HIGHLANDS COOPERATIVE ASSOCIATION

Open Minutes

August 29, 2004

Board Members Present: Ellena, Jane, Smith, Smydra

Board Members Absent: Guyer

Management Present: Miller, Lyon

Meeting called to order at 5:12 p.m.

OPEN MINUTES

Smydra moved, Jane seconded to accept the June 27, 2004 Open Session Minutes. Approved 4-0.

MEMBER CONCERNS

Linda Masters, 6222 Balfour Drive: Ms. Masters reported that there were children playing football in her parking lot today, and that footballs were hitting cars. Mr. Smydra requested that Ms. Masters put this complaint in writing, noting the names/addresses of the children/parents, and submits it to the office. Ms. Masters agreed to do this.

COMMITTEE REPORTS

None at this time.

2004-2005 BUDGET

Smith moved, Ellena seconded to approve the 2004-2005 budget (representing a $5.00 per month carrying charge increase) contingent upon HUD’s approval. Approved 4-0.

FURNACE REPLACEMENTS

Due to a recent inspection of sixteen furnaces on Highlands’ property (fourteen of the sixteen inspected were found to have cracked heat exchangers), Management recommended all furnaces be replaced.

Mr. Lyon contacted Carol Alcox of HUD for approval to use reserve funds for this project. Ms. Alcox was in agreement that the furnace replacement is essential, and will allow the reserve funds for all six sections to fall below the required $1,000.00 per unit.

The Board and Management reviewed bids received from three heating companies, and Mr. Lyon’s letter to Ms. Alcox outlining the bids with his selection of Applegate Heating and Insulation to do the furnace replacement work.

Smydra moved, Jane seconded to approve using reserve funds for the furnace replacement project. Approved 4-0.

ARCO AIR—POTENTIAL LAWSUIT

There was discussion between the Board and Management regarding entering into a lawsuit with other area cooperatives against Arco Air. This company installed Highlands’ furnaces, which are currently in use in all units. The heat exchangers that are being found to be cracked are still under warranty, however, Arco Air informed Highlands that the part is no longer made. They offered to recast the die for the part, but could only promise to manufacture 15 per day.

Smith moved, Jane seconded to enter into a lawsuit with other area cooperatives against Arco Air. Approved 4-0.

MORTGAGE REFINANCING

Mr. Lyon updated the Board with further information regarding refinancing our mortgages.

He spoke about the differences between National Cooperative Bank and Arbor Commercial Mortgage and their refinancing options. He informed the Board that he plans to speak at length to both companies for about a week, to see which will best meet Highlands Cooperative refinancing needs.

Mr. Smydra stated that at the recent NAHC Conference, a Mortgage Payoff track instructor informed attendees that cooperatives would not be able to collect surcharge after mortgage payoff. Mr. Lyon will investigate this and report back to the Board at the next meeting.

Smydra moved, Ellena seconded to waive the by-law which requires three-day advance notice of a Board meeting, to sign the use agreement papers regarding refinancing. Approved 4-0.

NEW BUSINESS

Concrete: The Board and Management reviewed an estimate from H&C Earthworks and Construction, LLC for concrete repairs of $15,380.00. Smydra moved, Smith seconded to approve the funds for the repairs to be done by H&C Earthworks.

Speed Limit Signs: Ms. Jane reported receiving a request from a member that additional speed limit signs be installed on the property. There was discussion regarding where current signs are placed, the additional traffic/speeding of vehicles cutting through to Edgewood Blvd., and where additional signs could be installed. Ms. Miller will investigate what it will take to have more installed.

Sidewalk extension on Balfour in front of ballpark: Ms. Miller reported that a sidewalk would be constructed on Balfour Drive in front of the ballpark, most likely by Spring, 2005.

OLD BUSINESS

Property Trees: Mr. Smydra, Ms. Miller and Mr. Robert recently walked the property to observe where trees removed due to Emerald Ash Borer infestation would need to be replaced. Costs of various sizes/types of trees were discussed, as was estimates from two landscape companies. An update of tree replacement costs will be available at the next Board meeting.

BOARD MEETING DATES

September 26, 2004

MEETING ADJOURNED AT 5:44 p.m.

I certify that this is a true and accurate statement of the Board Meeting of August 29, 2004.

Respectfully Submitted,

Elizabeth A. Smith

Secretary

Highlands Cooperative Association Board of Directors