SYNOPSIS OCTOBER 22 BOARD MEETING

Board members attending: Rochelle Bisaillon, William Brady, Wilbur Bullock, Jason Katz, George Lauth, Pete Shelton, Sam Slota

Absent members: None

Miscellaneous other: Joanne Lowenthal, manager, John Stevens (BCC lawyer), BCC security guard

Owner attendees: 62

Minutes: June 10 minutes corrected to remove erroneous approval of CCG contract.

Reports

1. Manager’s report on BCC official website.
2. Financial report on BCC official website.
3. Screening committee reported 2 leases, 4 sales since September board meeting.

Old Business

1. Communications Consultants Group (CCG) contract signed by Sam Slota September 23, 2008. Contract has not been approved by the BCC BOD. Christopher Merrill of CCG alleges that no kickbacks were involved. Wilbur Bullock will negotiate a buy-out of the 10-year CCG contract.

2. Comcast rebate of $128,000 initially deposited in BCC operating account. This amount (less CCG’s bonus) was later transferred to a money market account by Slota and Lauth. Board unanimously approved all of the above.

New Business

1. BCC contract safeguards requiring that all BOD members be informed of all bids, and requiring two BOD signatures on all contracts. Attachments (exhibits, meeting minutes, etc.) are required. Proposed and passed unanimously.

2. A proposal that Katz and Bullock research new auditor for 2009 passed unanimously.
3. A proposal that all BOD meeting tapes be retained for seven years passed unanimously.

4. Investigation into obtaining new recording equipment for BOD meetings was approved.

5. Video conference screening for interviews (on 30-day trial basis) approved by all BOD members except Lauth.

6. Motion made and defeated to remove Slota as BOD president. Against: Slota, Lauth, Shelton; For: Bullock, Brady; Abstained: Bisaillon, Katz

7. Bisaillon and Katz resigned from board.

Meeting adjourned at 9:42 pm. (Thanks to Bev Houston for on scene reporting.)

BLOG MODERATOR COMMENTS

The $121,395 CCG contract violates Florida law in several respects:

1. Exceeds BCC’s 2008 annual budget by more than 5% and therefore required bids.*

2. Not voted on and approved by a 2/3’s vote of BOD.*

3. Not disclosed to owners at BOD meeting so they could request a members vote and possibly cancel the contract.*

4. No single board member (including president) can legally contract anything for BCC Association or any other Florida corporation.

*F.S. 718.3026 Contracts for products and services; in writing; bids; exceptions.--

THIS CONTRACT IS FRAUDULENT AND SHOULD BE FORMALLY NEGATED BY THE BOD. Should CCG feel they have been damaged they should seek recourse from the signer of the fraudulent contract.

The 30-day trial for video conferencing interviews seems inadequate given slow pace of BCC sales.

Please share thoughts with your fellow BCCers by clicking on "Comments" below and adding your opinion.

HEADS UP ON CABLE CONTRACT!

BCC’s “consultant” (CCG) looks forward to pocketing our total $121,395 payment over the ten year cable contract. ($32,000 from initial Comcast kickback + $89,395 in savings over 10 years.)

This is 5.14% of our total 2008 annual budget.

F.S. “718.3026 Contracts for products and services; in writing; bids; exceptions….

(1) All contracts as further described herein or any contract that is not to be fully performed within 1 year after the making thereof, for the purchase, lease, or renting of materials or equipment to be used by the association in accomplishing its purposes under this chapter, and all contracts for the provision of services, shall be in writing. If a contract for the purchase, lease, or renting of materials or equipment, or for the provision of services, requires payment by the association on behalf of any condominium operated by the association in the aggregate that exceeds 5 percent of the total annual budget of the association, including reserves, the association shall obtain competitive bids for the materials, equipment, or services. Nothing contained herein shall be construed to require the association to accept the lowest bid.”

Once again this Board of Directors has violated Florida law, failed in their fiduciary duty and demonstrated mind-boggling incompetence. Does the BOD’s failure to get bids on “consulting” (not to mention their failure to read and/or understand the CCG contract) nullify the contract?

Is it time to take back our community?

SYNOPSIS SEPTEMBER 24 BOARD MEETING

Board members attending: Sam Slota, George Lauth, William Brady, Wilbur Bullock, Pete Shelton
Absent members: Jason Katz, Rochelle Bisaillon
Miscellaneous other: Joanne Lowenthal, manager, John Stevens (BCC lawyer), CPA “Kim” (from Goldman/Juda), Ernie Valdestri (owner of lawn maintenance company and past BCC BOD president)
BCC owner attendees: 35 in audience
Reports
1. Manager’s report available on BCC official website.
2. Financial report available on BCC official website.
3. Screening committee reported 16 leases, 5 sales and 2 second occupant screenings since June board meeting.
Old Business
1. Rec #4 bathroom improvements/repairs costs estimated from $56,000 - $68,500. Spirited discussion arose regarding costs for a single Rec set of bathrooms. No agreement could be reached if upgrade to ADA compliance was a repair or improvement. Item tabled.
2. Cable TV discussion limited because of no-show CCG representative. It was moved and unanimously approved to reserve $96,000 Comcast rebate for a one-time up-front discounted payment to CCG. If CCG refuses to negotiate discount, $96,000 will be placed in a CD for paying them off over 10 years. Rebate cannot be touched for any other purpose.
3. Seawall repair by B.K. Marine ratified unanimously. Motion to replace a rotted-out transformer for $5,000, using old “guts” (circuitry) made and passed unanimously.
4. Tree trimming contract ratified. Slota, Lauth, and Shelton: yes. Brady and Bullock: no.
5. Tennis court lighting repairs at Rec # 1 approved unanimously.

New Business
1. Appointment of Budget Committee members (Bill Brady, Wilbur Bullock, Saundra Zubko, Pete Shelton) was ratified unanimously.
2. Proposed budget reviewed and approved unanimously. Copies to be mailed to owners week of Sept. 28.
3. Presentation was made by accounting firm hoping to replace our present monthly accountants.

Meeting adjourned at 9:25 pm. Open forum until 9:35.
Congratulations to the 5% of BCC owners interested enough to show up and see where their $3500 annual maintenance is going.
Please share thoughts with your fellow BCCers by clicking on "Comments" below and adding your opinion.

BCC INFRASTRUCTURE MAINTENANCE

This report was written by BCC resident Gordon P. Houston, P.E., a Professional Civil Engineer registered in Florida and Illinois. He worked in construction and design since 1965 and served 2 years on the BCC Board.

Roofs

The roofs of our buildings are constructed by stretching a membrane over plywood sheeting supported by wood roof trusses. The membrane is anchored at the roof edge by steel screws spaced at intervals along the edge ledger board. This produced a strong roof with a low wind drag which is important during a strong wind storm. We found during hurricane Wilma that the edge anchorage must be maintained. During this storm we had a failure on the south side of buildings 1 through 8. The roofing expert hired to repair these roofs said the steel connectors had deteriorated. He made repairs using stainless steel connectors. When asked how we could prevent this from happening again, he suggested we install additional stainless steel connectors between the existing steel connectors.

Seawall

The seawall along the canal and entrance road was built before the condo buildings. This type of concrete seawall is designed with a service life of 30 years. Our wall is approximately 40 years old; therefore, we have surpassed the design service life and it needs to be reinforced to extend that life.

In addition, this wall is only 2 feet from the edge of the entrance road within the soil slip zone behind the wall. When a heavy vehicle drives near the curb there is an additional load against the wall. When we repaved the road, we added even more weight on the wall. It would be best if the curb was 10 to 12 feet back from the back face of the wall.

The reason we see so much subsidence (or washouts) along the wall now is because of movement of the wall due to stretching and failure of the steel strand tie backs. This causes misalignment of the precast sheets and pilings, allowing the backfill to pass through. If enough tiebacks fail the wall will fail as it did at building 14 where the wall tipped over. Or the piles will break and damage the precast concrete panels, which happened along the Intracoastal Waterway.

To properly stabilize and extend the life of the seawall without the greater expense of replacing it, the normal method is to drive sloping piles in front of each existing vertical pile. This is to replace the failing tiebacks. In addition, the existing cap is replaced with a wider cap to encompass both piles and to insure the top of the existing sheet is supported.

Balconies

The balcony railings are in very poor condition, causing a safety hazard for residents. In addition, many residents are having problems with their screens because the railings also support the screens. When hurricane Wilma damaged 3 balcony railings, we could not just replace these railings. Florida's Building Code required the railing to be 4 inches higher and the vertical slats closer together. The vertical support at the center of the balcony has to have additional support at the top.

Entrance Doors

Building entrance doors are a concern. The door panels are mostly in good condition but the hardware has been used for over 36 years without replacement. Most latches and worn-out hinges are noisy, and many closures are inoperable or nearly so. The conditions of the entrance doors are important during wind storms because if they fail to hold back the wind we will lose the roof.

Shutters, Windows & Balcony Enclosures

BCC should have a policy on window replacement, balcony enclosures and practical shutter design. If we make all windows meet the new code we would be eligible for a substantial discount on wind insurance. The policy should require all present and future glass balcony enclosures (where sliding door is removed) to meet the same present code requirements.

DON'T BE SHY...

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Our Auditor

BCC budgets $6,000 for our audit. While the BOD may be happy with the auditor’s performance, BCC owners should demand more than the lame audit we got. “Audited” and “Auditor” is in quotes throughout this blog because of the quality of the product we received.

The purpose of the audit is to protect BCC owners whose money is being reported on. It is supposed to assure us that the BCC Board of Directors are properly controlling and accounting for our $2 million+ in annual maintenance fees.

This 2008 “Audit” doesn’t do it! It’s time to insist the BOD engages an auditor who realizes his responsibility is to BCC owners, not the BOD. Owners need and deserve an audit that highlights problems and suggests solutions, not one that glosses over mistakes and attempts to bury them with “prior period adjustments”.

Bernie Madoff’s outfit was "audited" too!

64 DAYS LATE AND $31,669 SHORT

The Board of Directors’ explanation for delay in releasing 2008 audited year-end Financial Reports was puzzling. In his July 1, 2009 Affidavit to the Florida State Department of Business and Professional Regulation, board V.P. George Lauth claimed that:

1. The “Audited” Financial Report was received too late to make the state-required April 30 deadline for release to BCC owners; and,
2. On receipt, “errors were noted by the Association’s accountant” and investigation and correction was required.

The facts are:

A. The report was available for review April 13 and, despite numerous reminders and promptings from various sources, was not included on the April 23 BOD meeting agenda or even reviewed by BCC’s Treasurer until early June.
B. “Errors …noted” were confined to rental and dock deposit accounting. (More on deposit accounting follows.) These problems were certainly apparent in the September 2008 (if not earlier) monthly Financial Reports. Why wasn’t a correction made earlier in the year?
C. Delay in releasing year-end financials was caused by BOARD failure to do their job. An identical failure in 2003 (made by mostly the same people) resulted in a $4,800 fine from Florida State.

IT'S ONLY MONEY, RIGHT?

BCC requires security deposits for each unit rented ($300 - $1,000) and for each boat at our docks (three months dockage fee). These deposits are supposed to be kept in separate, non-interest bearing accounts and, absent damage, returned to the renter or boat owner on termination of the lease.

Standard accounting practice requires that these deposits be shown on the books as an Asset (under cash) and as a Liability (because they will have to be repaid). The Assets and Liabilities should be equal with, perhaps, some minor difference caused by transaction timing on individual deposits.
Our “Audited” 2008 Financial Report is not close to balancing deposit Assets and Liabilities. [Total Cash Deposits (Assets) of $141,673 ($120,308 Rental + $21,365 Docks). Total Deposits Liability of $127,317.] Last year’s 2007 Financial Report had Deposit Cash and Liabilities balanced with a minor difference. The 2008 imbalance, therefore, developed during this BOD’s 2008 term.

The amount of cash in Dock deposits makes absolutely no sense. The “Audited” 2008 Financials as well as the accountant’s Monthly Financial shows $21,365 Dock Deposit Cash. Our Accountant’s Monthly Financials for 12/31/08 has the offsetting Docks Liability at $8,726. Dock Cash and Liability amounts are not close to balanced. (The “Auditors” report does not break out Security Deposit Liability into Rental and Dock, but presumably the total liability of $127,317 shown includes $8,726 Dock Liability.)

1. The security deposit for each boater is equal to three months of his dock fee.
2. Total dock security deposits should be three times the total monthly dock fees.
3. Monthly dock income was budgeted at $3,000 a month and has actually been less.
4. Dock security deposit cash should not be more than $9,000 (3 X $3,000).
5. Dock Deposit Cash cannot logically be $21,365. Where did that number come from?
6. As of 10/31/08 Dock Deposit cash was $52,412. On 11/30/08 Dock Deposit Cash was $21,360. Where did the $30,000+ go?

A cursory look at BCC financials reveals obvious discrepancies within the reports themselves. In his report, our “Auditor” made no comment on the mess in the Deposits accounting nor did he suggest a closer investigation or a remedy. If such an obvious discrepancy was allowed to exist, what might be buried in more obscure areas?

UPDATE 8/12/09: ADDITIONAL AREAS OF QUESTIONABLE ACCOUNTING HAVE BEEN DETECTED. FOR DETAILS, PLEASE CLICK ON COMMENTS BELOW.

June 10 Board Meeting

Following is a brief description of the most questionable or noteworthy actions taken at the June 10 BOD (Board of Directors) meeting that might interest BCC owners. My thoughts are in bold italics. Please pass the web address on to any BCC owner, resident non-owner or employee you think might be interested in news and views about BCC: http://baycolonyclubcondo.blogspot.com/

Manager's Report - Cancelled because the BOD didn't want to allow compensatory time off for the manager. By having the manager's report first on the agenda, any compensatory time certainly wouldn't go beyond an hour. Couldn't we spare the manager for one hour during the work week? This seems to be another BOD move to keep owners in the dark. See the Confidentiality and Duty of Loyalty items below.

Finance Report – Audit 2008 - Usual monthly financial report not discussed due to incomplete data. President Slota then attempted to move on to next agenda item. Asked by an audience member why the audited 2008 financial report was not released by its April 30 legally required due date, the BOD gave the following reasons:

1. Jason Katz thought Pete Shelton was reviewing the audit and Shelton thought Katz was reviewing it, so neither reviewed it, and;
   
2. A multi-thousand dollar accounting abnormality exists which has not yet been resolved.
   

This is a violation of Florida law. Numerous complaints from BCC residents have been filed with the Florida Department of Business and Professional Regulation regarding the delay in releasing the 2008 financial report as well as prior reports. BCC has been fined for past similar violations. If the board responsible for spending our $2+ million annual budget is unable to release an audited financial within four months of year's end, they are incompetent.

New Towing Rule –This agenda item was ignored.

Not discussed or voted on, yet a towing sign is now located at the first turn of the entrance road. Is it legal? Will BCC face more legal fees because of it? Was any consideration from the tow company involved in this action? Are we over-run with illegally parked cars? Are we willing to allow our board to do whatever they want without any discussion or vote?

Confidentiality Agreement for Employees - Ratified. For- Bisaillon, Katz, Lauth, Shelton, Slota. Against- Bullock, Brady.

BCC employees have a fiduciary duty to owners, NOT to the BOD. I believe there are two reasons for forcing this on BCC workers: To keep owners in the dark and to advance the effort by some board members to get rid of our manager and service agent. Those of us who were here in 2004 will recall the serious problems after Slota and associates forced out a manager.

Board Members Duty of Loyalty - An agenda item included by Pete Shelton to protest Wilbur Bullock's "unauthorized" release of the Secrecy Agreement to BCC owners not on the BOD.

Shelton accused Bullock of "unprofessional" and "disloyal" behavior. Shelton is apparently unaware that Florida law requires all condo activity (outside of legal matters in litigation) to be open and transparent. Every Board member's duty is to BCC owners and part of that duty is to be sure that we all know what's going on. Bravo Wilbur.