Leewood Homeowners Association

Annual Meeting

March 13, 2007

Minutes

Board Members Present:
Janet Rourke – President (serving on a temporary appointment)
Bob Chilakamarri – Vice President
Rose Weber - Secretary
Mohammad Umar – Treasurer
Melinda Ford – Member-at-Large (serving on a temporary appointment)

Convening: The meeting was called to order at 8:03pm. The meeting was held at the Immanuel Bible Church, 6911 Braddock Road, Room 412, Springfield, VA 22151. The meeting was electronically recorded by the Board Secretary for record purposes. Note: the meeting was preceded by a short period of socializing and light refreshments (7:30-8:00pm).

The 2007 Annual Meeting was attended by forty (40) “vote-eligible” homeowners. In addition, sixteen (16) proxies were received for a total of fifty-six (56) possible ballots cast. There were a total of fifty-three (53) residents in attendance (homeowners, spouses, partners, roommates etc.). Quorum was established. “Roberts Rules” were invoked and guidelines regarding same were distributed.

Officer Reports:
President: The President welcomed those in attendance and thanked those who have volunteered in various capacities throughout 2006. The President also thanked the volunteers who worked on the planning and execution of the annual meeting. The President briefly recapped what the Board accomplished in 2006, to include: negotiation of a new trash contract; the revitalization of parking enforcement & ticketing; the repaving and repair of lower Leestone Street and installation of new curbs to correct drainage issues and the repainting of the curbs to reflect reserved parking spaces. The President also outlined the Boards plans for 2007, to include lighting, drainage and mailbox projects and the intent to review and revise as necessary the Leewood Handbook and suggested the community organize a Spring Cleaning Day during April to pick up trash and other small debris around Leewood. On behalf of the entire Board, the President encouraged/welcomed residents to attend Board meetings when possible and expressed the hope that monthly meetings would be better attended in 2007. The President also brought to the meetings attention that zoning ordinances prohibit the renting out of basements that do not have a separate entrance/exit (walk-out) and indicated that important zoning information was in the annual meeting package; everyone was advised to read this information if they had not already done so.

Vice President: No report. Did give brief words of thanks and welcome to the residents.
Secretary: No report.
Treasurer: No report.
At-Large: No report.

Summaries from Committee Chairs:
Architectural Review Committee: Janet Rourke reminded residents that the ARC spring walk-through was just around the corner and encouraged everyone to do a self-inspection soon and correct what they could before the ARC committee did the walk-through and had to start issuing violation notices. She also thanked everyone for working with the ARC to correct problems in 2006 and therefore helped keep our community looking great. No other summaries were given by committee chairs.

Report on State of Finances: Leona Taylor, the volunteer Financial Secretary, gave the following financial report: Assessments are charged to each homeowner and are used to pay both regular operating expenses as well as contributions into the repair and replacement reserve. The repair and replacement reserve is used to maintain the common property of the association (curbs, roads, signs, gutters, etc.). Over time, the assessments collected have exceeded the amount used for operating expenses and the reserve contribution.

Under the federal tax rules, LHOA has elected to only pay tax on its investment income. An IRS ruling, Revenue Ruling 70-604, allows homeowner associations to rollover excess assessment income from one year to the following year. The IRS ruling holds that the assessment income that is rolled over is not taxable income to the association. A separate election (resolution) must be made by the owners/members to do this rollover. Our accountants have advised us that by adopting a resolution that permits this rollover we are then assured that we can choose the tax filing method that results in the lowest taxes. The board adopted a standing resolution in February, 1996 to make the assessment rollover possible. This resolution was ratified at our 1996 Annual Meeting. To be conservative, the membership has ratified the resolution each year.

When preparing the income tax returns for the last few years, our accountants have informed the board that the association has experienced excess assessments for several years, resulting in the deferral of these assessments. The deferral of assessments, however, is expected to be sporadic in nature, and not recurring. The accountants, therefore, have recommended that the board consider addressing the situation of the accumulated deferred assessments. As of December 31, 2005, the deferred assessments (excess assessments) totaled $68,075.

The accountants recommend a few alternatives, as follows: (1) the association can make an additional contribution to the repair and replacement fund; (2) the association may elect a different method for filing its income taxes that would result in paying more taxes than under the current method; (3) the association may return the accumulated deferred assessments to the members. This last approach is rarely done, due to the administrative overhead, lack of clarity as to who is eligible to receive such refunds, and the potential of leaving the association without necessary funds for unexpected expenditures. Another alternative is to use the excess assessments to fund new capital improvements for the community.

The board has chosen to use a portion of the excess assessments to fund the installation of common area lighting in the community for safety purposes. The 2007 budget calls for a one-time expenditure of $32,400 for the new lighting. Another $8,000 will be spent in 2007 on special projects related to drainage issues in the common areas.

These two extraordinary expenditures totaling $40,400 will create an overall deficit for 2007. In other words, 2007 expenses (operating expenses, the reserve contribution, and the lighting and drainage expenditures) will exceed the assessments to be collected for 2007. This deficit will, however, eliminate more than half of the deferred assessments and address the concern of the accountants that too much is being accumulated as deferred assessments. The board chose not to spend all of the deferred assessments, as this would have expended all of the associations accumulated operating funds.

Election of Board Members and vote on tax resolution and by-law changes: Prior to casting ballots, a discussion ensued regarding the By-law changes. The By-law change regarding the length of vehicles was explained. There was much concern expressed over the By-law change regarding PODS. It was felt by some that if PODS were allowed they would create safety hazards. It was also felt that there would be no real way to enforce how long PODS stayed in a parking space. There was concern that PODS would attract thieves. Those concerns were countered by those who felt PODS were really no different than moving vans and that they posed no more safety threat than a moving van or truck would. The same logic was expressed with regard to the concern of thieves and the length of time particular PODS would be present. A resident who works in the moving and storage industry stated that PODS were very popular and are now an accepted and widely used method of moving. Overall, it was felt that since PODS are now an accepted and common-use moving method that it will be better to have specific regulations on the books regarding their use so as to control that use within Leewood rather than have no recourse when they do appear from time to time as residents move in and out of Leewood. One resident proposed a deposit for the use of PODS which the Board will look into. After a short break for those in attendance to vote and cast ballots, the following results were announced:

Board elections: There were no nominations put forth or issues raised for vote from the floor. Janet Rourke was elected to the Board of Directors (50 “yes” votes/3 “no” votes/ 3 “abstain” votes); Melinda Ford was elected to the Board of Directors (47 “yes” votes/3 “no” votes/5 “abstain” votes); the tax resolution was passed (52 “yes” votes/3 “no” votes/1 “abstain” vote); the By-law change was passed (37 “yes” votes/16 “no” votes/3 “abstain” votes).

Upcoming Projects: The President gave a brief overview of the current status of the lighting, drainage and locking mailbox projects:
Lighting: Lights have been researched and a design has been chosen. The exact number and location of lights to be installed has not yet been finalized. Dominion Virginia Power will install & maintain the lights. The President still needs to meet with Dominion to work out details before any actual installation will begin.
Drainage: Al Sanford, the Grounds & Maintenance Committee chair has researched the drainage issues. He has talked to professionals to identify problem areas and rate them by cost to repair and severity of the problem. He has also discussed various methods of correction. The drainage project will need to be split into two phases, due to cost, with the phase two areas being done in 2008.
Locking mailboxes: This project is only in the earliest stages of being researched, but information will be provided as the project progresses. All efforts will be made to retain our colonial design and to incorporate our existing mailbox structures into the locking mailbox stands.

Open Forum: There was discussion of the three projects discussed above. Concern was expressed with regard to how these projects came to be approved. The Boards actions were questioned and explained. Points of each project were discussed. Some residents expressed support of and thanks to the board. Chris Taylor asked that the issue of a left turn lane into Leewood be resurrected. The Board agreed that this needs to be researched and will do so. Pam Stover asked that the Board look into the possibility of escalating the street repair cycle and the board agreed to address the issue and provide a response. Juan Laguna has concerns regarding the number of cars some residents have and how it affects parking; he felt that perhaps a car business was being run out of a Leewood residence and wanted to know what could be done about it. He was advised that if the business was licensed and the cars registered to/owned by a Leewood resident there was nothing we could do unless they were parked illegally, unregistered or inoperable.

Door prizes were drawn and four (4) winners received $100 among them in prizes.
The meeting was adjourned at 9:27pm.

Certified for the record:

___________________ _____________
Rose Weber, Secretary Date
LHOA