SHAREHOLDERS MEETING 2009 BUDGET

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1 SHAREHOLDERS MEETING 2009 BUDGET

2 REVENUE 1. Shareholder Maintenance (GL 5001): By carefully trimming expenses and monitoring costs we have been able to hold a maintenance increase in this very challenging budget year to 3.9%. We will also assess for the property tax abatements and STAR credits as we have done in prior years. These are a wash for most shareholders and will have a $0 cash flow impact. It will also raise $1,197,000 which would be the equivalent of an additional 7% increase if we were not to assess for these funds but to simply raise maintenance to generate this revenue. We will NOT assess for the NYS and NYC STAR credit refund checks that most shareholders receive. It is important to remember that Water Rates are up 26% in the last 2 years and we expect another double digit increase in Heating costs are still higher than last year and electric rates are significantly higher with new increases being proposed by Con Ed. Property taxes are expected to increase more than 7% this year and add union controlled maintenance salaries, benefits and insurance all costs which we have NO control over and you have just spent 58% of all of our revenue. We think we have made the best choices for most shareholders. By implementing a 3.9% increase and tax assessment that will have no cash flow impact on most shareholders and a nominal $25 temporary asbestos abatement surcharge, we have been able to keep maintenance low, maintain our infrastructure and generate the needed revenue to properly run our co-op. 2. Apartment Rentals (GL 5007): An Apartment Rental program was established to warehouse apartments owned by GOVO and not flood the sales market with them which would adversely affect shareholder apartment sale prices. As GOVO owned units become vacant and available for sale we will assess them and make a determination whether to put them in the Sales Renovation Program or Rental Program. The rental program is limited to rentals for LIJ staff at this time. The rental program which is expected to have apartments in it at year end will generate $195,000 in rental income in Garage Rentals (GL 5005): The board has chosen NOT to increase garage fees or parking permits at this time! Our garage fee structure is $35 for on-site Shareholders, $60 for Fair Market Rental Tenants and an average of $45 for Rent Stabilized tenants whose prices vary according to rent stabilization guidelines. For the record, a $5.00 per month increase would raise $71,000. An increase from $35 to $50 for shareholders and $60 to $75 for nonshareholders would raise $212,000 or the equivalent of 1.2% of our maintenance increase. 4. Parking Permits (GL 5035): The parking permit fee is $25 per year for passenger vehicles and $100 for commercial vehicles which require specific board approval. There is no pro-rating of cost, so if you buy a permit in January or December the cost is still $25 for the year. The 2009 permit color will be white on purple and the stickers will be an EZ peel off type, leaving no residue on the windshield.

3 EXPENSES 5. Security (GL 6610): In order to provide and maintain a 24/7 security service that provides quality of life protective services, we will spend $462, Seasonal Workers (GL 6210): We employ 28 seasonal workers for various periods of time during the spring, summer and fall. They are used as follows: 22 for Lawn Maintenance, planting, leaf removal, etc. and 6 for asphalt driveway seal coating at a total cost of $299, Door Painting (GL 6407): We will start a new round of door painting on the property. In 2009 we will be painting doors, octagon windows, stoop railings, tops of bay windows and wood terraces. The areas to be done are sections E, F, G, L, and M. These are the sections surrounding The Oval. We have allocated $100,000 for this project. 8. Original Terraces (GL 6414): In 2009 we will initiate a new program to replace all original wood terraces with synthetic materials. This will include the railings and decking. The railings portion will be done by an outside contractor and the decking will be done in-house. This will eliminate the need for future painting which is costly. It will also eliminate peeling which has a tendency to make an entire area look shabby. This three year program will cost $200,000. The board will require shareholders that directly benefit from this program to participate in its cost. Currently when an original wood deck is replaced, each benefitting shareholder is charged 25% of the cost. The board will continue this practice. 9. Settlements & Deductibles (GL 6051): In order to create some equity for those shareholders that did basement conversions and removed the asbestos at their cost prior to our property-wide asbestos abatement program we have created a Basement Conversion Rebate Program. Currently, someone doing a basement conversion pays a total of $6,550 in fees to help recoup some of the co-op costs to abate asbestos and create a water resistant basement. Prior to this, basement conversion shareholders paid for the full cost of the abatement which often exceeded this amount. For those few shareholders we will reimburse them $550, which is the cost of the asbestos abatement surcharge,

4 bringing the total program cost to $6, Budget Highlights 10. Vehicles & Equipment (GL 1410): We will purchase a tractor/back hoe to replace our old one which has needed costly repairs. We have budgeted $75,000 for this and it will be funded from the reserve account. 11. Building Foundation Project (GL 1430): This multi-year preventative maintenance program began in 2002 and will be completed in the spring of It deals with each of our 134 buildings, specifically those areas below the bottom most brick. The project included the replacement of all basement windows with glass block ones. The building facade was repaired and painted with a special epoxy protective paint. Window wells have been cleaned out and filled in with stone for better drainage. The crawlspace doors were painted and surrounding walls replaced. New green metal basement doors with locks were installed throughout the property. All of this work except for the basement doors has been done in-house saving the co-op thousands of dollars. 12. Laundry Rooms (GL 1434): Laundry rooms 1 & 4 have been completely replaced and reconstructed as ground level laundry rooms. Laundry Rooms 2 & 3 have been fully upgraded. The cost of this project which began in 2006 was approximately $230, Lighting (GL 1454): We will install energy efficient outdoor lighting in areas such as garages where incandescent lights are being used. Because of lighting technology improvements made in recent years, energy efficient lights can now be used outdoors in all temperatures. In the past these lights would not work well in cold temperatures and took too long to become fully illuminated. We will also apply for a grant from NYSERDA, which is a state run program to encourage energy efficiency. 14. Concrete (GL 1458): In 2009 we will start an in-house Concrete widening program to create wide flairs at turns where the golf carts wheels eat up the grass. We have identified all areas in the co-op where sidewalk turns need to be widened. We have allocated $50,000 for this project. In addition to our normal concrete replacement program we will install a new sidewalk to facilitate pedestrian traffic in the driveway that connects 263 rd & 260 th

5 Street. This driveway gets a lot of pedestrian traffic so we will put in a sidewalk to create a safer passage. CAPITAL PROJECTS continued 15. Other Assets (GL 1480): We will explore the feasibility of Solar Panel Electric generation on a very limited scale by investigating the possibility of installing solar panels on our smallest building. This program is currently in the exploratory stage. 16. Computers (GL 1485): We plan to upgrade our accounting system and property maintenance software and networking hardware at a cost of $103,400. The current proprietary software is old and clunky. New software will give us the ability to do coupon billing, accept direct deposits and add other flexibility to our system. 17. Hot Water Heaters (GL 1494): By the end of Budget year 2009 we will have completed 56% of our Hot Water Heater Installation program at a cost of $893,000. The remaining cost to complete this multi-year project is $787,500 for a total project cost of $1,680,000. This program is energy efficient and will prolong the life of our boiler systems since they can be completely turned off for 5 months out of the year while the hot water heaters will create domestic hot water for cooking and bathing. 18. Reserve Account (GL 1032): Our reserve account continues to be well invested in conservative mutual and money market funds. Although we have taken a hit as has everyone else because of the severe economic downturn, we have a long term horizon and have no need or plan to liquidate any of these invested funds for the foreseeable future. Contributions to the reserve fund are made annually through our Capital Improvement Contribution Fee that all new buyers and sellers pay into at closing. All new buyers pay a $750 fee and all sellers pay a $250 fee for a total of $1,000 for each apartment sale in Glen Oaks Village. These funds are allocated directly to the reserve fund. The annual contribution has averaged approximately $125,000. The fund also generates income through interest earnings, capital gains and appreciation. The reserve account currently funds 35% of our capital improvement program and $1,000,000 of our asbestos abatement program. In addition, the cost of the tractor that we will be purchasing this year will come from the reserve account. This money no longer needs to be raised through monthly maintenance fees!

6 IMPORTANT NOTES PERMANENT INCREASE OR ASSESSMENTS? For those that say they do not like the special assessments that offset the tax credits or the $25 temporary asbestos abatement surcharge, the alternative would require a permanent increase of 12% on top of the 3.9% increase to produce the same revenue. As mentioned before, by implementing a small permanent increase of 3.9%, a special assessment offset by an equal tax credit that will have no cash flow implications for most shareholders and a nominal $25 asbestos abatement surcharge that will end after April 2010, we have been able to keep maintenance low, while generating the revenue necessary to run our co-op without having debilitating increases that would impact all of our shareholders. SOLID FINANCIALS & FISCAL INTEGRITY! In order to protect the fiscal integrity of our co-op we have continued to reduce our reliance on apartment sales to pay for ordinary operating expenses of the co-op. Similarly, you don t pay for your groceries with your pension or IRA monies. This is important because if we rely on apartment sales to cover ordinary operating expenses and then have a real estate slow down with much less apartment revenue coming in, we would be forced to implement financially devastating maintenance increase to cover our operating costs. This would be a financial shock to everyone and a very irresponsible way to manage a co-op of this size. So in 2003 when 75% of budgeted net apartment sales revenue was used to cover ordinary expenses we began to reduce our reliance on these monies, sometimes under pressure to do otherwise. In 2009, only 20% will be used for these purposes, in 2010 this will be further reduced to 10% and by 2011 all apartment budgeted revenue will no longer be used for operating expenses but instead flow directly into the reserve account where it can be used for capital expenses. By meticulously moving in this direction against pressure to do otherwise we have created a fiscally sound financial position for our co-op with the lowest maintenance of any of our neighboring co-ops.

7 2009 BUDGET 2008 Projected Actual REVENUE: Total SH Maintenance Revenue 19,070,100 18,401,200 Total Rental Revenue 2,491,000 2,328,000 Non-Maintenance Revenue 3,811,475 3,292,800 TOTAL REVENUE 25,372,575 24,022,000 ADMINISTRATIVE EXPENSES: Total Management Staff 788, ,000 Total Professional Fees 228, ,400 Total Administrative Office 404, ,200 Total Bad Debt Expense 0 0 TOTAL ADMINISTRATIVE 1,420,850 1,408,600 MAINTENANCE EXPENSES: Total Salaries & Wages 2,952,400 2,830,000 Total Landscape 185, ,000 Total Vehicles 128, ,700 Total Repairs 1,300,300 1,045,100 Total Maintenance Office 29,000 29,000 TOTAL MAINTENANCE EXPENSES 4,595,400 4,203,800 OPERATIONS & SECURITY: Total Heating Expense 3,400,000 3,365,000 Total Security Fee 462, ,000 Total Other Operating Expenses 939, ,000 TOTAL OPER. & SECURITY 4,801,000 4,630,000 TOTAL INSURANCE & PENSION 1,856,800 1,857,000 TOTAL TAXES 6,711,600 6,155,000 TOTAL INTEREST ON DEBT 2,076,000 2,153,000 TOTAL EXPENSES 21,461,650 20,407,400 Cash Flow Before Capital Expenses 3,910,925 3,614,600 CAPITAL EXPENSES Total Debt Principal 1,242,342 1,164,900 Total Capital Improvements 1,666,900 3,747,700 TOTAL CAPITAL EXPENSES 2,909,242 4,912,600 TOTAL EXPENDITURES 24,370,892 25,320,000 Cash Flow + / ( - ) Unallocated 1,001,683 (1,298,000)

8 2009 surplus is to cover deficit from 2008 due to asbestos abatement program. Most costs were incurred in 2008 and most of the revenues to pay for them are in 2009.

9 HISTORICAL MAINTENANCE OVERVIEW 3.9% Increase GLEN OAKS VILLAGE YOUR Effective 1/1/09 OLD Historical Maintenance Information UNIT NEW MONTHLY Annual Monthly MONTHLY 3.90% 3.99% 2.52% 3.86% 4.76% 7.53% TYPE Shares MAINTENANCE Increase Increase MAINTENANCE 1/1/09 1/1/08 1/1/06 1/1/05 1/1/03 9/1/94 A Lower 104 $ $ $16.47 $ $ $ $ $ $ $ A Upper 107 $ $ $16.94 $ $ $ $ $ $ $ B Lower 132 $ $ $20.90 $ $ $ $ $ $ $ B Upper 136 $ $ $21.53 $ $ $ $ $ $ $ C Lower 138 $ $ $21.85 $ $ $ $ $ $ $ C Upper 142 $ $ $22.48 $ $ $ $ $ $ $ D Lower 150 $ $ $23.75 $ $ $ $ $ $ $ D Upper 155 $ $ $24.54 $ $ $ $ $ $ $ E Lower 142 $ $ $22.48 $ $ $ $ $ $ $ E Upper 146 $ $ $23.12 $ $ $ $ $ $ $ F Lower 121 $ $ $19.16 $ $ $ $ $ $ $ F Upper 124 $ $ $19.63 $ $ $ $ $ $ $ G Lower 142 $ $ $22.48 $ $ $ $ $ $ $ G Upper 146 $ $ $23.12 $ $ $ $ $ $ $ H Lower 160 $ $ $25.33 $ $ $ $ $ $ $ H Upper 165 $ $ $26.13 $ $ $ $ $ $ $ Profesional 157 $ $ $24.86 $ $ $ $ $ $ $ Profesional 169 $ $ $26.76 $ $ $ $ $ $ $ Profesional 179 $ $ $28.34 $ $ $ $ $ $ $ Profesional 190 $ $ $30.08 $ $ $ $ $ $ $ Glen Oaks Village Owners, Inc. Board of Directors Bob Friedrich, President Roseann Ciaccio, VP Lisa Marulli, Treasurer Carol Carucci, Secretary Lee Feinman, Christine Bergen, Leonard Motsinger, Mitch Jaret, Justin Conklin