Harbor Island Condominium Association Minutes of Meeting

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					                                       Minutes of Meeting
                                       Board of Directors
                            Harbour Island Condominium Association
                                          July 17, 2009

        The following Board Members were present:

          Chip Gordy                     Jay Hancock                          Tom Duffy

                        Paul Rogers                      Rick Meehan

        Also in attendance: Gene & Beverly Brewis

       The meeting was called to order and the minutes of the June 26, 2009, Board Meeting
were reviewed. A motion for approval was made by Jay Hancock seconded by Tom Duffy and
unanimously accepted.

         The Treasurer’s report was presented and reviewed. After a review of the HI accounts
receivable including a review of the units currently in collection; the Board noted some of the
owners had made a request to the Board for the dismissal of attorney’s fees, late fees and interest
due to financial hardship. While the Board sympathizes with an owner’s predicament, the Board
cannot show partiality. The Board requested another note (for the third straight billing) be
included in the July billing re-affirming the Board’s position “that the Board will enforce the 10%
penalty for late payments as authorized by the by-laws”. The Board also noted any owner with
unpaid association fees or late charges is unable to vote in the HI annual election of September
19, 2009.
          A motion for approval of the Treasurer’s report was made by Rick Meehan, seconded
by Paul Rogers and unanimously accepted.

                 LANDSCAPING CONTRACT: George Kemp of JND has submitted a proposal
for a five (5) year landscaping contract. The current JND landscaping contract is $37,000 per
year which expires in 2009 and the increase would be $1,000 per year beginning in 2010. The
landscaping contract is for lawn maintenance only; the spring planting is an additional item to the
contract, along with the tipping fees at the landfill for the yearly fall grass and crape myrtle
trimmings. Gene has obtained a landscaping bid from Total Lawn Care for $87,000 for the lawn
maintenance which is the exact same services that JND provides for $37,000, with the bid being
over double JND’s proposed fees. Tom stated he feels JND keeps Harbour Island looking good
and the fact that George Kemp is reliable is also a big plus. The total proposed landscaping
budget for 2010 which includes the spring planting is $54,000 which is less than the amount
approved for the 2009 budget.
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July 17, 2009
Page 2

        A motion for Chip to sign the JND landscaping contract for a term of five (5) years
beginning in 2010 with a $1,000 per year increase after attempting to negotiate the proposed
contract amount with George Kemp was made by Rick Meehan, seconded by Tom Duffy and
unanimously approved.

         PLUMBING ISSUE: The Board had received a letter from HI unit owner #53 regarding
extensive damage by sewer backup to their bonus room, which consists of partitioning off their
garage and adding a bathroom. Five (5) of the six (6) units in G building, five (5) of the seven (7)
units in H building, and approximately six (6) of the twelve (12) units in I building have all added
bathrooms in their garages.
         A HI unit owner, who is also a builder; suggested the lines be checked for a broken pipe
or possibly an obstruction in the pipes. Chip called Hal Adkins with the Town of Ocean City and
asked for suggestions regarding the problem. Chip was informed the City would be willing to
come down and run a test on the lines except the City does not currently have any inspectors
         The problem seems to be located in the corner by H building. Gene consulted with his
plumber who came and cleaned the clean-out which was accomplished by going through unit 53;
and the plumber feels the problem is in the outside lines, which would involve tearing up the
parking lot to find the source of the problem. The Board noted the City has the capability to
check out the lines without tearing up the parking lot.
         The Board stated all of the townhouses originally have had drains in the garages, which
included a shower and no additional drains have been added; the shower has simply been
removed and replaced by a toilet.
         Chip had researched the issue of ownership responsibility and informed the Board all the
owners of the townhouses own their property up to and including five feet below the surface as
part of their unit. He also informed the Board the MD Legislature has just enacted a new law
stating that a Condominium Association must insure the units as well as the common elements,
except for improvements and betterments made by an owner to a unit (which, incidentally,
includes the toilets installed by the unit owners). Insurance on the improvements and betterments
is the responsibility of each unit owner. The new law also makes a unit owner from which
damage originates responsible for the first $5,000 of the deductible in the Condominium master
policy insuring units and common elements.
         Rick noted when he had obtained the necessary building permits while installing his toilet
in the bonus room in his townhouse, he was informed the gravity fall from the toilet to the drain
was not steep enough, and Rick was not allowed to install his toilet without first installing a pump
as a requirement of his building permit.
         The Board’s position on the situation is to have the City verify if the problem does
originate from the lines in the parking lot; if the problem is not as a result of blockage of the
outside lines then the Board will go to the individual townhouse owners in building H and inform
the owners whatever the problem is it is the unit owner’s responsibility to resolve the problem.
Chip noted he had added a rider to his condominium homeowner’s policy for sewer backup
coverage at a cost of approximately $20.00 per year. Harbour Island’s current insurance policy
has $50,000 of sewer backup coverage.

         INSURANCE: The current Maryland law requires Condominium Associations to notify
the unit owners yearly in writing of the amount of the current insurance deductible and also it is
the unit owner’s responsibility to cover the insurance deductible up to $5,000. This information
will be included in the yearly annual meeting notice. The Board decided an insurance committee
is necessary to insure all HI unit owners receive accurate information regarding their insurance
requirements. A motion for Chip to appoint a Board member to head up a committee regarding
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July 17, 2009

HI insurance requirements was made by Tom Duffy; seconded by Jay Hancock and unanimously
approved. At this time Chip has appointed Board member Paul Rogers to head up said insurance
         Jay suggested all HI unit owners be reminded that for any changes and alterations to their
unit the owner is required to obtain all the necessary Town of Ocean City permits. Chip
informed the Board the HI by-laws provide any changes to a unit must be approved by the HI
Condominium Association; and any changes and alterations to a unit over $500.00 requires a
Town of Ocean City building permit.

         2010 BUDGET: The 2010 proposed budget will be approved by the Board at the August
21st meeting which will then be included in the Annual Meeting notice.
         There will be a proposed 5% increase in the HI quarterly dues due in part to the Fannie
Mae and Freddie Mac insurance requirements, including making the insurance deductible a line
item included in the budget.
         Tom raised the question as to if the Director’s liability were to exceed the $1,000,000
limit would the liability then be covered under the Umbrella policy, which is a question for Reese
Cropper of IMG to answer.
         Dick had added a note that once the 2010 proposed budget is adopted, any disbursement
which is not considered normal expenses in excess of $5,000 or in excess of the budgeted amount
would have to be approved by the BOD before commitment and all capital expenditures must be
approved prior to commitment.
         Rick feels there is the possibility of budget savings from cutting the hours when the
guardhouse is manned; and he also feels there is not enough light at the entrance to Harbour
Island. The Board consensus was that if there was not a guard on duty at HI there would be no
way to stop or monitor the people and cars from entering and also a guard on duty is actually a
psychological deterrent to those entering HI who do not belong there. Rick does feel the HI
entrance needs to be brightened up as a deterrent to crime. Rick is to have the City assess the
situation and make recommendations as to what can be done to brighten up the HI entrance.
         The Board approved the installation of a sign which states “Surveillance Camera in Use
24 Hours” to be affixed to the guardhouse.

         WMO: Tom and Gene met with Jim Motsko of the WMO and Tom feels all is prepared
for another great year of the WMO at HI. Tom has informed Jim Motsko what expenses to
expect as a result of this years WMO.
         Tom noted ten (10) more trash cans are needed, and the cans would be placed where the
largest concentration of people are located, and also Jim Motsko’s people have agreed to empty
the cans more frequently.
         Tom feels there is an issue for the HI community with people wanting to rent a boat slip
during the WMO and there is no one around to accommodate them. Jim Motsko has listed slips
are available for rent during the WMO at Sunset Marina and HI on the WMO website and
included Scott’s and his own phone number for the potential renters to call.

         RESIDENT PROBLEMS: It was noted there is a continuous problem with some of the
occupants of a certain HI unit. The occupants are known to race their cars in and out of HI along
with being loud and boisterous. Gene has spoken with the parents of the individuals causing the
disturbance and the parents have refused to cooperate, therefore, the Board stated the next time
this situation occurs the police are to be called in to handle the problem.

         RECYCLING: Jay met with Steve Brown concerning HI’s recycling issue. HI has
recycled for years and is considered in compliance with Ocean City standards. As Harbour Island
II does not currently have recycling, they will be required to do so. HI II would like the recycling
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July 17, 2009

to be between the dumpster of M building and the transformer, with a light pole located in the
middle of the area. Harbour Island’s current recycling area is in front of J building and behind
the dumpster.
         The cost would be approximately $2,000 for a three sided enclosure including a concrete
pad for the two (2) recycling containers. Steve Brown is to await plans to be submitted by
Harbour Island II before coming to a decision on the location of possible new recycling areas for
Harbour Island.

        MID-RISE RAILINGS: Gene has obtained a price of $4,000 for materials for koma
board trim work to K building’s first floor all the way around such as had been completed on all
the townhouses. All three (3) of the mid-rise buildings will require the same trim work repairs,
and it was suggested the repairs could be completed over a two to three year period. The Board
deferred any decision on the repairs until a full Board is in attendance.

       With no further business to discuss, Rick Meehan made the motion to adjourn which was
seconded by Jay Hancock, and unanimously carried.

                                                Respectfully Submitted,

                                                Jay Hancock, Secretary
vlt                                             Richard Kemper, Jr., Asst. Secretary

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