The Facts About Nassau Gardens Market Rate Conversion

Last May, President Mullinex sent a letter to Shareowners with her opinions/recollections regarding two efforts to convert Nassau Gardens from a limited equity to market rate Cooperative, in the 1990s and early 2000s. Shareowners have twice voted overwhelmingly for conversion. The opinions in her letter are not held by most Shareowners and previous officers, and contain significant disinformation.

Most importantly, Ms. Mullinex wrote of the 2002-4 effort to convert, "It was determined overwhelmingly that the membership was not interested in converting to market rate."

NOT TRUE: In the Market Rate Committee's June 14, 2004 report to the Board, co-chairs Kent Lawson and Pegg Mullinex (yes, the same her!) reported 78% of those contacted were in favor of Market Rate and only 5% were opposed (above). Exactly the opposite of what she wrote you last year!  This was an extensive, in-depth, well-managed straw poll with home meetings, phone interviews, etc. Yes, many Shareowners did not actively participate, but that was because we had already been through the process in the 1990s (when over 2/3 voted to convert in a binding special meeting) and knew the 2004 committee's work was more informational for new members, and not binding.

Ms. Mullinex wrote last year that the value of "market rate would bring $30 to $50 thousand. It could, of course go for a good deal more, maybe as high as $100,000."

FACT: I asked Donna Duggan, a highly experienced Realtor from McNulty Realty in Norwood, to do an appraisal of our property this week. Her report stated "a good listing price range would be between $150-$165,000 for a 2 bedroom. For a 1 bedroom unit, I recommend -$20,000 and to increase it $20,000 for a 3 bedroom."

Ms. Mullinex wrote the market rate conversion process ended in 2004 in part because "they did not send the vote to the Secretary of the Commonwealth."

THEY? It is the responsibility of the President and Clerk to sign and submit the form (it's strictly procedural), not some anonymous "they" as she wrote. Of course Ms. Mullinex never filed the form; she does not want market rate. Cost is only $15. See the state's form here: http://www.sec.state.ma.us/cor/corpdf/180amen.pdf

Ms. Mullinex's statements about HUD not allowing us the use of Cooperative funds for conversion are technically correct, but were limited to an earlier time period, not now or the past few years.

FACT: That was when our HUD HAP contract was in effect (Section 8 renters subsidized by HUD). When that contract ended, that financial limitation also ended, but the Board failed to subsequently pursue conversion. It would have been no problem to use our own funds after the contract ended. Jim Polito, our account manager at HUD, wrote me April 14, 2009 (in government-speak) that "Without the use of the [Cooperative's] Replacement Reserve [fund], in a development that is [now] unsubsidized, it is not clear what role the government can exercise here." It's moot today with HUD out; we can use our own funds -- which we have from refinancing -- to cover market rate conversion costs.

Ms. Mullinex repeatedly writes about how converting to market rate would change our Cooperative 'culture' and "we would no longer be a unified limited equity Cooperative" and "We are the best deal in town and will remain so as long as we are a limited equity cooperative."

Other Opinions: In 2002, former President and then Market Rate Committee Chairman George Hildebrandt wrote an informational letter to all Shareowners stating "the day-to-day operation of a Limited Equity and Market Rate co-op is identical." As to 'how good a deal' we are today, we're better off than an apartment renter, but that's about all.

Ms. Mullinex refers to animosity, resignations, hurt friendships, etc. over past conversion efforts.

That goes on all the time here and is to be expected when Directors pursue their personal agendas rather than the Cooperative good. Remember the dueling newsletters from different Board factions as recently as last year, under Ms. Mullinex's administration?

Ms. Mullinex wrote "we have neither the time nor the money to research this [conversion] fact and any additional legal expense would have to be voted by the Board."

Well, let's elect some new directors who will find the time ... Directors who are enablers rather than blockers like her who look for excuses not to improve our Cooperative and Shareowner value.

And if our Board can find the Cooperative funds to seek a legal opinion to not evict a person whom they knew lived here for many years as a prohibited subletter (a Director's son, no less!), hopefully a new President will find some more of those funds to realize our equity.

Final point: There are 6,400 housing coops with 1,200,000 units in the U.S., according to the National Co-Operative Business Association. Ten percent are HUD insured/assisted no or limited equity units (not us any more). Discounting those HUD units, 277,000 other units (27%) are limited equity; the other 765,000 (73%) units are market rate. So Nassau Gardens shareowners are not just in the vast minority, we are the poor vast minority.

Outsourcing

Cooperative maintenance employees used to perform many services for which we now pay outside vendors (and their profit margins). I see a trend here of more and more outsourcing and getting less value from out staff. What do you think?

Laundry - See the Laundry blog entry.

Groundscare - Maintenance used to manage/perform this service back when we had a staff of two. We had our own mowers and other equipment and hired kids to supplement for seasonal help. Now we are on our third vendor in three years and the grounds are not better than they were before. Best guess is the current contract is over $50,000. You can hire a lot of temp kids for that.

Sanding - We used to own a sander and maintenance did post-snowstorm sanding.

Cleaning - Maintenance used to do the high hall ceiling and window washing. Now it doesn't seem to be getting done at all.

Painting - Maintenance used to do minor touch up interior painting after repairs. Now we use an outside painter.

Pest Control - We once sent an employee for training and certification.

And this trend is getting even more troubling. Now the Board wants Shareowners, even retirees, to drag their Christmas trees to 701 for pickup and take the outside hoses to the utility rooms for the winter, each one bothering the volunteer block key holder. These are simple, seasonal things maintenance always performed in just a few hours time.

The $250,000+ Laundry Deal

Earlier this year, the Board voted to continue outsourcing our laundry facilities to a third party vendor for ten more years. Here are the facts and numbers. You decide if the Board acted in your best interests, or to make the books look better and save maintenance staff a bit of work.

For the first 20+ years of our cooperative, we owned and maintained the 21 washers and 21 dryers with two maintenance staff. Shareowners annually did 27,000 washes and 27,000 dryers. At $.50 per load, the cooperative grossed $27,000 per year. There was some maintenance, not a lot, and machines were replaced on a schedule so capital expenditures were managed. But then, under Halkeen management, we got in a huge financial mess. All the machines were at end-of-life and there was no budget to replace them.

So the cooperative outsourced the equipment ten years ago. The vendor put in new machines and water heaters and also paid the Cooperative about $30,000 as a "signing bonus" for our business. (In my line of work that would be a kickback, but all the laundry companies do it, so there must be some legal exclusion.) Costs more than doubled from $.50 to $1.25 (average), plus the new front loading machines held 1/3 to 1/4 less. Shareowner usage also dropped, from 54,000 down to 44,000 loads per year. Revenues jumped to $55,000 per year, which was split 50/50 with the vendor. The vendor gross revenues were $27,500 or so per year, well over $250,000 on the life of the contract.

End result? Cooperative revenues stayed flat but the cost to Shareowners more than doubled. It was a necessary evil, with little choice considering the mess the Board and Hallkeen got us into.

This year the laundry contract has expired. And again, the Board had made no provisions to budget for new equipment to facilitate a return to self management. And instead of buying all new equipment ourselves (Home Depot bid under $33,000 to provide all 42 machines), the cooperative has signed a new 10-year deal with the existing vendor with a price increase of $ .25 for each machine midway through the contract.

A few other notes:

All agreed the new machines will be more reliable than older equipment, thus reducing the demands for staff maintenance calls if we returned to self-performing the laundry service. Even at the current end-of-life of the current 10-year-old machines, the vendor was getting only one service call per week, quite often a false alarm because people still overload the smaller capacity machines. Optionally, maintenance could be contracted out locally on a per-call bases to a company like Poirier. For that your Board has decided to spend $250,000 of your money with the contractor.

It was not revealed until after the Board approved their bid that the banks will be taking a percentage cut for each credit/debit card transaction. The Board did not know what that percentage will be and how it will be paid. Did our lawyer miss it as well?

The vendor is switching to a card system instead of coins. Some will like it, others won't. But the important thing is they will no longer be coming each week to make their collections and inspect the equipment, so their expenses will drop considerably while their 50% take remains unchanged. And they did not provide a comprehensive maintenance schedule as required in the RFP, which is a concern.

The vendor is paying the Cooperative another "signing bonus" around $20,000 - $25,000 which will be earmarked for laundry room refurbishing. Like the laundry contract, this a fee paid by Shareowners, not the Cooperative.

March 20, 2012 Board Meeting

(Please note this is a repost of the original post from March 23 which developed a problem and was not visible at the time.)


Treasure's Report
Treasurer reported budget items on track.
He also noted the Cooperative had received a report back from Sansone, which we hired a couple of years ago to see if they could get the Cooperative tax abatements from the town. Sansone reported they were able to obtain $32,135.39 in abatements from 2009-2011. By agreement with them, the total is split 50/50, so the Cooperative has received $16,067.70

Manager's Report
The manager reported the Energy Wise insulation program (installing new attic insulation, thermostats, aerators, shower heads, pipe insulation) is in final stages. Nassau Gardens cost is $75,000 (National Grid pays $180,000) and payback is expected in four years.
Renovation of 200 Block is underway with expected completion of hallways and exteriors expected mid-June.
The Board approved a contract for 30 new kitchen windows in the 200 Block, for $17,670 including installation.
Laundry room renovations and new equipment orientation meetings are being scheduled and will be announced.
The Cooperative has engaged a new landscaping vendor, Tony's Landscaping of Canton.

Stock Certificates
The amendment to the Cooperative's articles to modify procedures for assigning names to stock certificates is still working through legal procedures.

New Laundry Machine Contract
A member asked how much the new laundry contract would cost since the new machines will be debit/credit card (not coin) operated, and the banks take a percentage of all card transactions. None of the directors knew and the property manager said he thought it was "about three percent."
This news is troubling because that bank card fee was not disclosed by the vendor until after the Board accepted the laundry committee's report and recommendations. At 44,000 loads per year that fee, if it is 3%, figures to over $1,600 a year.

Tree Plan
Members from the 100 Block presented an outline of a plan they would like the Board to accept for new trees in the 100 Block courtyard, including an offer to purchase the trees at a wholesale discount.. The Board took the proposal under advisement.

January 17, 2012 Board Meeting

I was unable to attend the January Board Meeting. If anyone would like to share any information on the meeting, or other matters, please post below under comments.

November 15, 2011 Board Meeting

Insulation
After installing new insulation in the 500 block attic, which resulted in a reported 15% gas savings there, the property manager has meet with an insulation contractor regarding moving forward with re-insulating the attics at the rest of the blocks. Total cost to do the remaining five blocks as one project would be $254,188 less $179,452 in energy program initiatives/savings paid for by National Grid, for a net cost to the cooperative of $74,736 ($14,947 per block). The contractor will additionally install new programmable digital thermostats, new sink aerators, and new shower heads in all units in that price. The property manager said they anticipate overall heating savings of 17% annually. The Board voted to accept the bid contingent on funds being available to do the entire project this year.

Insurance
The vice president reported costs for renewing the cooperative's property and casualty insurance will be just under $75,000, about $1,000 lower than last year. Treasurer credited a good claims record and the copalum electrical rewiring project with the overall decrease. Costs rose in two areas: workers compensation and crime.

Stock Certificate Amendment
President noted she has not received approval from Arbor Commercial Mortgage yet.

Laundry Committee
The committee chair reported a Request for Proposal had been sent to six vendors and Q&A sessions with them have begun. The committee plans to have its recommendations ready for the Board in January. Current contract expires April 30, 2012.

Finance
The treasurer said he will be requesting the board approve a recommendation to change cooperative bylaws from requiring a formal financial audit each year to a less involved financial statement review. If the board and Arbor Commercial Mortgage approve, the change would be voted on by membership at next April's annual meeting.

Maintenance
The coop has submitted 24 rebate applications for a total of $9,600 for new indirect water storage tanks.

Emergency repairs were completed on a gas leak at the 100 block, necessitating shutting down heat, hot water and stove service to the block for 18 hours while an underground line was replaced and inspected by the town. Staff also repaired damage to a storm drain at the 500 block.

Abutters Fencing
The president said she had not yet sent a letter to cooperative abutters about neighbors' fences on cooperative property. This was discovered when the property was surveyed as part of the refinancing process.


Open Meeting
No Smoking Area
A member spoke to the board regarding a request he made earlier this year to make the pool a no smoking area. He noted he checked with the town and all town pools prohibit smoking. The president said the question will be decided by the time the pool regulations are distributed for the 2012 season.

Replacement Windows
A member asked why the cooperative is seeking bids to replace all kitchen windows in the 200 block for that block's refurbishment project next year when it only replaced some kitchen windows (about 10) in the 500 block last summer. That means most 500 block shareowners will have to wait for another six-year maintenance cycle for their new kitchen windows. The board explained that the windows were not a part of the original refurbishment project for the 500 block and done when the extent of damage became evident during the repair work. The treasurer noted his objection to redoing work that had just been done to replace sheathing, trim, etc. and painting the 500 block.

A dozen shareowners attended. The board adjourned to executive session after 55 minutes.

October 2011 Board Meeting Post

Meeting Minutes

The September minutes were approved. May and June minutes, however, still have not been done and distributed (see last month's post).

Hallways

The Building & Grounds Committee chair again raised the question of cleaning the hallways' high ceilings and windows. The Property Manager said "it's not realistic for maintenance staff to handle it" and will get prices for an outside vendor to clear the cobwebs, etc. and clean the windows.

Financials

Treasurer reported end of fiscal 2011 budget was completed September 30 with Cooperative in excellent financial shape ($74,000 in the black) and the refinancing paperwork complete. Just three areas came in over budget:

1. real estate taxes ($7,000);
2. legal expenses ($15,700) due to 'member issues'; and
3. grounds ($10,900) due to tree pruning and paying the October bill in September by mistake. A Board member questioned the pruning cost overrun noting the Board is supposed to approve such additional expenditures; the president accepted responsibility.

Energy Rebates

Property manager reported the Cooperative is looking into possible rebates for water heaters and attic insulation.

Function Hall Rental

The president asked for the board's and membership's feelings about renting the function on the anniversary of September 11. A hand vote was taken and by a 16-7 vote it was decided to continue to rent it out that date if requested.

Open Floor

In response to a member question, the property manager said the front end loader was purchased for $11,500 from the previous grounds vendor.

Thirteen shareowners attended.

September 2011 Board Meeting Post

Meeting Minutes Delayed

The president reported the meeting minutes for May and June 2011 are not done. She apologized for the delay and accepted personal responsibility for it.

Building and Grounds

The Building and Grounds Committee chair reported all work requests had been completed but bugs and spider webs high in the hallways and on windows were a problem. Property Manager explained the Board does not authorize cleaning costs for windows. A shareowner asked if maintenance could provide a stepladder but did not get an answer.

Refinancing

Treasurer reported refinancing the remaining $2.3 million mortgage with Arbor Commercial Mortgage and Fannie Mae was completed on schedule in August, and noted a memo had been sent to all shareowners on it. He went over details again, noting net savings of $270,651.85 total over the final eight years on the mortgage. He indicated there will be no monthly increase in monthly carrying charges for next year (and perhaps beyond), and that $100,000 in funds was made available to do an additional year of boiler/furnace replacements next year.

Management Report

Property manager noted the 500 block exterior repainting/repairs and hallways were completed in August; the 200 block will be done next year.

The laundry room contract with Automatic Laundry expires next April. Several members volunteered to serve on a committee to begin the bid process for a new contract. Anyone else who would like to serve should contact the president.

The property survived tropical storm Irene with minimal damage, partial flooding of a unit in the 200 block; a sump pump will be installed in a storage area next to the unit.

Insurance

Vice President Joe Hinton offered to serve as the board's "insurance director" to work with our property and liability insurer. Current policy expires in November.

Special Meeting

The board again encouraged all shareowners to vote in the October 2 meeting regarding the proposed amendment to add/change names to a stock membership certificate.

Open Meeting

Director O'Connor opened the floor to members with the announcement he was limiting a speaker's "presentation time" to three minutes.

A shareowner, noting the treasurer's report, asked why the cooperative's legal fees were $9,900 over budget for the year-to-date. The treasurer noted the budget was $14,000 for the year but we were up to over $23,000 with a month still to go. No specific explanation was given, but the president said there were "member complaints and issues raised with HUD" with which the board need legal assistance.

Meeting adjourned to executive session after 40 minutes.

About 13 shareowners attended.

Stock Certificate & Sub-Letters

Note: the following item was part of the June 2011 Board Meeting post but is included here as a separate item here because of the volume of response it is generating. I didn't want the other items from the meeting to be lost in all the responses to this issue. I've copied several already posted elsewhere to here. - Pete

Stock Certificate & Sub-Letters Brouhaha

Questions relating to revising the cooperative's stock certificate policy (changing/adding names for relatives living or wanting to move here) led to a heated discussion when it was revealed (and the president conceded) that her son has been living at Nassau Gardens for some 15 years as a sub-letter which is strictly prohibited by policy.

June 2011 Board Meeting Post

Refinancing

A director/member of the refinancing committee reported the refinancing is on track to close in Week 3 August (4.3%, 8 year conventional loan with Arbor should save cooperative $250,000 - $3000,000). It was noted this will end all HUD involvement with the cooperative.

Standards & Inspection

The board voted unanimously to approve a new Standards & Inspection Policy. The 25-page document will be printed and distributed to all shareowners.

Maintenance Update

Property Manager reported the 100 Block roofing is ahead of schedule and will come in under budget. However, the 500 Block repairs are significantly worse than estimated and are expected to more than wipe out the roofing savings.

Pool 'No Smoking' Request

A member requested the pool be made a 'No Smoking' area, particularly as it relates to second hand smoke and children's health. The president said the idea will be considered but did not open the idea for discussion or schedule it as new business for the next board meeting.

May 2011 Board Meeting Post

Refinancing Update

The treasurer reported he has been working at refinancing the Cooperative's current mortgage and has sought refinancing options from HUD, which now guarantees our mortgage, and two private firms. He noted there are 8-9 years left on the current mortgage at 7.2% interest and he feels refinancing should come in at 4.2 to 4.5% at the time of closing, in late summer or early fall. He estimated total savings over the remainder of the mortgage at $200,000. He added the next step is a presentation to the Board.

Maintenance

The treasurer reported "issues with HUD" regarding withdrawal of funds from the replacement reserve. HUD has not approved releasing the funds and he said that may affect some projects going forward, including repairs/repainting the 500 block and reroofing the 100 block. He added the property manager is preparing contingency plans.

Stock Certificates

Director Sonya Harrison, subcommittee chair, submitted a draft of proposed new wording to amend adding/changing names on stock certificates. The board approved sending the draft to a lawyer for review.

Board Meeting Schedule

The board noted its schedule of open meetings for the current year has been posted in all hallways.

April 2011 Board Meeting Post

Stock Certificates Update

The board reported it has received a second legal opinion that names may not be added to or removed from stock certificates under the Cooperative's current Articles of Organization, and to change it will require a two-thirds vote of membership in a special meeting. A committee was formed for this purpose and a number of shareowners volunteered to serve on it.

Market Rate Status

When I asked the status of the 1996 special meeting vote (which passed) to change the Cooperative from a limited equity to market rate corporation, there was no direct response. The treasurer stated that counsel had previously advised the 1996 vote is no longer valid because the statute of limitations had expired. When I noted I had received a different legal opinion that the 1996 vote is still valid, there was no response. Instead, the board said another market rate special meeting vote (like the stock certificate situation) would be needed ̶ but took no action to make that happen.

The meeting was then suddenly gaveled to adjournment before the the board could be asked to explain why it waited eight years to find out it needed to file a simple document with the state to make the change, why the document was not filed even when that was discovered, and what if any action(s) toward market rate it had taken during those eight years or since.

The result of this inaction is that each Cooperative share now has an average equity of about $7,000, or about $1,430,000 for all 204 owners. Nassau Gardens is assessed by the town at $14,473,400, which means shareowners possess only 10% of our assessed value. The other 90% is ...?

And assessed value is not necessarily actual market value. Windsor Gardens (914 units) was sold three years ago for $161,000,000, or an average of $176,000 per unit.

The overriding responsibility for a board in every action it takes is to maximize shareholder value. Nassau Gardens' board is ignoring that responsibility.

Announcements

The president announced she will not be able to meet all of the responsibilities of the position due to a situation she explained but is not published here (HIPAA observation). She noted the vice president will be signing checks and passed the gavel to director O'Connor to run the meeting.

The board announced it will be starting it's monthly meetings at 6:30 p.m. beginning with the May 17 meeting. That will be more convenient for them, which is why they are doing it, but likely means more shareowners won't be home from work in time to eat and get to the meetings.

The board also plans to post one memo in each hallway with the entire year's meetings schedule instead of issuing monthly notices.

I am pretty sure that means there's no hope they will post the agendas so members can plan ahead to attend those meetings they would be interested in depending on scheduled business. (If they get home from work in time.)

Executive Sessions are also scheduled in advance for the entire year, so it looks like they will continue to not observe Roberts Rules of Order procedures for executive sessions as required in the Blue Book. This meeting was adjourned without a vote and the board apparently went into executive session (as on their schedule) without taking a vote to do so, announcing the agenda topics, etc.

Insulation

There was further discussion on the attic insulation installation plan at the request of a director. The 500 block was insulated as a test to measure ROI, and it was originally reported the payback in heating savings was too low and too long to justify the expense. During the meeting the treasurer reported a study he did on the subject showed there was a 17.8% one-year savings, so the Cooperative is going ahead with plans to re-insulate the other five blocks next year.

That sounded good until a director pointed out that the installation of many new, more energy efficient heating systems also played a significant role in the savings figure. So the ROI is not known.

Maintenance

The board approved several maintenance items:

• Contract for 100 block roofing project to begin May 31

• Budget for five new trees for 200 block courtyard

• Budget for 500 block exterior repairs and painting and hallways painting and reflooring

Why I started this blog

I have lived at Nassau Gardens for 33 years, since it was a privately-owned apartment complex that was in receivership and being managed by HUD. After HUD assisted the residents in purchasing the property and incorporating as a cooperative, we had terrific board members, management and maintenance services for a number of years and it truly was a very nice and relatively inexpensive place to live.

In recent years the situation has changed dramatically, and unfortunately not for the better. I have become more and more frustrated by the living conditions here:

• failure of the Board of Directors to live up to its responsibilities and observe our by-laws
• failure of management to be responsive, effective and even-handed
• failure of maintenance to provide timely and quality service
• and a host of other problems from financial issues to favoritism

I am now going to begin posting specific issues, with supporting information. I do this with trepidation because I have experienced the pettiness of the Board, Manager and Maintenance first-hand, but I honestly feel too many things have gotten far too out control.

Feel free to add your comments and experiences; that is what a blog is about.

Please be careful what you say and how you say it, however. The Board and Management would like nothing better than to shut this blog down with a lawsuit, so that their newsletters are your only point of information.

So please keep you remarks supportable, on-target, non-libelous, and without profanity.

Shareholder Value

The Number One responsibility of a director on any board is to maximize shareholder value. Here are my uppermost concerns about our Board's actions in regards to it's prime directive:

Market Rate Amendment

In 1996 the owners voted to change our form of membership from Limited Equity to Market Rate. This was done with HUD's approval and carefully managed by our attorney so the results would be binding. Yet 15 years later, it still has not happened. And considering the following from a recent article written by our current president, it appears she and other Board members have no intention of ever making it happen.

“In 1996 the HAP contract ended and was not renewed. Members voted to remove the restriction of “Limited Equity” status from the articles of organisation. It was felt that HUD’s approval was sufficient for this amendment. Only 8 years later it was learned that the change required the approval of the Secretary of the Commonwealth of Massachusetts. That action has not been sought and, therefore, Nassau Gardens remains a limited equity cooperative.”

It takes eight years to discover there is another step to take? And then it is not sought?

You can read the entire article here: http://www.ica.coop/al-housing/attachments/Case%2021%20USA.pdf

I called the office of the Secretary of the Commonwealth and spoke with an adviser there to find out what the problem could be. She told me all that needs to be done is to file an amendment, a four page document that has a $15 filing fee. The state, she said, only checks to assure the information is correct and they will approve; they do not perform any value judgment on the change.

You can see the form here: http://www.sec.state.ma.us/cor/corpdf/180amen.pdf

I also consulted with a real estate attorney about whether the 1996 vote is still in effect and binding. He said it is.

FICO Credit Rating

As owners of the cooperative paying off a 40-year mortgage, members should be able to receive credit for their financial performance on their credit ratings. In 2007 when reviewing my FICO scores with Experian, Equifax and TransUnion, I noticed I have no mortgage information with any of the credit services and FICO; two of them still had me listed as an apartment renter. I sent an email in March 2007 to the office asking the coop to see what could be done to get all the owners properly listed with FICO. The property manager responded he would follow up with the Board.

I am still waiting for a reply, four years later.

Diminished Stock Values

Overall, here are several other indicators Nassau Gardens is nowhere near the value property it once was.

• Lack of Waiting List – we used to have a waiting list years long to move here, just from word of mouth recommendations. A couple of years ago the Board had to spend $7,000 in advertising to rebuild the list. And now they are already advertising again.

• First thing you see when driving in is that Bahama Drive is unsightly. Seal coating and crack filling is not an answer. Are there any other streets in town with 200 homes that have not been repaved in 40 years?

• Windows are unsightly and not energy efficient. Like Bahama Drive, there is no firm schedule to repair/replace.

• Second thing you see entering our home is all the dumpsters and trash barrels, equally unattractive. Why aren't they back on the pads behind wood fencing of some kind as they once were? Trash trucks could still get at them for pickup. And maintenance employees need to manually put out the recycling bins anyway. There are lots of alternatives to screen them. Plus we'd get back a lot of parking spaces on Bahama Drive for visitors and to use during snowstorms when we have to empty the courtyards for plowing.

Financial Missteps

Carrying Charges

When the Board re-assumed self management after terminating Halkeen, they reported severe financial issues including that Halkeen left the Cooperative with $130,00 in unpaid bills and the reserve fund had been depleted to $100,000. Since then, the Board has continually prided itself on returning the association to financial health. However, the Board has never accepted responsibility for failing to properly oversee and manage the budget, allowing the management companies, auditors and accountants to create the problems.

Further, they have failed to acknowledge that the primary way they got the cooperative back on its feet was to assess each owner an unprecedented $100 per month increase in carrying charges. This was presented to membership as a one-time event to save the cooperative. Here's the math: $100 per month times 204 units times 12 months per year equals $244,800 a year. That was enough to wipe out the deficit and double the reserve in just one year. Yet the unprecedented $100 per month increase has never been rescinded and we continue to pay it to this day.

• The $30 monthly annual carrying charge increase that was announced as part of the long-term financial planning program seems to have been suspended. Will that affect our ability to provide maintenance as planned, or is it a short-sighted ploy by the current Directors to keep their seats on the board?

Refinancing

We have been in a recession for over three years now, with record low interest rates, yet we still have not refinanced.

The Board seems to be finally addressing this issue. But they are again acting in secret and not revealing what refinancing options they considered and how they voted to either:

• refinance to reduce monthly payment

• refinance to keep monthly payment as is but retire the loan earlier

• refinance to leave monthly payment and length as is and used proceeds for major maintenance project(s)

It's our money and we have a right to know how each director is voting to spend it.

And why wasn't this done several years ago when the recession began?

Laundry Rooms

This was another ill-advised financial mess the Board got us into. We used to own and maintain the laundry rooms ourselves. We grossed $27,000 in revenue per year. The Coop charged $ .50 each to wash and dry a load, for any temperature water and 60 minutes of drying time.

But the Board got away from budgeting routine, on-going replacement of the machines and water heaters in order that that an appropriate percentage of the oldest units were replaced each year. After returning to self management, they found most of the equipment was in very poor shape and there were no funds to replace the number that needed to be replaced. So they outsourced the whole service to a private company, including $10,000 in cash the vendor paid the Cooperative for our business. (What do you think that 'loan" wound up costing us?)

So the $3.00 we used to pay to wash and dry three loads (hot, warm and cold water) now costs $8.25 for washers that hold less and dryers that run for 25% less time.

Bidding Out Work

Is the Board actively and properly bidding out all of our work? Occasionally I see some bid numbers from meeting minutes, but not always. I bid out a lot of contracts in my work and found that since the recession started I have switched most of my vendors. We're in a recession and many companies are bidding razor-thin margins to get new business. But I continue to see the same vendors we've had around here for years.

Truck Purchase

The Coop spent $26,300 on a new pickup truck. Why not buy a used truck? You can get great buys in this economy on a repo or short term lease turn-in. The minute that truck drove off the lot we lost thousands of dollars.

Playground

The presidents responsible for the project promised over and over again that no Cooperative funds would be spent for the project. Then they did.

Basic Accounting Practices

One month I received a note from the office that I was being fined because I had not paid my rent for the prior month. I had, and the check had been deposited by the cooperative. I had to go to my bank and get a two-sided copy. But I was most concerned the coop did not do a proper monthly reconciliation to catch the error. Especially since it was under the new financial software system management is so proud of.

I was also concerned with the management attitude. I have never been a problem getting my rent in on time. One would think when they didn't receive it promptly they could just make a quick, pleasant call saying they hadn’t received it and please give them a call back if there was a problem. Instead they waited until after the penalty date. Like they want the penalty fee instead of the check on time. And I never received an apology or clarification.

Maintenance Issues

Plowing

Yes they worked hard. But you also have to work smart. After the Sunday, Dec 26 blizzard, they did not plow the fire lane until Wednesday.

Attention: it is a FIRE LANE as in F-I-R-E as in EMERGENCY.

Grounds Care

Our grounds looked much better back when we had a two-man maintenance staff who did the work themselves, along with some summer kids. Saved about $50K a year, too.

• They typically do not fertilize and spray for weeds until mid-May which is too late. You want to fertilize early April to get the grass growing to crowd out weeds. You also need to spray the weeds that early; by mid-May they have established themselves and sent off their spores.

• They don't apply pre-emerge crabgrass solution. That shows up in August.

• They use a regular mower and collect clippings to compost and sell to other customers. It would be better for us to use a mulching mower to return clippings and nitrogen (natural fertilizer) to the grass.

• They cut the grass too short; it needs to be longer to protect the grass roots, resist summer drought and give children a little more support when playing.

• Last year they continued to mow the grass in late July and in August when the grass had turned brown and gone dormant. This was a waste of time and money. How about pulling weeds and attending to the shrubs instead?

• Several years they didn't aerate lawns and add lime until November, by which time the grass was dormant.

• They've also used a large industrial tractor for all aerating, which means they didn't treat the tighter areas and terraces.

• One year they spread seed at a 600 block lawn in December, when ground was frozen and seed is dormant.
  
  

701 Bahama Building Permit

In early April, 2009 management sent a memo out praising Maintenance for designing “the new ramp, stairs and deck and ... performing all of the quality work.”

I don't know if any employees are certified to design such construction, but they failed to get a required building permit from the town until after the concrete was poured and railings in place.

Maintenance Requests

In August 2008 I sent in a maintenance request for 10 items to be addressed by maintenance during it's annual inspection. Of those ten:

• two simple items were addressed during the inspection.

• The problem with the refrigerator was diagnosed as a faulty compressor, which could stop functioning at any time and I could lose everything in the refrigerator. Maintenance would not replace it for two full weeks.

• The other seven items remain ignored, three years later.

So much for tracking work orders.

Flooding

My home has been flooded three times under current self-management. If the exterior drains and pipes in the courtyard are not kept clear, when there is a long thunderstorm downpour or tropical storm, water backs up into the laundry room stairwell, floods the laundry room and then floods into my home. It's happened a couple dozen times since I moved here. Every new manager tells me it won't happen again because they know what they're doing, but it still always does.

Here's what happened when my home flooded three times under current self-management.

• After the first flood, maintenance said they checked the line and it was clear. They said it wouldn't happen again. When I asked how did it flood if it was clear, I got no answer.

• When it flooded the second time I got the same non-answers, but was assured it would not happen again.

• When it flooded the third time, maintenance finally admitted they found the problem. There was a plumber's snake stuck in the line.

It is no disgrace to break the tool in a badly clogged line; it happens all the time. But it is inconceivable a person, either employee or contractor, would walk away from the problem knowing that he did not fix it, he did not report it, and it would flood again. Management has stonewalled me about who was responsible and what they would do to prevent a recurrence.

They've also ignored repeated requests to set up an annual maintenance work order to check and clear the drains and pipes.

Respect for the owners

Employees continue to enter owners' homes in non-emergency situations without advance permission. They like to blame this on new employees. But I think it is the responsibility of the supervisor who schedules the work and opens the work orders.

Director Abuse

Satellite TV

Satellite dishes were always prohibited at Nassau Gardens until several years back when when a director installed one at his home. The rest of the Board and Property Manager refused to make him take it down, despite a huge hue and outcry by other owners. Instead, they eventually passed a policy that allowed him to keep his, and some others to install them depending on the orientation of their porch or patio. But a large number of owners may still not install one. That is discrimination.

• When the 200 Block roof was repaired, someone decided to take down the master antenna for the complex. They never bothered to check with all the owners to see if anyone was still using it as a radio or TV antenna with digital converter box.

• Now the question is why didn't they get Dish or Direct TV in here to bid to install satellite TV through the existing master antenna chases, so all members could have this benefit?
  
  

Pet Violations

In 2005, Management began eviction proceedings against one owner for violation of the Cooperative’s long-time no pets policy. However, they did not apply their decision to evict uniformly and equally, to many other members with illegal pets, including at least one Board member.

Parking Abuse

A director has been parking her second family car in my reserved courtyard spot for over a year, 24x7x365.

Discrimination

Committee Participation

The president of the Board refused to allow me or other neighbors to participate on the playground committee he established, without a Board vote, to erect a new facility for "our future Olympians," if you will recall all their newsletters. In an email of 8/2/2008 the president of the cooperative informed me I and other neighbors would not not be considered to participate on the committee because he was restricting invitations to join the committee to (his words) "parents who have children who are at the age where the playground is attractive for them." This is clear discrimination against owners by parental status, age and, as it turned out when all members he selected were mothers, sex as well. What he effectively did was stack the committee to get the results he wanted by assuring his committee represented a very small and unrepresentative percentage of our total ownership.

• On August 20 of that year, just 18 days after refusing to let me volunteer for his playground committee, the president sent me another email in which he stated, again his words: "However, since becoming a member in September of 1979, I do not see that you have actively participated as a volunteer and that concerns me." When I pointed out the error of his statement (I had participated in several efforts and on a previous playground committee), and that he Himself had just refused to let me participate on his new playground committee, he did not respond.

Satellite Television

The Board continues to have in place a policy which discriminates against owners who want to install satellite television because of the orientation of their porch or patio. This policy was implemented after a director illegally installed a satellite dish, allowing him to keep it but denying the same right to other owners.

Other Issues

Abuse of Executive Session

See the proper way to conduct executive sessions, as outlined by the Norwood Board of Selectmen, here:

http://www.norwoodma.gov/index.php?option=com_content&view=article&id=112&Itemid=164&limitstart=1

Untimely Meeting Minutes

Meeting minutes are not issued in a timely manner by the Clerk, who now wants to be elected a director. The meetings for last spring outlining pool changes were not issued until November, well after the pool closed for the season.

Other times they are incomplete, such as not properly recording individual director's votes when the votes were not unanimous.

General Dis-ingenuousness

Several months back the Board decided to stop distributing many reports to save a little money. In it's most recent newsletter, they said that is not an issue because the documents are available for review at the office (during office hours). They know very well most owners cannot take time off from their jobs to go there during the day to see that information.

I consider that one more example about how insincere they truly are about conducting our business in an open manner and being responsible for their actions.

Along the same lines of general insincerity is the Board’s refusal to distribute meeting agendas to owners before the meetings. Members need this information ahead of time to decide if they want to attend. Many members need to leave work early, arrange for a babysitter, etc. to attend. By withholding this information, the Board is acting to keep attendance at their meetings down.

When the Shoe Was On the Other Foot

In July 2002, the current president, then recently elected to the Board, sent out a “Minority Voice of the Nassau Gardens Board of Directors” newsletter decrying secretive board actions and further noting “the majority of the Board refuses to listen to the membership.”

The same year, another letter from the current president noted, in regards to closed Board Meetings: “however we must ask 'Why?' After opening these meetings to the membership for past 20+ years, the 'majority' of the Board claims that we, the shareholders, are responsible...”