FINANCE & LEGAL COMMITTEE
Monday, September 13, 2010
“Responsible for the annual operating and capital budgets, determination of fees and assessments, definition of member and guest privileges, and all related legal, taxes, insurance, zoning, and organizational matters affecting the Association.”
PRESENT: Jere Kovach-Chairman & Member Board of Directors
Kirk Sessions- GM-Ex Officio
ABSENT: Tom Hensel
ALSO IN ATTENDANCE: Joe Angelovic , Kathy Daulton-Member Board of Directors and Jerry Kittleson
The meeting was called to order @ 3:00 P. M.
The minutes of August 16 were approved.
The outstanding 2009 unpaid assessments have been reduced to 32. The 2010 unpaid assessments have declined to 99. GM Sessions was commended for his success in obtaining payment of the unpaid assessments..
Ms. Daulton and Mr. Angelovic were asked to make a presentation concerning balloting for the recommended changes to the DCC&Rs. In order for the proposed changes to take effect 70% of the eligible lots must be voted. The DCC&R Revisions Committee feels an incentive, in the form of a raffle, would encourage some of our members who ordinarily might not be inclined to reply to, instead, cast their ballot. The DCCR committee recommended that, upon getting the response, each lot would be eligible to participate in drawings to be held in Feb.($2,000), Mar.($1500), April($1,000) and May($500). After some discussion including comments about reluctance to provide incentives for people to vote in their own self interest it was moved by Mr. Hanck, seconded by Mr. Stucki and passed unanimously that this committee recommends adoption by the BOD of the “DCCR Revisions Incentive Program to Improve Member Participation in the Final Approval Process, 2011”. Mr. Kovach will inform the BOD of this recommendation. If adopted by the BOD, this proposal will add an additional $5,000 to the budget of the DCCR Revisions Committee. This Committee thanked Ms. Daulton, Mr. Angelovic and the rest of the DCCR Revisions Committee for their considerable effort devoted to this very important mission.
Mr. Kovack discussed ongoing conversations and activities concerning proposals to change the use of SVRA owned lots. In summary, there is some question as to the legal right of SVRA to utilize SVRA owned lots for purposes other than residential. Mr. Kovach stated that he and Mr. Kittleson have been in negotiations on this subject and both are getting attorneys’ opinion. They will be meeting in the near future and will attempt to resolve the issue without court action. For the time being, any action to implement policy has been “put on hold”. This committee is supportive of all effort to equitably resolve this issue.
Mr. Kovack discussed a State of Wyoming grant program administered by the Wyoming Business Council which provides $4 million dollars per year for Sublette, Lincoln and Uinta Counties to be utilized for community facilities. The grant would be for a total of $1million and would be matched at 15%. In summary, the applicant for these funds must be a governmental body which is the owner or long term (40 year) lease holder of the facility. SVRA and the town of SVR are exploring the possibility of the town leasing the Silo and Barn area from SVRA and the town becoming the applicant of record. There are many questions that must be addressed if this idea is to become reality but the committee is of the opinion that the idea is worthy of further study. Mr. Vandel moved and Mr. Root seconded that this committee recommends to the BOD that SVRA continue to pursue this opportunity for help in funding proposed improvements to SVRA owned community facilities. The motion passed unanimously. Mr. Kovach will present the recommendation to the rest of the BOD.
Mr. Sessions handed out copies of the Balance Sheet as of August 31, 2010 and the Profit and Loss statement for August 2010. Mr. Root pointed out that our “Accounts Receivable” shows a balance of $71,422.63. Mr. Root also pointed out that delinquent assessments are the only source of “Accounts Receivable” and questioned that we actually had that much money owed from delinquent assessments. Mr. Sessions pointed out that some of that figure is represented by attorney fees and interest. In general it was agreed that we need to get an accurate breakdown of what is included in the $71,422.63 figure. If there are accounts that are truly uncollectable then we should write them off the books. Considerable discussion ensued over our accounting procedures and when income is credited to the books. Mr. Sessions pointed out that Mr. Richard Brough CPA has been retained to provide advice and recommendations on our accounting issues. Mr. Sessions feels and the committee agrees that although we are not yet satisfied with our accounting methods we have and will continue to make progress.
It was pointed out that there is no approved Capital Budget for 2010. The BOD has approved 9 capital projects so far in 2010. Mr. Vandel pointed out that there is no budget figure for any of those projects in the Profit and Loss statement and suggested that the figure the BOD approved, for each project, be included as “annual budget”. Mr. Stucki pointed out that “Capital” expenses don’t belong in a profit and loss statement but depreciation expenses should be included. Mr. Sessions agreed and stated that it was done this time in order to “capture” the expenses for now. He and Mr. Brough are working on the problem and he feels this issue will be resolved in the near future.
Mr. Sessions expects to have a preliminary 2011 budget ready for review later this month. Included in that will be requests for Capital Improvements. Considerable discussion ensued over how we need to proceed on producing a Capital Budget. Mr. Vandel pointed out that he had requested input from all the committees for capital projects for 2011 as well as for future years so he and the subcommittee could prepare a Capital Budget for 2011 as well as a Capital Improvement Program for future years. As of the meeting date he had received no capital requests. He anticipates that the only capital requests he will receive are those produced by Mr. Sessions and the SVRA staff. Mr. Vandel further stated that, in his opinion, there is little interest in having a multi-year “Capital Improvement Program” and it would be a waste of committee time to further pursue the concept. Mr. Sessions discussed the BOD’s endorsement of the development of a “Master Plan” and stated that in future years there will be more support for the concept of long range planning. It is anticipated however, that this committee will produce a recommended 2011 Capital Budget for BOD approval utilizing the best available information. Mr. Vandel pointed out that there is now a little more than $1million in various CDs that has been reserved for the purchase or construction of Capital assets. He is of the opinion that plans need to be developed soon for the utilization of these funds.
Mr. Stucki stated that, in his opinion, this committee should be working with a predetermined annual assessment, set by the BOD. The budget, in turn, should be adjusted to that assessment and the anticipated revenue. He continued by making the observation that many of his contacts are highly in favor of reducing or eliminating the assessment. There was considerable discussion about the role SVRA is playing now and will be playing in the future. There was general agreement that we, as a community, need to make the attempt to reach some consensus opinion about the SVRA role and how much our members are collectively willing to pay to fulfill the various needs and desires. No action was taken.
Mr. Sessions handed out a report reviewing the results of the recently implemented fall reduced fees for golf. The results have been very favorable as there are more golfers and increased revenue. It was suggested that we plan to have a reduced fee schedule in the future for the periods prior to Memorial Day and after Labor Day. It was generally agreed that not only does Golf revenue increase due to the increased play during these periods but exposure to the amenities and benefits of Star Valley Ranch will very likely result in increased interest in owning real estate here.
It was agreed that our next meeting will be devoted exclusively to the Operating and Capital Budgets.
Meeting was adjourned at 5:15 PM. The next meeting will be in the library at 3:00 P. M. on Sept. 20.