Artist Alexandra Bradley of Ward, Pa., uses oil paints to capture a covered bridge on canvas at Fair Hill Natural Resource Area near Elkton, Md., one day last month. Matthew Givens/Cecil (md>) Whig View and ORDER more photos.

LOW Board hears about economy from new board vice president

BY ROBIN KNEPPER

Date published: 10/6/2008

BY ROBIN KNEPPER

Lake of the Woods' new treasurer was introduced at Friday's board of directors' meeting and began immediately by addressing the effect of the volatile economy on the Orange County homeowners association.

Olive Kelly, a retired vice president and senior trust officer at Boston's State Street Bank (New England's largest investment bank), was elected by a 4-3 majority of the board when it reorganized last month.

Even though she is not an elected member of the board, LOW bylaws allow a non-elected treasurer to be chosen.

"Everything in the economy is happening fast," Kelly reported, "but be assured we're on top of everything."

Some board members have been questioning investment and spending decisions made by the previous board majority. Those officials were all replaced in the September reorganization, and the new officers immediately elected Kelly to manage the association's finances.

LOW's funds are kept in Wachovia and Morgan Stanley.

Wachovia is in the middle of court action involving two attempts to take it over. Citigroup first agreed to take over Wachovia's banking business, with FDIC help. Then, Wells Fargo announced plans to acquire all of Wachovia's operations.

Morgan Stanley was forced to become a bank holding company rather than an investment bank last month.

Even with the financial turmoil, though, Kelly said, "There is no cause for alarm."

LOW has about $1.5 million invested with Morgan Stanley in about a dozen holdings, Kelly said, "but none of our funds are tied up in Morgan Stanley assets."

About a half-million dollars is on deposit with Wachovia, but all are short-term certificates of deposit laddered for different maturity dates and held to meet budget requirements.

Kelly assured the board that all of LOW's money is safe. Investments in CDs do not exceed the FDIC insurance limit of $100,000 and all working funds, in aggregate, are less that $100,000 in cash.

Other financial matters were also addressed.

The board voted to return $126,000 of unused money to the reserve fund and to move $125,000 into next year's budget. The money to fund a design study for a new clubhouse pool and fitness center was returned to reserves rather then being moved forward.

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Date published: 10/6/2008