DRAFT Kaanapali Royal Association of Apartment Owners Annual Meeting Minutes January 9, 2010
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1 DRAFT Kaanapali Royal Association of Apartment Owners January 9, 2010 Board Members Present: Other Attendees: Matthew Kinney, President; Pam Harris, Vice President; Lauri Beck, Secretary; Karen Kupferberg, Treasurer; and, Directors Robbie Taylor, Gregg Sherwood, Rod Conklin, Doug Duckworth and Bob Nisonger David Ferguson, Management Consultants of Hawaii; Jim Graybill, Manager; and, Chyna Colorado, Recording Secretary I. DECLARATION OF QUORUM A quorum was declared with total of % represented in person and % by proxy for a total of % present. II. PROOF OF NOTICE It was certified Notice was sent to all owners of record in accordance with the Association governing documents, and it was posted on property in compliance with Hawaii State Law. III. CALL TO ORDER President Matthew Kinney called the Kaanapali Royal Association of Apartment Owners Annual Meeting to order at 9:05 a.m. The meeting was held at the Waiola Church, Lahaina, Maui, Hawaii. IV. INTRODUCTIONS The President introduced the Board and management team. He noted that Pam Harris will be retiring after many years of service on the Board. She was recognized for her contributions and dedication. V. APPROVAL OF MINUTES The President asked for any corrections or additions to the Minutes of the 2009 Annual Meeting. To approve the Minutes of the January 10, 2009, Annual Meeting as presented. Londynsky/Basolo VI. PRESIDENT S REPORT President Kinney reported that 2009 was a year of light transitions. The Budget operated on target due to the drop in oil prices. The goals of the Board were reached financially, and President Kinney recognized Treasurer Kupferberg. The Reserves are funded at the 60% level. The Association condominium fees for 2010 will remain the same as 2009 at $895.
2 January 9, Page 2 The President noted that there has been a decrease in legal fees over the previous year. There is one pending legal request for mediation, and the insurance company is covering these costs. The President outlined the Board s philosophy on consulting with attorneys. The Board will continue to consult with counsel when changing the Bylaws, etc, but will monitor these expenses. The property is in good physical condition. The President recognized the maintenance staff and management. The President would like to improve communications, and welcomed s from owners with questions. VII. FINANCIAL REPORT A copy of the Annual Audit for the year-ending November 30, 2009, was distributed to owners at registration. The Auditor, Shaun Thayer, CPA, rendered a clean opinion. The performance of the Budget was generally on target. The amount of the funds in the Reserves is higher than in the past, providing a cushion for unanticipated expenses. Thus far, the budget is on track for Accounts receivable were discussed. There has been a $25,000 write-off. Actions taken or available to collect the delinquent amounts were discussed, including rent intercept actions, Letter of Demand, Placement of a Lien and use of collection agency. To approve the Audit Report. Mallard/Hyman VIII. COMMITTEE REPORTS A. Communications Director Beck thanked Debbie Conklin and Carol Sherwood for providing refreshments and food and setting up the room for the meeting today. She announced there is an owners pot luck pupu party tonight at 5:30. Refreshments will be provided. Director Beck reported the website service contract for 2010 has been negotiated for an annual flat fee rate of $275. She noted that updating the website has been challenging. In 2010, Director Beck will have assistance, with personnel at the front desk helping with this task. Feedback forms were distributed to owners at registration. Owners with comments, questions, suggestions or concerns are invited to fill out the form and return. B. Energy & Tech
3 January 9, Page 3 Director Nisonger reported the DSL project was a rousing success thanks to the Association Resident Manager Jim Graybill. Over half of the apartments have DSL service, and there is also access by the pool. Director Nisonger has explored the potential of the installation of a photovoltaic system powering the chillers. There are only four buildings with south facing rooftops appropriate to place photovoltaic panels. The tax codes are not advantageous for this Association project. The codes are applicable at this time to individuals only. Director Nisonger will continue to research the potential of alternative energy at Kaanapali Royal. Director Nisonger has also investigated options for television service other than Oceanic Time Warner. With the complex current wiring, the options are extremely limited. C. House Rules Director Taylor asked for suggestions or comments from owners regarding the House Rules, specifically about the noise issues, golf carts and pool rules. There were some comments, discussion and questions from owners about the following issues: 1) Allocation of handicap parking stalls in the lower parking lot; 2) Concerns about vehicular parking under certain trees, with a suggestions to cut back the plumeria to protect the cars; 3) Reconsideration of covered parking at Kaanapali Royal; 4) Confusion about parking, including refund for erroneous charges; 5) Registration of immediate family members at front desk to avoid repeated parking fees; 6) Suggestion to register guests in advance in order to receive laminated parking passes before coming on property; 7) Parking registration forms available prior to arrival by ; 8) Suggestion to be able to use golf carts at Kaanapali Royal; and, 9) Suggestion to build a parking structure with tennis courts on top. Director Taylor clarified the second car parking issue. If a guest of an owner brings a car on property and the owner is storing a vehicle onsite, there will be a parking fee imposed for the second car. The potential for parking golf carts was discussed. In order to change one of the tennis courts into a parking area for golf carts, a vote of the membership is required with 67% approval required for passage. The Board will be looking at alternative parking for golf carts and is taking the suggestions from owners under advisement. There are 125 designated parking places. According to the Association governing documents, owners are entitled to one undesignated parking space per unit. There are 25 remaining spaces. D. Building and Grounds Director Conklin reported it was a busy year. He noted that the Kaanapali Royal is in top notch shape. He recognized the grounds crew under the supervision of Mr. Graybill for its current condition. He updated the owners on Association projects and activities, including: 1) Resurfacing of tennis courts in-house, saving approximately $10,000; 2) The net to protect the pool area from golf balls on the fly remains in place; 3) Enhancements by gate
4 January 9, Page 4 area, including painting and installation of new plants propagated onsite; 4) New barbecues in pool area; and, 5) Installation of stairs by pool and E Building in-house. A plan in the absence of onsite management in an emergency situation was drafted by a panel of owners. Owners with questions about the plan should contact Director Conklin. The Board would like to develop an tree, so that the Board can contact the owners in an emergency/disaster situation. A form to provide owner contact information was available at the meeting. Director Conklin urged the owners to complete the form and return. Director Conklin answered questions the owners had about the ongoing replacement of the cast iron pipes with ABS plastic piping in-house. Owners planning major renovations should inform management. E. Rental Advisory With 47 apartments under vacation rental and nine units rented on a long-term basis, Director Beck reported a Rental Advisory Committee was recently established. She noted under the current economic conditions, 2009 was a tough year for units in the vacation rental market. The goal of the committee is to facilitate communication between all owners. Director Beck has reviewed the complaint log. The average is about one complaint per day, with most of the complaints noise related. She urged rental owners to include copies of the abridged House Rules in the information provided to guests, including quiet hours. A referral program was established with Expedia. When activities are booked through the program, the Association receives a 5% referral fee. F. Professional Services The President is the chair of the Professional Services Committee. The purpose of the committee is to provide an assessment of professional services. The services of a Wailuku attorney, Paul Horikawa, have been retained to provide general services for the Association. The Association insurance company has retained the services of an Oahu firm to represent the Association in matters involving the request for mediation. The President explained that the Kaanapali Royal Association is not a party to the Lanai Appeal. A hearing is set for March. Jim O Brien was recognized for his contributions in this regard. IX. APPOINTMENT OF TELLERS The President appointed two owners, Brian Mallard and Don Betterly, to serve as inspectors of election to monitor and certify the election process. X. ELECTION OF DIRECTORS The Association has been governed historically by a nine-member Board of Directors serving three-year terms. With the terms of Pam Harris, Gregg Sherwood and Matthew Kinney expiring, there are three vacancies on the Board for three-year terms. Director
5 January 9, Page 5 Harris is retiring from service. The President announced the slate of candidates, as follows: Vivian Hyman, Paul Lyndonsky, Matthew Kinney and Gregg Sherwood. The President called for nominations from the floor two times. Hearing none, the President declared nominations closed. The candidates present introduced themselves. Balloting procedures were explained. There was a short recess to cast and collect the votes at 10:30 a.m. Regular business resume at 10:50 a.m. XI. UNFINISHED BUSINESS With a number of owners expressing interest in the golf cart issue, the Managing Agent was instructed to add this item to the next Board Meeting agenda. At the last Annual Meeting, the Board agreed to research the potential of reducing the number of Directors serving on the Board to seven or five. The idea has been discussed by the Board; however, it is responsibility of the ownership to make a decision on this matter. The pros and cons of reducing the number serving on the Board were noted. The Bylaws were cited, with no less than three and no more than nine required to serve on the Board. This is a legal issue, and counsel will need to be consulted if the owners would like for the Board to proceed in this regard. XII. ANNUAL RESOLUTIONS Be it resolved by the Association of Apartment Owners, that any excess of membership income over membership expenses for the fiscal year ending November 30, 2010, shall be applied against the subsequent tax year members assessments as provided by Internal Revenue Service Ruling The Motion was made by Jim Graybill, and, with no objections voiced, the Resolution was adopted by unanimous voice consent. To authorize the Board of Directors to select the Auditor to perform the fiscal year end, November 30, 2010, audit, unannounced verification of cash and prepare the tax returns for the Association. Taylor/Basolo XIII. DIRECTOR RECOGNITION Pam Harris was recognized for her 20 years of service on the Board, with a gift certificate at Leilani s and a lei. She gave a farewell address. XIV. ELECTION RESULTS Election results were announced, as follows: Vivian Hyman, %; Paul Lyndonsky, %; Matthew Kinney, %; and Gregg Sherwood, %. Vivian Hyman,
6 January 9, Page 6 Paul Lyndonsky and Matthew Kinney were elected to serve on the Board for three-year terms. The President recognized Gregg Sherwood for his service on the Board. The President announced there will be a brief Organizational Meeting of the Board following adjournment of Annual Meeting Business. XVI. ADJOURNMENT To adjourn the meeting at 11:12 a.m. Kelly/K101 Respectfully submitted, Louise Rockett Transcriptionist
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