Members of the Board of Directors in attendance were:
- Dick Donohoe – President
- Gordon Strauss – Vice President
- Hal Cottingham – Treasurer
- Beth Dixon – Secretary
- Kate Doub – Board Member
Also present at the meeting was:
- Joy Jarvis – Building Manager of FSH
- Hamlin O’Kelley – Attorney for the Association
Dick Donohoe introduced Mr. Hamlin O’Kelley, the Association’s attorney.Mr. O’Kelley joined the meeting to answer any questions that relate to legal issues regarding items in the Annual Meeting Agenda, and to respond to questions related to the litigation during the Special Meeting (requested by a group of Owners) that immediately followed this Annual Meeting.
1. Calling of the Role and Certifying Proxies
Joy Jarvis confirmed that we satisfied the quorum requirement (>50%) for a valid meeting. The percentage of Ownership is based on square footage owned, not headcount. We had a quorum of 98.61% which includes those Owners present at the meeting and those Owners who sent in a proxy.
- Present: 35 Owners (74.47% of Ownership)
- Proxy: 17 Owners (24.14% of Ownership)
- Not present / no proxy: 2 Owners (1.39% of Ownership)
2. Proof of Notice of the Meeting
Proof of notice of the meeting was confirmed. The letter scheduling the meeting was dated and mailed on October 15, 2018, meeting Master Deed requirements.
3. Approval of Last Year’s Meeting Minutes
A motion was made to approve the minutes from the 2017 Annual Meeting and it was seconded. The minutes were approved and are posted on Fort Sumter House web site (fortsumterhouse.org).
4. President’s Report
A: Murray Blvd Wall & Gate Contract and Start Date
There were three bidders for this portion of landscape design. The lowest reliable bid came from Ables’ landscaping on John’s Island. The contract sum in the amount of $82,000 has been awarded and will be funded by the Reserve funds. Construction will start in early January and will take approximately 2-3 months to complete.
B: Reserve Study
The Board has undertaken a Reserve study of the building’s projected capital needs over the next 25 years. David Strickland completed the study and projects that $9.5 M (over the next 25 years) will be needed to preserve and protect this building. The Board will begin to put a plan in place in 2019 to implement the Reserve study. Hal Cottingham, Treasurer, offered to explain the study spreadsheets to any Owner interested in seeing the details. Owner Sarah Donnem commented that she prefers to only pay for what is currently needed. She does not want to fund the Reserve Account to take care of maintenance items needed 25 years from now.
C: Water Intrusion Survey and Stucco Frieze Issue
Water Intrusion involves penetrations of the roof, stucco skin, window and door openings, and also cracks and other stucco failures. The roof was replaced last summer. The stucco frieze at the top of the building wall and the molding above the second floor are two of these failures. Applied Building Sciences (ABS), specialists retained by the Board in 2017, have undertaken a survey of all these issues. We have not yet received their final report and specifications for addressing all of these problems.
Hal Cottingham reported that we are waiting for BAR approval on the repair design for the stucco frieze failure. He hopes that BAR will approve the lighter material (gypsum-infused stucco or fiberglass) for the frieze work. He anticipates that BAR may approve the design by mid-November. If so, he hopes to have some cost estimates by end of January, and then to get this work started in the spring.
ABS is also conducting an analysis of all windows and doors in the building. The windows and doors are the responsibility of the respective Owners. A motion was made in a recent Board meeting and passed unanimously: FSHA will assume the responsibility of maintaining the exteriorof all windows, doors, and frames and will get this work done, and then invoice each Owner for the actual cost of work.
D: Status of the West Side Terraces
In March, we contracted for the repair of the eight terraces at a cost of $160,000 most of which has been received. Since the contracted repair was estimated to last only 10 years, the Board asked the contractor and the engineer to consider the cost of total replacement of the terraces with a structural variation that would allow for sustainable maintenance and more stability.
The final engineering drawings for replacement should be completed in early November. We have received an estimated cost of $320,000 for the replacement minus $60,000 if the existing railings can be reused. The new Board will review the comparative costs and decide whether to repair or replace. The drawings will then be submitted to BAR for approval. Repair or replacement will begin approximately six weeks after the Board authorizes the contractor to proceed.
Owner Sarah Donnem commented that the Board should ask the Owners who have sole access to these terraces to help pay the cost for this project. Dick Donohoe pointed out that there is no mechanism in Master Deed to have the Owners with sole access to these balconies participate in the cost. If they want to make a voluntary donation to the Reserve account, that would be appreciated.
E: Ravenel & Associates Proposal for Building Management
Two years ago, the Board solicited a proposal for management services from Ravenel Associates, an experienced firm managing 400 properties in the Charleston area. We resubmitted a new request for a proposal in August 2018 and they responded with a proposal for providing only insurance and accounting services.
Kate Doub reported that Ravenel can provide Accounting services for a cost of $12,000 a year and this includes handling all financial management. Mr. Ravenel declined to provide a management proposal because they cannot not compete with the breadth of services (that we currently provide our residents) for any reasonable cost. He shared that it would be cost prohibitive for FSHA and revenue ineffective for Ravenel Associates.
- The Ravenel Associates service model provides for one onsite manager M-F (8-4), no after-hours, no weekend coverage, and no 24/hr security.
- For after-hours, Ravenel provides an answering service that would dispatch calls for urgent requests, with a response time of 1-3 hours.
- For non-urgent requests, dispatchers create work orders and issue(s) would be addressed as personnel became available.
- When maintenance work or extra help is needed, Ravenel would bill at the rate of $75/hour per/worker with a minimum charge of $225 per visit. That is a minimum of four times what we pay our staff members Nick and Keon.
- All general maintenance (pool, HVAC, landscaping, etc.) would be contracted out at cost, plus Ravenel’s mark-up.
- Ravenel will tailor their services to our needs, e.g. they would hire any staff we wish to keep but they would become Ravenel employees.
If we want a proposal from Ravenel or any other management firm, we will need to pare down the services that we currently offer to residents. The Board is considering taking a survey of Owners to determine what they want and what they feel they can give up. Once we have that feedback, we can re-approach Ravenel Associates and other management firms to seek cost estimates.
A motion was made to accept the President’s Report. It was seconded and approved.
5. Treasurer’s Report
Hal Cottingham reported that FSHA has 3 accounts: Operating Account, Reserve Account, and Insurance Escrow Account. We have moved all accounts to Bank of South Carolina. We created a new Insurance Escrow Account to be separate from the Operating Account. We have redefined Capitalization to be $5k with life expectancy of 5 years or more. We have redesigned the Operating Budget Statement to be more user friendly. We have also implemented a new budget format that contains more numbers and assumptions. The Operating Account is on budget. The Reserve Account should have a balance of about $478K at the end of this year. In 2019, we expect to collect $200K in assessments which brings the balance to $678K. Known expenditures include the 8 balconies and the Murray Blvd. & pool fencing. Unknown expenditures include the repairs for stucco frieze failure and the water intrusion. Hal recommends that all proceeds from the antenna leases should go into the Reserve.
A motion was made to accept the Treasurer’s Report. It was seconded and approved.
6. Unfinished Business
There was a request for an updated “Owner’s email list.” Teresa Clowney offered to help update the list.
7. New Business
Russell Holiday made a motion to change the Bylaws “Notification” clause (Section 2, Article 4) to include 3 words: “transmitted electronically or.” This would facilitate delivery of FSHA communications and save postage costs.However, no action was taken on this motion because any amendment to the Master Deed requires written notification to Owners at least 2 weeks in advance of a vote.
8. Election of Board Members
A notification letter about the Annual Meeting and election of officers was sent out on October 15, 2017, as required by the Master Deed.To assure the validity of the election, Ann Beauchamp and a Charleston Police officer validated the counting of the ballots. Hal Cottingham, Helen Jacobs, and Louise Strauss were elected to the Board by majority vote for two-year terms.
9. Adjournment
A motion was made to adjourn the meeting and it was seconded.