BIG BAY RESIDENTIAL ESTATE HOME OWNERS ASSOCIATION
MINUTES OF THE ANNUAL GENERAL MEETING OF THE BIG BAY RESIDENTIAL ESTATE
HOME OWNERS ASSOCIATION HELD AT THE BIG BAY LIFESAVING CLUB,
BLOUBERGSTRAND AT 18H00 ON THURSDAY, 12 NOVEMBER 2009.
PRESENT: REPRESENTING:
Kevin Cordon (KC) Chairman/Security
Edna Bunn (EB) Vice Chairman/ Building Operations/Finance
Belinda Ketel (BK) Trustee : MPOA
Chris Parsons(CP) Trustee : Security/Finance
Frits Metz(FM) Trustee : Security
Isobel Spence(IS) Trustee : Landscaping
Mike Myers(MM) Trustee : Maintenance
Charlotte Nuttall (CN) Trustee : Marketing
Ben Lutumba(BL) Estate Manager
Lesley Horne Admin Assistant
Cape Classic Property Solutions (Pty) Ltd:
Yvonne Green
Carla Pronk
Diane Smith
And members present in person or by proxy as per the attendance register.
1. ESTABLISHMENT OF A QUORUM
Kevin Condon, in the chair, advised that all property owners present
constituted a quorum, as per the Special Resolution of 2006, and that
the meeting could proceed. The meeting was then declared open.
2. WELCOME BY CHAIRMAN
The Chairman welcomed all present to the meeting, and thanked everybody
for making the effort to attend the AGM. KC introduced Ben Lutumba,
as Estate Manager and Lesley Horne, the admin assistant in the Estate
office. KC also introduced Yvonne Green, Carla Pronk and Diane Smith
from Cape Classic Property Solutions (Pty) Ltd. The Trustees were
introduced as per their portfolios.
Frits Metz resigned as a Trustee due to work commitments
3. APOLOGIES:
Mike Myers, Trustee: Maintenance, forwarded his apologies. Apologies
were also received from Erf 510 and Erf 622.
4. CONFIRMATION OF THE NOTICE CONVENING THE MEETING
The Chairman confirmed that the Notice had been sent with 21 days
notice, via email on the 16 October 2009, and a further 4 reminder
emails thereafter. A copy of the Agenda was also delivered to all
residents post boxes in the Estate, and hard copies of the AGM
Documents were available in the Estate office.
5. CONSIDERATION OF THE TRUSTEES’ REPORT
The Report was sent out with the Notice. There were no comments
or additions to the Report and it was approved at the meeting.
6. CONSIDERATION OF THE ANNUAL FINANCIAL STATEMENTS AND AUDITORS
REPORT OF THE ASSOCIATION FOR THE LAST FINANCIAL YEAR
Edna Bunn, as Vice Chair, proposed approval of the Annual Financial
Statements for the year 2008/2009.
There was a query about the figures, specifically the Repairs and
Maintenance expenditure from the previous year (2007/2008) which was
R300 000 versus the R150 248 in this financial year(2009). EB
explained that for the 2008/2009 Financials, the general heading
Repairs and Maintenance was divided for more clarity and Landscaping
was under a separate heading. A clearer breakdown of the Expenses
was also requested as an owner felt there was no accountability.
BL explained that the Landscaping budget included 2 Gardeners
salaries and all the costs to enhance the look of the Estate,
i.e. upkeep of plants and grass, verges, circles and the
general maintenance of the parks as well as the irrigation system.
EB stated that the Building Period Penalties were implemented
if owners had not built on their properties, after 3 years from
the start of the Estate in 2004.
The Penalty was 4 x the monthly levy and this income was now
reduced as the Estate was almost complete.
CN informed all owners present that she had been asked a number
of times if the Trustees earned a salary. The Trustees work on a
voluntary basis, they all had fulltime jobs, and do the work in the
interest of the Estate. They are all shareholders and she requested
that everybody understands that they are also learning as they go
along. Trustees and owners are on the same team, and the Trustees do
it in their own time. Residents can forward questions at any time
to the Trustees, the Estate Manager and Cape Classic. The AGM was
not a firing session, it was for the benefit of all to understand
how the Estate operated.
EB confirmed that there had been a cash surplus and the money was
spent on critical Major Improvements.
Due the economy the Trustees had agreed that many of the Major
Improvements as per the previous budget would not be done thus
the money was not spent haphazardly. BL confirmed that the R650 000
queried was specifically spent on security items, due to break-ins,
such as the beams and the CCTV camera system.
Depreciation was increased from R90 000 to R100 000 following the
purchase of the Estate bakkie which was bought as a capital item.
The bakkie is used for transporting items, cleaning up etc in the
Estate.
An owner queried the high salary budget for the Estate. BL explained
the structure as Estate Manager, Admin Assistant, Cleaner,
3 Landscaping Gardeners(under Landscaping) and 2 General Assistants.
KC added that during the year the Security Manager, Mr G Lewis,
was retrenched which had reduced the salary budget by about R100 000
at the end of the financial year.
CN responded to a query as to how the Debtors who owed approximately
R500 000 to the Estate were dealt with. These owners received a
7 day letter and were then handed over for the legal process which
was ongoing and bad debt would always exist. EB continued that there
was 1 defaulter, as an example, who owed R100 000 but no owner could
transfer a property and receive a consent from the HOA unless all the
levies had been paid on the property. The Trustees also made decisions
at the monthly meetings for specific cases and decisions were made in
line with the Constitution.
An owner was concerned that the security expenses could be the same
in the next financial year. EB explained that security was an ongoing
project thus there would always be a cost. BL confirmed that the
infrastructure for the security systems was now in place and that
from now on it was the maintenance and upgrading of the systems which
would cost less. KC added that there were 2 dedicated Armed Response
guards from 6am-6pm and from the day this service started there had
not been a single break in.
Arrests were being made on the borders of the Estate and the caliber
of criminal was very bad.
The Estate had a 12 month track record of no break ins. Safety was
imperative to the Trustees and that was the driving force behind the
beams, spikes etc.
FM added that it was essential for the Estate to stay ahead of the
criminals.
Three years ago there was only a high voltage fence, and each year
steps need to be taken to improve the systems and he predicted the
cost would be approx R500 000 to R1 000 000 per annum.
An owner queried a safe level for reserves. The current cash reserves
were R500 000 but should go back to the R1 400 000 that it was before.
EB confirmed that the reserves were invested in a Money 24 Account
and the interest was another form of income.
The Annual Financial Statements and Auditors Report for the year ended
30 June 2009 were approved by the members present.
7. TO APPROVE THE ANNUAL LEVY BUDGET FOR THE ENSUING YEAR
7.1 Annual Levy budget of R1000
EB confirmed that at the last AGM, even though there were funds in the
bank, an increase in the levy was voted against. When the Estate
started 5 years ago, the levy was R570 and there had only been
1 increase 3 years ago, to R700.
As there was no increase in the last financial year, the reserves
had to be used for the security emergencies. As these reserves had
been used up, the proposed increase for the levy this year was to
R1000 levy(Incl VAT), an increase of R300.
As houses in the Estate were valued at R3- R4 million, there should be
no debate for a R300 increase. CN added that as an owner last year,
and not a Trustee, she voted for the R100 increase as she knew it would
have to go up in 2009.
She quoted an example that Big Bay Beach Club had a levy of R1200
per month. MW added that for every R100 less, the Estate would lose
R250 000 of cash reserves.
It was noted last year that an increase would happen this year.
An owner queried the income of R2 6000 000 proposed versus the expenses
of R3 000 000. Morne Weyers, Trustee : Finance 2008/2009. responded that
the cash flow was not the issue, the R1,3 million “cash” was made up of
a number of entries, including levies owed and as such not available
reserves. He continued that the Operating Expenses would continue to
increase, and thus the levy increase could be more next year. It was
better to take a step by step increase rather than a big jump and he
agreed the R300 was necessary. EB confirmed that the Trustees
looked at all options, and in the last 2 months of the new Financial
year R160 000 had to be used from the Reserves for the operating expenses
It was stated that the Estate was running away with the expenses and that
Dune Ridge Estate had a levy of R750 for their new budget. EB responded
that firstly the budget was cut drastically in order to be able to
operate at this level, and that Dune Ridge Estate had 1 gatehouse
compared to Big Bay which had 3 security gatehouses making the costs
more expensive. BL added that the set up of Big Bay security items
were more expensive and that Dune Ridge still had the benefit of
Building Period Penalties as there were still lots of plots. EB
concluded that in future the levies would also increase by a minimum
inflationary increase of approximately 10%. FM stated that there were
always many unknowns for example last year there was a security strike
which made it difficult to forecast any budget. It was important to
note that security costs made up half the levy budget.
EB explained the Endowment Levy as 0.5% of the selling price and that
this budget for 2009/2010 was conservative, as it was not a definite
income and depended on the number of house sales which depended on
market conditions.
The Trustees were operating on a skinny budget and it was difficult
to confirm if they would break even or end up with a deficit.
EB stated that any resident was welcome to see any of the Financial
information at any time. She requested that an appointment be made
with the relevant party.
CN informed the meeting that she did not agree to the suggestion
from an owner that the financials should be put on the website as
it was confidential information. An owner requested that the budget
and actual figures of the previous year also be included with the
proposed budget and he also requested more line items for clarity.
The proposed R1000 levy(incl VAT)would be applicable from October 2009,
and would not be backdated to July 2009, which was the full financial
year, to soften the blow for owners. The increase levy was approved
by a majority vote by the members present.
7.2 Major Improvement Budget – Special Levy:
EB presented and explained the Major Improvements Budgets proposed
by the Trustees.
The following items were queried:
i. Changing of gate motors – The Developer had put in motors of a
poor quality at the time and these needed to be replaced due to the
high volume of traffic.
ii. Lights in open spaces – an owner stated that this project had
already been done and residents were complaining as they did not
like it. KC explained that lights were needed on the perimeter fence
in order to catch intruders before they were able to access the
Estate. There had been 40 arrests in the last 6 months and this
was possible because security was able to see the culprits. KC
stated, that with respect, owners must put up curtains as the
lights were keeping them safe. All lights shone outwards and not
into residents homes. The lights for the open spaces were
proposed to be able to catch anybody damaging the areas and for
additional security.
The costs for the items on the list were based on 3 quotes from
suppliers but an owner was concerned as quotes were only valid
for a certain period of time and if these costs were still
realistic.
BL would negotiate with the suppliers to keep the prices as low
as possible. The Major Improvements were not part of the operating
budget as they were a once off expenditure.
An owner queried why last year the Trustees presented a budget with
a R250 000 deficit but the financials now had a deficit of R500 000
and why did the Trustees not adhere to the budget and he was worried
that there was no cash.
KC answered that at this stage there would be no further major
expenses as per last year.
The beams were put in and extended to all 3 Estates. Then, as there
were still intruders, spikes were put in and security became the
main focus.
It was queried that once the budget was approved by the owners,
would the Trustees exceed the budget again. KC confirmed that
the Trustees made decisions to cut the budget, for example, they
retrenched the security manager, and for landscaping, plants were
used from the Estate, and on the Security budget there was no fat.
As per EB, each Trustee is supposed to stick to their budget and
the Estate Manager has a limit of R1000 for expenditure and
thereafter the Trustees must approve any costs.
CN continued that Trustees must work within their budgets as they
can’t just spend the money.
Additionally, approvals are made by the Trustees in the monthly
meetings and this is recorded in writing as no individual Trustee
can make a decision. The owners were concerned that when the budgets
were exceeded this was not communicated to the residents. An owner
queried what the limitations were as in another Estate that he was
involved with, Special General Meetings were held to inform and
involve the residents. As the budget was overspent last year maybe
the procedure was wrong in terms of the security improvements and
the system must change. There was no guarantee that the Trustees
would not overspend the budget again as they did last year.
KC, as Chairman, conceded that it was wrong not to communicate with
all owners. In future, all such decisions will be communicated with
everybody and the Trustees will change their way of operating.
He continued that there was overspending on some items, under
spending on others but he believed that the money that was spent
was on the right items, namely security.
The expenses should be capped and as Chairman, KC confirmed that
if a budget, or Capex item, would exceed R50 000, then residents
would be informed via email or a Special General Meeting. An owner
requested that detail must be explained, how an expense affects
and impacts the budget. If the budget is exceeded, then other
parts of the budget must be cut. Atlantic Beach wanted an
extra R5000 for security upgrades in the form of a Special Levy.
It was proposed that a Financial summary is included in the
monthly newsletter.
In conclusion, there was a majority vote that there was a limit for
the Trustees that if they exceeded a budget by R50 000, or a special
item not budgeted for, that resident’s written approval was required
in order to control the cash flow.
The Major Improvements 1 of R40 000 were approved as critical items.
In Major Improvements 2, the Municipal and Architects Fees of R7000
and the Roof at residents’ entrances of R100 000 was voted to be
taken out and a final Special Levy of R461.00(Excl VAT) was approved
for the forthcoming year. EB confirmed that this levy would be
invoiced for payment at the end of January 2010 and the would send
out a revised budget with the AGM Minutes.
8. TO APPOINT THE AUDITORS FOR THE ENSUING YEAR
KC proposed that the Auditors, BVV Platinum, continue for the
forthcoming year as they hade been appointed at the start of the
Estate. This was approved by all present.
9. ELECTION OF TRUSTEES
In line with the Constitution. The Board of Trustees of the
Association shall consist of no less that 3 and not more than
7 Trustees.
All the current Trustees were willing to stand again for the
forthcoming year, except for Frits Metz who had resigned due
to work commitments.
KC confirmed that the following Trustees were appointed and
approved at the AGM:
Kevin Cordon
Edna Bunn
Belinda Ketel
Chris Parsons
Isabel Spence
Mike Myers
Charlotte Nuttall
Lisa Keytel(Erf 811) was nominated as an additional Trustee and
offered her financial experience and the fact that she had time
available to assist and work with the Trustees.
10. GENERAL
10.1 SECURITY PATROLS
An owner was receiving calls from security informing him that his
car was unlocked and he was a concerned about this practice. KC
explained that residents had complained of items such as cell
phones and laptops being taken out of cars and the Estate had
instructed the guards to check any cars not locked. It was agreed
that this security check would continue.
10.2 NOISE CONCERN
An owner was concerned about the excessive noise from a neighbour’s
motorbike, including revving the bikes, in the early hours of the
morning and why the Estate Management was not doing anything about
this. BL explained that these residents were using the motorbikes
as transport to and from work and it was difficult to enforce the
rules in this situation. FM added that it was a matter that should
really be addressed by the police as it was difficult for the
Estate Manager to control. CP added that each house was still a
private residence and the Estate could not get involved in domestic
disputes and the laws of the country applied.
Estate Management could only warn and fine owners where applicable.
BK concluded that there was no rule that applied specifically to
noise disturbance and that neither the Estate Manager nor Trustees
had any real ammunition to deal with this situation. The proposal was
to communicate with the neighbour. CN quoted a recent incident where
she knocked on her neighbours door and they complied thus she worked
on building the relationship. KC advised the owner that another
recourse was to call the Metropolitan Police who would park outside
and check if the noise of the bikes was excessive.
10.3 TENANTS ON THE ESTATE
An owner queried if the tenants on the Estate were aware of the Rules
and Regulations. BL confirmed that all Tenants completed a Tenant Form
and that they were provided with the Estate Rules. CN requested
that all residents be vigilant and inform the Estate Manager of
anything unusual as everybody must look after each other.
10.4 CELL PHONE RECEPTION
Vodacom had recently installed a micro cell for the Estate which had
improved reception. Estate Management was in discussion with MTN who
would be implementing a micro cell in the new year. An owner suggested
that one may have to change the setting of a phone for this facility
to work.
10.5 INCOMPLETE BUILDING SITES
The incomplete house on Erf 595 had not been worked on for months and
the owner had informed a neighbour that he was not paying Building
Period Penalties, and the site was dangerous, particularly for children
who played on it. EB confirmed that the Trustees were dealing with the
owners as there was an issue with the roof, and if this was not
resolved by December 2009, action would continue to be taken. BL
would be closing off the site as the owner had been warned.
Erf 410 in Blouberg Hills had been handed over to Attorneys and EB
assured everybody that they were dealing with the matter and following
the full legal process.
10.6 IRRIGATION
An owner was concerned that the irrigation system was still on even
during all the recent rains. BL said that the system was on a timer
but he would investigate to sort this out.
10.7 NEWSLETTER
It was requested that the Newsletter is only emailed to residents
in the future, as everybody had email these days, as a way of cost
saving. The Trustees agreed to this proposal.
10.8 SPEEDING IN THE ESTATE
This was still a problem in the Estate, and cars were going over
the pavements to avoid the speed bumps. BK stated that the problem
was catching the culprits and requested that owners who witnessed
speeding forward a report to the Estate Manager with a description
of the car, colour, number plate etc. There was also a request for
speed bumps outside the Estate, but the Estate had already
investigated this with Council and no approval is given until
there have been 50 accidents.
10.9 BIG BAY MASTER PROPERTY OWNERS ASSOCIATION
BK was the Big Bay Estate representative for the MPOA. There were
8 precincts that make up the MPOA and Big Bay Estate was one of
the precincts. Top Notch was the Managing Agent for the MPOA and
they were paid a fee for their service. Some of the private open
spaces belonged to Checkers, and others to the MPOA but the MPOA
could not deal with the concern about the mess around the shopping
centre where Checkers was the anchor tenant. Topnotch, together
with the MPOA Trustee, had to take responsibility for their common
land. The MPOA appointed Koreserv as the cleaning company but there
are only 3 cleaners due the funds available as only 40%of owners
were paying the MPOA levies and thus there was no budget. The MPOA
is trying to run the area on only 50 % of the budget due to lack
of funds.
The MPOA has only officially been operating since September 2008
so only for a year and people are not paying for a number of
reasons. The bus stops are also a problem but there is not enough
manpower to manage the area. There was also not enough
communication with owners and this needs to be worked on.
BK proposed that if owners are not happy with the service to
let BK know, as she would be able to forward it to the right
person to assist with an answer. Top Notch are only the Managing
Agents and do not make decisions. The next AGM will be held at
the end of January 2010 and all the financials will be sent out.
There is no confirmation of a levy increase and the reason why
the levy for the current year was less was because it was based
on 10 months of the year. The new budget would be over 12 months
which is why the levy will be more. The levy is based on a
percentage of the rates of a property, as per the City Deeds
Register, and as there was a 2 year delay, it was not completely up
to date. Due to this the correct levies were not being collected.
All the issues would be discussed at the AGM in 2010.
With nothing further to discuss the Chairman thanked the Trustees
and Cape Classic, who assisted with everything and attended all
meetings, as well as all present for attending and closed the
meeting at 8pm.
|
