Attending: Board of Directors Carol Hassebrock, Greg Bistline, Wayne Holverstat, Jim Morehouse, Arlyn Plagerman, Deanne Wright, Anne Van Der Zahm

Membership: Attached List.

Carol Hassebrock made additions to the agenda. M: Gary Haveman, S: Peter Vanderzalm. Passed.

Minutes for the 2005 annual meeting read by Jim Morehouse. M: Gary Haveman, S: Nancy Stull. Passed.

Carol gave further detail on the 2005 minutes. She indicated that the paint warranty that was in question is upheld and the same paint may be applied and not jeopardize the warranty. Carol continued with a presentation by George Emmitt on carport installation was deferred at the time due to other issues that became pressing matters and will see if members have a possible interest at a later time.

Carol provided clarification on the assessment instituted in 2005. It officially began October 2005 and runs through the end of September 2010 at a total of $3,000 assessment for capital improvements to the buildings and grounds (assessed at $50 per month; 60 months total) and added that anyone who wishes to pay the balance of their assessment is welcome to do so rather than have it assessed monthly over the 60 month period. She also said the assessment will be suspended should the fund balance in the account totals or exceeds $100,000 during the 60 month period of time.

Arlyn provided a treasurers report reviewing the information sent to the constituents before the annual meeting. He noted the major difference in the balance of the projected an actual budget is primarily the insurance and building repairs account balances. He said the insurance is higher than previously budgeted.

Arlyn continued by reviewing the ongoing research of the embezzlement that has occurred against the association. He is conducting the research, with legal counsel’s advice, and an audit is being conducted to determine the final amount owed to the associations from Bookkeeping Solutions insurance agency that was embezzled. He noted that at this time the budget is unaudited because of the special forensic audit being conducted and auditors have advised not to do an annual audit until after the forensic audit is completed.

It was asked why a year ago there was not an audit presented at the annual meeting. Gary Haveman indicated that an audit was contracted to be completed, but unfulfilled due to Bookkeeping Solutions representative withholding information unknown by the board until after the embezzlement was uncovered.

Mark Sowers asked for further clarification on previous auditors report. Carol provided further explanation and discussion on auditor’s previous reports in prior years.

Arlyn further explained clarification on the embezzling done by the representative of Bookkeeping Solutions since January 2004, as best he can determine at this time. He added the forensic audit has gone back to the first day of employment by the embezzling representative of Bookkeeping Solutions, with the full cooperation of the owner of Bookkeeping Solutions. It was added that both Arlyn and Carol on two separate, individual occasions, reported that the owner feels bad about this and wants to not only have Bookkeeping Solutions insurance pay the embezzled amount, but Bookkeeping Solutions pay for any costs incurred by Mariners Cove Condo Association conducting the research on the embezzlement. He projected approximately $40,000 was lost in the embezzlement, but wont have a final determination for a couple of more weeks due to a couple of more items that the forensic audit needs to cover.

Carol described all the actions taken by the board in addition to following the advice and guidance from legal counsel. Those include closing the checking accounts and reopening new ones, no longer using rubber stamps to sign checks for the association and a computer generated budget rather than the hand generated budget previously provided by Bookkeeping Solutions. She noted that it should take three to six months before the embezzled funds are returned.

Arlyn continued by reviewing the Building Fund account and reported that it included the settlement funds from Exxel that are earmarked for the deck repairs of Phase III. It was noted that any balance remaining from that settlement then goes to help offset the Phase I final deck repairs.

Arlyn reviewed the Insurance Reserve Fund account. Arlyn clarified that the insurance covers everything on the outside and the tenants are to insure everything from the paint on inside.

Motion to pass treasurers report. John Neiboer/S Mark Sowers/P.

Carol then provided the President’s Report to the meeting. She reviewed the three board vacancies and announced the names of new candidates for the two-year terms as follows:
(Alphabetically)

Carol Hassebrock
Anne Vanderzalm
Deanne Wright
Kevin Yacoub

Discussion on candidates. Carol asked for everyone to vote, including proxies and hand in to be counted. It was agreed by the constituency that Ken Russell and Nancy Stull would count the secret ballots.

10 Minute break while ballots were counted.

Ken Russell announced that Anne Vanderzalm, Deanne Wright and Carol Hassebrock were elected to fill the three board vacancies for the two-year terms.

Carol then presented for discussion an inquiry on whether the $1,000,000 basic liability insurance coverage is enough in this day of litigation and presented to the annual meeting consideration for increasing that amount to something greater than $1 million. Discussion by constituents.

Carol asked for a vote to see if there is interest in increasing the liability limit. Motioned by Gary Haveman, S Loye Carrington; to consider increasing the insurance liability limit at the board’s discretion of up to $3 Million total (an additional $2 Million in coverage, if determined) of what that limit should be after conducting research of other condo associations, if the board feels it necessary. Passed 20-6.

Carol took an inquiry about considering new signage in the pool area to replace current signage. She indicated the board would follow up on that. There was discussion by the constituency on usage issues surrounding the pool area and who is entitled to use the pool. Carol referenced the CCRs. She noted that every rental agreement in the association should have standardized language regarding facility usage by the tenants who are renting.

Carol then opened the floor to new business discussion.

Harlen Langstrat reminded the owners to recycle better in each of the designated bins and that any good items that may be thrown away may also be considered for donation rather than trashing them, but noted not to bring those items into the clubhouse to rid of them. He also asked if people see an influx of bees, ants or birds to please inform him to eradicate.

John Nieboer inquired about the drainage issues associated with the back bluff behind the buildings. Carol said that the board is looking into that, and other associated development issues, through the ongoing community committees being held in the area that are addressing the area’s growth. She has asked board members to select community committees to help represent at these meetings and return with pertinent information and issues to board meetings for discussion.

Meeting adjourned 12:10 PM.