Maui Sands I & II August 4, 2010 Maui Sands I Board Members Present In Person: Maui Sands I Board Members Present by Skype: Maui Sands I Board Member Absent: Maui Sands II Board Members Present In Person: Maui Sands II Board Members Present By Skype: Maui Sands II Board Member Absent: Owner Present: (in person or by Skype) Other Attendees: Rosa McAllister, Ken Baldwin John Cush, Jean Rachkowski and David Stuffler Keith Hertz Lucia Livoti Claire LaChance Art Ford Bob Jenks, Kory Skolnick David Ferguson and Bill East, Management Consultants of Hawaii; Deidre Rockett, Recording Secretary; Ken Kuhlman, Resident Manager I. DECLARATION OF QUORUM A quorum was declared for both the Boards of. II. CALL TO ORDER Rosa McAllister called the combined Board of Directors Meeting to order at 12:14 p.m. III. APPROVAL OF MINUTES The Board considered approval of the Minutes of the following Meetings: April 24, 2010, Annual Meeting as to form and content; and April 24, 2010, Organizational Board of Directors Meeting; It was noted that the listing of Steve Lewis should reflect that he is an officer of the Board and not a Director. It was agreed to approve the Minutes of the Annual Meeting as corrected and as to form and content. It was also agreed to approve the Minutes of the Organizational Board Meeting as corrected. IV. RULES OF CONDUCT Meeting rules of conduct were briefly reviewed.
August 4, 2010 -- Page 2 V. OLD BUSINESS A. Communication President McAllister reported there has been some activity on the online owners Discussion Board. The President further noted that work is ongoing building the Maui Sands website. Contents to be part on the website include Board Meeting Minutes, a slide show of photographs, copy of the old Maui Sands Brochure, meeting dates, management monthly reports, monthly financial statements, etc. The President encouraged owners to contribute with historical information about the Association. This announcement will be posted on the Discussion Board. The President and her son were recognized for their work in expanding the communication tools for the Association and for the benefit of all. There is an ongoing campaign to solicit email addresses from owners. An informational mailing will be sent to the owners by snail mail and will include the following: 1) Email registration request; 2) Introduction of the Board; 3) Website announcement with instructions; and, 4) Information and instructions on how to access the online Discussion Board. There was a suggestion to add a web cam at the sundeck to the website. Director Hertz has been exploring this potential. With a privacy issue in question, further research will be conducted. B. Delinquencies Ken Baldwin updated the Board on delinquencies for Maui Sands I as of July 27, 2010. Actions taken to collect the past due amounts were noted and discussed, including Demand Letters, Rent Intercept, Payment Plans and Foreclosure. The President asked that the Aging Report include information about the accounts of owners on a payment plan. The overall amount past due is decreasing, but there is still an accounts receivable problem. As an aside, it was noted that there are three one-bedroom units for sale under $50,000 each. Two-bedroom units are being offered at just over $100,000. Director Livoti updated the Board on the status of delinquencies for Maui Sands II. All owners, she said, are paying. Further discussion was deferred to Executive Session. C. Land Lease
August 4, 2010 -- Page 3 A proposed contract from Michael Pang, Monarch Properties, was received. He will represent the Association in lease rent renegotiations as well as a potential buy-out. There was a round-table discussion on the proposal from Mr. Pang. There were questions about the Sandwich Lease. The goal is to purchase the Master as well as the Sandwich lease at one time. However, if this cannot be accomplished, the Master Lease could be purchased on its own. It was agreed by unanimous voice consent to approve the contracts with Michael Pang for both. It has been documented that the lease extends to 2037. Information about the contract with Mr. Pang will be added to the Letter to the Owners. The fee per unit for his services is $30. Mr. Ferguson was authorized to pay. D. Legal Representation have approved Joyce Neeley as the Association legal counsel. Mr. Ferguson detailed the multi-pronged, step-by-step process to amend and restate the Bylaws by the Association attorney. With legal representation selected, ongoing questions the Board has will be answered. VI. PROPERTY UPDATES A. Projects and Monthly Reports Mr. Kuhlman submitted a Monthly Report dated July 2010. Mr. Kuhlman has been pumping up the curb appeal, including a number of repairs. The Association has come a long way. Ken Baldwin assisted with the laundry area project. It looks great. Upcoming and ongoing projects were noted: 1) Refurbishment of all trash compartment bins; 2) Ongoing spalling, including the landings; 3) Redo of pool area electrical; 4) Great rock hunt; 5) Maui Sands side of the seawall; and 6) Roofing. Community work day projects might include the painting and sanding of the stairs and the great rock hunt for the seawall. There are five buildings experiencing roof leaks; and these leaks need to be addressed. Mr. Kuhlman asked for direction in this regard. Options were discussed, including: 1) Recoating; or 2) Re-roofing.
August 4, 2010 -- Page 4 The gutters on Building 7 have been fixed. Mr. Kuhlman attended pool school and was certified. After the course, Mr. Kuhlman tested the chemical balance in the pool. He determined that the sand filter in the facility had never been changed. He replaced the compacted old sand, with new sand. With this action, the cost for chlorine has dropped $300 a month, and the pool is sparkling. Terry Nutt (landscaper) has done a great job on the irrigation system, and he has done it for free. The Association needs to purchase more parts. These actions are saving the Association a lot of money on water usage. It was agreed that the re-numbering of the parking stalls would be a great community work day project. Mr. East will work with Mr. Kuhlman to update the Priority List, and it will distributed to the Board. B. House Rules Issues Mr. Kuhlman asked the Board for its understanding. His work schedule is full, and it is a challenge issuing citations for violations. He presented a Request Form. Requests would be documented and filed. The requests would be tracked to insure follow-up on the Request Form. Owners with complaints about neighbors should talk with the neighbor first. If continued non-compliance, then notice will be sent. A paper trail was considered important. C. Security There have been no security incidents reported in over a year. A Neighborhood Watch program was suggested, with owners volunteering to walk the property at night. A request for volunteers will be posted on the Discussion Board. Ken Baldwin offered to meet with the owners, providing the dos and don ts of Neighborhood Watch program protocol. D. Roofing The roofs need replacement. Proposals were solicited. There was a meeting in the past with Grant Henry, a roofing consultant. Ken Baldwin proposed that the Board invite Mr. Henry to meet with the current Board to determine if his services are desired. Mr. Ferguson recommended the Board consult with a professional, such as Mr. Henry, in this regard and cautioned the Board to make decisions on actions to take, i.e. a long term versus a short term fix. Mr. Ferguson explained that the infrastructure would not support another layer. He said the roofing is a remove and replace project. Hiring an independent consultant will protect the Board, under the Business Judgment Rule. The multiple advantages of hiring a consultant were noted, including, but not limited to, conducting a final inspection so that the Board receives the warranties. The proposal from Mr. Grant is for $11,000.
August 4, 2010 -- Page 5 It is possible to install solar panels at the same time, the Board would like this considered. MOTION: To schedule a meeting with roofing consultant Grant Henry. Rachkowski Unanimous Approval Mr. Ferguson will arrange the meeting with Grant Henry. E. Community Work Day Projects The Board considered a suggestion from President McAllister to schedule the next Community Work Day on Saturday, August 14, 2010. The President suggested scheduling work days on a once-every-other-month basis or quarterly. Specific tasks should be delegated to each Community Work Day event. Optional days for work days were discussed. It was considered important to keep the jobs small, with the owners finishing the project themselves. The President will work with Ken Baldwin organizing the work days schedule and task list, and the information will be posted on the Discussion Board. VII. NEW BUSINESS A. Credit Bid The Association foreclosed on and bid on 716. This information is part of public record. Mr. Ferguson reported escrow on the unit has been opened. Escrow has asked the court to confirm the commissioner of sale, the auction and the conveyance to Maui Sands II. The next step is to make sure the Association has the cash to bring the property taxes current in the amount of $24,000 and to pay attorney s fees and escrow costs. Once the Association gets title, the usage of the apartment is the next consideration, i.e. place for sale or rent. Mr. Ferguson explained that the Association was the only bidder for the unit. It will take about 75 days to close escrow. The hearing for Confirmation of Sale is on August 17, 2010. Mr. Ferguson suggested Maui Sands I and II should incorporate prior to the preparation of the deed. By email, the Board previously discussed this consideration, and all have agreed to move forward in this regard. The advantages of incorporating were noted. It was agreed by the Directors of both Maui Sands I and II that Joyce Neeley would be asked to incorporate both Associations. The potential for further non-judicial foreclosure actions were discussed. Mr. Ferguson suggested analyzing the pros and cons on a case-by-case basis. The Board also considered a suggestion to buy properties that are listed at a low price. Mr. Ferguson said an owners vote to approve this action might be required before bidding. B. Rick s Apartment Rick s space has been cleaned completely and there may be renter (an owner) for the space.
August 4, 2010 -- Page 6 Mr. Ferguson outlined the required terms of rental. The Board cannot rent the space for more than five years without a 60-day termination agreement included in the lease. The person interested in the space is a party planner. Options for the space have been suggested by owners, including making the space into a common room for use of benefit to all owners, i.e. exercise room and/or social lounge. Both Boards agreed by unanimous voice consent to try to rent the space to the interested owner. There was a recommendation to have the attorney help format the lease. C. Other Maui Sands Community Events President McAllister has been approached by some owners about the potential of a community garden, movie nights by the pool, yoga classes, etc., to increase community spirit. VIII. OWNERS FORUM There was a brief owners forum. IX. EXECUTIVE SESSION (Director Jean Rachkowski was excused from the Meeting at this time.) The Board moved to Executive Session at 2:20 p.m. Regular business resumed at 2:41 p.m. X. NEXT MEETING DATE The next Board of Directors Meeting was scheduled for October 2, 2010. XI. ADJOURNMENT The meeting adjourned at 2:42 p.m. Respectfully submitted, Louise Rockett Louise Rockett Transcriptionist