Tuesday, December 28, 2010

PROJECT $900,000 OVER BUDGET



Reserves plundered, another loan, residents to pay even more

Yesterday, St. Regis homeowners received a letter which bluntly stated, “The Bottom line is this: we are $898,831.00 over the original budgeted costs for the project.”

Despite the fact that a loan has been taken out to cover the costs of this special assessment, the building’s reserve funds have been tapped into, and homeowners will now have to pay an additional $3,600-5,400, depending on unit size.

The letter states, “Another $140,000 will be paid from a loan that the association will carry.” What is not stated is where the money to pay this loan will come from.

FACT: The board, Vista, and the engineer assured homeowners that this do-everything-at-once construction plan would save homeowners money (as opposed to doing necessary repair projects over time, which was the course of action preferred by the residents).

FACT: The board and Vista assured homeowners that the engineer’s report was authoritative and thorough.

FACT: In October, they blamed budget overruns to “unexpected structural repairs”.

FACT: As project manager, Vista’s Mark J. Ranieri receives a percentage of the final project costs.

FACT: The project promised to be $1.2 million, amassed “approximately $900,000 additional cost” and is now $2,098,830.75.



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