Posts Tagged ‘micro politics’

New Board cont’d

February 15, 2010

2/11/10 Addendum: Well, I mis-spoke.  Oops. There are three people on the board now who are anti-the established order, and already have issued notices that the management firm is fired. No new one is in place. The lawyer is also being sent a notice that they are no longer desired. The attorney hired by this group has already issued requests for all records from the attorneys hired to make the condominium conversion happen, concerning the condominium conversion and to please turn over all those documents.

However, there is one more level of administration that is currently being ignored. This is someone called a trustee, independent of the board, the management and the home owners. Our current trustee happens to be affiliated with our management company. The trustee has the power to say this is not in the best interest of the association, of the homeowners. From the various votes on condominium conversion over the years, the home owners want to be a condominium association. The trustee then takes that into consideration, and makes an independent assessment, an independent determination.

In speaking with former board members who have lived here for more than a decade, they remember when there was no management company. The association at that time was nearly bankrupt. If any major emergency had happened, such as has in the last few years when the boiler heating the entire building needed replacing, there would have been no money for repairs, and a special assessment that most residents could ill-afford would have been needed. At this point in time, with six or so years of the same management firm, we have nearly 200k in various forms of liquidity available for the maintenance of the building. We have been advised that 300k would be ideal to have in reserves, because the entire plumbing and electricity systems are still needed to be repaired/replaced within the next few years. This is a known fact. We are still using the nearly 100 year old original systems. Time for an intelligent, well-planned upgrade.

I do not believe this newly elected board is currently thinking about maintaining the building, which means all of us who invested in ownership here, hoping to remain living here for many years to come comfortably, are fearful. But we are also wondering what they ARE thinking. We wonder what their attorney is telling these people, why condominium ownership is so bad. The fear is, she is actually taking these disgruntled owners for a ride, just throwing legal procedures around to rack up a bill to charge them. She has already told them that whatever they pay her out of their pockets can be re-imbursed by the home owner’s association. Perhaps she sees that 200k held in reserves for the building’s needs as a large potential paycheck. Perhaps.

There is a meeting scheduled tonight by the new board at the request of their lawyer, and that is the one question I want to ask. Why is condominium ownership bad? Being able to sell a unit with bank financing is the way of most real estate transactions these days, as most people don’t have a hundred thousand dollars or so in a back pocket to finance a cash transaction. Being allowed to be a condominium association is exactly the legal vehicle that will finally allow bank financing.

There are still owners in this building who only paid $5,000 to $7,000 for their units. Their perspectives as to how much it costs to buy a unit, and how easy that is for others is slightly skewed, to say the least. I paid approximately 20x their purchase price for my unit, and still feel I got a good deal for Los Angeles, but bank financing at the time would have made the transaction a lot easier to take place.

The fact that bank financing not being an option when I purchased into the building is exactly what allowed me to get into the building. But it makes it extremely difficult to ever consider selling it. Not that I am, but circumstances change. Knowing I have that as an option, especially without a full time job, is exactly the sort of peace of mind that helps one sleep at night.

Board Elections

February 10, 2010

Well, the home owners’ association board elections were tonight, and yet again, I did not win.

This really means nothing.

I was on last year’s ballot, and did not win, but ended up on the Board when one of the five elected members chose to resign. As I was the one with the next most votes, I was asked would I join. I said yes.

So guess who came in with the sixth most votes this year again? Me.

It is so fun watching the voting tally take place. All sorts of thoughts run through your head. It is nothing more than a popularity contest of sorts. I’m still not well known in the building, so plenty of people don’t know who I am. I’m fine with that. I chose not to vote for someone in this election for that exact same reason.

We were given five votes to do with as we wished. We could vote all five for one person, or one for each of the five board seats. When I heard that someone voted five times for me alone, it certainly made me wonder in whose estimation I was held so high. Not even I gave myself more than a single vote.

There was an attempted coup taking place, so the ones elected on the floor today were getting five votes at a time. Of those three new candidates, two were the most elected. Then two new candidates who had been asked to fill the missing two seats from our old board, the one I sat on, as one member now works in Europe and the other lives in Riverside, and both were finding it difficult in their schedules to be in LA on any certain night for board meetings. So two new candidates from the “opposition” and two new members of the “ruling party” and one from the old guard remains on the new board. So really, the coup wasn’t very successful, as three of the positions are now held by the reasonable members, and only two by the opposition. Since majority always wins on board votes, although the opposition was congratulating itself vigorously for its win, what have they won besides two seats on the board? They will be the vocal, agitating minority.

One of the things the opposition has been arguing for is the illegality of our recent voting into condominium status. This has been a long, hard slog, and has taken nearly a decade, and been put up for numerous votes. What the opposition fails to understand is that it has gone through. A super majority of the home owners (not necessarily the ones in attendance at meetings, but of all the 94 unit owners) has voted not once, but three times to make the building a condominium. The city has separated all the units’ tax bills, that is no longer the building association’s responsibility, etc.

Somehow, the opposition believes that our management company is running the show, the one that helps us handle collecting all the association dues, paying for repairs, paying our one employee, making sure the building has its fire, elevator and earthquake inspections, is up to code, etc., etc., all the things that managers handle so the residents can go about their business and not have to worry about these things, the opposition believes these people who do all these things required by law, are bad and bilking the building of its money. The fact that our building is woefully behind in its plumbing and electrical repairs, as it is still all original, and everyone knows it needs to be replaced to ensure the building’s continued long life…. if the management suggests we make plans to do these upgrades and repairs, at the Board’s request, this is evidence of the management firm wanting to cheat us of our money.

Most of the opposition are retired people on fixed incomes. Being on a fixed income myself, I certainly understand wanting to make sure every penny spent is necessary, but unfortunately, many of these people have no idea what things cost these days (indeed, perhaps they never did) and protest over expenses that seem quite reasonable.

It costs money to maintain a building. It costs more money to maintain an older building. And it costs even more if you ignore it all and decide it is always too expensive to bother with.

That is the situation our building is in.

It will be interesting to see if the new board reverses anything that has already happened. The one I fear the most is the possible firing of our management company. With a new board with only one member from a previous board, the thought of throwing a new management firm in the mix in addition is a frightening thought of potential mis-management.

In the meantime, the former president (having been on the board since 2002, continuously) and I are looking forward to being able to travel and watch our television programs without pesky board management issues having to be dealt with.

Until I suspect I get called in to replace whomever will next come off the board.

Until that time….