Community Contact | Fall 2021

Community

Fall 2021

CONTACT A Resource For Homeowners Associations, Condominiums, Townhomes, and Cooperatives

www.dfwcai.org

Professional Residential Security Services Armed & Unarmed Security Officers Mobile Patrol Services Remote Guarding Concierge & Lobby Ambassadors Gatehouse Operations Covenant Enforcement Package & Key Control Parking & Speed Enforcement Amenity Inspection Paramedic & First Responder Services

Is Your Community St. Moritz SAFE?

Let Us Show You The St. Moritz Difference!

DAVID BURGER SOUTHWEST REGIONAL VICE PRESIDENT

949.413.1472 dburger@smssi.com www.SMSSI.com CA: 16862, 6192,6355 // HI: 1006 // NV: 1453A // TX: B14072

SBB Management Company is dedicated to providing professional homeowners association management and consultation to Texas communities.

• Enduring Client Relationships • Unparalleled Staff Longevity • Industry Leading Technology • Continuing Education Programs • Senior Direct Support Personnel • Robust Accounting Analysis Tools • Mobile Management Platform • Digital Document Management • Family Corporate Culture

Accredited Association Management Company (AAMC)

45 Years of Association Leadership!

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12801 N. Central Expressway, Suite 1401 • Dallas, TX 75243 • Phone (972) 960-2800 • Fax (972) 991-6642 www.sbbmanagement.com • emailus@sbbmanagement.com

12801 N. Central Expy., Suite 1401

Access Your HOA - Anytime, Anywhere

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Community

CONTACT Fall 2021

Sponsors 6 Upcoming Community Events 12 Membership Report 51

Protecting North Texas Landscapes

10

FROM FROSTS AND FREEZES

Cybersecurity 16 HOW DO WE PROTECT OURSELVES

Winterizing and Emergency Preparedness

22

Executive Summary

29

GREATEST RISK TO ASSOCIATION MANAGERS

Expansive Soils

37

AND THEIR EFFECTS

To Budget or Not to Budget

40

HOA Construction Projects and Covid-19

45

Community Associations Institute is a national, non-profit, membership organization dedicated to the successful creation and operation of community associations. The Dallas/Fort Worth Chapter was established in 1980 to provide support for the North Texas area. Community Contact is published by the Dallas/Fort Worth Chapter of Community Associations Institute and is issued with the understanding that the publisher is not engaged in rendering financial, legal, accounting or other professional services, or be construed as a recommendation for any course of action regarding financial, legal, accounting or other professional services by Community Contact or its authors or advertisers. The services of a competent professional should be sought where professional services are required. The articles appearing in Community Contact do not necessarily reflect the opinion of CAI or the DFW Chapter, and acceptance of advertising does not constitute an endorsement of the products or services.

All contents of Community Contact are protected by copyright. Reproduction in whole or in part without written permission is expressly prohibited. AAMC, AMS, and PCAM are registered trademarks of Community Associations Institute. CMCA is a registered trademark of the Community Association Managers International Certification Board. Many of the designations used by manufacturers and sellers to distinguish their products are CONTACT | FALL 2021 claimed as trademarks. Use of a term in this publication should not be regarded as affecting the validity of any trademark or service mark.

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2021 BOARD OF DIRECTORS Clayton Hearn - President Roberts Markel Weinberg Butler Hailey PC chearn@rmwbhlaw.com Chris Broach, CMCA, AMS, PCAM - President-Elect Blue Hawk Management cbroach@bluehawkmgmt.net Anne Bernhardt - Secretary Park Towers Condominium Association anneb972@gmail.com Diana R. Larson, AMS, PCAM - Treasurer Assured Association Management, Inc. dlarson@assuredmanagement.com Olivia Hurtado, CMCA CIT olivia.hurtado@cit.com Mark Norton Insight Association Management Company mnorton@insightam.com Wendy Hazelwood Alliance Association Bank whazelwood@allianceassociationbank.com Joe Veach Globus Management Group jveach@globusmanage.com Kevin Cavanaugh - Immediate Past President Cavanaugh & Company, PLLC kcavanaugh@cavanaughcpas.com

MANAGEMENT James Nicholson, Chapter Executive Director DFW Community Associations Institute 14070 Proton Road, Suite 100 Dallas, TX 75244-3601 (972) 246-3540 www.dfwcai.org office@dfwcai.org

MESSAGE FROM THE PRESIDENT

Dear Chapter members: As 2021 starts to wind down, I am writing to reflect back on what many of you would agree was the second strangest year in the Chapter’s history (next to 2020).

Given the time and space constraints this forum presents, I won’t be able to fully express my gratitude for all of the dedication and engagement we had from our many volunteers, members and management team. The world, our nation and DFW have all learned to cope with the reality of COVID – 19 and I’m sitting down to write this a day after our most lively and well attended luncheon session in recent memory, the 2021 Legal Update. Many thanks go out to Marc Markel for his entertaining and thorough moderation of the program and the outstanding legal professionals who volunteered to go on the firing line of his questions – Bob Blend, Leah Burton, Kate Kilanowski and Chad Robinson. I believe I speak for the entire audience when I say that we all appreciate the opportunity to pick the brains (free of charge!!!), of these elite members of the local POA bar. Most of all, it was great to see such a robust attendance and to be able to see and interact with our friends and colleagues in the Chapter.

The Chapter went back to in-person luncheons in March, and our multi-talented workhorse of an executive director, James Nicholson, arranged to make the sessions available online for those of you who could not attend in person. If you missed one or a few, don’t miss the opportunity to access them through the Chapter website.

This year’s biennial legislative session was not one in which our elected representatives forgot about the POA industry. Several pieces of legislation were passed that pose challenges to our industry, and many of you are hard at work guiding the fine people who volunteer their time, skills and effort to their community as Board members on these new developments. Many thanks to all of you who spent countless hours reviewing proposed legislation, analyzing and succinctly reporting on the impact to our industry. Legislators hear negative stories from constituents and the media about POAs, and it takes engagement and volunteerism to educate the public and our legislature about the positive aspects POAs deliver to their membership and the community at large.

Some highlights and reflections on 2021 include successful and well-attended events such as the gala, the expo, golf tournament, bowling tournament and upcoming sporting clays event. A lot of work goes into all of these events and they could not be successful without the dedication and hard work throughout the year of the committees, volunteers, sponsors and attendees.

2021 is coming to an end and I would like to thank each and every one of you for your support and involvement in the Chapter. I am honored and humbled to have been given the opportunity to serve as your Chapter President this year and I’m looking forward to a great 2022, with Chris Broach as our new Chapter President. And last but certainly not least, on behalf of the Chapter I would like to thank our Executive Director, James Nicholson, for his contributions and hard work on behalf of CAI-DFW. Under James’ leadership the Chapter has grown to almost 750 members. Not too shabby given the challenging last couple of years we’ve faced.

Clayton Hearn 4 • CONTACT | FALL 2021

PRESIDENT

retail | office | mixed-use | multi-family | civic | education healthcare | lodging & hospitality

www.cleanscapes.net | info@cleanscapes.net CONTACT | FALL 2021 • 5

6 • CONTACT | FALL 2021

Diamond Sponsors Cardinal Strategies CCMC RTI/Community Management Associates, Inc. “CMA”, AAMC Texas Disaster Restoration Insight Association Management, AAMC Magnolia Fisheries & Lonestar Fountains McKenzie Rhody, LLP Neighborhood Management, Inc., AAMC Roberts Markel Weinberg Butler Hailey, PC Southern Botanical Staying-A-Float Lifeguarding (S.A.F. Guarding) Texas Security Bank Worth Ross Management Company, AAMC Platinum Sponsors ACME Roof Systems, Inc. Alliance Association Bank Blackmon Mooring/BMS CAT Brightview Landscape Services CIT Five Star Pools Globus Management Group Kerrane Storz, PC Kilowatt Partners Robert's Pool Service Scarbrough, Medlin & Associates SOLitude Lake Management Timothy, DeVolt & Company, P.C.

Gold Sponsors BB&T - Now Truist Davis-Dyer-Max, Inc. EmpireWorks Henry Oddo Austin & Fletcher, P.C. The Playwell Group Yellowstone Landscape Services Silver Sponsors Advanced Association Management Amtech Solutions Bob Owens Electric Co., Inc. Castle Group Classic Property Management, AAMC Excel Association Management, Inc. Landscape Professionals of Texas Riddle & Williams, PC Bronze Sponsors Allegra Print & Imaging Association Reserves - Texas Canady & Canady, LLC Cavanaugh & Company, PLLC Kraftsman Playground and Park Equipment Master Systems Courts RealManage Reserve Advisors, LLC SBSA, LLC, a Charles Taylor Company Education Sponsors Randolph Brooks Federal Credit Union

This “Deep In The Heart of Texas” logo recognizes our Business Partners who are apart of all four CAI Texas Chapters.

2021 DFW CAI COMMITTEES Ambassadors of Fun

Committee Chair: Montana Hantes

Community Affairs

Committee Chair: Wendy Hazelwood, CMCA

Expo

High Rise Managers Forum

Committee Co-Chairs: Kathy Epperson, PCAM and Matt Kopchak, PCAM

Magazine

Committee Chair: Chris Broach, CMCA, AMS, PCAM

Committee Co-Chairs: Betty Clarady and Robin Anderson

Membership

Gala Committee

Programming

Golf Tournament

Sporting Clays Committee

Chair: Mark Norton, AMS, PCAM

Committee Chair: Jeff Higgins

Committee Chair: Cindy Martin, CMCA, AMS, PCAM

Committee Chair: Ruth McLaughlin, CMCA, AMS

Co-Chairs: Wendy Hazelwood, CMCA & Alicia Speer

CONTACT | FALL 2021 • 7

8 • CONTACT | FALL 2021

CONTACT | FALL 2021 • 9

Protecting North Texas Landscapes FROM FROSTS AND FREEZES Steven Milks, Account Manager - BrightView Landscape Services

With cold season fast approaching, it is a good idea to start thinking about how to protect your landscape over the winter season and ensure its success for next spring.

STEVEN’S TIPS FOR SUCCESS:

Know Your Plants • • •

Basic knowledge (variety, age, location in the landscape) will help guide your actions Consult with your local nursery professional with questions Several free apps are available which work with the camera on your phone. Snap a pic of the plant in question and the app will provide a lot of valuable information

Covering Your Plants • • • • • • •

Certain evergreen varieties including hawthorn, holly and boxwood are vulnerable to freezing temperatures and frost Knowing the variety and age of the plant will help you know if they need to be covered Older, established plants will typically handle a freeze better than newly planted material Frost cloth can be purchased at your local nursery or you can use an old sheet or blanket Cover the plant completely, all the way to the ground Stake or tie down the cover to avoid it blowing away Remove the coverings as soon as temps rise above freezing. Remember your plants still need sun to maintain health

The Benefits of Mulch • • •

•

Mulch isn’t just for aesthetics; it protects your plant material Mulch protects against frost on the root system and retains moisture Moist soil stays warmer than soil that dries out. You won’t be running your irrigation in freezing temperatures, so the mulch will help retain the moisture in the soil Remove old mulch every several seasons, and re-mulch with a high-quality hardwood blend

Potted Plant Care • • • •

Cover the entire plant and the container The roots of containerized plants are especially vulnerable Keep the soil moist and water as the soil dries out Purchase a soil probe at your garden center so that you can check the moisture level at the roots and not just the topsoil

Tropical Plant Considerations • • •

Tropicals including Rubber Trees, Bird of Paradise and Hibiscus are especially sensitive Covering plants may not be sufficient; brining them in the house or garage may be necessary If bringing inside is not an option, cover the plant and pot and move them close the house for extra protection from the wind

ADDITIONAL RESOURCES

• Texas A&M AgriLife Extension: https://agrilifeextension.tamu.edu/ • AgriLife article concerning freeze protection: https://agrilifeextension.tamu.edu/library/landscaping/protecting-landscapes-and-horticultural-crops-from-frosts-and-feezes/

10 • CONTACT | FALL 2021

11 • CONTACT | SUMMER 2021

CONTACT | FALL 2021 • 11

UPCOMING HOLIDAY COMMUNITY EVENTS Nov. 9 – Dec. 31

Holiday at the Arboretum, Dallas, TX

Dallas Arboretum - Admission

Nov. 18 – Jan. 2

Six Flags Over Texas– Holiday In the Park, Arlington, TX – Holiday in the Park 2021

Nov. 25

Dallas YMCA Turkey Trot - Turkey Trot | YMCA of Metropolitan Dallas

ymcadallas.org

Nov. 26 – Jan. 2

Enchant Christmas, Dallas, TX

www.visitdallas.com

Nov. 26-28th

McKinney – Home for the Holidays

www..mckinneytexas.org

Nov – Dec

Vitruvian Park Events – Vitruvian Lights, Addison, TX - Vitruvian Park Events udr.com

Nov – Dec

Gaylord Texan’s Lone Star Christmas, Grapevine, TX - Christmas at Gaylord Texan

A Holiday Season Tradition in Grapevine

marriott.com

Dec 2.

Parade of Lights, Grapevine, TX - Christmas Lights Events

grapevinetexasusa.com

Dec. 4th

Dallas Holliday Parade

www.dallasholidayparade.com

Dec. 4 – 18

Santa’s Village, Richardson, Tx - Richardson, TX | City of Richardson Home cor.net

Dec. 10th-12th

BMW Dallas Marathon Festival

Dec. 11 - 12

KwanzaaFest, Dallas – John Wiley Price - Our Man Downtown

www.rundallas.com

2415 Avenue J, Suite 100 | Arlington, TX 76006-6119 P: 817.640.2064 x 1217 | F: 817.640.6028 www.classicpm.com

12 • CONTACT | FALL 2021

Personal Attention.

Proven Results for HOAs. For over two decades, Henry, Oddo, Austin & Fletcher, P.C. has provided clients throughout Texas with trusted counsel. Their experience related to homeowners associations is unmatched – providing guidance, leadership and oversight to community associations. Their attorneys have experience resolving disputes and advising homeowners associations on legal issues.

C

M

Y

CM

MY

CY

CMY

Assist developers with drafting governing documents Advise boards on governance and collection issues Assist boards in enforcing bylaws and covenants Attend association meetings to provide explanations of the association’s rights and responsibilities, to help maintain rules of order, and to address issues of concern to members and directors Assist boards in interpreting governing documents

Draft revisions to association governing documents to clarify issues of governance Work with boards and management companies in dealing with property owners Cost effective and creative debt collection methods leading to revenue recovery Active participation and support of Texas Community Association Advocates (TCAA) and Community Associations Institute (CAI)

K

Judd A. Austin, Jr. - Shareholder jaamex@hoaf.com

Vinay B. Patel - Shareholder vpatel@hoaf.com

1700 Pacific Avenue, Suite 2700, Dallas, Texas 75201 | (214) 658-1900 | www.hoaf.com

CONTACT | FALL 2021 • 13

Loot 4 Boots |

SUPPORTING HOMELESS VETERANS

On September 29th, we had a great turn out to fill care packages for homeless veterans in Dallas. From the generous support of our members, we collected various hygiene items to create 300 care packages to be given to homeless veterans in the DFW Metroplex, Homeless Veterans Services of Dallas, Inc. Homeless Veterans Services of Dallas, Inc. (HVSD) is a non-profit 501(c)(3) organization dedicated to improving the lives of homeless and at-risk veterans and their families. HSVD is to provide assistance in the area of housing and self-sufficiency by way of donations, fund raising and grant efforts for homeless or at-risk veterans and their families.

We wanted to say, “Thank You” to everyone who donated or filled care packages for this great cause and event!

NOVEMBER FOOD DRIVE & LUNCHEON “Thank You” to everyone who donated and attended our November Luncheon & Food Drive.

14 • CONTACT | FALL 2021

CONTACT | FALL 2021 • 15

CYBERSECURITY

HOW DO WE PROTECT OURSELVES? Alliance Association Bank In 2019, the FBI’s Internet Crime Complaint Center recorded 23,775 complaints about business email compromise (BEC), which resulted in more than $1.7 billion in losses. In the wake of COVID-19, fraudulent cybercrimes and email schemes are on the rise.

It’s vital to learn about the different ways cybercriminals attempt to infiltrate your organization. This knowledge can help your organization to proactively spot different types of cybercrimes and ultimately guard your confidential information against cybercriminals.

DON’T GET HOOKED – AVOID PHISHING EMAILS Phishing is a type of cybercrime that uses emails disguised as coming from a person or organization you trust, in order to lure you into clicking a fraudulent link or providing access to sensitive information. It is so important that you stay vigilant and keep an eye out for these red flags: • • • • • • •

The email includes a request for your username and password, either by replying directly to the email or by clicking on the link that takes you to a site where you’re asked to input your information. DON’T DO IT! NO ONE IN YOUR ORGANIZATION SHOULD EVER ASK YOU FOR YOUR PASSWORD. The email appears to be sent to you by HR or IT, but something doesn’t quite look right.

There are grammatical errors in the email or subject line.

You do not know the sender and the email has an unexpected attachment.

The email contains email addresses that don’t match between the header and the body, may be misspelled (like @gmaill.com), or have unusual formats (@company-othersite.com) The email includes links or email addresses that, when you hover over them, list a different destination than described.

They try to create a sense of urgency in order to get you to respond.

16 • CONTACT | FALL 2021

Here is an example of a phishing email:

THE KEY TO WIRE FRAUD PREVENTION: OUT-OF-BAND AUTHENTICATION Out-of-band authentication is a process where authentication of an account requires two signals from two different channels. Out-of-band authentication makes hacking an account much harder for attackers because they would have to compromise two separate and unconnected authentication channels, rather than one.

If you suspect that an email is a phishing email, DO NOT open any links or attachments in the email. Delete it, or notify your IT or information Security department immediately.

PASSWORDS – STAYING SECURE IN A DIGITAL AGE These days we are overloaded with online accounts that require credentials and memorizing them is impossible. While it may be tempting to reuse the same password across different accounts, this is not a safe solution. Compromised passwords are a leading cause of data breaches, and reusing passwords can increase the damage in what would otherwise have been a relatively small incident. Cybercriminals know that people reuse login credentials and often test compromised passwords on commonly used sites in order to expand the number of accounts they can access. So before you reuse a password, consider all of the data that could be at risk both personally and professioally. Here are some tips to help keep your information safe: • • • • • • •

Use separate passwords for work and personal accounts.

Any words that can be easily guessed by attackers like “password” or “september2017” or predictable keyboard combinations like “1234567”, “qwerty” or “1q2w3e4r5t”.

Longer is stronger. Use passphrases rather than passwords.

Passphrases could include several random words like “Highway owl purple elephant” or could be from a favorite song lyric or book.

Add complexity with capitalization or special characters.

“Fido!sanAnAwesomeDog” is a stronger password than your pet’s name.

Adding numbers or special characters at the end of a word does little to increase security, because they’re easy for software to guess.

Avoid words like your kids’ names that could be revealed by a few minutes of online research.

Answers to security questions are often easily found – your

mother’s maiden name is public record – so pick another word to use whenever that question comes up.

For instance, if you get an email from a vendor, you should call them using the number you previously had on file and confirm that they sent the email. This is especially true if they are giving you new account information, for example, asking you to send money to a different account than one you’ve used in the past. Similarly, if you get an email from a co-worker that asks you to send money to a new vendor or changes to the account information for an existing vendor, confirm it is real. Walk over to their workplace or call them on their extension to confirm. It’s better to ask questions first than to authorize the payment and regret it. Three common scenarios are listed below: Scenario 1 – Your system has been breached and someone’s email account has been hacked. In this scenario, a hacker has gained access to your systems in order to hijack your email accounts. This means that they have an employee’s login credentials and can communicate with you without the employee knowing. The hacker can also make it appear as if an actual employee is sending an email with instructions on how to distribute funds. Oftentimes, the attackers will monitor your communications, and use the information they gather to send a more convincing email.

Scenario 2 – The vendor’s system has been hacked. In this scenario, one of your vendors has been hacked and the attacker sends you an email from the vendor’s account asking for you to make a payment. As in the first scenario, the email will be from a legitimate account of someone you have communicated with in the past. The attacker will also likely monitor communications and jump in after legitimate emails have been sent back and forth, so that it looks like a continuation of a real conversation with the vendor.

Scenario 3 – Vendor’s email is spoofed. This scenario is different from the first two because no one has actually been “hacked”. Instead, the attacker makes it appear as if they are one of your vendors. These attackers are smart, so the email will look similar to a real email from your vendor. They may copy the logo and the email address will likely be off by only one or two characters. An example is CEO@company_ xyz.com vs. CEO@company-xyz.com Anyone who is tasked with purchasing supplies or making payments to vendors could be at risk of receiving falsified payment instructions.

These fraudsters are smart; it is important to stay vigilant and cautious to avoid sending money to someone who is attempting to trick you in order to receive funds through fraudulent methods.

We hope you have learned a few tips on preventing cybercriminals from stealing your personal and business information. This information was excerpted from Alliance Association Bank’s promotional collateral. Alliance Association Bank is a division of Western Alliance Bank. Member FDIC. For more information about Alliance Association Bank or to receive these cybersecurity resources electronically to share with your organization, please contact Wendy Hazelwood, CMCA, Vice President of Alliance Association Bank at whazelwood@allianceassociationbank.com. Wendy represents the N. TX, AR, OK, MO, KS, NE regions and is an active member of the DFW and Heartland Chapters, of the Community Associations Institute (CAI).

CONTACT | FALL 2021 • 17

Committed to communities For more than 35 years, we have provided solutions specifically designed to meet the needs of property management companies and community associations. You can count on us to be your trusted partner. BBT.com/AssociationServices. n n

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Alan Alanis, VP / Relationship Manager 512-482-0103 | AAlanis@BBandT.com BB&T now Truist. Truist Bank, Member FDIC. Loans and lines of credit are subject to credit approval. ©2021 Truist Financial Corporation. All rights reserved.

18 • CONTACT | FALL 2021

Home

Your Association Should Feel Like For the Holidays Worth Ross Management Company does so much more than simply manage your day-to-day operations. Alongside services such as financial management, developer services, and training, WRMC ensures your community truly feels like a home.

Our Secret?

Unique services catered to your association’s needs paired with the best and brightest minds in the industry.

The result: impeccable service that is always above expectations, especially when it matters most.

Contact us today to see how WRMC can help your community feel more like a home.

Phone

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Email

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Website

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Address

4144 N. Central Expy, Ste 580 Dallas, TX 75204 CONTACT | FALL 2021 • 19

FREEZE on Winter Holiday Fires

Put a

It’s fun to decorate for the winter holidays, but holiday decorations can increase your risk for a home fire. As you deck the halls this season, be fire smart.

Half of the home decoration

fires in December are started by candles.

More than 1/3 of home decoration fires are started by candles.

Christmas is the peak day for candle fires.

A dry Christmas tree can burn very hot and very fast.

Keep candles at least

tree fires were caused by a heat source too close to the tree.

12 inches away from anything that burns.

Read manufacturer’s instructions for the number of light strands to connect.

More than 1 in every 5 Christmas

Make sure your tree is at least 3 feet away from heat sources like fireplaces, radiators, space heaters, candles or heat vents. Also, make sure your tree does not block exits.

Get rid of your tree after Christmas or when it is dry.

For more information on how to prevent winter f ires, visit us fa.fema.gov/prevention / outreach / holiday.html and nfpa.org/winter.

Winter Holiday Fire Safety Did you know?

Nearly half of holiday decoration fires happen because decorations are placed too close to a heat source.

It’s fun to decorate for the winter holidays, but holiday decorations can increase your risk for a home fire. As you deck the halls this season, be fire smart. o Inspect holiday lights each year before you put them up. Throw away light strands with frayed or pinched wires. o Water your Christmas tree every day. A dry tree is dangerous because it can catch on fire easily. o Consider using battery-operated flameless candles, which can look, smell and feel like real candles. o If you do use lit candles, make sure they are in stable holders and place them where they cannot be knocked down easily.

For more information and free fire-safety resources, visit

www.usfa.fema.gov.

Click here to add image.

CONTACT | FALL 2021 • 21

WINTERIZING

AND EMERGENCY

PREPAREDNESS

Tracy Wolin, CMCA, AMS, PCAM

Preparing our property, buildings, and residents for emergencies is always on our minds, it’s a component of risk-management, but we sometimes neglect emergency planning for our families and ourselves. Below are some examples of helpful emergency preparedness tips for hazards such as fire, severe thunderstorms, tornadoes, snow, ice, extreme heat and flooding.

EMERGENCY SUPPLY KIT An emergency supply kit should include items for a variety of emergency scenarios and placed in an easy access location to “grab and go.” The kit should include items that might be needed for three to fourteen days. Remember, everyone must be prepared and not rely on Emergency Services for assistance. Emergency Services may be unable to reach you. Some items to consider for an Emergency Supply Kit include: • • • • • • • • • • • • • •

Water, one gallon per person per day for drinking and sanitation.

Supply of nonperishable foods and can opener.

Battery-powered or hand-cranked radio, a NOAA Weather Radio with tone alert and extra batteries.

Flashlights and extra batteries.

A first aid kit and whistle to signal for help.

Dust mask to help filter contaminated air.

Extra pair of eye glasses.

Moist towelettes, garbage bags and plastic ties for personal sanitation.

Cellphone with chargers or solar charger.

Cash in small denominations in the event ATMs are not available due to power outages or stores may be unable to make change.

Copy of important documents such as passports, immunization records and Social Security cards.

Critical items for family members, such as pet supplies, medications, blankets, and baby items.

Live in a two- story home? A rope ladder may be needed to egress outside.

Fire Extinguishers, especially having a unit in the kitchen.

22 • CONTACT | FALL SUMMER 20212021

RULES OF THUMB REMINDERS:

TORNADOS

•

Tornados are nature’s most violent storm and can occur in many sizes. They can be up to one mile wide and travel for long distances.

A tornado watch means that the formation of one is possible. A tornado warning means that one has been seen by storm spotters or detected by radar, and residents should seek shelter immediately.

Winter Weather Freezing rain, snow and ice, even though they can be fun to play in, can cause car accidents and hypothermia. Power lines can be knocked down for an extended period of time as well.

We all got firsthand experience earlier this year in February, but it is a lesson that we must never forget.

•

Never let your gas tank run empty past ¼ tank. If the power goes out, gas pumps will not work.

Check the tire pressure on your vehicles monthly and don’t forget the spare tire every few months.

Prepare an emergency plan ahead of time before an emergency occurs. The plan should include household member information, doctors and medical information, places where household members often spend the majority of their time, information on household pets, designated place where household members will meet and emergency numbers. For help making your plan, visit https:// knowhat2do.com/.

TOP TIPS FOR FIRE SAFETY Install smoke/carbon monoxide (if you have gas) alarms on every level of your home, inside bedrooms and outside sleeping areas such as hallways. Test alarms every month and change batteries if the smoke/carbon monoxide alarms are not working.

Remember to GET OUT, STAY OUT and CALL 9-1-1. Yell “Fire!” several times and go outside right away if you are not alone.

If you live in a building with elevators, use the stairs. Leave all your things where they are and save yourself. If closed doors or handles are warm or smoke blocks your primary escape route, use your second way out. Never open doors that are warm to the touch. Always remember to use the back of your hand on a door to test for heat.

Never use your palm. It is reflex to grab a hold of a hot door knob.

If you must escape through smoke, get low and go under the smoke to your exit. Close doors behind you. If smoke, heat or flames block your exit routes, stay in the room with doors closed. Place a wet towel under the door and call the fire department or 9-1-1. Open a window and wave a brightly colored cloth or flashlight to signal for help. Once you are outside, go to your meeting place and then send one person to call the fire department. If you cannot get to your meeting place, follow your family emergency communication plan.

If your clothes catch on fire: • Stop what you’re doing.

• Drop to the ground and cover your face if you can.

• Roll over and over or back and forth until the flames go out.

Running will only make the fire burn faster.

• Then Once the flames are out, cool the burned skin with water for three to five minutes. Call for medical attention.

• Flooding can happen anywhere. Just 6 inches of fast-moving water holds enough force to knock over an adult, and 2 feet will carry away most vehicles. It is not always easy to see a flooded area while driving especially in the night.

• Flood Watch: A possibility of flooding.

• Flood Warning: Flooding is occurring or will soon.

• Flash Flood Warning: Flash flooding is occurring or will soon occur.

WINTER WEATHER SAFETY TIPS INCLUDE: • • • • • •

Ensure heating source is working properly and is well ventilated.

Winterize household pipes and keep faucets dripping when the temperature falls below freezing.

Winterize vehicles and prepare emergency kit to keep in vehicle (blanket, warm clothing, water, flashlight etc.).

Wear several layers of lightweight warm clothing instead of one heavy layer.

Ensure outer garments are water-repellent.

Ensure pets have plenty of food, water and shelter.

Outdoor Warning Sirens: Check your city to see if there are outdoor warning sirens. For instance, The City of Carrollton has 26 Outdoor Warning Sirens to alert citizens of severe weather, hazardous material releases, and national security events. The City of Dallas has 168 sirens. Fort Worth has 153 sirens. While these sirens are not meant to be heard indoors, it is designated to alert anyone outside to go inside.

Most smart phones also have a warning feature for weather, public safety, and AMBER alerts.

Visit https://lacounty.gov/emergency/earthquake-preparedness/ just to familiarize yourself with tips to stay safe in an earthquake no matter if you are driving, in a high-rise such as a hotel, stadium, or at the beach.

One thing I can tell you with first-hand knowledge is during an earthquake, cell phone calls do not work, but usually texting does work. This might be true in other emergency situations too.

Lastly, Tips on Winterizing Your Building and Home Fall is a really good time to start thinking about maintenance for your property and building as you prepare for the winter season.

Winter is particularly tough on buildings suffering from water intrusion because the trapped water expands if it freezes, causing bricks and masonry to crack, spall, and/or loosen.

See Basic Checklist on Next Page

CONTACT CONTACT | SUMMER | FALL 2021 • 23

Below is a basic checklist of some building components to consider when preparing for the winter season: Caulking: is the first line of defense in keeping water out of buildings. Check caulking at all junctures and install or replace where it’s deteriorated or missing. Key locations are joints between coping stones on top of parapet walls, around through-wall window air conditioner sleeves, and around windows and doors.

Boilers: The boiler flue tubes, over which hot water or steam passes, should be checked to make sure they are not leaking or clogged. A basic check of the insulation around the boiler piping should also be conducted. Most boilers require some type of chemical treatment to inhibit rust and corrosion. Check the boiler flue to make sure it is clean and not blocked.

Roof: The roof receives the bulk of exposure to the elements.

Potential problem areas are all penetrations through the roof, such as stack vent pipes, ladders, and drains; open seams on the roofing membranes; blistering or cracking; ponding; base flashing that has slipped or peeled away from parapet or bulkhead walls; deteriorated counterflashing; and broken glass, nails, screws, or other debris that could puncture the roofing membrane

Cooling towers: Buildings with central chillers, heat pumps, or fan coil units typically use cooling towers to reduce the temperature of the condenser water circulating through the system. Some properties shut down their cooling systems in October depending on the weather. Supply valves are closed off and drain valves opened to remove any leftover water in pipes to prevent freezing. Some heating and cooling systems operate year round. For those systems, the water in the cooling tower must be kept from freezing such as adding antifreeze to the water.

Drains: Check for clogs, and debris built up around the drains and clean as necessary. For roof decks with pavers, the pavers around the drains may need to be removed to see that there are no leaves, paper, sand, or other items blocking them. Gutters, leaders, and scuppers should also be checked to make sure they are not loose and are cleared of leaves and other debris so water can drain properly.

Outdoor piping: Cold water pipes running to and from a water tank or cooling tower are often heated using an electric coil, wrapped around the pipe to keep the water inside from freezing and the pipe from bursting. A layer of insulation is wrapped around the heat tracing, which is plugged into a GFCI. A routine check should include making sure the heat tracing is plugged in and none of it is exposed because of insulation that is worn away or missing.

Facade: A visual exterior inspection should be conducted using binoculars or drones to check for loose, spalling, or missing bricks, stones, mortar, masonry, terra cotta elements, cornices, windowsills, balconies, railings, etc.

Gutters: Once the leaves are pretty much off the trees, it’s time to clean those gutters. When your gutters back up, they overflow, and when they overflow, that water runs down the building, speeding up the deterioration of the exterior.

Windows: If a draft is felt around the windows or the panes are cold to the touch, the windows may be failing. As a stopgap measure consider installing removable foam insulation around the window frames.

Cover your patio furniture. Get your patio furniture protected, but make sure you wait until a clear, warm day to cover it so you don’t trap moisture.

Exterior faucets/sprinklers: Some balconies and roof decks have hose bibs. When the temperature drops, the inside valve for the plumbing line should be shut off, any remaining water drained, and the faucet covered to prevent water from freezing inside, which could cause the pipe to burst and crack the surrounding brick and mortar. Same can be said for landscape hose bibs and sprinkler systems.

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Preparing your landscaping and pool for cold weather are other featured articles in this edition of the Magazine.

CONTACT | FALL 2021 • 25

McKenzie Rhody has represented thousands of homeowners and homeowners associations affected by defects in their townhomes,

Member of the Community Association Institute

condominiums, lofts, high-rises and single-family homes.

– Balconies – Patios – Expansive Soils – Roof Defects – Structural Defects – Foundation Defects – Water Intrusion – All Other Construction Defect Claims

If you believe construction defects exist at your project, call (800) 996-1770 for a FREE initial investigation or visit us at mrcdlaw.com for more information.

Serving the Dallas Metroplex and all of Texas | (469) 587-6800 | www.mrcdlaw.com 26 • CONTACT | FALL 2021

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CONTACT | FALL 2021 • 27

October Members Luncheon “Community Management is a Marathon”

Speaker – Matt Jones “Eight Continent Marathon Man” At the October luncheon we had the pleasure of having Matt Jones speak about his inspiring life experiences overcoming cancer three times, a bone marrow transplant, relearning how to walk and then completing a marathon on every continent, all eight. Also, he shared the most current groundbreaking research in the science of success and leadership from his book “Happiness is a Marathon, 26.2 Ways to be Happier at Work and in Life”.

For more information about Matt please visit his website at www.MatthewDJones.com.

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EXECUTIVE SUMMARY

Greatest Risk to Association Managers From the desk of Rod Medlin, AAI

I often read and follow trends and legal issues arising in property claims relating to property managers. I do this for obvious reasons, as my agency insures over 1,000 HOAs and well over 150 associations. So it is important to us and our client management companies. Recently I asked myself “What is the most catastrophic claim that can happen to both a management company and the association they serve?

My conclusion is based on my experience and knowledge gained in 40 years in this business. The answer is underinsurance due to an inadequate property valuation, typically resulting from a defective decision-making process when selecting the insurable value. Swiss Re, who provides high limits for insurance agents E&O, agrees on this subject.

I have found that there is often a big misconception shared by both property managers and board members, which can and has led to litigation adverse to both parties, and sometimes their insurance agent. That misconception is that “the insurance agent is responsible for picking the total insurable value adequate for replacement cost.” Specifically, legally, who picks the property value for a Community Association? So I put this question to Leland de la Garza, a shareholder at Hallett & Perrin, P.C., who has served as our Corporate Counsel and has served as our exclusive litigator since 1999. I asked Leland to prepare a brief on this important issue, which is attached.

I encourage you to read his brief and do a self-evaluation of your own decision-making process. How did you do? This issue deserves some attention before it rears its ugly head. Leland’s brief gives some good suggestions on how to mitigate the risk of facing a claim because of an inadequate insured value. Agents, managers, and board members would be well served by not learning the hard way.

If we were discussing my home insurance, the analysis would be simple. I choose the insurable value of my house. If it is too low, so as to be inadequate for replacement, then I pay the cost of my mistake. When discussing a community association’s property insurance, that decision must, necessarily, be made by the board of directors, and may be guided by a property manager. And, it must be evaluated regularly because property values and replacement costs rarely remain the same. The failure to properly evaluate and determine the insurable value must fall on the ones charged with managing the association’s property, the board of directors, and the property manager if that responsibility has been shared.

At Scarbrough, Medlin and Associates, Inc., my Association Team of 8 Producers and Account Managers can assist any managers and boards with securing the property insurance they need.

Insurance Agents Are Not Responsible Under Texas Law for Procuring “Adequate” Property Insurance A frequent source of disputes and litigation when dealing with property insurance is inadequate insurance coverage. While property owners usually want the most insurance possible at the lowest cost, owners or property managers often decide to use a lower property value to reduce their premium cost. And, many times owners simply do not pay enough attention to the values used each year in insurance applications when buying insurance, only to realize after a loss that values that were adequate in the past are no longer adequate. Whether due to cost-cutting or inattention, when a loss occurs the owner or property manager usually casts the insurance agent as the villain, while claiming victim status. Under established Texas law, an insurance agent is generally not responsible when insured property is under-insured.

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Texas Law Texas courts generally recognize that an insurance agent owes only two common law duties to an insurance customer: (1) to use reasonable diligence in attempting to place the requested insurance; and (2) to inform the customer promptly if unable to do so. See May v. United Servs. Ass’n of Am., 844 S.W.2d 666, 669 (Tex. 1992). Texas courts have consistently rejected attempts to expand the agent’s duty to procuring the right kind or amount of insurance, absent an agreement or a prior course of dealing in which the customer relied on the agent to select the insurance for the customer without consulting him.

225, (Tex.App.—Tyler 2004, pet. denied). In McCall, the customer operated a used car lot. After he opened a new location, he told his insurance agent about the new location, but did not ask for coverage on the new location. After a fire loss at the new location, the customer sued the agent claiming that since the agent had been told about the new location, the agent owed a duty to insure that location as well. The Texas Supreme Court rejected the argument because it found that the agent owed no duty to insure the new location because the agent was not asked to insure the new location. The Court’s analysis was similar to the analysis later used in May.

Bryce v. Unitrin Preferred Ins. Co., 2010 WL 1253579 (Tex. App.—Austin 2010, not pet.) illustrates Texas courts’ reluctance to make insurance agents responsible for selecting the right insurance or the right amount of insurance. In Bryce, an insurance agent sold the Bryces a replacement cost property insurance policy insuring their home for $474,000 and its contents for $284,400. After a fire loss, the Bryces learned that the actual replacement cost of the home was $1.7 million and the contents was $864,000. The Bryces sued Unitrin, the insurer, and their insurance agent claiming that the insurer and the agent negligently set inadequate policy limits and failed to disclose that their coverage would not cover the full replacement cost of the home and its contents. At trial, there was conflicting testimony about discussions between the Bryces and the agent’s customer service representative about the replacement cost value of the home. A jury found that the Bryces were negligent in not setting the proper amount of replacement cost value and that the insurer and the agent were not negligent and did not commit unfair or deceptive acts in violation of the insurance code.

Texas courts have also rejected attempts to make the insurance agent responsible for selecting a “reputable” company to provide insurance. See, e.g., Harding v. Higginbotham Insurance Agency, Inc., 2017 WL 11510643 (N.D. Tex. 2017).

The Austin Court of Appeals held that May did not impose a duty on an agent or an insurer to monitor an insured’s policy to ensure that the requested coverage is adequate. “We find no support for this proposition in May or any other Texas case.”

The Court expressly recognized that insureds might choose to insure their home for less than full replacement cost in order to reduce insurance premiums. The court found that the agent was not liable because it procured the coverage requested. The court noted that because the agent procured the amount of insurance listed in the application, it was not negligent.

Ruch v. Ted W. Allen & Associates, Inc., 2017 WL 4682031 (Tex. App.—Houston [1st Dist.] 2017, pet. denied) is also instructive.

In Ruch, the insurance agent was sued for not procuring adequate insurance. Relying on May, the court of appeals held that “[a]ny obligation of the insured to obtain a certain amount of insurance does not extend to the insurance agent.”

An insurance agent in Texas has no legal duty to secure additional insurance protection merely because he knows the customer needs additional insurance coverage. McCall v. Marshall, 398 S.W.2d 106, 108 (Tex. 1965); Critchfield v. Smith, 151 S.W.3d 30 • CONTACT | FALL 2021

Although Texas law appears clear on what duties are generally owed by an insurance agent, it is possible to expand those duties by agreement, a course of dealing, or by engaging in acts that constitute unfair or deceptive acts that violate the Texas Insurance Code. And, of course, false statements are actionable as fraud or a negligent misrepresentation. Each of these legal theories is fact intensive and the outcome depends on the particulars of the case.

POA Board’s and Property Manager’s Duties When a property is operated by a property owners’ association, there are normally multiple layers of responsibility for procuring the right kind and amount of property insurance. The owners normally elect a board of directors who are responsible for acting for the property owners on matters of joint interest, including buying property insurance. The board usually hires a property manager to manage the property and sometimes delegates to the manager procuring insurance.

In many cases the governing documents for the property owners’ association specifies the type and amount of insurance required, for example, “full replacement value.” In such cases, the board may bear responsibility for not procuring the insurance required by the governing documents. Likewise, the contract between the POA’s board and the property manager may specify the type and amount of insurance required, in which case the manager will face liability if it procures a lesser insurance coverage. Or, the contract may clearly exculpate the manager from liability by allocating responsibility for ensuring the proper coverage is in place. See, e.g., Ruch, 2017 WL 4682031 at *4 (manager not liable because contract with HOA gave sole responsibility to ensure proper insurance coverage to board, manager did in the past recommend to board increasing coverage but the board did not act on the recommendation, and there was no evidence the board would have bought greater insurance if recommended to do so).

Frequently, during the application process, or annual renewal process, property values used in past policies are used in the

applications. Ultimately, the customer or its agent must approve the application thereby creating the order for requested insurance.

Unless the insurance agent has agreed to determine the proper amount of insurance—which usually does not and should not happen—the application forms the basis for the insurance that is requested and forms the first leg of the May analysis for an insurance agent’s liability. If the insurance agent procures the insurance specified in the application, it satisfies the second leg of the May analysis and avoids liability if the insurance proves inadequate.

Risk Mitigation for Insurance Agents and Property Managers Although the law in Texas limiting the liability of insurance agents for inadequate insurance claims has been in place for over half a century, insurance agents and property managers would be well advised to take steps to avoid such claims. For example: • Create a favorable paper trail in communications with the customer. To avoid even the argument that the agent was responsible for procuring the right type or amount of insurance, an agent should include a disclaimer in its communications with customers similar to the following: The decision on what insurance coverage is right for your particular business or situation is up to you. We cannot make that decision for you and by doing business with us you agree that you bear sole responsibility for deciding what type of insurance or what amount of insurance is appropriate for your needs. We encourage you to have any property that is to be insured appraised or valued so that you will have the information you need to decide how much insurance you need. We intend to rely on your decision on how much insurance to purchase. Should you choose to do business with us, you disclaim any reliance on us for the proper amount of insurance to purchase.

• Create a favorable paper trail in applications and quotes.

Similar to the disclaimer recommended above, because the customer is going to point to the application and quote as the actionable event when the agent did not procure adequate coverage, it is a good idea to include a disclaimer in the application or quote (or the transmittal) similar to the following:

Please be sure that the limits and insurance values in the attached are adequate for your needs. To avoid being underinsured, you should ensure that the limits and insurance values will provide you the insurance protection that you need. By proceeding with the purchase of insurance on the terms described herein or in the attached, you acknowledge and agree that we are not responsible for ensuring that the limits and insurance values will provide you adequate protection. If you are not satisfied that the limits and insurance values will provide you adequate protection, you should increase the limits or provide values that are appropriate for your needs.

• When in doubt, back away. This advice is hard to follow, especially when the account is lucrative. But, there are always other properties and one lawsuit will teach any insurance agent the wisdom of this rule. When the customer appears to be intentionally undervaluing the property to keep premiums down, or refuses to obtain current values, the account is not worth taking. When (and not if) the property suffers a loss, the insurance agent will be on the short list of potential defendants.

Fortunately for Texas insurance agents, Texas has a well-developed body of law limiting the duty of insurance agents to customers.

The May two-step analysis is simple to follow: buy the insurance requested and let the customer know if you could not. While this two-step process will not guarantee that an agent will not be sued if the insured property suffers a loss and the insurance is inadequate, it provides a solid defense to most claims that fall outside of this analysis. To enhance the agent’s protection from such claims, the agent should create a clear paper trail that it is not deciding the type or amount of insurance to buy. This should minimize the agent’s risk. Ultimately, the decision on what insurance to buy is the customer’s decision. The agent should recognize this and make that point clear in all dealings with the customer.

Leland C. de la Garza is a shareholder of Hallett & Perrin, P.C., a Dallas-based business law firm serving the needs of Texas Business. © Leland C. de la Garza, 2021.

CONTACT | FALL 2021 • 31

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Community.

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When it comes to protecting the value of your neighborhood, consider a company that: • Adheres to the highest ethical standards • Possesses an outstanding reputation and more than a third century of experience • Employs top-notch, professionally qualified staff • Strives to enhance the appeal and value of your property CMA serves a wide variety of communities including single family, masterplanned communities, townhomes, mid-rise, mixed use communities and commercial/retail properties.

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CONTACT | FALL 2021 • 33

Texas Community Associations

facts & figures » Approximately 5,657,000 Texans live in 1,552,000 homes in more than 20,000 community associations. 43% say they always vote in state and local elections. 59% vote in national elections. » These residents pay $9.2 billion a year to maintain their communities.

These costs would otherwise fall to the local government. » 202,000 Texans serve as volunteer leaders in their community associations each year, providing $185 million in service. » Homes in community associations are generally valued at least 4%* more than other homes. » By 2040 the community association housing model is expected to become the most common form of housing.

88 70 85

» percent of residents oppose additional regulation of community associations. » percent of residents rate their community association experience as positive (56%) or neutral (29%).

Community associations are private entities, not governments. Residents vote for fellow homeowners to provide leadership—making decisions about operation, administration and governance of the community.

Assessments paid by association members cover the costs of conducting association business—such as common area maintenance, repair and replacement, essential services, routine operations, insurance, landscaping, facilities maintenance as well as savings for future needs.

CAI supports public policy that recognizes the rights of homeowners and promotes the self-governance of community associations— affording associations the ability to operate efficiently and protect the investment owners make in their homes and communities.

SOURCES foundation.caionline.org Community Associations Fact Book 2018.

Home Sweet HOA: 2018 Homeowner Satisfaction Survey.

www.caionline.org (888) 224-4321 @CAIAdvocacy

34 • CONTACT | FALL 2021

Community Next: 2020 And Beyond, 2018. *Clark, W. & Freedman, M. (2019). The Rise and Effects of Homeowners Associations. Journal of Urban Economics, 112, 1-15.

9.25.19

» percent say their association’s rules protect and enhance property values (66%) or have a neutral effect (22%).

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In many areas of North Texas, soils have high contents of expansive clays that swell when wet and shrink when dry. Damage to building foundations, swimming pools, monuments, perimeter screen walls, and retaining walls can, and often does, result from the shrink-swell pressure exerted by the soil.

The expansive clay soils cause problems for us in multiple ways. They can cause settlement, which is the problem most of us think of regarding the effect of our soils, or they can cause heave due to swelling of the soils. Think of our soils as a sponge: they swell when wet; and shrink when dry.

Settlement to any type of structure being supported by the soil can occur for several reasons including poor compaction of fill materials, lack of maintenance (maintaining a stable moisture content by watering around the structure during dry periods), and by far the greatest impact we see - trees too close to the structure. More-or-less uniform moisture levels can help preclude cyclic expansion and contraction of the soil with its resulting differential movement.

Installation of an irrigation drip-line zone around the perimeter of a structure, that can be controlled, can help maintain uniform moisture levels.

Because of the highly expansive nature of the soil, trees can significantly contribute to differential settlement of any foundation or structure. The roots of trees and large plants consume the moisture from the soil, causing the soil to shrink much faster than other soil areas exposed to the weather. The soil where the moisture is lost more rapidly will sink lower than the surrounding soil, causing evidence and consequences of differential settlement in all types of structures. Research studies indicate that a tree should be at least as far away from a structure as the drip line of the tree to minimize the effect of drying caused by the

tree. Clusters of trees can have an even greater effect, and some studies indicate that the impact of trees can reach a distance equal to the mature height of the tree(s).

Most people think of settlement when there is damage to a structure, however often the problem is just the opposite – heave. Heave to a structure occurs when highly expansive clay soils become wet and swell like a sponge.

Structural damage can often result from the shrink-swell pressure exerted by the soil. Most often this heave results from a lack of proper drainage in close proximity to the structure. It is for this reason that building codes require a minimum 5% slope in grade away from a building.

Proper grade slope doesn’t always get executed properly around buildings, as many of you know due to drainage issues. It is especially not always thought of when other structures like perimeter screen walls, retaining walls, and pools are installed. Any areas where water can pond near a structure can potentially cause damage due to swelling of the expansive clay soils.

So remember, when you encounter distress to a building, swimming pool, monument, perimeter screen wall, or retaining wall, it is likely a result of one or more of these factors. Consider the proximity of trees to buildings and other structures, maintain positive drainage away from any structure, and maintain a uniform moisture content through a consistent watering program around structures during our dry periods.

CONTACT | FALL 2021 • 37

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For a full list of our services, visit solitudelakemanagement.com/services CONTACT | FALL 2021 • 39

ASSOCIATION BUDGETING

TO BUDGET OR NOT TO

Tracy Wolin, CMCA, AMS, PCAM

Getting an early start on your budget is essential for any HOA Manager. One never knows what emergency might occur, so if you begin thinking about your budget early, you will be that much more prepared when the time comes to enter actual numbers.

I begin preparing for budget season four months in advance, reviewing past budgets/history, verifying when the last budget increase was and amount of the increase, and creating my budgeting template. Some Boards believe in increasing the budget yearly which makes a Manager’s job so much simpler, but these Boards are rare. In my experience, those types of Boards will provide directive at the beginning of budget season by proactively divulging the increased amount for the upcoming fiscal year. Then there are those Boards who will not increase a budget so as Managers we start shifting money from line item to line item hopeful that there will be no large unforeseen expenses on the horizon.

how much of an increase? This could be a perfect opportunity to negotiate with the vendor or even go out to bid to confirm your vendor is competitive in their pricing. I have been able to negotiate some contract reductions at budget time so this could be a great opportunity for you to decrease a line item or two or three.

There are many approaches to preparing a budget but you must find your own style. A Management Company typically uses a custom template and provides a timeline to complete the pro forma budget. With self-managed Associations, there may be a template already in existence or perhaps you may have your own worksheet. The narrative should be embedded in your When preparing a budget with no instructions, I create three data on how you arrived at the figure in any line item. columns for different increase amounts, typically 2%, 4% and 6%, using a calculation to average the expenses for the What will vary this year and make budgeting problematic are remainder of the year for each line item. Budget increase material delays, costs and COVID supplies. I am sure many amounts are typically stated in the governing documents of us have signed contracts and now months later, the vendor of each Association. This language will let you know if the wants to add an addendum to the contract as compensation for Board has the authority to raise dues without a vote of the the unforeseen increase in materials. Problems such as being able to schedule a project and have it come to completion, membership or if there is a cap on any increase amounts. but budgeting for COVID materials such as hand sanitizer, Firstly, figure out the financial objectives of the Association disinfectant, masks. Another issue is employees, not only for the next budget year. The reoccurring expenses are the finding them but at what cost? With the pandemic making easiest to get started on, utilities, management fees, insurance supplies scarce as manufacturers cut production on top of the premiums, landscaping, annual audit, security, and contracts. cost of lumber, copper, steel, glass, etc., plus inflation, how can When was the last time the vendor received an increase and we make the budget balance? There will certainly be a major 40 • CONTACT | FALL 2021

challenge ahead. If we know there is work to be done and we put projects off until material prices fall, are we negligent in our duties by not planning projects to try to keep owner assessments lower or are we smart to wait and see if material prices fall? This is something that can only be answered by your Board and you, the Manager. If a project can wait and there is no risk of liability to make a repair then you have something to consider. If you are looking into a capital improvement project, perhaps you can wait to build that new playground area but consider the homeowner who pays dues one time and wants to see progress for the money.

For those readers new to the industry, I want to share my first year of creating a budget for a high-rise Association in Los Angeles. In my mind, I did not see any issues and using past history to prepare the budget did not seem like a big deal. I prepared letters to the contract vendors inquiring if there would be a proposed increase. These letters also included questions as to when the last increase was and amount for the vendor to populate along with a statement declaring there would be no increase forthcoming without discussion. I recall a lot of budget discussions with other Managers and listening to these conversations I began to panic wondering why I was not more concerned with preparing the Association’s budget.

I gathered from these conversations that budgeting was a bigger task than I originally thought. After contemplation and being unable to wrap my mind around all the different emails, I called the Manager in the high-rise building next door, a manager with 30 years in the industry, to discuss my concerns and my methods for developing the budget. Long story short, she advised me to stop reading the budget emails and to continue on the course I had established and I would be okay. I am happy to report, she was right and the Board approved the budget as presented although there was quite a bit of discussion, with one little tweak, I misspelled the word maintenance.

and bring in vendors to discuss the bigger projects I know are already on the radar. I prepare a list of possible projects and with Board input, we amass the list. The Board will number these possible projects in order of importance so we can tally the results and find some commonality to finalize the project list for the upcoming fiscal year.

I believe in the importance of gathering bids for possible projects to add to my files whenever any vendor is onsite. These bids are then entered into a spreadsheet to be used for budgetary numbers in the future for planning. I bring my spreadsheet along to the Board workshop so once a project is considered that may not be on my list, I take out my spreadsheet and instantly I have some budgetary numbers to share with the Board. If the proposed project becomes a possible project, using the bid, I can create an RFP, validate the bid and pricing with the original vendor and then proceed with the bid process.

I now should have the pro forma budgets for the operating and reserve accounts along with notes completed and ready to be sent on to the next reviewer whether it is the Management Company, Board Treasurer, or Budget Committee. Once I get to this phase of the budget development, I know it is just a matter of a few weeks until the Board approves these budgets so I can prepare them for distribution to the membership.

And so another year of the budget season comes to a close and I am left with a feeling of hope that income will exceed expenses and there will be no more unforeseen catastrophes to wreak havoc with the approved budget. Once again, it is up to you and your Board to figure out the priorities for the upcoming budget. The final step of this process is planning to take a couple of days off after a job well done.

My method of preparing a budget is to work on the expense side first. After finishing the first few drafts, I take another look, but not as a Manager, but as a Board member, in an attempt to view the budget through the Board’s eyes. Now I am ready to add income figures into the budget, adding assessment income as the final piece. Comparing the expense and income numbers, I have to review the entire budget again, tweaking expense line items so I have a zero based budget to present for all scenarios, up to a 6% increase.

Capital Projects and the Reserves are next on the list. After completing the Operating budget, I am able to anticipate the monthly/yearly reserve transfer. I try to hold a workshop with the Board to solicit their input on any capital improvement projects they want to accomplish in the next budget cycle

CONTACT | FALL 2021 • 41

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RMWBH Attorneys and Counselors at Law

LEAH K. BURTON

Get to know your DFW area attorney.

5 FACTS ABOUT LEAH K. BURTON 1. Leah represents POAs of all sizes from small condominium complexs to large multi-thousand lot master-planned communities.

2. Leah has practiced POA law in both Texas and Florida and understands the complexities that associations face around the U.S. 3. Leah was raised in Anchorage, Alaska and is no stranger to the cold winters that sometimes visit Texas, but she enjoys the Texas summers more.

4. Leah’s experience practicing civil litigation in California prepared her to better advise her POA clients on the risks they may face from litigation.

5. Leah has been recognized for her continued work to increase diversity within our communities. Her work on the topic has been featured by CAI on an international scale and formed the basis of CAI’s renowned Diversity and Inclusion Guide.

Learn more about Leah at www.RMWBH.com.

COMING SOON! RMWBH DFW One Cowboys Way Frisco, TX 214.365.9290

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HOW WILL YOUR HOA CONSTRUCTION PROJECT(S) be impacted by Covid-19?

In short, higher prices and possible delays in building materials being delivered. When it comes to the Covid-19 pandemic, it seems like it has mostly been a lot of bad news. But for the construction industry there really has been a mix of the bad and the good.

The measure employed by Dodge Analytics to gauge the health of the construction industry dropped by over 25% between the first and second quarters of 2020, but by the third quarter that number remained steady and even rose slightly thus suggesting that initial negative impacts of the virus had leveled as the year wore on. In 2020, we experienced a year of unprecedented disruptions—a global pandemic, country-wide lockdown, massive loss of employment, economic downturn, and an uncertain outlook all combined to create unique challenges for individuals and businesses across all industries.

The construction industry is no exception. The Covid-19 pandemic added increased emphasis on shortages due to factory closures, logistical issues and lack of labor force. With construction and real estate specifically, shortages can lead to delays in projects, which adds additional costs into the mix.

Despite the broad designation of construction companies as “essential businesses” that largely allowed them to keep operating throughout 2020, the industry has had to adjust to workforce and supply chain disruptions caused by the pandemic, shifts in resources, incorporating remote technology, and a steep drop in non-residential starts this year.

In fact, supply constraints related to limited product allocation, raw material availability, and freight concerns are continuing to have a significant impact on our industry. Attached to this blog are increase notices from each of our shingle manufacturers. Accordingly, our suppliers are announcing a 5-7% increase on asphalt shingles and a 5-15% increase on all residential roofing accessories. Fasteners, commercial products, and commodity based items will be priced at time of shipment.

In addition, workplace adjustments to COVID-19 on construction sites are further complicated by the fact that you often need teams of people working and coordinating closely on the jobsite.

Separating employees as much as possible, forming smaller work crews, staggering shifts, and ensuring that everyone is wearing proper personal protective equipment (PPE) are all precautions that construction industry employers should be taking. The COVID-19 pandemic caused supply chain interruptions across industries, from toilet paper and cleaning supplies to red meat. Although most states have resumed close to “normal” capacity and operations, the nation still faces an historic and unprecedented lumber shortage.

The shortage is the result of growing demand for bigger homes, new construction, and a surge of home renovations amid the

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pandemic, coupled with supply chain disruption caused by the The lumber shortage is just part of the litany of insufficiencies in virus as production cuts and government shutdown orders stifled today’s market. The price of all building materials, as well as many production at both domestic and foreign mills. resources we use every day, are in constant fluctuation. Many government entities that oversee building projects and work to As a result of this perfect storm, prices for lumber and other building issue permits are also experiencing staff shortages, leading to further materials have skyrocketed since the start of the pandemic, and obstructions. Finding land to build on has also been a huge hurdle. have only just begun to fall, as the increasing supply struggles to Developers are tapping out their current supply of land much more catch up with still very high demand. According to the National quickly than anticipated, and build-ready land is not readily available.

Association of Home Builders (NAHB), the average price of a It typically takes a year or more to clear the obstacles required to turn newly constructed single-family home has increased by about raw land into a new home development, and large home builders $36,000 since April 2020, and the “price per thousand board are already behind current needs. As fewer and fewer build-ready feet” went from $350 to over $1,400 in May 2021. lots become available, the demand for new home construction has been increasing, not decreasing, during this same time frame.

Major lumber mills cut back on production during the pandemic due to concerns that the economy would worsen. Lack of This shortage has contractors and builders struggling to find protection for workers in factory settings due to the virus was also materials, let alone finding materials they can afford. This challenge a concern, with many operating on a rotating schedule and at leaves suppliers susceptible to allegations—especially by developers, decreased capacity to provide safe conditions during the pandemic. builders, and other contractors—that they may be using pandemicWhile the lumber industry has taken one of the hardest hits, the related shortages to their advantage by unfairly raising prices. shortages extend to building materials in general, as the demand Experts predict that supply will be unable to catch up to demand for new homes has increased. A survey conducted in May 2021 until late 2021 or early 2022. In the meantime, we are sure to see by the NAHB found that more than 90% of builders reported parties attempting to utilize termination, price escalation, force shortages of appliances, 87% reported a shortage of windows and majeure, and other contract terms to mitigate the impact. With doors, and more than 50% of builders reported shortages of steel many businesses suspending operations during the early months beams, insulation, roofing materials, vinyl siding, copper wiring, of the pandemic, and global supply chain disruptions affecting the and plumber fixtures, among other materials. availability of building materials this year, construction companies and contractors have had to scramble to adjust, with many ultimately Since May 2020, the cost of steel mill products has risen over paying higher prices for materials.

75%, including a 59.4% increase in 2021 alone, and the cost of prepared asphalt and tar roofing and siding products has risen Unfortunately, this trend shows no sign of improving in the near nearly 15%. The ramifications of the shortage have rippled term. This means that many companies will need to reevaluate through the industry, as the increasing costs are passed from long-term business relationships with vendors. Some may need to supplier to the builders and contractors, and onto consumers explore forming new partnerships, which means taking on a certain themselves. Soaring lumber prices have impeded contractors’ amount of risk. Adjusting to global supply chain disruptions will ability to perform building contracts for the originally agreed- require robust coordination between suppliers, subcontractors, upon price, and hindered consumers’ ability to pay the new, general contractors, and owners to make timely and well-informed increased costs. decisions.

In North Texas, one couple who had signed a building contract for $525,000 got an unpleasant surprise when the builder came back to them with a dramatically increased price, based on the mounting cost of materials. Unable to pay the more than $200,000 increase from the original estimate, the deal was called off pursuant to a no-cause termination clause in the contract.

This is hardly an isolated incident, and while such clauses are common in building contracts, the pandemic-related shortage no doubt has led to more and more parties having to take advantage of them or take their disputes to court. To mitigate the rising lumber prices and avoid contract disputes, builders have increasingly included similar termination and price escalation clauses in their sales contracts.

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According to LevelSet, “New contracts will likely put more emphasis on escalation clauses to cover unforeseen cost increases, and current contracts may need to be similarly revised. But it’s also an opportunity for nimble suppliers and contractors to move into areas and clientele that might have previously been difficult to access.”

For more information, contact Jason Dove (Chief Revenue Officer) for Classic Construction & Restoration, Inc. Classic Construction & Restoration is a family owned, full-service Dallas general contractor offering professional experience handling insurance claims and catastrophic losses as well as 24-hour emergency care. If you’ve been affected by a catastrophe, you can count on us to make things right again.

Please call (469) 290-8980 Sales@ClassicConstruction.com

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Funds deposited through the Lockbox will follow Western Alliance Bank’s funds availability policy as outlined in the Deposit Account Agreement Disclosure. 2Fees may be imposed for additional services related to online banking. Refer to Business Online Banking Setup and Authorization for more information. 3All offers of credit are subject to credit approval, satisfactory legal documentation and regulatory compliance. 4Refer to the disclosures provided at account opening and the Schedule of Fees and Charges for additional information.

Alliance Association Bank, a division of Western Alliance Bank, Member FDIC. Western Alliance Bank ranks high on the Forbes “Best Banks in America” list year after year.

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CONTACT | FALL 2021 • 47

Your Full Service HOA Partner

We specialize in construction, renovation,and property maintenance All major trades in-house, including: Roofing, Plumbing, Electrical, AC & Heating

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MEMBERSHIP

REPORT New Members Mrs. Tina Borg CCMC (214) 228-6260 tborg@ccmcnet.com

Shane Ousey RTI/Community Management Associates, Inc. (972) 943-2898 sousey@cmamanagement.com

Mr. Jordan Jones CCMC (469) 246-3508 jojones@ccmcnet.com

Preslie Rose Taylor RTI/Community Management Associates, Inc. (337) 396-9372 ptaylor@cmamanagement.com

Mr. Louis Freeland Moules, II Classic Property Management (707) 326-5212 louis.f.moules@gmail.com

Ms. Sheryl L. Roy SBB Management Company (972) 824-7547 s.roy@sbbmanagement.com

Ms. Roseann Walton (702) 300-6505 livnnusa@aol.com

Ms. Jennifer Tirado CondoLogic (904) 329-7239 jennifer.tirado@condologic.com

Wendy Waldemar-auau Somerset Association Management (512) 787-8090 wwaldemar-auau@somersetassociations.com

Mr. Price Joel Trosin 3525 Condominiums Council of Co-Owners (312) 545-9396 pricet@3525condominiums.com

Kristin Nowak FirstService Residential (214) 451-5472 kristin.nowak@fsresidential.com

Mr. Logan Passmore TBK Bank (214) 930-6196 lpassmore@tbkbank.com

Ms. Deitra Walter Advanced Association Management, Inc. (940) 445-4010 deitra.walter@outlook.com

Mrs. Maggie Raines Goodwin & Company (214) 445-2752 Margaret.Raines87@gmail.com

Mrs. Kaitlin Ulrich The Residences at The Ritz-Carlton, Dallas (214) 922-4737 kati.ulrich@ritzcarlton.com

Ms. Emily Baehner Associa (214) 272-4136 emily.baehner@associaonline.com

Mr. Cole Adams LaBarre/Oksnee Insurance Agency, Inc. (512) 706-5024 ColeA@hoa-insurance.com

Ms. Nicole Bates Associa (214) 627-1429 nicole.bates@associa.us

Mr. Ron Anthony PMG North-Richland Hills (682) 325-5363 ranthony@principal-mgmt.com

Mr. Ron Cayon The Village at Frisco Lakes Community Association (972) 370-0404 cayonronald@gmail.com

Mr. Burt Jones, CMCA Associa-PMG of North Dallas (929) 319-2151 burt.jones@principal-mgmt.com

Mr. Tim Clement PMG North-Richland Hills (682) 325-5363 tclement@principal-mgmt.com

Mr. Chad Avery Bearfoot Companies, LLC (972) 849-3849 chad@bearfoot.net

Mr. David Diaz PMG North-Richland Hills (682) 325-5363 ddiaz@principal-mgmt.com

Mr. Michael John Walker, CMCA Bridlewood Homeowners Association (817) 491-0843 micwalk@tx.rr.com

Ms. Sonja Wixom PondMedics LLC (469) 430-1986 sanja@pondmedics.com

Ms. Robin Davis Cavalry Construction & Restoration (469) 799-5595 rdavis@cavalryconstruction.com

Ms. Melisa Mraz RealManage (469) 371-7248 melisa.mraz@realmanage.com

Mr. Scott Ehrenberger (704) 838-6841 scott@pminortexproperties.com Mr. Robert Garrison (559) 623-2931 robertgarrison43@yahoo.com Christopher Gruber (214) 803-2408 Christopher.Gruber@FSResidential.com Mr. Matthew Skipper, CMCA, AMS (863) 532-1120 skipper.matt21@gmail.com

Mrs. Aleah Miles RTI/Community Management Associates, Inc. (972) 335-3661 amiles@cmamanagement.com

Mr. Tom Collins The Village at Frisco Lakes Community Association (972) 370-0404 tomflbod@gmail.com Ms. Janell Ferguson The Village at Frisco Lakes Community Association (972) 370-0404 janellflbod@gmail.com Ms. MaryKathryn Lightsey Village Association Management, LLC (214) 552-1629 mks@villagemgmt.com Mr. Madan Goyal West Park Home Owner Association (972) 943-1670 goyaltexan@hotmail.com Kaitlin Rose Mcgarry Zeus Restoration (469) 707-2084 kmcgarry@zeusrestoration.com

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MEMBERSHIP

REPORT

Renewed Members

Mr. Jerry Bridges Mr. Paul Zellar Ms. Amanda Chapman, CMCA Mr. Steven P. Fielding Mr. Thomas J. Armstrong, AMS, PCAM Ms. Monika Karin Loeffler, CMCA, AMS, PCAM Mr. Brett Russell Mrs. Diana R. Larson, AMS, PCAM Mr. Steven L. Sumners Ms. Virginia Bender, CMCA, AMS Mr. Calvin Bogart Mrs. Gianna Rahmani, CMCA, AMS, PCAM Mrs. Yolanda M. Wilson Ms. Jordan Berger, CMCA Ms. Susann Elizabeth Fortney Ms. Liliana Olvera, CMCA, AMS Mr. Richard Hamilton, RS Mr. John S. Adami Mr. Greg Libke Mr. Dan Schulze Mrs. Krystal Barbarito, CMCA, AMS, PCAM Mr. Patrick Droesch Mr. Todd Yamaoka Ms. Rosie Morataya, CMCA, AMS Ms. Krystal Chambless, CMCA Mr. Ed Colvin, CMCA Mr. James Fulps Mr. Benjamin Hardy Ms. Debbie Landess Ms. Kerry Beatty, AMS, PCAM Mrs. Rebekah Small, CMCA, AMS Mr. Kristopher Grooms, CMCA, AMS, PCAM Mr. Greg Barnett, CMCA, AMS, PCAM Mr. Mark Norton, AMS, PCAM Ms. Stephanie A. Smith, CMCA, AMS, PCAM Mrs. Lori Jo Ball Mrs. Thelma Terrell, CMCA, PCAM Mr. Jeremy Foster Ms. Anne Bernhardt Mr. Rick Tuzinski Ms. Darla Mathews Mr. Charles Heineman Mr. Sterling Kropp Ms. Gail Fishkin-Ogle, CMCA, AMS, PCAM

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Ms. Mary Michele Harris, CMCA, AMS, PCAM Ms. Stephanie Horvath Mrs. Jennifer Ashley Mayben, CMCA Mr. Timothy D McConville, CMCA, AMS, PCAM Mrs. Nichole Rice, CMCA, AMS Mr. Nicholas Abair Robin Anderson Ms. Michelle L. Reynolds Mrs. Katie Kim Ms. Susan Garrett Ms. Susan Record Mr. Michael Reeves, CMCA, AMS Mr. Robert Ikard, CMCA Mr. Matthew Mark Kopchak, CMCA, AMS, PCAM Mr. Emmanuel Munoz Ms. Robin Ricker

Rejoined Members

Mr. Brenden Kurtz Ms. Julie Dickens Mr. Trevor Phillips Mrs. Stacy R. McGrath Mr. Edward Williams, Jr., CMCA, AMS Ms. Sondra Franey Ms. Jaine Prieto, CMCA Mrs. Suzanne M. Smith, CMCA, AMS Mr. Bryan Slaton Mrs. Lori A. Jones, CMCA, AMS Mr. Rafael Rodriguez Mr. Larry Pollis Mr. Daniel Andres Ms. Amber Anderson Ms. Michelle Weber

MEMBERSHIP

REPORT

New Designations

Congratulations to our fellow CAI members who achieved new designations!

Mr. Robert Walter Clark, III, CMCA, AMS Mr. Mathew J. Eberius, CMCA, AMS Mrs. Jordan Monroe, CMCA Mr. Mathew J. Eberius, CMCA, AMS Mr. Colby Gschwend, CMCA, AMS Mrs. LaWanda Brannon, CMCA, AMS Ms. Barbara Thomas, CMCA, AMS Ms. Debbie Gschwend, CMCA, AMS Ms. Gloria C Black, CMCA Mr. Juan Manuel Zuniga, CMCA Mr. Burt Jones, CMCA Mr. Matthew Skipper, CMCA, AMS

AMS CMCA CMCA AMS AMS AMS AMS AMS CMCA CMCA CMCA AMS

9/15/21 9/16/21 9/21/21 9/24/21 9/28/21 9/29/21 9/29/21 9/29/21 10/19/21 10/21/21 10/21/21 10/27/21

***Certified Manager of Community Associations (CMCA®) From CAMICB - “As a CMCA®, you have shown a commitment to your profession by staying informed about current community association issues and holding yourself to a high standard of professional conduct.” ***Association Management Specialist (AMS®) The second level in the career development track for community association managers.

The AMS® designation demonstrates a higher level of commitment to your career and the community association industry. An AMS® designation is recommended for managers who want to enhance their career opportunities by increasing their knowledge and expertise. ***Professional Community Association Manager (PCAM®) The pinnacle of community association management. The PCAM designation is the highest professional recognition available nationwide to managers who specialize in community association management. Earn your PCAM and join the elite—the select—the best.

Recommended for experienced managers who want to demonstrate advanced skills and knowledge and who wish to be recognized as one of the best and most experienced managers in the nation. ***Reserve Specialist (RS®) Community associations rely on qualified reserve specialists to assist them in extensive reserve planning to keep their communities running smoothly. Gain the confidence of board members by obtaining the Reserve Specialist® (RS®) designation.

The RS designation is awarded to qualified reserve specialists who, through years of specialized experience, can help ensure that community associations prepare their reserve budget as accurately as possible.

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Put the power of more than 20 years of engineering experience to work for your Homeowners Association (HOA): Reserve Study - a clear road map that helps your HOA budget maintain its assets and assure stability for your association Transition Study - to confirm that you are getting what you should be receiving when your association takes over Construction Monitoring - the HOA's advocate on the construction site Consulting Services - evaluate site issues and create specifications to help field proposals from contractors Criterium Dotson Engineers 972-562-1011 info@criteriumdotson.com www.criteriumdotson.com 54 • CONTACT | FALL 2021

RESIDENTIAL & COMMERCIAL COURT SPECIALISTS

CONSTRUCTION • RESURFACING • MAINTENANCE • EQUIPMENT

Master Systems has 25 years of proven expertise in providing clients with innovative, customized, turnkey court solutions. DFW’s premier court construction and maintenance company, we are known for a tradition of integrity, craftsmanship and unparalleled service after the sale.

Master Systems specializes in building new post tension courts, resurfacing, repairing and cleaning existing courts.

OUR COURT SERVICES INCLUDE: Consultation • Design • Construction • Resurfacing • Repair • Maintenance Cleaning • Fences and Gates • Windscreen and Netting • Shade Structures Lighting • Multipurpose Courts • Basketball • Volleyball • Pickle Ball • Bocce Ball • Batting Cages • Painted Games • Equipment and Accessories Quality work guaranteed. Fully licensed and insured.

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AAMC®- Accredited Association Management Company®

We Can MANAGE IT ALL DISCOVER THE NEIGHBORHOOD DIFFERENCE NMI is an Accredited Association Management Company that has been expertly managing a variety of community associations, including master planned, single family, condos and townhomes, in the DallasFort Worth metroplex for nearly two decades.

We are dedicated to building better communities!

NeighborhoodManagement.com NMI@NeighborhoodManagement.com Beverly Coghlan, CMCA, AMS, PCAM Beverly@nmitx.com 972.359.1548 56 • CONTACT | FALL 2021

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14070 Proton Road, Suite 100 Dallas, TX 75244

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Olivia Hurtado, CMCA Vice President 214.717.2718 866.800.4656 x7567 Olivia.Hurtado@cit.com ©2020 CIT Group Inc. All rights reserved. CIT and the CIT logo are registered trademarks of CIT Group Inc. MM#7205