todd also said that legislation is coming that requires “fully funded” reserves, so if Banana Bay stays at straight line funding and only funds at 35%, mortgages will not be available for new buyers. Owners asked many questions and then Todd was thanked for his time and left.

Michelle was asked about payments in 2017. First, the account numbers will be changing to be the same as your UNIT number.  

Secondly, Sunrise Bank is changing the way they accept payments in 2017. Instead of having the bank take your fees from your account (ACH), owners will be asked to set up a one-time account with “PayLease”. The owner gets to set up the date the fee comes out of their account and goes into Banana Bay’s account. They can modify the date and amount as needed. PayLease charges the bank and not the unit owner for this service. Reconcilable Differences will have a button on their website to click to start this process, along with a step-by-step detail sheet. The bank and management will also schedule a meeting in the clubhouse to help people sign up.

The second option would be to order the coupon book and send a coupon with your personal check each month.  Those who desired coupon books for paying in 2017 have sent in their written requests.

Some people wanted to continue to use “bill pay” and have their bank send a check to Sunrise Bank. Over 50% of these checks are received with incorrect information, so those who still want to use that can do so, but if their checks are not correct, the bank will mail them back and the possibility of late fees is a concern. 

Results of Voting on Pooling Method of Reserves:  Sixty-eight (68) units voted to pool reserves instead of continuing to fund on the straight-line method. Twenty-three (23) voted to continue to fund straight line. 

Results of Voting for Partially Funded Reserves: This vote would have been needed if straight line reserve funding received more votes, so the need is moot, but the votes were 72 to partially fund and 11 to fully fund straight line reserves.

Results of Voting for Audit or Review: Seventy-five units voted to have a review instead of an audit, and nine voted to have a full audit.

Results of Vote to Remove Fire Pump and Hoses: Fifty-nine (59) units voted to remove the fire pump and hoses and twenty-six (26) voted to keep them. Barb noted that the fire marshal was on site last week and asked why we still had them. He requested a letter asking his permission to remove them. Management will send that. Once his written approval is received, we will add more fire extinguishers and possibly remove the large boxes and put in small extinguisher boxes. Fire drills will also be required, but they don’t have to be a surprise. 

Hurricane Damage Update:  Barb said we are still in the middle of repairs, but there has been no rain. Rock Roofing hopes to be water tight as soon as the tiles are replaced on the mansards and some flashing is replaced.
Until we are sure the roofs are water tight, we do not want to install the insulation.
Because insurance company said damages were just under the deductible, the board interviewed and hired a public adjuster and team to do air and mold inspections and see what they can do to get some insurance proceeds. Their fee is 10% of actual funds received, after the deductible.

Two garage roofs are replaced except for flashing, damaged garage doors were replaced, and we are still waiting on the contractor to bid the carport repairs. 

The drywall vendor is making some repairs, but is waiting to ensure the building is water tight. 
The city building department inspector was called by an anonymous owner in the midrises, and they said the property is being kept very neat for such a construction zone. 

Coquina rock (seawall) in front of 2300 was also lost, so that must be repaired.

A resident asked what the deductible is, since they assume a special assessment is coming. The midrise roofs have a 5% hurricane deductible of $163,105 each, the garages have deductibles from $2,460 to $3,452, and carport deductibles are between $1,200 and $2,730.
Michelle stated that condo insurance policies have a required “loss assessment coverage” 

A resident asked if the roof reserves can be used for part of the replacement costs. They will be, but it will not cover all the roofing costs.
Another resident asked if the community is covered as a whole or will there be separate deductibles for each building. Each building is individually valued and insured. She wondered who set these values. Michelle said Florida Statute requires an Insurance Appraisal by a licensed firm every 3 years.

At this time, there is no idea of what the special assessment will be, but there will be one. 

Adjournment: The meeting adjourned at 7:19 pm, and the board meeting began.


Call to Order/ Establishment of Quorum of Directors:  The meeting was called to order at 7:24 pm. Board president Barbara Peterson, VP Clyde Hoover and Secretary Carol Langmesser were present. Treasurer April Scott and Director Jim Miller could not attend.  Michelle Davis, CAM, and Ted Manna, facilities oversight manager for Reconcilable Differences were also in attendance. 

Approval of Minutes from last Board meeting: Barb motioned to approve the minutes of the October 5, 2016 meeting as written. Clyde seconded, all in favor.

Financial Report: Michelle stated that through October, the Association has $36,978 in the operating account and $689,015 in reserves. There is $65,175.56 in accounts receivable, but most are making payments, and year to date, the Association is $8,596 over budget.

Board Vote to Start Pooling Reserves as of 1/1/17: Based on the 86 votes of the owners, and the amendment in 2015 allowing approval by the majority of owners who vote, versus the majority of all unit owners, Barb voted to approve pooled reserves. Clyde seconded, all in favor. Barb wanted to make sure that at least $200,000 is the lowest limit the association keeps in reserves. There are some issues with the figures Todd put in, so it will be discussed and he will be asked to modify this, so the pooled figures for 2017 are on hold for now.

Board Vote to Partially Fund Reserves: While the vote to partially fund reserves was 72 to 11, the vote is moot, since the owners voted for pooled reserves.

Vote to have Review of 2016 financial record: Based on the 75 owner votes, Clyde motioned to have a CPA Review of the 2016 records in 2017. Barb seconded, all in favor. 

Final Approval of 2017 Budget: Based on the fact that hurricane costs are currently unknown and yet we must approve a budget so that coupon books can be ordered, Carole motioned to approve the pooled reserves budget as mailed to owners, providing for a $5.00 per unit increase, to $460 per month in 2017. A Special Assessment will have to cover the expenses incurred for damage repairs. Barb seconded, all in favor.

Discussion about Possible Special Hurricane Assessment: Once all costs have been tallied and we know how much insurance will cover, a Special Assessment meeting will be set. Barb motioned to mail out a Special Assessment notice with costs within 20 days of final costs. In the meantime, we must use reserve funds to cover the repairs already made, and that includes terminating some CD’s early. Insurance Proceeds and Special Assessment money will reimburse reserves as needed. Carole seconded the motion, all in favor. It was found that the last special assessment for the townhome roof replacements was $3,100 per unit.

Final Results of the Fire Sprinkler “Opt-Out” Vote: 136 members voted to opt out of installing fire sprinklers throughout the property. 96 owners voted to retro-fit, but the majority vote wins. Attorney Frank Ruggieri will write up and then record the notarized form with the county and state.

Vote to Remove Fire Pump & Hoses: Due to the owner vote of 59 in favor of removing the fire pump and hoses, we will mail a request to Cocoa Beach Fire Marshal and once his letter is received, we will have them removed. Clyde motioned to use Miscellaneous Reserves to cover the cost of $5,250.00 from All Brevard Fire & Plumbing and the cost to install new extinguishers and possibly smaller boxes; whatever is required by the fire marshal. Carole seconded, all in favor.

Set Next Meeting Date: Once we have more information, a meeting will be set.

Adjournment: There being no further business, the meeting adjourned at 8:07 pm.

Respectfully Submitted,
Michelle Davis
Michelle Davis, CMCA, AMS, LCAM #17226, 
Community Association Manager, Reconcilable Differences, Inc