Key Royal Condominium Association, Inc.

Budget Committee Meeting

November 4, 2009

Minutes of the Budget Committee Meeting

Date of Meeting: November 4, 2009

Time of Meeting: 7:00 P.M.
Place of Meeting: Key Royal Clubhouse, 8204 Key Royal Lane, Naples, FL. 34119

Vice President Sharon Stites called the meeting to order at 7:00 P.M.

Call to Order

Roll Call: Vice President Sharon Stites were present. President Ken Stephens and
Secretary/Treasurer Joseph Kalinowski were absent.

Also present was Susan L. Bedyan and Steve Rodeiro; Property Managers.

Introduction and Process

(Vice President Sharon Stites presided over the meeting due to a recent accident suffered by
President Ken Stephens).

(Sharon began the meeting by re-arranging the agenda by moving Owner Questions (item #4)
up to item #3which is currently posted as Items to Review For Next Meeting if Necessary).

Vice President Sharon Stites spoke about the following items:

1. The current state of our foreclosures and the success our attorney John Goede has had
with collecting delinquent assessments.

2. The preliminary budget; the current year expenditures vs. a “wish list” for next year
which includes: replacement landscaping, repairs to the Tiki Hut roof, new building
lights, photo cells on buildings, and the possible installation of a barrier arm for the gate.

3. The creation of a strategic planning committee and volunteers who may be interested.

4. No anticipated assessment fee increase for 2010.

The Preliminary budget was reviewed by line item:

1. Office Supplies; includes copier, toner postage,-total expenditure $ 7,500.00.

2. Licenses, taxes, fees (slight increase) from $1985.00 to $2,000.00.
3. Accounting fees- no increase.
4. Legal fees-have exceeded what was previously budgeted due to the increase of court
actions being filed by John on behalf of the Association due to delinquencies.
Steve clarified that we have spent $ 6,790.00, but actually budgeted &7,200.00, and may
reduce legal fees to $ 2,000.00.
5. Miscellaneous, $2,500.00 spent to date, this includes, screening costs, etc., -increase to
$3,000.00
6. Bad debt expense-Steve spoke about delinquencies to date, but currently $143,900.00 +/-.
Have to include in the budget what we won’t be collecting in the next year. Will be
increasing from $17,500.
7. Office & Clerical expenses-last year $46,900.00 has increased slightly, this includes
salary, insurance, taxes, increase of health insurance.
8. Maintenance/Custodial-( one full time person, and an occasional part time person) there
will be a decrease in the next year; from $ 55,980.00 to $ 45,000.00. ( no health insurance
in this case).
9. Management fee-no increase for the upcoming year.
10. Maintenance/janitorial supply-no increase.
11. General repairs and maintenance-buildings are aging, repairs increase.
12. Pool Operation & Maintenance-no change;; a lot of expenses this year, but we are
confident that we can stay with the current budget
13. Fitness Center-There will always be the need for repairs, will increase the budget for next
year. (currently awaiting repairs).

(Sharon interjects and mentions that we are still currently entertaining proposals from a
number of vendors; security, landscaping, etc.).

14. Cable television-no change.

15. Fire Equipment-decrease due to no lightning strikes.
16. Lawn Maintenance and Landscaping- currently entertaining proposals all somewhat in
line with each other, others slightly higher with irrigation which we currently pay a
separate company for; anticipated increase (slight).
17. Trash Removal-
18 Extermination-not taking bids, satisfied as is.
19. Entry Gate-anticipating some enhanced safety features, therefore increasing the budget
for the upcoming year.
20. Security-entertaining proposals; currently $31, 400-31, 500. May increase for special
circumstances, i.e. –occasional pool guard.
21. Carport/Parking-for damage; no change.
22. Ingress/Egress-Shared maintenance with Laurel Lakes.
23. Insurance-due for renewal, entertaining current proposals and slight decrease for
upcoming year even with an increase of coverage. No decision yet.
24. Telephone-less budgeted last year. Projection.
25. Water Sewer-less than last year. Projection. Steve and Susan explained the “credit” we
received for 2-3 months due to an over ride of a county water valve that occurred at the
fault of some workers and resulted in bills to the Association in the “hundred” dollar
ranges as opposed to the usual “thousand” dollar ranges.
26. Electricity-?
27. Reserves-total expenses with reserves-$ 951,004.00 –water reimbursement income, our
total estimated operating expenses for 2010 are $862,164.00-bottom line - our fees will
not increase.

Questions & Comments from Owners

Charlie Miller points out a discrepancy within the painting/exterior walls estimated
remaining life years which needs to be corrected.

Susan King mentions that there is no income line represented on the budget and asks why
since we do rent out the clubhouse for after-hours private parties and that the income
should be shown as a separate line item.

Charlie Miller mentioned that he does not believe the Association should charge for the
use of the clubhouse.

Susan King asked why there is a charge for movie night and clarification was made since
movie night is arranged by volunteer residents in the community.

Property Manager Susan Bedyan informed the residents that as of tomorrow (November
5, 2009), the Association will begin collecting the rent from a second delinquent unit
owner.

Vic Burnett suggested The Whitestone security group; a vendor we currently entertained
a proposal for, but whose fees are higher than what we are currently paying.

Charlie Miller commented that he feels that it is wonderful that our maintenance fees are
still under $800.00 a quarter and Sharon agreed and commended Presidio for the
wonderful job they have done with regard managing the property.

A conversation arose about controlling the ducks and how to prevent people from feeding
them and/or the possibility of having them removed from the community; pros vs. cons.

Adjourn

The meeting was adjourned at 8:41 p.m.