01/26/06, 8:00 A.M.

Pursuant to the e-mail notification dated January 16, 2006, the January Heartland Apartment Association Board of Directors meeting was held at the above stated date and time at the HAA offices, 2405 Grand, Suite 106, Kansas City, MO 64108.

Board members present were: Doug Price, Lee Harris, Jim Beverlin, Jim Adams, Chris Erdley, Ralph Lewis, and Dennis Watts. Also present were Rosie Kiene, Mary Jo Shaney, and Sam Alpert. (Bill Charcut, Rick Oddo, Jerry Miller, Ward Katz, and Ken Riedemann were absent.)

The meeting was called the meeting to order and introductions were made.

The minutes of the last meeting on 12/01/05, which had been previously circulated, were reviewed and approved by those present

KCMO BUSINESS LICENSE - Sam Alpert reported that subsequent to the last meeting, and mostly during the last week of December, apartment owners were once again receiving assessments for the KCMO Business License. This was a source of great disappointment and frustration, as the HAA had been given to understand by city officials that a "stand still" agreement was in effect, deferring these assessments until the "archaic" and irrelevant enabling statute could be properly updated. Inasmuch as the HAA had already filed a lawsuit in anticipation that negotiations with the city would not bear fruit, Sam Alpert asked Mary Jo Shaney, an attorney with White Goss Bowers March Schulte & Weisenfels, to brief those present on the required discovery process now that it appears that the lawsuit will need to press forward as the result of the city's precipitous actions. In the coming weeks pre-trial discovery will target key elements of the policy making process that has ultimately led to taxing previously untaxed "passive" owners.

JOCO WASTEWATER- Lee Harris and Sam Alpert reported that the previously circulated joint communication to the JOCO BOCC and WaterOne was ready for final review and signatures. Mr. Harris related some frustration with trying to get some of the key "Metropolitan Development Community Advisory Council" participants to lend their official support to the initiative. It was agreed to proceed with the signatures in hand………HAA, BOMA, IREM, CUC, and AAKC. Upon adding their specific set of concerns to the letter, the KS Restaurant and Hospitality Association (KRHA) had indicated a willingness to sign; so Sam Alpert indicated that he would coordinate getting the letters turned around with KRHA in Wichita and then circulating them to the appropriate recipients on both the BOCC and WaterOne boards.

KCMO FIRE INSPECTION FEES - Sam Alpert reported that, as reported at the last meeting, the trial judgment will not become "final" until the Court has ruled on all post trial motions, which has not yet occurred. A final ruling will be necessary before the city proceeds an appeal. While no fees for the inspection certificate will be collected during the term of the litigation, pending a final court order, the plaintiffs will continue to fund the litigation.

KCMO RENTAL UNIT REGULATION TASK FORCE- Sam Alpert and Doug Price reported that the KCMO Rental Unit Regulatory Task Force continues to seek constructive solutions without penalizing good operators, and that a final report is likely to be made to the City Council in late February. There appears to be growing agreement among the participants that rental unit licensing, routine frequent codes inspections, and associated fees should not be the primary focus of the task force. They (both the city staff and the task force) are generally in favor of taking a more global approach to neighborhood preservation and the most efficient utilization of available resources to address "blight" resulting from neglect of both occupied home owners and absentee landlords. This is in addition to ensuring that minimum habitation codes standards are being properly enforced. There will be a task force recommendation to institute a standing oversight committee comprised of public stakeholder representatives including landlords, neighborhoods, churches, and codes officials. Many in attendance were skeptical that any "improved" regulatory or enforcement activity would be in the apartment owner's best interest until it could be demonstrated that existing provisions are being properly enforced. While Alpert and Price felt it was better to remain engaged in this process in an attempt to moderate "hawkish" city policy in dealing with "landlords", many in attendance felt that a more militant legal stance needed to be taken early, lest the industry would eventually find itself paying exorbitant impact fees to support more inefficient bureaucracy. It was agreed that legal counsel would be advised of the pending situation.

KS HB 2592- Sam Alpert circulated a bill introduced to protect landlords from unpaid tenant contracted utility obligations. While the primary intent of the bill appears to be in the owner's best interest, Ralph Lewis pointed out that it provided that in the event of an owner's non-payment of an obligation for which the owner is clearly responsible, the damaged party could file a lien that would be senior to the mortgage on the same basis as a tax lien. Sam Alpert said he would modify his written support of the measure to reflect our concerns, as well as those of our lenders.

KS SB 380- Ralph Lewis brought a proposed bill to the attention of the Board, which attempts to rewrite significant sections of the KS Residential Landlord and Tenant Act. The changes would significantly limit remedies now available to a landlord with emphasis on allowable amounts and disposition of respective security deposits. This bill, having its origins among college student advocates, will need to be closely monitored by all interested parties.

The next regularly scheduled meeting of the HAA Board of Directors will be held on February 23, 2006.

There being no further business to come before the Board of Directors, the meeting was adjourned at approximately 9:45 a.m.