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o ctober 2015 | volume 19 | number 3

CondoLifestyles

©

THE SOURCE FOR INFORMATION ON COMMUNITY ASSOCIATIONS, CONDOS, TOWNHOMES, CO-OPS & HOAS

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Community Association Managers Face New Issues FEATURES

A LITIGATION PERSPECTIVE: COMMUNITY ASSOCIATION RULE VIOLATIONS & DISPUTES

The Top 10 (Guaranteed) Ways To Blow Your 2016 Budget DRAFTING RULES AND REGULATIONS IN CONSIDERATION OF THE FAIR HOUSING ACT

Governor Rauner Vetoes Bills Related To Municipal Incorporation And Developer Lawsuits

YOU’RE FINISHING THE BUDGET…

Did You Overlook Any Items? THOUGHTS ON RANDOM ISSUES THAT ANNOY ME AND LIKELY YOU AS WELL


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table of contents COVER STORY

03 Community Association Managers  Face New Issues By Pamela Dittmer McKuen BOARD BASICS

09 A Litigation Perspective: Community  Association Rule Violations & Disputes By Kelly C. Elmore EVENT HIGHLIGHTS

12 MCD Golf & Bocce Invitational GUEST EDITORIAL

13 The Top 10 (Guaranteed) Ways  to Blow Your 2016 Budget By Salvatore Sciacca 15 Industry Happenings Compiled by Michael C. Davids & Sherri Iandolo EVENT HIGHLIGHTS

17 MCD Showcases the Races 18 From the Editor 19 Directory Advertisements A S S O C I AT I O N ’ S AV E N U E

26 ABOMA Anchors Away L E G A L U P D AT E

28 Drafting Rules and Regulations in  Consideration of the Fair Housing Act By Jonathan D. Wasell L E G I S L AT I V E U P D AT E

30 Governor Rauner Vetoes Bills  Related to Municipal Incorporation and Developer Lawsuits By Jim Webb GUEST EDITORIAL

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31 Thoughts on Random Issues That Annoy Me and Likely You as Well By Stuart Fullett M O N E Y M AT T E R S

34 You’re Finishing the Budget…  Did You Overlook Any Items? By Steven M. Silberman

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COVER STORY

by Pamela Ditmer-McKuen

community Association managers Face new Issues The role of community association managers has grown increasingly complex over the decades. New challenges arise continuously, bringing with them additional responsibilities and quandaries. In this issue of Condo Lifestyles, several industry veterans spoke candidly about the hot topics on their minds as well as a few of their recommendations for change. PALM II RULES overall, management is up to speed on and accepts (grudgingly, perhaps) the dictates and nuances of Palm II, officially titled Palm vs. 2800 lake Shore Drive condominium Association. In its controversial ruling, the Illinois Appellate court on may 2, 2014, addressed several matters concerning how boards conduct business. the ruling disallows

board workshops, email voting and canvassing of board members before a meeting. All decisions must be made in open, properly noticed meetings. “back when I started (in the business) in the ‘80s, this is the way it was done,” says cathy ryan, chief executive officer and President at Property Specialists Inc. in rolling meadows. “We wouldn’t allow our boards to

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have coffee together because, for appearance sake, it looked like they were discussing business. then we all went to technology because it was so easy to have daily contact and instantaneous response. now we can’t do that. It’s come full circle in 30 years.” “I think most managers understand the idea that ‘that’s the way we’ve always done things’ doesn’t mean we’ve been doing them the right way,” says association attorney Patrick costello of Keay & costello P.c. in Wheaton. “Palm II basically put an end to that as a legitimate response.”

CONDO LIFESTYLES

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CONDO LIFESTYLES

TOO MANY MEETINGS Possibly the greatest frustration with the ruling is the exponential increase in the number of board meetings. boards who used to meet quarterly are now meeting monthly. Some boards who used to meet monthly are

now meeting weekly. everyone’s meetings are longer and later into the night. “Palm II basically only reinforces existing items in the condo and cISA act, and is nothing new or to fear. Just do follow the existing rules” says michael baum President of baum Property management AAmc in

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Aurora. “I do not believe that an open workshop is out of bounds, and encourage proper workshops to help board meetings go smoother and be more productive.” “the city council meetings in Aurora last under an hour because of their use of open and proper workshops.” the inability to use email except for oneon-one communication has prompted not only extra meetings but also confusion, says tom Skweres, regional vice President of Acm community management in Downers Grove: “You can’t hit ‘reply All,’ so you don’t know who is talking to whom. there is a lot of duplication.” “one thing we are cautious about is manager burnout from all the night meetings, especially with our portfolio managers,” says Asa Sherwood, President of FirstService residential in chicago. baum’s recommendation for reducing meeting hours is policy-based governance. that way, boards establish policies, all kinds of policies for what to do in the event of such-and-such, and management knows to carry them out.

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COVER STORY

RESISTANCE FROM BOARDS managers also report resistance from some boards to comply with Palm II. that leaves managers unsure how far to persevere before they alienate their clients, which no one wants to do. “We have many exceptional board members, but there are some rogue board members out there that create a lot of turmoil. often, their actions are no longer serving the better good of the association. Sadly, when we do come across a board member like that, they commonly target the property manager and the other board members,” says Joel Garson, President of Hillcrest Property management in lombard. “When someone refuses to follow their own Declaration and the Illinois condo Act, we are in a very awkward situation.” “Some boards say they are not in cook county or they’re not a condo, so they’ll keep doing what they have been doing,” ryan says. “When they push back to us for being too technical, our response is, ‘You don’t want to be the first test case to challenge that decision.’” “Some managers, who don’t want to upset the apple cart, have said, ‘let’s get a legal opinion to see if the ways you’ve been doing things has been legal or in compliance with the governing documents,” costello says. Several managers predicted the restrictions and obligations of Palm II will dissuade owners from volunteering for board service. “those associations having a difficult time will only get worse,” Sherwood says.

after the emergency event. Public Act 99-0472, as it is now titled, takes effect June 1, 2016. Don’t look for much more in the near future, costello says. “other pieces of legislation tried to codify certain things, but they didn’t get anywhere,” he says. “I talked to a number of legislators, and they said, ‘We don’t want to create legislation where the boards can operate outside the members.’ they love the word ‘transparency.’”

LITTLE LEGISLATIVE RELIEF the industry and its supporters were hoping for quick legislative relief from the rigors of Palm II, and they tried. more than a dozen relevant bills were introduced to the Illinois General Assembly last year, but only one passed. Hb-2640, sponsored by Kelly cassidy, D-14th, allows boards to ratify any actions taken in response to an emergency if they notify owners within seven business days

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Shaping the future!

“If a board sets a policy, it’s done,” he says. “the policy might be if a tree dies, cut it down and replace it. the budget is X. then the board gets out of the way. If a tree dies, the manager has to report what he/she did. You don’t have to have meetings and vote on everything if there are policies.”

MANAGER LICENSING, OH BOY the long-fought campaign for community association manager licensing has opened a Pandora’s box of unintended consequences. one oft-recited argument in favor was it would enhance the professional image of managers. Whether that has occurred is arguable, but what licensing hasn’t done is draw a badly needed influx of new blood to the field. the demand for qualified, interested,

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CONDO LIFESTYLES

12:40 PM

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CONDO LIFESTYLES

licensed managers is strong, and the supply is maddeningly low. A major problem is that the barrier to entry is high. managers must be licensed before they start managing associations. before they can be licensed, they must take certain prescribed educational courses and pass an examination. It can take a year and $1,000 (on top of the employee’s salary) or more to get to Day one on the job. no exceptions. “I keep getting phone calls from management companies asking, ‘Do you know any managers? I’m looking,’” costello says. “It seems like there is more movement of managers from this company to that company.” “All the good ones are working, so we end up recruiting a lot of managers that are currently employed with other local management companies,” Skweres says. traditionally, management companies could recruit from the hospitality, banking, real estate, retail, project management and other customer-oriented arenas. today the licensing requirement discourages rookies

from giving association management a try. too much time and money are at stake if they don’t adapt to the work. “In many ways, the licensing law wasn’t well thought-out,” Garson says. consider the case of a former real estate agent, who is working for a national chain of health clubs. She travels the country overseeing the design, build-out, opening and membership recruitment of new facilities. A chicagoarea homeowners association spotted her profile on linkedIn and asked if she would consider being their full-time onsite manager. She was very interested. She’d like to get off the road, and her skills would translate well. but when she researched the requirements of licensing, she decided she couldn’t take the risk for a job that might not work out. “Historically, this has been an industry where people don’t grow up saying, ‘I want to be a property manager,’” Sherwood says. “most people just fell into the role. now they have to plan ahead, and it’s much different.” the current state of affairs makes employee retention more critical than ever.

Sherwood says his managers routinely receive phone calls of solicitation from other management companies. “You have to be a great place to work to retain the top talent you have,” he says. “You have to be a place people enjoy coming to and where they find opportunities for growth and career advancement.”

PROMOTING FROM WITHIN “It takes a pretty good-sized company to be able to grow property managers from within,” costello says. “they start someone in customer service or in a receptionist role and train them, and have them educated and licensed. For a smaller management company, that’s difficult to do.” “maybe one of the ways to get costs down is to secure grants” to pay for education and licensing requirements, Skweres says. “maybe our non-profit trade associations (cAI, Irem, etc) should think of granting money at the national level. You’re going to drive small management companies out of business. they can’t afford to have four or five

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COVER STORY

managers taking tests and classes.” baum, Acm and others are hiring at the entry level. they pay for or reimburse those who successfully complete the courses and pass the licensing test. that’s well and good, but “I think you learn this condo management through hard knocks,” baum says. “You can’t get some of this stuff out of a book.” It’s not easy finding people who are willing to start out in that customer service role, who have a proclivity toward the business, and who are willing to spend a year or more to qualify for a management position. “the owners have changed,” Skweres says. “they are more demanding and tenacious. Younger people (managers) don’t seem to want to put up with that like I did 30 years ago.” Desperately needed is a one-year apprenticeship provision, says michael rutkowski, President of First community management in chicago. “We could hire someone, and they could practice under our supervision,” he says. “that allows us to go to other industries to recruit people to come over and try us out. they

could work here for a year and get their license, or they could be here for 90 days and decide it’s not for them, and they haven’t wasted any time.” the managers expressed other frustrations with the licensing law. Among them: unclear continuing education requirements and availability of courses, and added fees for

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supervising manager licenses. A few prefer that licensing had not been passed. “licensing has yet to benefit us or our associations,” Garson says. “If someone is going to steal money, and it’s happened, they are going to jail. Sure, they will lose their license, but was that really a deterrent for the individual in the first place?”

CONDO LIFESTYLES

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CONDO LIFESTYLES

HIGHER MANAGEMENT FEES? It’s a dirty word in the management industry. everyone agrees managers are not paid enough for what they do and for the ever-increasing demands on them. certainly, their salaries have not kept up with inflation over the past couple of decades. So why don’t they charge higher rates and get on with it? For several reasons: Fear of losing business to competition, fear of reprisal from client asso-

ciations and—just maybe—a touch of doubt about how valuable they are. Says Skweres: “We can’t raise our rates because our competitors out there will do it for bare bones.” “managers oversee the operation, control, and oversight of mIllIonS of dollars of real estate. At a minimum, they must possess knowledge in budgeting, property inspections, contracting of services, project management,

dispute resolution, assessment collection, banking, financial reporting, tax filings, and psychology (yes, psychology!) I guarantee you that in any other industry, to hire someone that is licensed to do all of those tasks would be incredibly costly. A change is needed, sooner rather than later” rutkowski predicts management fees will go up for the 2016 budget year. He has already begun moving in that direction by weeding out unprofitable accounts and alerting others about impending increases. If they disagree, he will release them from their contracts gracefully. Ideally, community association managers would charge by the hour, just like most other professions do, he says. “but why would anyone go along with that when there are 25 other companies out there willing to do it for a flat fee? the accounts that demand a lot of time would never agree,” he says. “We can’t get together and fix our prices, but we need to have more respect for ourselves and charge appropriately. We’re not trying to rip people off, but there is a service we provide.” Y

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BOARD BASICS

By Kelly C. Elmore - Kovitz Shifrin Nesbit

A LITIGATION PERSPECTIVE:

Community Association Rule Violations & Disputes It  is  no  secret  that  community  living  often  results  in  disputes  involving  residents, not only between the residents themselves, but also with the Association.  Whether an owner or resident deliberately chooses to sidestep the Association’s covenants or rules and regulations deliberately or not, Boards are often faced with the challenge on how to address the violation issues, and ultimately, may seek to pursue litigation to address certain conduct.   

B

oard members often question their authority to become involved in certain disputes, and question how far is too far.  While many of these issues must be handled on a case by case basis, the following is a general discussion of handling disputes from the pre-litigation stage through litigation, should the violation issue progress to that point. Although many violations of the Association’s 

governing documents, including the Declaration and rules and regulations, may be obvious at first glance, other types of violations many not be as clear cut.  For example, whether an owner or resident is in violation of the governing documents for causing a nuisance may not be as easy to determine as whether an owner has violated the Association’s “no pet” rule.  For those types of violations, the Board and/or property manager should con-

sult with legal counsel to review whether a certain activity or conduct is in violation of the Association’s governing documents.

Pre-Litigation Stage During the “pre litigation” stage, it is extremely important that all instances of the violation or activity be documented.   In some cases, the Association’s Declaration or rules may require that written complaints be submitted to the Board or management for each instance that a certain conduct or nuisance-causing activity is reported.   If there is such a requirement, the documentation should sufficiently set forth the time and date of each violation, any witnesses to the violation and the name of the person submitting the complaint. In some cases which involved particular egregious violations, including threats of physical harm, the reporting owner or resident may wish to keep

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CONDO LIFESTYLES

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CONDO LIFESTYLES

his/her identity confidential.   The Board should discuss with legal counsel and confirm that the identity may be kept confidential during the prelitigation stage so as to avoid any unwanted retaliatory action by the defaulting resident.  However, it is important to note that should the issue proceed to litigation, it may be necessary to identify the reporting owner or resident as a witness, and he or she may be asked to testify during a trial in the litigation.  In addition, during this stage, the Association may also request that counsel for the Association send a cease and desist letter, in addition to a notice of violation, to the owner.   This letter notifies the owner that the conduct complained of is violating the Association’s governing documents and is demanded to stop this conduct (or to force his/her tenant or invitee) to stop this conduct by a certain date.   In addition to the requirement that all instances of conduct or violations be properly documented, the Association’s governing documents may also contain a provision that requires the Association to tender a copy of the written complaints to the defaulting unit owner before a rule violating hearing is conducted.   If the offending resident is a guest, invitee, or tenant of an owner, the governing documents may require the Associ-

ation to submit the complaints to the unit owner, as well as the offending resident.   Lastly, during the period of time before litigation is filed, the Board must ensure that proper notice of the violation is provided to the unit owner before any fine can be imposed.  If the Board opts not to assess a fine, but litigation is contemplated, the Board may still be required to provide a hearing to the unit owner on the violation(s).   Generally, as a means to demonstrate to any future court, it may be a good practice for the Board to conduct a hearing before litigation is filed in order to give the owner an opportunity to respond to the allegations and determine whether a resolution can be reached.

Proceeding to Litigation In many cases, a rule violation issue or a dispute involving a resident can be resolved without having to resort to litigation.  However, in those cases where a unit owner, or the tenant or invitee of an owner, refuses to adhere to the Association’s covenants and rules, the Board may be forced to file litigation in order to address the violation issue. Over the past few years, many of the cases we have seen escalate to litigation involve the following situations:  owners who allow excessive

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trash and debris to accumulate in a unit, or “hoarding”; owners or their tenants who have engaged in inappropriate harassment and threats of violence against other residents and management staff; owners who deliberately violate the Association rules regarding the number of pets permitted in a unit, or whose pets violate the size limitations in the Association.  After the Board and/or management has compiled all of the necessary documentation evidencing all of the instances in which a violation occurred, proper notice has been issued, and a hearing has been conducted, the Board may determine that the case should proceed to litigation.  In those cases, the Board must vote at an open meeting of the owners to approve the filing of the lawsuit. Only after the Board has approved the filing of the case, the lawsuit may be filed. Generally, because the Association is seeking to stop a resident from engaging in certain conduct, or allowing a certain condition to exist in a unit or on the property, the type of action that will be filed is an action for an injunction.   An injunction is an equitable remedy in the form of a court order that compels a party to do or refrain from specific acts.  A party that fails to comply with an injunction may face contempt of court, and pos-

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BOARD BASICS

sible monetary sanctions.  In addition to the request that an injunctive order be entered, the complaint may also include a claim for breach of contract against the unit owner, for causing or permitting the violation of the rules or covenants to occur.  If the Association prevails on proving that such a breach occurred, this will likely allow the Association to recover reasonable attorney’s fees and costs for having to bring such an action.  Ultimately, if the goal is to obtain the unit owner or resident’s compliance with the Association’s governing documents, the litigation process- given the cost- may resolve the issue permanently.  However, if during the pendency of the litigation, the acts or conduct continues, the Association may ultimately push for entry of the injunctive order, and even a possible sale of the unit.   This result would be the most extreme result, but in appropriate situations, has been ordered by the Courts.

Alternatives to Litigation It should be noted that in lieu of litigation, the Board may also consider other alternative forums in which to seek to resolve the conflict.  Some Declarations provide for resolution of certain conflicts or violations through an arbitration proceeding, in

which an arbitrator or panel of arbitrators conducts a “mini trial” and makes a determination.   Arbitration may be binding or nonbinding, depending on the governing documents and any agreement between the parties.   Alternatively, the Association may also seek to submit the matter to mediation with a selected mediator, or through a professional mediation company.  In those types of informal proceedings, a mediator or “neutral” meets with the parties and assists the parties in attempting to reach a settlement or resolution of the conflict.  This form of resolution is less adversarial than a court proceeding or arbitration.  However, with both the arbitration and mediation forum, there may be a cost associated with submitting the dispute for resolution in that forum. Y

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2015©.

10.15

CONDO LIFESTYLES

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CONDO LIFESTYLES

MCD Golf & Bocce Invitational July 17 at Eaglewood Resort

The  19th  annual  MCD  Golf  &  Bocce  Invitational  was  held  on  July  17,  2015  at Eaglewood  Resort  in  Itasca.  Over  200  participants  played  golf  or  bocce  and enjoyed  industry  networking  at  a  special  reception.  Special  thanks  to  Tim Conway of Golub & Co. and Mydraine Janvier of ALMA Property Management who served as co-chairs. Major sponsors of the event were Suburban Elevator, Westside Mechanical, FirstService Residential and Xfinity Communities. 

Y Pictured above is 3rd place foursome Kevin Kojzarek & Brittany Ryan - Property Specialists, Inc., Riley Skaggs Acres Group and Kurt Kojzarek - Property Specialists, Inc.

Y Shown in front row; Annette Byrd, Angel Runnion Williamson Management and Jeff Swanson – Fullett Rosenlund Anderson. In back; Erica Horndasch –Associa Chicagoland and Stuart Fullett – Fullett Rosenlund Anderson.

Y Pictured above are Loree King- Baum Property Management, Jim Fadellin – Hard Surface Solutions, Tina Straits & Michael D. Baum – Baum Property Management

Y Shown here is 2nd place foursome Tim Conway – Golub & Company, Russ Fleagle – The Building Group, and Greg Semmer – Semmer Landscape (not pictured Bob Bonifazi)

Y Shown here is 1st place bocce pair Lindsey DaehnkeKeough & Moody & Ron Muldoon-Brouwer Bros. 2nd place bocce pair Sheila Malchiodi –QCI Restoration (Not pictured Austin Werner – The Real Seal), and 3rd place bocce pair Lou Lutz – First Community Management & Al Murray – Landscape Concepts Management.

Y Shown here is 1st place foursome from Chicagoland Community Management - Stan Niketic, Tony Briskovic, Rudy Karastanovic and Mitch Vucic. Murray – Landscape Concepts Management.

Y Pictured here is a group of bocce players in the Bocce Tournament.

Dickler, Kahn, Slowikowski & Zavell, Ltd. ~ concentrating in ~

Condo & HOA Representation Corporate • Real Estate • Litigation • Wills Personal Injury 85 W. Algonquin Rd., Ste #420, Arlington Heights, IL 60005

847-593-5595 12                               C O N D O   L I F E S T Y L E S         10.15

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GUEST EDITORIAL

By Salvatore Sciacca, Chicago Property Services

The Top 10 (Guaranteed) Ways to Blow Your 2016 Budget Now that Fall is upon us, you can bet your bottom dollar on two things.  Old man winter is right around the corner and it is time to prepare and approve next year’s budget.  And in order to run an association in a fiscally sound fashion, the board of directors must take the time to review the financial history of the association and to properly plan for the future.  This is only accomplished by following common sense accounting guidelines. And what are those guidelines you might ask? Well I am pleased to share with you the absolute most important best practice guidelines to ensure your budget is blown before you know it in 2016. So sit back, relax, take a few sips of neat Kentucky bourbon and enjoy the ride ? 10. Slash your snow removal budget.  better yet, buy hand shovels for all the homeowners so that the association can cut back on the ridiculous snow removal expenses that have grown exponentially especially after the Polar vortex winter of 2013.  besides, the association has workers compensation and everyone at the last annual meeting (3 years ago) said that they wanted to pitch in.  Well here is a great way for everyone to help out in ways that they never imagined.

n9. Install a green roof and allocate the expense under roof repairs.  Green roofs are environmentally friendly and help cut down on co within the environment. this is also a great way for homeowners who live on the top floor to save on their heating and cooling bills.  besides, the current roof which is about 25 years old needed some work anyway.  n8. Upgrade the swimming pool to a salt water pool (without the consultation and approval of the homeowners).  think of

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10.15

the therapeutic benefits of this. everyone is talking more and more about ways to live a healthier lifestyle and this will ensure your association will be the talk of the town.  So what if you have to buy all new pool maintenance equipment?  the current equipment was on its way to the graveyard anyway. n7. Decrease the management fees by 50% and hire a startup management company. this is an ideal way to save money and can help the board cut assessments.

CONDO LIFESTYLES

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CONDO LIFESTYLES

So what if the new management company drains away your savings. besides, all the homeowners are sick and tired of “overpaying” for services and this is a perfect way to cut back on the budget expenses. And make sure that the board hires that startup company without any due diligence, because hiring an attorney to review the contract will coSt $$$. n6. Weed wack the landscaping budget. the landscaping budget has mushroomed over the years and has really gotten out of control.  It’s time to take back control of the gardening budget and bring the services in house.  this is a great way for all the homeowners to pitch in and help save the association money.  Don’t worry about the fact that the association spent $50,000 installing the new garden.  now that the new sprinklers are installed, it should easily maintain itself.  n5. Go retro with the lighting and install vacuum tube lamps. Isn’t that the new look?  retro vacuum tube light bulbs. leD lighting is too sterile. think of all the benefits such as warmer common areas and something for the building engineer to do.

n4. Freeze all capital expenditures for 5 years (and don’t raise the assessments). this way, the association will have time to build up the reserves.  besides, the hot water tanks are in the basement and there are a few floor drains just in case.  not only that but the hallways were painted about 5 years ago and all the board of directors realized that their condo investments are all underwater.  So they have no intention of selling for at least the next 5 years. 

n1. Don’t pass a 2016 budget. last year’s budget was blown by July and the last thing the board wants to do is create another fiscal mistake. remember the saying: if it ain’t broke, don’t fix it. besides, the association has $500,000 in reserves so the fact that the 2015 budget was blown by $50,000 still leaves the association with another 9 years of budget blowing opportunities.

n3. Cut back on all legal collections activity. these legal fees are sky high and are really draining our savings. besides, if someone can afford to pay, then we need to be sensitive to their situation.  We as a community should then pick up the slack for those that don’t pay.

So in summary, it is very important for the board to take the time to carefully review the past financial performance as an association and craft a 2016 that will take into account the current reality of the association in terms of physical infrastructure, collections and operating expenses. then add some pixie dust and pray that your board doesn’t follow any of these guidelines. Y

n2. Pass rules and regulations requiring all homeowners to install their own individual heating system (even though there is a common area boiler). this is a sure way to heat up the board meetings and drive up attendance.  besides, the board has been looking for ways to get the homeowners more engaged and this is the perfect way for homeowners to come to the meetings and blow off some steam.

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Summary

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INDUSTRY HAPPENINGS

Hillcrest Management

Hillcrest Property Management is pleased to welcome Mindy Maggio. Mindy has joined Hillcrest’s executive team as our Vice President of Operations. Ms. Maggio uses strategic planning and sets goals to continuously improve the operational core of Hillcrest. Mindy has an extensive background in the property management field that includes running a management company, managing communities and serving as a board member. She has been actively involved in the Community Association Industry for over 20 years and served as President of the Illinois Chapter of the Community Associations Institute in 2004 and still serves as a Board Member today. She is also a licensed insurance agent with extensive insurance knowledge pertaining to community associations.

industry happenings

Werk Management

A special reception was hosted by Jack & Lisa Mancione to commemorate 40 years in business and the 20th anniversary of Werk Management on Friday August 14th at Eddie Merlot's in Burr Ridge.

enhancing landscapes for life… • Landscape Maintenance • Landscape Design/Build • Landscape Construction • Seasonal Flower Rotations • Snow and Ice Control

Riggio/Boron, Ltd.

Y Shown above (from L to R) is Lee McGinty, Lisa Mancione, Colleen McCormack, Nicole Franz, Diana Luna and Lisa Luna.

708.926.2304 gsemmer@semmerlandscape.com

Riggio/Boron, Ltd. recently celebrated their 20th anniversary with a special event held on August 24 at the Max McGraw Wildlife Foundation in Dundee, IL. The picnic style gathering was attended by over 100 customers and employees and featured BBQ and many activities including sporting clay competition, fishing, volleyball, baggo games, and an exotic animal show.

FirstMerit Bank

FirstMerit Corporation announces the appointment of Martin I. Klauber as Senior Vice President to manage the bank’s Condominium and Homeowners Association in the Chicago area. Klauber has more than 25 years of banking experience, most recently at First Midwest Bank, following positions at JPMorgan Chase, the Private Bank and Popular Community Bank. Klauber earned his Bachelor of Arts from the University of Buffalo and his MBA in Finance from the University of Wisconsin-Madison. He serves on the Board of Regents of Trinity International University and is a member of the Community Associations Institute, Illinois Chapter; Association of Condominium, Townhouse and Homeowners Associations; and is a past president of the Gurnee Rotary Club. Klauber lives in Grayslake, Ill. FirstMerit Corporation is a diversified financial services company headquartered in Akron, Ohio, with assets of approximately $25.3 billion as of June 30, 2015, and 367 banking offices and 399 ATM locations in Ohio, Michigan, Wisconsin, Illinois and Pennsylvania. FirstMerit provides a complete range of banking and other financial services to consumers and businesses through its core operations. Principal affiliates include: FirstMerit Bank, N.A. and FirstMerit Mortgage Corporation.

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2015©.

10.15

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CONDO LIFESTYLES

industry happenings

Rowell, Inc.

Landscape Concepts Management

Rowell, Inc. is pleased to announce that Jennifer McCaw, CMCA, AMS recently joined the company as a Portfolio/Property Manager. McCaw has over 8 years of experience in the community association field. The announcement was made by Rowell’s President Kara Cermak, CMCA, AMS, PCAM. Cermak continued, “we’d also like to formally congratulate Kelsey Elgas, CMCA on obtaining her manager certification and license as well as being promoted to Portfolio Manager for our firm.” Rowell has been managing community associations for 43 years and is one of the few Illinois firms accredited with CAI’s AAMC. Ms Cermak dedicates time to teaching other management professionals as a part of the Community Association Institute’s faculty, several times a year.  Rowell held a seminar on October 10th in Schaumburg for their clients on the topic of Association Financials.

FirstService Residential

Y Shown here is Teri Lind, Elena Jimenez, June

FirstService Residential held their annual Vendor Expo on Friday, July 24th. Over 200 guests were in attendance along with 60 industry partners that exhibited their products and services to FirstService managers and operational teams. Held at the Abbington Banquet Hall in Glen Ellyn, FirstService Residential proudly donated over $11,000 of the event proceeds to the Neighborhood Housing Service of Chicago (NHS). Visit www. nhschicago.org to see how NHS supports and revitalizes neighborhoods in need. A legal update seminar and discussion was held for property managers and board member attendees. FirstService Residential President Asa Sherwood commented, “We’re very proud to be part of an industry that positively impacts the lives of so many. That is why we created our Vendor Exposition - bringing the industry’s best and brightest together in a dynamic learning environment for our customers and valued partners to forge new relationships and share ideas.” This year the event also featured an informative legal Q& A seminar hosted by several community association legal experts.

McCrory and Nick Helmer. Landscape Concepts Management held an open house at their corporate offices located in Grayslake, IL on August 6th. Nearly 150 client, colleague and supplier guests attended the event which featured a pig roast, craft beers, and live music. Landscape Concepts Management was founded in 1981 by Mike Kerton and is now one of the largest and most diversified commercial landscaping companies in the Midwest, with hundreds of employees and annual revenues in the tens of millions. In addition to their corporate office facility in Grayslake, LCM has Chicagoland branch offices in Aurora and Chicago and also has a Milwaukee area branch office located in Mequon, WI. The company also has its own tree nursery and grows its own perennials out of Bristol, WI.

Smart Elevators Taking Care of Chicagoland the Smart Way!

Try the Smart Way, Choose Smart Elevators Smart Elevators is a full service elevator maintenance and repair firm that operates with honesty, integrity and pride. Our business is built on referrals, with safety and reliability our foremost concern. Services Include: » Systematic and comprehensive maintenance service. » Modernization and ADA upgrades » Pressure Testing and Annual State Safety Testing.

P. 630.544.6800 661 Executive Drive Willowbrook, IL 60527

www.smartelevators.com

» We repair all brands and types of escalators, freight, Lifts, dumbwaiter and private residence elevators. Mention this ad and receive 10% of your first year maintenance service

16                               C O N D O   L I F E S T Y L E S         10.15

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EVENT HIGHLIGHTS

Proposalpalooza Plus

MCD Showcases the Races August 27, 2015 at Arlington International Racecourse

Associa Chicagoland recently hosted its annual community management seminar, Proposalpalooza Plus 2015, raising $2,100 for Associa Cares, a national nonprofit 501(c)(3) organization created to assist families and communities in crisis as a result of natural and man-made disasters.

Y (from L to R) Shruti Kumar - dk living, Sara McGuire - Smithereen Pest Management, Dan Cehen & Alisa Singletary - dk living

Y Pictured here is a group of guests on a paddock tour before the Westside Mechanical race.

Approximately 275 guests attended the annual event that was held on August 29 at the Donald E. Stephens Convention Center in Rosemont. Activities included a board member breakfast, silent auction and a speeddating style vendor fair where the attendees spent two minutes at each booth before moving to the next one. “This year we featured close to 100 top community management vendors who were able to showcase their products to the hundreds of industry professional and HOA board members in attendance,” says Associa Chicagoland President Don Kekstadt. “It was a tremendous success, as board members were able to network and discuss current and new project needs and we were able to contribute more than $2000 to Associa Cares.

Y Shown here is a group of guests on a paddock

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tour before the Xfinity Communities race.

Y Pictured here is a group of guests on a paddock tour before the Chicagoland Buildings & Environments/SuburbanElevator race.

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CONDO LIFESTYLES

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CONDO LIFESTYLES

From the Editor

F

all is here and it seems as though this year has gone by quickly. Thanksgiving will be here soon and although life challenges us more than we like, we still have much to be thankful for. Hopefully

we will have some striking fall colors to enjoy and appreciate. Soon after that will

CondoLifestyles

®

Y Mike Davids

come many holiday events and activities that give us time to pause and reflect on the past year.  One of the most important topics that has given many reason to pause and reflect, is the  licensing of community managers. Another current major issue for Associations is the Palm II court case. There is typically

october 2015 | volume 19 | number 3 editor & Publisher Michael C. Davids vice President Sherri Iandolo Art Director Rick Dykhuis Special events coordinator Mary Knoll contributing Writers Pamela Dittmer McKuen, Jim Fizzell, David Mack, and Cathy Walker circulation Arlene Wold Administration Cindy Jacob and Carol Iandolo Condo Lifestyles magazine is published quarterly by mcD media, a wholly owned subsidiary mcD marketing Associates, Inc. For editorial, advertising and subscription information contact: 935 curtiss Street, Suite 5, Downers Grove, Il 60515. 630-932-5551 or 630-202-3006.

an adjustment period for new laws after they go into effect and manager licensing is no different in this regard. Sometimes new laws or court rulings are essentially good and at the same time bring about new challenges and issues that must be addressed. Our cover story offers the perspective of a number of leading community management companies on the new issues they are faced with as a result of manager licensing and Palm II. Fall is the time for preparing budgets and holding elections at community associations for next year as well as wrapping up exterior projects. As such, we have two articles on budgeting featured in this edition. One article is a tongue in cheek guest editorial and the other article appears in our Money Matters column and covers some of the most over looked aspects in Association budgeting.  Our economy here continues to improve so that foreclosures and delinquent assessments do not completely dominate every budget discussion. Although the budgets of many are still stressed and require careful planning, more Associations are restoring funding for reserve accounts projects and undertaking capital projects. Real Estate values and market conditions are improving with increased sales activity, renting and unit owners as landlords continue to be a big issue. However, short term rental (Airbnb, etc) issues have become even bigger as it relates to dealing with renters in association life.      Rules & Regulations are important at all times of the year and we have two articles on this subject inside this issue.  One article provides an overview of litigation as it relates to community association rule violations & disputes. Another article in this arena discusses the drafting of rules and regulations in consideration of the Fair Housing Act.  A second guest editorial, plus our regular Industry Happenings and Event Highlight columns can also

Circulation: Condo Lifestyles is available for a single issue price of $8.95 or at a $30.00 annual subscription. Distribution is direct mailing and delivery direct through authorized distributors to over 5,000 officers and directors of common Interest communities, 800 property managers, 400 realtors, 400 developers and 400 public officials. total circulation is 9,500. Condo Lifestyles attempts to provide its readership with a wide range of information on community associations, and when appropriate, differing opinions on community association issues.

be found in this issue.   State of the Industry Program on December 10 Taking time to review important issues and identify those that will require significant attention in the coming year is the main purpose of our annual Condo Lifestyles State of the Industry program. Legislative/legal, budgeting and operational issues will again dominate our presentations, discussion and resources that are made available on December 10 at the Chicago Cultural Center. A legal and case law update will be provided and the previously mentioned Manager Licensing & Palm II case as well as how to find quality managers and board members will be among the topics discussed. We also recognize members of our magazine advisory boards at this program. You can find more information on this event at www.condo-

All material herein is copyrighted 2015. No part of the publication may be reproduced whatsoever without written consent from the publisher. this publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is issued with the understanding that the publisher is not engaged in rendering legal or accounting services. If legal advice is required, services should be sought. Advertisers assume liability for all content of advertisements printed, and also assume personal liability for any claims arising therefrom against the publisher relating to advertising content. the publisher and editors reserve the right to reject advertising or editorial deemed inappropriate for the publication.

lifestyles.net or email: mdavids@condolifestyles.net Special thanks to the companies, associations and groups that are Authorized Distributors of Condo Lifestyles. Those of you who are not current subscribers can find subscription information on our website at www.condolifestyles.net.  Please enjoy the upcoming holiday season. We encourage you to take this opportunity to make your association and your community all it can be. If you have an idea that would benefit other Community Associations, a success story to share, or some advice on how to avoid a problem or failure, please send us an e-mail (mdavids@condolifestyles.net) Y Michael C. Davids Editor and publisher

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SERVICE DIRECTORY

ACCOUNTANTS

ARCHITECTS/ENGINEERS

ATTORNEYS

CANTEY ASSOCIATES, CPA’S (630) 681-9400

CODER TAYLOR ASSOCIATES (847) 382-4100

FULLETT ROSENLUND ANDERSON, P.C. (847) 259-5100

ANNUAL ACCOUNTING SERVICES:

“We Specialize in Emergency Repairs” Architects • Research • Engineering Specifications • Reserve Studies coder@codertaylor.com

Audits Reviews Compilations Income Taxes Board of Directors Training Monthly Services: Collection of Assessments Paying of Bills Monthly Financial Statements Consulting for Developer Turnover  and Major projects

KEOUGH & MOODY, P.C. (630) 369-2700

FULL CIRCLE ARCHITECTS, LLC (847) 432-7114

www.canteycpa.com

MICHAEL J. COCHRANE, CPA (847) 301-0377

Legal Representation for  Community Associations www.kmlegal.com

Daniel Baigelman, AIA dan@fullcirclearchitects.com Capital Improvements • Reserve Studies Engineering Reports

Specializing in Accounting Services for Homeowner Associations.

www.frapc.com

www.fullcirclearchitects.com

LAW OFFICES OF KEAY & COSTELLO (630) 690-6446 pcostello@keaycostello.com www.keaycostello.com

CONDO CPA (630) 832-2222 EXT 113

J. HERSHEY ARCHITECTURE (847) 549-5900

CONTACT BRAD SCHNEIDER Brad@CondoCPA.com

Evaluations/Bid Repair Specifications/Reserve Studies

www.jhersheyarchitecture.com

CERTIFIED PUBLIC ACCOUNTANTS

Accounting Solutions for Management  Companies & Self-Managed Associations Audit & Accounting Services Income Tax Reduction & Planning

KELLERMEYER GODFRYT & HART, P.C. (847) 318-0033 Investigations and Repair  Documents for: Exterior Walls, Windows, Roofs,  and Parking Garages Condition Surveys and Reserve Studies www.kghpc.com

CUKIERSKI & KOWAL, LLC CERTIFIED PUBLIC ACCOUNTANTS

(847) 496-7180 A full-service accounting firm specializing in the unique needs of homeowners’ associations.

www.ckwcpa.com

FROST, RUTTENBERG & ROTHBLATT, P.C. (847) 282-6340

SUPERIOR RESERVE ENGINEERING & CONSULTING (888) 688-4560 www.superiorreserve.com

WALDMAN ENGINEERING CONSULTANTS (630) 922-3000

CERTIFIED PUBLIC ACCOUNTANTS

Contact:  Steve Silberman, CPA

www.waldmaneng.com

ARCHITECTS/ENGINEERS

ATTORNEYS BTL ARCHITECTS, INC. (312) 342-1858 Bringing Buildings Back to Like Contact Delph Gustitius www.btlarchitects.com

KOVITZ SHIFRIN NESBIT (855) 537-0500 Advising and Consulting with Business  Owners, Community Association  Law & Collection Services, Construction  Defects, Real Estate Assessed Valuation  Reduction, Litigation, Commercial  Restructuring, Bankruptcy & Creditors' Rights, Real Estate, Business ,Estate Planning www.ksnlaw.com

LEVENFELD PEARLSTEIN, LLC 312-476-7556 Howard Dakoff  /  hdakoff@lplegal.com www.lplegal.com

BALCONY REPAIR THE RESTORATION GROUP (630) 231-5700 24 HOURS

Structural Repair Services Balcony Repair/Replacement Stair Tower Repair/Replacement Fire and Water Response/Restoration dwells@trgrestore.com www.trgrestore.com

DICKLER, KAHN, SLOWIKOWSKI & ZAVELL, LTD. (847) 593-5595

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2015©.

www.dicklerlaw.com

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CONDO LIFESTYLES

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CONDO LIFESTYLES

BANKING

BUILDING RESTORATIONS

CONCRETE RAISING

ALLIANCE ASSOCIATION BANK (815) 342-4228 / (888) 734-4567

DAKOTA EVANS RESTORATION, INC. (847) 439-5367

CRC CONCRETE RAISING & REPAIR (847) 336-3400

Full service banking and lending solutions for management companies and associations. cfinck@AllianceAssociationBank.com www.AllianceAssociationBank.com

COMMUNITY ADVANTAGE, A WINTRUST COMPANY (847) 304-5940

We Save Concrete, You Save Money! www.SaveConcrete.com

Tuckpointing  ~  Masonry Repairs Waterproofing  ~  Terra Cotta Repairs Caulking & Sealants  ~  Structual Repairs Cleaning  ~  Balcony Restoration Concrete Restoration www.dakotaevans.com

CARPET CLEANING DONE JUST RIGHT INC. 630-893-0757

GOLF CONSTRUCTION (219) 933-3420

Loans, Reserve Investments & Lock Box Services www.communityadvantage.com

www.djrcleaning.com Email: mcorliss@djrcleaning.com

www.golfconstruction.net

FIRSTMERIT BANK (847) 223-7920 Email: Martin.Klauber@firstmerit.com

ITASCA BANK & TRUST (630) 773-0350 “Together We’ll Shape the Future” www.itascabank.com

MUTUAL OF OMAHA BANK (866) 800-4656

CREDIT BUREAU REPORTING HOLTON BROTHERS, INC.

(847) 253-3886 TEL / (847) 253-3255 FAX John@holtonbrothers.com www.holtonbrothers.com

THE REAL SEAL, LLC (847) 756-7987

jstarks@sperlongadata.com www.sperlongadata.com

DOORS LS CONTRACTING GROUP, INC. T (773) 279-1122 F (773) 279-1133 Contact: Tom Laird tlaird@lscontrtacting.com www.lscontracting.com

HOA Banking • Internet Cash Management HOA Loans • Online Payment Services www.mutualofomahabank.com

BASEMENT WATERPROOFING

SPERLONGA DATA & ANALYTICS (952) 500-1068

Masonry Repair Services, Tuckpointing, Caulking and Concrete Restoration

Window and Related Masonry Interior & Exterior Doors | Siding & Gutters www.woodlandwindows.com

DUCT CLEANING

QUALITY RESTORATIONS (630) 595-0990

austinwerner@therealsealllc.com

WOODLAND WINDOWS & DOORS 630-529-DOOR (3667)

AIRWAYS SYSTEMS, INC. 630-595-4242

RIGGIO/BORON LTD. 847-531-5700

Cleaning: Air/Laundry/Toilet Exhaust Ducts, Coils, Trash Chutes, Parking Garages. Also Air Filters, Belts www.airwayssytems.com

BUILDING RESTORATIONS

A Total Exterior Facade Restoration Company www.RiggioBoron.net

BRAL RESTORATION, LLC. (847) 839-1100

CONCRETE

DONE JUST RIGHT INC. 630-893-0757

Masonry and Concrete Restoration www.bralrestoration.com

HARD SURFACE SOLUTIONS (630) 916-8005 / (847) 838-6610

www.djrcleaning.com Email: mcorliss@djrcleaning.com

FORUM GROUP, INC. (773) 732-3051

Concrete Flatwork Specialists | Asphalt Paving Curbs & Driveways | Sidewalks Footings & Foundations Colored Concrete | Stamped Concrete Aggregate Finish Concrete Parking Structure Maintenance & Repair

www.ForumGroupInc.com

Contact Tom Frye

www.hsshardsurfacesolutions.com

20                               C O N D O   L I F E S T Y L E S         10.15

ELEVATORS/CONSULTANTS SMART ELEVATORS CO. (630) 544-6829 www.smartelevatorsco.com smartin@smartelevatorsco.com

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SERVICE DIRECTORY

ELEVATORS/CONSULTANTS

FIRE/FLOOD RESTORATION

FLOORING

SUBURBAN ELEVATOR CO. 847-743-6200

QCI RESTORATION (847) 891-2929 (866) 832-6724

MR BAMBOO 1(888) 672-2628

Simplifying Vertical Transportation Contact: Max Molinaro www.suburbanelevator.com

ENERGY USE/BENCHMARKING

www.mrbambooflooring.com

www.QCIrestoration.com

THE RESTORATION GROUP, LLC (630) 870-0658 www.trgrestore.com

WESTSIDE MECHANICAL GROUP (630) 618-0608 / (630) 369-6690

FIRE SAFETY & PROTECTION

Serving the Tri-State Area Since 1970 Contact: Jackie Loftis * jloftis@wsmech.com www.wsmech.com

GARBAGE CHUTE CLEANING BROUWER BROS. STEAMATIC (708) 396-1444 (708) 396-1477 www.bbsteamatic.com

HVAC

CONTECH MSI CO. (847) 483-3803

ALTHOFF INDUSTRIES (312) 332-5700

Fire Detection & Signaling Systems Fire Alarm Systems Chicago Life Safety Evaluation Solutions Security Systems/CCTV Card Access Systems www.contechco.com

Mechanical - Plumbing - Electrical - Building Automation www.althoffind.com

Natural Gas & Electric Energy Reliable Service. People You Trust. Contact: Vickie Farina Vickie.Farina@centerpointenergy.com www.CenterPointEnergy.com/CES

EMCOR SERVICES TEAM MECHANICAL FIRE PROTECTION DIVISION (847) 229-7600

www.emcortmi.com

OCEANS ENERGY (312) 870-0580

SIMPLEX GRINNELL (630) 948-1235

info@oceanscc.com www.oceanscc.com

Fire Alarm / Sprinkler Systems Fire Pumps / Extinguishers Fire Panel Monitoring Installation / Testing / Maintenance 24/7 Service: (630) 948-1200 www.simplexgrinnell.com

ENERGY SOLUTIONS CENTERPOINT ENERGY SOLUTIONS (630) 795-2594

BROUWER BROS. STEAMATIC (708) 396-1444

AMS MECHANICAL SYSTEMS, INC. (800) 794-5033

www.emcortmi.com

FIRE/FLOOD RESTORATION

EMCOR SERVICES TEAM MECHANICAL (847) 229-7600

24 Hour Service HVAC • Industrial Refrigeration Service/Maintenance • Systems Integration Energy Management • Electrical Process Piping • Plumbing www.amsmechanicalsystems.com

All types of environmental cleaning. (708) 396-1477 | www.bbsteamatic.com

NORTHERN ILLINOIS FIRE SPRINKLER ADVISORY BOARD (NIFSAB) (866) 2NIFSAB (866-264-3722)

GENESIS CONSTRUCTION, INC. (847) 895-4422

708-403-4468 www.firesprinklerassoc.org

WESTSIDE MECHANICAL GROUP (630) 618-0608 / (630) 369-6690 Serving the Tri-State Area Since 1970 Contact: Jackie Loftis * jloftis@wsmech.com www.wsmech.com

www.genesisconstruction.com

For Display or Professional Services Directory Advertising Info, Call (630) 202-3006

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2015©.

10.15

CONDO LIFESTYLES

21


CONDO LIFESTYLES

HVAC

LANDSCAPE CONTRACTORS

LOCKSMITH

THE YMI GROUP, INC. (847) 258-4650

ACRES GROUP (888) 231-1300 / (847) 526-4554

NONSTOP LOCKSMITH 312-929-2230

Mechanical - Plumbing Building Automation - Service www.ymimechanical.com

Professional Landscaping and Snow Removal www.acresgroup.com

ALAN HORTICULTURAL ENTERPRISES, INC. (630) 739-0205

H V A C CLEANING BROUWER BROS. STEAMATIC (708) 396-1444 All types of environmental cleaning. (708) 396-1477 | www.bbsteamatic.com

Locksmith Services, Intercom & Access Control Systems, CCTV, Overhead Garage Doors www.nonstoplocksmith.com

MAILBOXES MAILBOX WORKS (630) 355-9989/(773) 528-3111

www.alanhorticultural.com

BALANCED ENVIRONMENTS, INC. (847) 395-7120 | (630) 916-8830

Large Variety of Commercial and Residential Mailboxes Intercoms and Tele-Entry Address Signage & Engraved Nameplates Installation Services Since 1989

www.MailboxWorks.com

www.BalancedEnvironmentsInc.com

INSURANCE

NON PROFIT/EDUCATION

HOLLINGER SERVICES, INC. (847) 437-2184 Property Casualty • Employee Benefits Workers Compensation www.HollingerInsurance.com

OCEANS ADVISORS (312) 508-3032

ABOMA (312) 902-2266

www.iltvignocchi.com

ABOMA1@aol.com www.aboma.com

LANDSCAPE CONCEPTS MANAGEMENT, INC. (847) 223-3800

MESIROW FINANCIAL (312) 595-8135 Nancy Ayers www.condorisk.com

ILT VIGNOCCHI (847) 487-5200

www.landscapeconcepts.com

SEBERT LANDSCAPING, INC. (630) 497-1000

info@oceansadvisors.com www.oceansadvisors.com

INTERNET TECHNOLOGY WEBPASS (800) WEBPASS Simple Urban Internet www.webpass.net

JANITORIAL SERVICES

www.sebert.com

www.djrcleaning.com Email: mcorliss@djrcleaning.com

Association of Condominium, Townhouse and Homeowners Associations

actha@actha.org | www.actha.org

COMMUNITY ASSOCIATION INSTITUTE OF ILLINOIS (847) 301-7505 info@cai-illinois.org | www.cai-illinois.org

SEMMER LANDSCAPE 708-926-2304

PAINTERS

gsemmer@semmerlandscape.com

AAA PAINTING CONTRACTORS, INC. (630) 231-8350

LAWN CARE SPRING-GREEN LAWN CARE (800) 830-5914 www.spring-green.com

DONE JUST RIGHT INC. 630-893-0757

ACTHA (312) 987-1906

www.aaapaintco.com

ABBOTT PAINTING, INC. (312) 636-8400 (773) 725-9800 Quality Painting & Decorating since 1973 Our Mission: Guaranteed Committment to Quality Now offering Parking Lot Painting www.Abbottpainting.com

For Display or Professional Services Directory Advertising Info, Call (630) 202-3006 22                               C O N D O   L I F E S T Y L E S         10.15

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2015©.


SERVICE DIRECTORY

PAINTERS

PLUMBING

PROPERTY MANAGEMENT

CERTAPRO PAINTERS OF THE NORTH SHORE (847) 287-2642

AMS MECHANICAL SYSTEMS, INC. (800) 794-5033

ASSOCIA CHICAGOLAND 312-944-2611 / 847- 490-3833

Interior & Exterior Painting Wallcoverings • Decorating • Remodeling Drywall Repair • Decks & Staining Tile Installation • Metal & Iron Painting www.certacommercial.com tivanov@certapro.com

24 Hour Service

www.associachicagoland.com

Plumbing • HVAC Service/Maintenance • Systems Integration Energy Management • Electrical Process Piping •Industrial Refrigeration www.amsmechanicalsystems.com

CHICAGOLAND COMMUNITY MANAGEMENT (312) 729-1300

Chgo #BC 16138 / IL #055043442

www.chicagoland-inc.com

PRECISION PAINTING AND DECORATING CORP. (630) 688-9423

LIFELINE PLUMBING 847-468-0069 Plumbing - Heating & Air Conditioning Water Heaters - Sewer Cleaning & Repair Hot Water Drain Jetting www.INEEDLIFELINE.com

www.ppdpainting.com

PARKING GARAGE CLEANING EXTREME POWER CLEANING INC. (630) 532-0345 www.ExtremePowerCleaning.com info@extremepowercleaning.com

CHICAGO PROPERTY SERVICES, INC. (312) 455-0107 X102 www.chicagopropertyservices.com

MORE LIVING. LESS WORRYING.

PROPERTY MANAGEMENT A PLUS PROPERTY MANAGERS, INC. (847) 315-0222

COMMUNITY SPECIALISTS (312) 337-8691 www.communityspecialists.net

Professionals helping volunteers.

PAVING

info@aplusmanagers.com / www.aplusmanagers.com

DUBOIS PAVING (847) 634-6089 (800) 884-4728

ACM COMMUNITY MANAGEMENT (630) 620-1133

www.duboispaving.com

www.acmweb.com

HARD SURFACE SOLUTIONS (630) 916-8005 / (847) 838-6610 Contact Tom Frye

ADVOCATE PROPERTY MANAGEMENT 630-748-8310

www.hsshardsurfacesolutions.com

www.advocatepm.com

PEST CONTROL

ALMA PROPERTY MANAGEMENT (847) 517-4400

ALL-OVER PEST SOLUTIONS (773) 697-1100 Bed Bug Specialists. Results Guaranteed! www.all-overpest.com

SMITHEREEN PEST MANAGEMENT SERVICES (847) 647-0010 / (800) 336-3500 www.smithereen.com

Contact Tom Taylor

www.dkcondo.com

Contact Tom Skweres

THE HABITAT COMPANY (312) 527-5400 www.habitat.com

FIRST COMMUNITY MANAGEMENT (312) 829-8900

www.almapropertymanagement.com

BAUM PROPERTY MANAGEMENT, LTD. (630) 897-0500

Guiding board members since 1988 www.condomanagement.com

FIRSTSERVICE RESIDENTIAL (312) 335-1950 Contact Asa Sherwood

www.BaumProp.com

www.fsresidential.com

CARUSO MANAGEMENT GROUP, INC. (630) 717-7188

G&D PROPERTY MANAGEMENT (630) 812-6400

www.carusomanagementgroup.com

www.gd-pm.com

RESIDENTIAL & COMMERCIAL

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2015©.

DK CONDO (312) 346-8600

10.15

CONDO LIFESTYLES

23


CONDO LIFESTYLES

PROPERTY MANAGEMENT

PROPERTY MANAGEMENT WERK MANAGEMENT (630) 241-0001

HILLCREST MANAGEMENT (630) 627-3303 / (312) 379-0692

ADAMS ROOFING PROFESSIONALS INC. (847) 364-7663

For All Your Property Needs www.werkmanagement.com

www.hillcrestmgmt.com

LIEBERMAN MANAGEMENT SERVICES (847) 459-0000

ROOFING

Roofing / Siding / Gutters / Insulation www.adamsroofing.com

REAL ESTATE TAX ATTORNEY ALL AMERICAN EXTERIOR SOLUTIONS (847) 438-4131

ELLIOTT & ASSOCIATES (847) 298-8300

www.liebermanmanagement.com

www.elliottlaw.com

MCGILL MANAGEMENT, INC. (847) 259-1331

Roofing, Siding & Windows  www.aaexs.com

KSN TAX (847) 537-0500

www.mcgillmanagement.com

AMERICAN BUILDING CONTRACTORS, INC. (847) 670-1887

www.KSNLaw.com

NIMROD REALTY GROUP, INC. (847) 724-7850

Roofing • Siding • Windows • Gutters Maintenance • Capital Budget Projects A+ BBB Rating www.abc-usa.com

WORSEK & VIHON LLP (312) 368-0091

www.nimrodrealty.com

www.wvproptax.com

PROPERTY SPECIALISTS INC. (847) 806-6121

RESERVE STUDIES

ROLLING MEADOWS OFFICE

ATJ'S HOME IMPROVEMENTS (630) 432-3238

(630) 633-5450 WOODRIDGE OFFICE

www.psimanagement.net

RESERVE ADVISORS, INC. Our Reserve Studies Now Include ForeSite™

REALTY & MORTGAGE CO. COMMUNITY ASSOCIATION MANAGEMENT

773-989-8000 1509 W Berwyn Chicago IL 60640 contact: Chown Lemon www.RealtyMortgageCo.com

SUDLER PROPERTY MANAGEMENT (312) 751-0900

(312) 625-4958 Custom, Comprehensive Studies Conducted by Professional Engineers www.reserveadvisors.com Long-term Thinking.  Everyday Commitment.

B.T. LAKESIDE ROOFING (630) 628-0093 www.lakeroof.com

SUPERIOR RESERVE ENGINEERING & CONSULTING (888) 688-4560

CSR ROOFING CONTRACTORS (708) 848-9119 www.csr-roofing.com See our ad on page 8.

www.superiorreserve.com

2014 IREM Management Company of the Year

ROOFING

www.sudlerchicago.com

TAIRRE MANAGEMENT SERVICES (847) 299-5740

www.atjshomeimprovement.com

ACTIVE ROOFING CO., INC. (773) 238-0338/(708) 430-8080

tsutton@tairremgmt.com

24                               C O N D O   L I F E S T Y L E S         10.15

Established 1965 Maintenance & Repairs Roofing/Sheet Metal/Tuckpointing www.activeroofing.com

MI CONSTRUCTION AND ROOFING (630) 241-0001 www.mancioneinc.com

PROHTOP ROOFING (847) 559-9119 We’re Here When You Need Us! www.protoproofing.com

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2015©.


SERVICE DIRECTORY

ROOFING

SNOW REMOVAL

SIDING / RENOVATIONS

S&D ROOFING SERVICE (630) 279-6600

THE WINTER WERKS (630) 241-0001

B.T. LAKESIDE ROOFING (630) 628-0093

www.mancioneinc.com

www.lakeroof.com

SWIMMING POOLS

WOODLAND WINDOWS & DOORS (630) 529-DOOR (3667)

250,000 roofs installed since 1963 TEAR OFFS • SHINGLES • FLAT Multi-Family ROOFING Specialist Our experience & technical know-how gets the job done right the first time! www.sdroofing.com sales@sdroofing.com

SITE MAINTENANCE, INC. (847) 697-1077 www.sitemaintinc.com

SPMS (630) 692-1500 Heaters Pumps • Repairs • Chemicals Pool Maintenance • Complete Water Analysis    Pool Guards, Inc. ross@spmspools.com

TREE CARE

SECURITY SERVICES ADMIRAL SECURITY DOOR STAFF SOLUTIONS (847) 588-0888

ACRES GROUP (888) 231-1300 / (847) 526-4554 Certified Arborists & Certified Tree Care Safety Professionals www.acresgroup.com

www.admiralsecuritychicago.com

SAVATREE SAVALAWN

GUARDIAN SECURITY SERVICES (708) 385-3300

PREMIER SECURITY (773) 867-8813 www.premiersecuritycorp.com

TV-BULK CABLE & SATELLITE RCN (312) 955-2322 rcnchicagoapts@rcn.net www.rcn.com

XFINITY COMMUNITIES 1 (800) XFINITY For more information E-mail: xfinity_communities@cable.comcast.com www.comcast.com/xfinitycommunities

Northbrook: 847.729.1963 Barrington: 847.726.1991 Warrenville: 630.725.1963 www.savatree.com

Providing Chicagoland’s Finest  Door Staff and Security Officers since 1975 www.guardiansecurityinc.com

Window and Related Masonry Interior & Exterior Doors | Siding & Gutters www.woodlandwindows.com

WASTE SERVICES

SIDING / RENOVATIONS

LAKESHORE RECYCLING SYSTEMS (773) 685-8811

ACCURATE EXTERIORS (630) 830-9191

www.LakeshoreRecyclingSystems.com

WINDOWS/REPLACEMENTS

SNOW REMOVAL ATJ'S HOME IMPROVEMENTS (630) 432-3238

ALL AMERICAN EXTERIOR SOLUTIONS (847) 438-4131

WOODLAND WINDOWS & DOORS (630) 529-DOOR (3667)

www.atjshomeimprovement.com

www.aaexs.com

Window and Related Masonry Interior & Exterior Doors | Siding & Gutters www.woodlandwindows.com

HARD SURFACE SOLUTIONS (630) 916-8005 / (847) 838-6610

ATJ'S HOME IMPROVEMENTS (630) 432-3238

Contact Tom Frye

www.atjshomeimprovement.com

WOODLAND WINDOWS & DOORS (630) 529-DOOR (3667)

www.hsshardsurfacesolutions.com

For Display or Professional Services Directory Advertising Info, Call (630) 202-3006 No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2015©.

WINDOW RESTORATION

10.15

Window and Related Masonry Interior & Exterior Doors | Siding & Gutters www.woodlandwindows.com

CONDO LIFESTYLES

25


CONDO LIFESTYLES

ABOMa

Anchors

Away 9.10.15

Crystal GARdens at Navy Pier, ChIcago

Baum PROPERTY MANAGEMENT

Professional Community Management C O N TA C T

Michael D. Baum, CPM, PCAM

630-897-0500 www.BaumProp.com

26                               C O N D O   L I F E S T Y L E S         10.15

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2015©.


A S O O C I AT I O N ’ S   AV E N E U E

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2015©.

10.15

CONDO LIFESTYLES

27


CONDO LIFESTYLES

By Jonathan D. Wassell - Keough & Moody, P.C.

Drafting Rules and Regulations in Consideration of the Fair Housing Act It is important for all board members to understand that the Fair Housing Act, codified  as  42  U.S.C  3601  et  seq.,  applies  to  all  Condominium  and  Common Interest  Community  Associations.  This  federal  law  prohibits  discrimination against  any  individual  in  housing  related  transactions  based  on  race,  color, national origin, religion, sex, familial status and disability. Because of the prevalence of fair housing complaints, Associations and their Board should be aware and consider the Act when the Board drafts and enforces its rules and regulations.   Why Consider the Fair Housing Act When Drafting or Enforcing Rules? Liability The principal reason that Associations should be cognizant of the Fair Housing Act when drafting or enforcing rules is because any individual may bring a legal cause of action against the Associa-

tion under the Fair Housing Act for alleged discrimination.  In fact, governmental entities, such as the Department of Housing and Urban Development (“HUD”), has the power to step into any legal action on behalf of the individual bringing the action in order to protect the individual’s interests against the Association.  These claims can also be

costly for the Association to defend because, often times, the Association will not have insurance coverage for a discrimination complaint.  Furthermore, these complaints regarding alleged discrimination under the Fair Housing Act are not only brought against the Association, but also against individual Board members or management. 

What to Consider When Drafting Rules First and foremost, when adopting any rule, the Board should consider whether or not the rule is supported by the terms of the Declaration’s governing documents.  If the rule does not conflict with the governing documents, next the Board should ask whether or not the rule is facially discriminatory.  For example, a facially discriminatory rule would be one that prohibits children from

s! r a e Y 50

Historic, Commercial & High Rise Residential Services Include: • Façade Inspection • Tuckpointing • Brick Rebuilding • Caulking • Limestone Repair/Replacement • Concrete Repairs • Terra Cotta Repair/Replacement • Cleaning Masonry • Steel Lintel or Shelf Angle Replacement

800-673-2567 Algozine Masonry Restoration • 2000 N. Lafayette Ct. • Griffith, IN 46319

www.algozinemasonry.com 28                               C O N D O   L I F E S T Y L E S         10.15

You shouldn’t accept anything less than

excellence, attention to detail, experience and a commitment level unsurpassed by any other firm.

312 729 1300 www.Chicagoland-inc.com 111 E. Wacker Drive | Suite 1412 | Chicago, IL 60601-4501

| ACCOUNTING | ADMINISTRATION | BOOKKEEPING | CONSULTING | MANAGEMENT |

for over

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| ACCOUNTING | ADMINISTRATION | BOOKKEEPING | CONSULTING | MANAGEMENT |

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| ACCOUNTING | ADMINISTRATION | BOOKKEEPING | CONSULTING | MANAGEMENT |

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L E G A L   U P D AT E

playing in hallways, because it explicitly singles out children.  Boards should also consider whether or not the rule can be perceived as discriminatory or misinterpreted, e.g. No basketball or other sport may be played on Association property.  While this may not explicitly be directed at any one group of individuals in the Association, it has a good chance of being perceived as a rule against children playing basketball or other sports, since they are the individuals most likely to engage in these activities.  Finally, the Board should also ask itself whether or not the proposed rule implies enforcement or application to a specific group of individuals, class of residents or prospective residents, such as a restriction against Section 8 rentals.  Section 8 provides government subsidies for lowincome individuals and, enforcement of this rule, may imply that the Board is singling out a specific group of low income individuals.  

Exception to the Fair Housing Act Prohibition on Age Discrimination The Fair Housing Act does have one main exception to its prohibition on discrimination. Specifically, the Act’s prohibition on Age Discrimination.  This exception is commonly referred to as the “Housing for Older Persons” exception, or

“HOPA.”  Under HOPA, Associations may discriminate against individuals based on age, if the Association meets specific requirements.  First, the Association must expressly state and be identified as being intended for occupancy by persons over the age of 55.  Also, at least 80% of the occupied units in the Association must be occupied by at least one person over the age of 55.  Furthermore, the Association must publish and adhere to policies and procedures which demonstrate its intent to be a 55 and older community.  Finally, the Association must comply with HUD rules and regulations for verification of occupancy by doing the following: 1) surveying owners every 2 years to ensure that the 80% requirement is being met; 2) maintain all surveys of owners; and 3) request appropriate age verification documents from all owners, which include: birth certificates, drivers licenses, passports, immigration cards or an affidavit from the owner attesting to the age of the occupants in the respective unit. 

Rule Enforcement Issues Just like with any Board action, there will undeniably be complaints by owners regarding any rule adopted by the Board.  When any complaint is brought it is important for the Board

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10.15

members to remain objective and consistent in all determinations of violation of the rules.  Board members should not give favorable treatment to friends and neighbors.  Furthermore, it is important that the Board create and keep a paper trail of all matters related to the violation and support for the violation of the rule.  Finally, the Board should also be aware that, under law, there may be times when it must grant an exception to a rule if certain circumstances exist, for example an owner’s request for a reasonable accommodation.

Reasonable Accommodation A reasonable accommodation is a change, exception or adjustment to a rule, policy, practice or service that may be necessary for a person with a disability to have equal use and enjoyment of a dwelling.  However, to be entitled to a reasonable accommodation the person has to be viewed as having a disability under the law.  If disabled, accommodation must be reasonable and necessary to afford requesting party equal use and enjoyment of premises. To help determine if reasonable accommodation for a person is necessary, the Association should consult legal counsel. Y

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L E G I S L AT I V E   U P D AT E

By Jim Webb, Keay & Costello, P.C.

Governor Rauner Vetoes Bills Related to Municipal Incorporation and Developer Lawsuits Governor Bruce Rauner recently vetoed two bills that had been supported by stakeholders in the condominium and common interest community association world.

S

ection 1-20 of the Common Interest Community Act provides if members of a common interest community wish to incorporate their community as a municipality, the incorporation procedure cannot begin until twothirds of the community members sign a petition agreeing to incorporation. Section 1-20 places a higher threshold on common interest communities seeking to incorporate than does the Illinois Municipal Code, which requires, depending on the population of the area, as few as 35 residents to begin a petition for incorporation. 

Common Interest and Non-Common Interest Communities As a way to lessen this extra burden placed on common interest communities, Senate Bill 1344 (sponsored by Senators William R. Haine and Mattie Hunter and by Representative Daniel V. Beiser) lowered the initial threshold for common interest communities from two-thirds to 51% of members. After the bill passed both houses of the General Assembly without a single “nay” vote, Governor Rauner vetoed the bill. In his veto message, the Governor said “The Decision to incorporate... should not be taken lightly. Illinois has almost 7,000 units of local government, more than any other state in the country. As such, we should maintain the higher threshold for initiating the incorporation process.” In vetoing Senate Bill 1344, Governor Rauner did not acknowledge that even if the threshold is lowered from two-thirds to 51%, most common interest communities would still have a much higher requirement than other communities seeking to incorporate. Given the current economic and political climate where common interest communities are taking on more responsibilities historically associated with municipal gov-

ernments, Senate Bill 1344 would have aided the residents in a common interest community to actually create their own municipality. Furthermore, a petition with the required number of signatures is only the first step in the process; the Municipal Code still requires several additional steps culminating in an election before the new city or village is incorporated. By no means does lowering the threshold for the initial petition from two-thirds to 51% make the incorporation process as easy as the Governor feared. The Governor’s concern in granting a common interest community a lower threshold, though still significantly higher than the threshold required of most noncommon interest communities, appears misplaced.

Developer Lawsuits The same day as the Senate Bill 1344 veto, Governor Rauner also vetoed House Bill 2644 (sponsored by Representatives Kelly M. Cassidy and Martin J. Moylan and by Senator Heather A. Steans). A common frustration experienced by condominium associations is the inability to pursue litigation against the community’s developer. Quite often, an association’s declaration contains burdensome requirements (written into the declaration by the developer) a board must meet before it can sue the developer, though such preconditions are not required before pursuing legal remedies against other parties. Two common requirements written into declarations by the developer are the board cannot sue the developer unless a vote of the owners has approved the litigation and the board cannot file suit until it has engaged the developer in a formal arbitration or mediation. The owner approval can be particularly difficult to overcome in a condominium where the developer still owns a significant number of units.  In recognition of this fundamental unfairness

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memorialized in declarations by developers, the General Assembly, in 2014, enacted Section 18.9 of the Condominium Property Act. According to Section 18.9, provisions in the declaration that restrict the board’s right to 1) initiate an action in court without the prior consent of the owners or 2) sue the developer or non-owners without first going through arbitration or mediation are void as against public policy unless those provisions are approved by a vote of 75% of the owners.   This year, there was concern among some association advocates that Section 18.9 was too broad and could be interpreted to invalidate declaration provisions beyond those concerning developer lawsuits - House Bill 2644 sought to alleviate this concern by specifying the only void provisions would be those limiting the board’s ability to act in a representative capacity on behalf of the owners in matters relating to the common elements or multiple units, i.e., the ability to sue or take other action on behalf of the owners. Under House Bill 2644, the board, not a purposely cumbersome process put in place by the developer, would decide when it is in the best interest of the community to pursue legal action against the developer. The bill also removed the provision of Section 18.9 allowing such void provisions to be approved by 75% of the owners. Governor Rauner vetoed House Bill 2644 and, in his statement, displayed a misunderstanding of the purpose of Section 18.9 and House Bill 2644. According to the Governor’s veto statement, Section 18.9 currently “permits condominium owners, acting by approval of 75% of unit owners, to limit or restrict certain rights of their board with respect to disputes and legal actions.”  Because the bill removed the owners’ ability to approve void provisions, the Governor reasoned, it “is an unnecessary restriction on the rights of condominium owners...” The Governor’s reasoning for the veto is reversed as to the true intent of both Section 18.9 and House Bill 2644. The purpose of both is to give owners more rights by removing self-serving provisions included in declarations by developers. Section 18.9 and House Bill 2644 protect the rights of owners, acting through the board, by restricting the ability of a developer to insulate itself from lawsuits. While Governor Rauner read the removal of the 75% override provision as limiting owners’ rights, it is more fairly read as further inhibiting the developer’s rights to block lawsuits in communities where the developer still owns units and thus has the ability to vote against suing itself. Senate Bill 1344 would have placed common interest communities on a better, though still not equal footing with non-common interest communities as to the ability to start the municipal incorporation process, and House Bill 2644 would have expanded the rights of condominium owners by limiting the ability of developers to protects themselves from legal action brought on behalf of those owners.  The Governor’s veto messages attached to these bills demonstrate the importance of association members and stakeholders to become engaged in the legislative process in order to ensure their voices are heard and elected officials have a clear understanding of their wishes and values. Y

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GUEST EDITORIAL

By Stuart A. Fullett, Fullett Rosenlund Anderson PC

Thoughts on Random Issues That Annoy Me and Likely You as Well

T

he general topic of my Guest editorial is my random thoughts, especially issues that annoy me. many have expressed to me that it would likely be shorter to list the things that do not annoy me. based on the endless possibilities, and with the indulgence of mcD media, I expect that there may be additional guest editorials. With regard to this article, while it is meant to include issues with Associations, it is also a commentary on other aspects of life and while it does not come across well in print - try to imagine my sarcasm with most comments. now, and in no particular order, I present my initial list below.

Stupid/Belligerent People: the smart person knows that there is no way that you can know everything. the goal is to surround yourself with a good team. the problem with stupid people is that you just

Personal Attacks: this often occurs at board meetings in which an owner disagrees with the board or the opinion that I have provided. In my experience it is typically an owner stating that he or she does not like what the board or I have to say. As soon as someone refers to a personal characteristic it is an indication that the complainer does not have the facts to back up the dispute and as such needs to make it personal. In my case it is usually the reference to the “smirk” (for those that know me, you are already picturing the look). once the personal attacks start, generally you have won the argument. Keep in mind that you should not justify bad behavior by acting in a similar manner or by pointing to bad behavior.

The Know-It-All: We all know this person (yes some of you may think it is me). this is the person that is a self-proclaimed expert on every subject and simply must dominate every conversation. As mark twain stated (for those that know me, you know that it is normal for me to quote mark twain) “I never learned anything while I was talking.” I trust that it is self-explanatory and if not, you have other problems. this seems like a good time to reference a sign that used to hang in my dad’s office of “those that think they know everything are particularly aggravating to those of us that do.’’ While it may not fit into this category, I just really like the sign.

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can’t argue with them. make your point and move on to the next issue. As for the quote with regard to this issue, we are back to mark twain, “never argue with stupid people, they will drag you down to their level and then beat you with experience.” Yes, I have used

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CONDO LIFESTYLES

this quote at a meeting. Keep in mind that there are no inner inhibitions that will stop crazy but hopefully the stupid and belligerent will not rise to this level.

The Professional is Not Your Friend: the job of the professional, whether it is the manager, accountant, attorney or other is to provide opinion - not to be your friend. everyone would be well served to keep this in mind as the best qualified professional may not be the friendliest. In fact, the best qualified is quite likely to be the one that does not care if he or she is liked. It comes down to the preference of whether you want someone that speaks his/her mind and provides an honest opinion or whether you want to be surrounded by the individual that always agrees with you such as a “yes man or woman.” I am not sure about you but I enjoy a spirited debate and on rare occasion have changed my mind on a subject. Quit laughing, it has happened.

Political Correctness and Bad Phrases: this is a term that seems to be misunderstood. While it is a good goal, it is not always possible. the goal of political correctness should be to try not to marginalize an entire group. As most people that know me will attest, I have no problem upsetting someone by stating my opinion but I try to focus on the issue and not the individual or the group. It is important to try to remain respectful; although I know that this is not always possible. While we are on this subject, the term “brutally honest” comes to mind. typically when someone wants to be brutally honest, it is my experience that they simply want to be brutal and are ducking for cover. the other aspect of this is starting an argument with the phrase “with all due respect.” A judge once told me that as soon as he hears that phrase that he is already prone to not like the upcoming comments as he knows that someone is about to tell him why they think he is an idiot. Instead consider something similar to a more friendly

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phrase such as “while I understand your reasoning, this is why I disagree.”

People with No Sense of Humor: While I hope it is an overstatement, it sure seems that most problems are caused by people with little or no sense of humor. Generally if it does not involve death or tragedy, it is important to lighten up – although some of us may take this too far in the wrong direction. one of my bigger annoyances is being surrounded by a group that does not have a sense of humor.

Free Advice: When it comes to free advice you get what you pay for. In most situations, if it is too good to be true, it generally is and for the last cliché for this category, one size does not fit all.

Personal Responsibility and Character: I am bothered by those that are too quick to take credit and even faster to deflect the

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GUEST EDITORIAL

blame. I learned a long time ago that the sign of a good leader is when something goes right you try to give credit to those around you and when something goes wrong, you take the heat. As we are all aware, it is easy to do the right thing when people are watching but much harder to do the right thing when no one is around. It is always easier to criticize and provide comments from the cheap seats than it is to offer solutions and lead.

Get it Right the First Time: It drives me crazy when an excuse for doing something wrong is that I did not have enough time to get it right. If you do not have time to do it right the first time, when will you find the time to do it again?

Trade Shows/Expositions: While I understand that these serve an important function, especially for education purposes, a balance needs to be in place so that it is not simply a dog and pony show in which you are the carnival barker. the main

concern I have is that it cheapens certain professionals to the point in which they are seen as replaceable commodities that are easily tossed aside. there is a fine line between providing content and being the side show freak at the circus.

which opposing counsel stated a similar phrase it sure seems that most problems and the judge interrupted with, “counsel I are caused by people with little or no will assume that everysense of humor. Generally if it does thing you say is the truth but if you start with that not involve death or tragedy, it is type of phrase, I will start to wonder if you important to lighten up – although are lying about every some of us may take this too far in statement that is not Everyone is a Winner: prefaced by the phrase.” While everyone certhe wrong direction. to this day I think about tainly brings something the comment every time to the table, you can’t be a someone uses a similar phrase. winner every time and there should not be an thank you for taking the time to read award for just showing up. While participathis Guest editorial. I hope that you found it tion is important and should be recognized, entertaining and that it gave you something to awards (this includes trophies) should be think about. As for my final thought, when earned not just handed out. dealing with an issue, consider whether it will be something that you or someone else will “To Be Honest” or even care about in five or ten years. this will “To Tell You the Truth”: go a long way in determining the importance early in my career I was arguing a case in of the matter. Y

While I hope it is an overstatement,

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CONDO LIFESTYLES

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CONDO LIFESTYLES

By: Steven M. Silberman, CPA - Frost, Ruttenberg & Rothblatt, P.C.

YOU’RE FINISHING THE BUDGET…

Did You Overlook Any Items? It is hard to believe it is that time of year again.  It is the beginning of fall and of course, the time to finalize the budget.  All Boards should be reviewing their monthly  financial  statements  each  month,  comparing  actual  results  to  budgeted amounts and gaining an understanding as to why there are any material differences even though the actual budget process begins in August and usually is completed in October.

A

s an accountant and cPA involved in the condominium and homeowners association industry for over 35 years, there are certain budget items that are overlooked many times. before you finalize your budget, take one last review to see if you overlooked any budget items.

Contingency for Bad Debts We all know that the amount of operating fund assessment income that is budgeted each year is determined by the operating fund expenses. We also know that the operating assessment income is based upon the amount of assessments that are billed each year; however, Associations do not always col-

lect all of these assessments. When preparing your budget, an often overlooked item is contingency for bad debts, which is determined by reviewing the operating assessment income that cannot be collected. to determine what you may not collect, start with reviewing your monthly aged accounts receivable. every Association needs to have a good and consistent collection policy that they diligently follow along with a good experienced collection attorney. the key is to minimize slow paying unit owners or units that go into foreclosure. once the board has reviewed its aged receivables, there should be a budget line item for contingencies for bad debts.

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M O N E Y   M AT T E R S

Contingency Expenses Related to Severe Weather besides, budgeting for contingency bad debts, Associations can budget for other contingency expenses. these contingency expenses can include possible excess snow plowing costs due to heavier than expected snow falls or higher than expected utility costs due to colder than normal winters or hotter than expected summers. If these budgeted contingency expenses are not used during the year, the Association may be able to transfer these unused contingency expenses to an operating contingency fund. Associations should review their declaration first before transferring these excess funds to see if your declaration indicates what to do with any excess operating funds. It may reflect that excess operating funds should be refunded to unit owners.

respect to income taxes, the Association should then determine if income taxes should be budgeted. We have many Associations that ask us to review their financials through June or July and estimate if any taxes should be budgeted. even if your Association had no taxes due in prior years, it is possible that you could owe in the current year. For example, signing a licensing agreement with a cellular company most likely would be taxable. If we determine that income taxes could be owed,

we can now perform tax planning to minimize or even possibly reduce income taxes to zero.

Capital Reserve Account Funding the last area that is overlooked is properly budgeting for reserves. many Associations always ask me, “How much should we have in reserves and how much should we budget each year?” each time I am asked, I say the same thing, “It is dependent upon your

IRS Determination on Painting Expense An operating contingency expense that is not always budgeted properly is painting, since many Associations budget this expense with reserves. the Internal revenue Service has determined that painting is not a reserve expense but an operating maintenance expense even though major painting projects may only be done every few years. each year Associations should budget for painting in the operating fund budget and then transfer this budgeted expense that is not used to a separate operating contingency fund account. Your Association will then have accumulated the necessary funds to pay for the painting project when it is scheduled.

Accounting Fees & Income Tax Additionally, I always notice there are two budgeted operating expenses that are overlooked a great number of times; accounting fees and income taxes. budget preparation time is when Associations should ask for proposals for year-end accounting and income tax preparation. Although year-end audits are always recommended over compilation and reviews, every Association should look at its by-laws and declaration to see if it states whether audits are required. If these documents are silent, and you have a loan, look at your loan document to see if an audit, review or compilation is required. With

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CONDO LIFESTYLES

reserve study.” What we find is that many Associations either do not have a reserve study prepared or if they do have one, it has not been updated or reviewed in many years. every Association should have a reserve study prepared every 3 to 5 years, preferably by a professional engineering firm. Your Association should designate in your annual budget an itemization and allocation of reserve funds. the Palm II case found the condominium association breached its fiduciary responsibility by failing to provide an annual budget for the reserve account that itemizes and allocates reserve funds. the real key is that the boards need to review this reserve study and the funding schedule every year at budget time. the board then needs to update the funding schedule depending upon what actually happened during the past year compared to what the reserve study showed. once the reserve study has been updated, your Association can now properly budget for reserves. often we find that Associations have commingled the reserve and operating

funds by paying reserve expenses out of the operating fund or not transferring the budgeted reserve assessments to the reserve fund. the Palm II case held that the board of a condominium breached its fiduciary duty by commingling operating and reserve expenses. now that you are aware of these possible overlooked items, you can update your budget accordingly and sit back, relax and enjoy the beautiful colors of fall. Y

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CondoLifestyles

®

~ S C H E D U L E / A G E N D A ~

» 11:00 am – Registration & Visit Information Tables » 11:30 am – Luncheon, Announcements & Legal Updates • Introduce 2016 MCD Media Advisory Board Members • Community Association Legal & Case Study Update (Including Manager Licensing Update; New Rules Proposed, Short Term Rentals, FHA Requirements & More) Featured Speaker: Gabriella Comstock - Keough & Moody, P.C.

» 1:15 pm

– Hot Topics, Trends & Challenges: Living with Palm II &

Other Recent Court Cases, Property Tax Appeals, Chicago Ordinance Update (Life Safety, & more), Environmental issues including Energy Benchmarking, Finding Quality Managers & Board Members and Technology, Communication & Meeting Strategies Panel Discussion Participants: Howard S. Dakoff - Levenfeld Pearlstein LLC Tairre Dever-Sutton - Tairre Management Natalie Drapac - Community Specialists Michael Donnell - First Service Residential Michael Elliott - Elliott & Associates Lou Lutz - First Community Management The Chicago Cultural Center is located at 78 East Washington. An MCD registration table will be located outside the Washington & Garland rooms on the fifth floor. Use elevators in South lobby.

Table Discussion Topics & Information Tables include: » Chicago Police Department William Townsell » Chicago Fire Department » Bulk TV, Internet Technology & Community Associations Chris Smith - XFINITY Communities » Credit Bureau Reporting for Associations Joel Starks - Sperlonga Data & Analytics » Energy Use Analysis & Audits/Benchmarking Compliance Jackie Loftis - Westside Mechanical Group » Fire Detection & Signaling Rocco Bartucci - Contech MSI Co. » Fire & Flood Restoration Mandy Manalli - Belfor Property Restoration » Fire Protection & Life Safety Charles Fetherling - Simplex-Grinnell » FAQ’s of Bulk Energy Purchasing Vickie Farina - Centerpoint Energy » Internet Technologies Jacqueline Bond - WebPass » Legal Q & A Marshall Dickler - Dickler Kahn Slowikowski & Zavell, Ltd. » Locksmith, Intercom & Access Control Systems Shimon Mery - Nonstop Locksmith » Urban Landscape Ideas Al Murray - Landscape Concepts Management » Fire & Water Restoration, Mold Remediation Rick Brouwer - Brouwer Brothers Services » Energy Use Benchmarking & Your Building » Painting & Decorating

Hand-Outs & Resources will be provided on the following topics: Renters, Pets & Parking, Board Training, Security, Waste Management, Green Building Technologies, Budgeting & Financial Management, Reserve & Transition Studies, and Managing Capital Improvements Additional topics may be added.

Who Should Attend? » Community Association Board & Committee Members » Property Managers

Luncheon Seating is limited to the first 140 registrants.

» Developers

» Realtors & Realty Professionals » Colleagues & Contractors

» Government Officials & Employees

Timing -Structure This event is intended to be structured to accommodate various levels of expertise as well as different types of interests in community associations. It is also intended to be flexible to meet time and schedule concerns. We are pleased to accommodate you in this regard. Contact our office to make customized arrangements.

Why Should You Attend? » To gain valuable, practical insight on how to deal with special issues of Community Associations » Identify resources needed to help your association(s) solve current challenges that your association(s) is facing » Meet and greet Condo Lifestyles Advisory Board members and other industry experts » To better understand government regulations regarding community associations » To contribute and share your ideas and input in an effort to improve standards in the field of community associations What Should you bring? Your questions. We will provide you with a bag full of paper, pens, and several other items you can use at the program, home or office.

2015 State-of-the-Industry Committee Tony Briskovic - Chicagoland Community Management Michael Donnell - FirstService Residential Tairre Dever-Sutton - Tairre Management Gail Filkowski - First Community Management Mydraine Janvier - ALMA Property Management Mickey Tierney & Natalie Drapac - Community Specialists Diane White - The Habitat Company Tom Skweres - ACM Community Management

Chicagoland

Buildings & Environments CondoLifestyles

We welcome you to join us! Please complete the form and return to our office. If you will attend the seminar, return the registration information with your payment. Seminar (per person) Cost is $125.00 for professional property manager, $175 for colleague or vendor, $150 per additional person from same firm (includes handouts and other resources to be provided). Qualified Community Association Volunteers are $40.00 per person. MCD Media, 935 Curtiss, Suite 5, Downers Grove, IL 60515, Phone: 630-202-3006 or Fax: 630.932.5553 email: mdavids@condolifestyles.net

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No. of CA units you are involved with as a:

No. of CA properties you are involved with as a:

DEVELOPER; __________

DEVELOPER; __________

MANAGER; ____________

MANAGER; ____________

REALTOR; ____________ COLLEAGUE/ CONTRACTOR; ________

REALTOR; ____________ COLLEAGUE/ CONTRACTOR; ________

DIRECTOR ____________

DIRECTOR ____________

UNIT OWNER __________

UNIT OWNER __________

NAME(S) List additional names on back or seperate sheet

NUMBER OF PROFESSIONAL GUESTS @________________________ = $ __________________ NUMBER OF VOLUNTEER GUESTS @________________________ = $ __________________

ASSOCIATION/COMPANY

ADDRESS

E-MAIL

PHONE

FAX

T O T A L = $ __________________ VISA/MC#

EXPIRATION DATE


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Condolifestyles 10 2015  

October 2015 issue

Condolifestyles 10 2015  

October 2015 issue

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