MINUTES FOR THE MEETING OF THE BOARD OF DIRECTORS OF THE EAGLE CREST MASTER ASSOCIATION

Transcription

1 MINUTES FOR THE MEETING OF THE BOARD OF DIRECTORS OF THE EAGLE CREST MASTER ASSOCIATION CALL TO ORDER ATTENDANCE PRIOR MINUTES OLD BUSINESS NEW BUSINESS COMMERCIAL PROJECT DIRECTOR Pursuant to call by the President of the Association, the first quarter meeting of the Board of Directors was held on February 10, 2012 at 10:00 a.m. at the Eagle Crest Administrative Office in Redmond, Oregon. Directors present included Pat Duffy, Hank Cavender, Mike Bessonette, Bill Neumann and Chris Earnest (appointed to the commercial director position during the meeting). Staff members present included Curt Heimuller, TJ Paskewich, Karen Smith, Lauri Miller, Scott Pickert, Robin Dowty and Debbie Hahn. David Bishop of Edward Jones Investments and several members of the Association also attended. Pat Duffy, President, presided at the meeting, and Debbie Hahn recorded the minutes on behalf of the Secretary. Following motion duly made, seconded and carried, the reading of the prior meeting minutes dated December 7, 2011 was waived and the minutes were approved as written. Pat announced the agenda for the meeting (see attached) and opened the discussion of business items. None pending. Pat advised Alan VanVliet is no longer an employee of a commercial project owner, and therefore has resigned from the Commercial Project Director position. There is now a need for the board to appoint a director to fill the vacancy. Pat noted there are two owners of commercial lots within ECMA, and the owner of the majority of such lots, Eagle Crest Resort Development, LLC, has nominated Chris Earnest, Financial Director for that entity. Pat referenced the nomination and resume previously sent to directors ( Attachment 1 ). Karen Smith confirmed she advised the other commercial lot owner of the vacancy, but no nomination was received from that owner. RESOLVED, that Chris Earnest be appointed as Commercial Project Director to complete the remainder of the term expiring in September FINANCIAL REPORT Curt Heimuller referred directors to a memo he authored with a subject of Reserve Fund Investments and OR Planned Community Act ( Act ) Update and Proposal on law change activities dated February 7, 2012 ( Attachment 2 ). Curt reminded directors the previous direction to 1

2 management was to work toward changing the law as described in his memo, with the current goal to present legislation during the 2013 legislative session. Curt next reminded directors of their previous direction to management to hold the bond investments with Edward Jones but to place new reserve contributions as well as principal/interest payments on the bonds into an FDIC insured institution. He confirmed management has proceeded accordingly. He asked if directors would either confirm this investment plan or provide alternate instructions to management. Directors agreed with continuing the current approach and took no action to revise their previous direction. Curt asked Karen Smith of Resort Resources to review the proposal submitted to Eagle Crest Management to pursue the law change proposal as detailed in Exhibit 3 of Attachment 2. Curt clarified the costs involved would be to engage Resort Resources, Inc. to work with state representatives, legislative action committees, and the Oregon Chapter of Community Associations Institute to propose the law change for the 2013 legislative session. Directors discussed and clarified that the costs outlined in the proposal were intended to be shared with other owner associations. RESOLVED, that the proposal as detailed in Exhibit 3 of Attachment 2 engaging Resort Resources to pursue support of the legislative change with a maximum of amount of $3,000 for the ECMA portion of the project be hereby approved. David Bishop of Edward Jones Investments attended the meeting to report on the Association reserve investment portfolio ( Attachment 3 ). David confirmed at this time all investments are in mortgage-backed securities in government programs (GNMA, FNMA, Freddie Mac). David indicated these investments return principal and interest on a monthly basis allowing the Association to have cash flow that matches expected expenditures. The current yield on the bonds in the investment portfolio is at 4.72%. David indicated the focus has been on keeping the investments safe and liquid and having cash flow available to meet projected expenses. At this time, David recommended staying on course with the current investment program in regards to the bonds, adding that any principal and interest returned each month is transferred by management to FDIC insured institution money market funds or CDs. Directors concurred in continuing this approach. David advised the state representative for the Eagle Crest area may change from Gene Whisnant to John Huffman from The Dalles. David has already contacted John Huffman and after this legislative session, he plans to meet with Mr. Huffman to educate him on the issue regarding the proposed 2

3 legislative change. Karen Smith presented the insurance report ( Attachment 4 ) noting there is no new activity to report. Next, Karen referred directors to her memo with subject line of Insurance D&O Liability; General Liability ( Attachment 5 ). Karen noted the underwriter of the general liability policy is now Philadelphia. Philadelphia s practice is to include medical payments coverage which gives the insurance company approval to pay claimants up to $5,000 rather than investigate incidents. This coverage was automatically added to the Association s policy, however it is an option to waive this coverage. Lauri commented the coverage was not previously included since the Association does not have a choice on whether the underwriter pays or not, which can negatively affect future premiums. Karen noted there is a cost for the medical payments coverage, but it is very small. Karen advised the president requested director ratification of his action renewing the D&O liability insurance as noted in Attachment 5. The board had previously authorized the President to sign binding orders for the policy. Following discussion and upon motions duly made and seconded, the following resolutions were unanimously approved: RESOLVED, that management notify J&W Risk Services to exclude medical payments coverage from the Association s General Liability policy; and BE IT FURTHER RESOLVED, that the President s action of signing binding orders to renew the Directors and Officers Liability policy be hereby ratified. Lauri Miller presented the financial report, reviewing the internally prepared year-end 2011 financial statements ( Attachment 7 ) noting the items detailed in the financial summary ( Attachment 6 ). Lauri confirmed that all operating funds ended the year better than projected with a positive variance in each. She advised the reported operating fund balances at year-end exceed the amounts estimated for the 2012 budgets, but no changes are needed to those budgets. Lauri noted the CPA s will be conducting the audit in April, so these year-end statements are preliminary. The approved 2012 Association budget updated for actual 2011 year end results ( Attachment 8 ) was included in the director materials for reference purposes. RESOLVED, that the financial report submitted by Lauri 3

4 Miller including Attachment 6, Attachment 7 and Attachment 8 be hereby approved subject to audit. In response to a member question, Karen clarified approved meeting minutes are available on the owner website and related attachments are available upon request. Karen noted that the Evaluation of Reserve Account Expenditures vs. Budget per 2011 Reserve Study ( Attachment 9 ) is the final report on 2011 activity. There are two minor variances related to freight charges for which management is requesting approval. Karen Smith reviewed the Evaluation of Reserve Account Expenditures vs. Budget Per 2012 Reserve Study ( Attachment 10 ). Planned items are noted by yes in the column labeled planned and are the expense items requested by management for approval. The remaining items are pending recommendation by the management company in the event of asset failure. Management is requesting approval of one unscheduled reserve expense for a fire hydrant replacement, which asset is listed in the 2012 reserve study titled Water Infrastructure Repair Estimation Plan. Following discussion and upon motions duly made and seconded, the following resolutions were unanimously approved: RESOLVED, that the Evaluation of Reserve Account Expenditures vs. Budget per 2011 Reserve Study dated January 13, 2012 ( Attachment 9 ), including two noted variances, be hereby approved as recommended by management; and BE IT FURTHER RESOLVED, that the Evaluation of Reserve Account Expenditures vs. Budget per 2012 Reserve Study dated January 13, 2012 ( Attachment 10 ), specifically expense items indicated as planned, and the one variance for the fire hydrant replacement at a cost of $3,800 be hereby approved as recommended by management. GOLF COURSE COMMITTEE Hank Cavender, Committee Chair, stated during the past quarter the committee worked on recruiting additional members. RESOLVED, that Mark Hunt (VROA), Doug Bristol (Worldmark), Steve Peccia (EHOA) and Bill Greeley (EHOA) be hereby appointed to the Golf Committee to serve at the will of the Board. 4

5 ENVIRONMENTAL CONTROL COMMITTEE COVENANT COMPLIANCE COMMITTEE Jim Madison, Committee Chair, noted there was one action item since the last board meeting. The request was to change the sign at the hotel, which was approved. Pat asked Jim if he was willing to continue to serve on the committee and Jim confirmed he was willing. RESOLVED, that Jim Madison be reappointed to the Environmental Control Committee, with a 3-year term expiring February Hank Cavender, Committee Chair, advised the committee had no activity to report. Hank noted the committee had one vacancy and recommended Doug Bristol of Worldmark to replace Steve Sansone. RESOLVED, that Doug Bristol be appointed to the Covenant Compliance Committee to serve at the will of the Board. UTILITY SYSTEMS OPERATIONS REPORT OTHER BUSINESS TJ Paskewich advised there was a failed fire hydrant that required replacement during the past quarter, but no other significant operating issues to report. TJ presented the Water Consumption Report ( Attachment 11 ) noting the information includes data through the end of TJ reported the sewer system master plan update is expected from WH Pacific by the end of March. TJ Paskewich referred to his written operations report ( Attachment 12 ), sports center usage statistics ( Attachment 13 ) and Holiday Inn press release ( Attachment 14 ). TJ noted the Holiday Inn press release was for informational purposes only and is specific to the 100 rooms at the Lodge at Eagle Crest (fka Inn at Eagle Crest). TJ then presented a memo from Resort Resources on Common Area Parcel Ownership ( Attachment 15 ) which details a title transfer which is currently in process. Pat advised he requested a management recommendation for a records examination policy to clarify the governing document requirements in this regard and incorporate updates in State law. He referred directors to the draft policy prepared by management ( Attachment 16 ). Karen added the majority of the draft is a compilation of ECMA Bylaws content and the related Oregon Statutes content, along with policy language sourced originally from the Stoel Rives law firm for another Oregon owners association. The board asked management to draft an additional cover 5

6 sheet and procedure for inclusion with the policy, further specifying by examples what would generally be considered proper and/or improper use of Association documents. RESOLVED, that the Record Examination and Privacy Policy be approved as presented, subject to the addition of a procedural guideline to be prepared by management to clarify examples of proper and/or improver use of Association documents. Mike Bessonette noted the Estate Homesite Association and the Ridge at Eagle Crest Owners Association have adopted extensive ladder fuels reduction policies to reduce risk of damage in the event of a wild fire. Mike advised he believes certain ECMA common areas are in need of ladder fuels reduction and recommends a ladder fuels reduction policy be considered for the Association. TJ offered to prepare a draft policy to present to the board at the next meeting. Directors discussed that policy adoption would be the first step, after which they would need to address scheduling any work and budgeting for those costs. Mike suggested attention be first focused on common areas along the Deschutes River canyon. The board directed management to prepare a proposal to present at a future meeting. Mike proposed changing the speed limits on ECMA controlled roads to 20 miles per hour, referencing the speed limit set by the Ridge at Eagle Crest Owners Association for its roadways.. TJ noted management recommends keeping speed limits at 15 in the more congested areas, such as Red Tail Hawk Drive. Pat asked management to prepare and present a proposal at a future meeting regarding speed limit recommendations. Mike advised some residents of Eagle Crest would like an off-leash area for dogs and that he received an informal proposal suggesting some part of the former equestrian facility be used for this purpose. Pat advised the Board was not in a position to respond or discuss the idea until a formal written proposal is submitted by the proponents of this idea. Directors acknowledged information from management with regard to governing document restrictions on pets. Pat closed the discussion stating a formal proposal would be needed before taking the matter under consideration. At this time, and upon motion duly made, seconded and approved, the board convened to executive session to discuss two pending contracts with the Association. Upon returning from executive session, motions were duly made and seconded, and the following resolutions were approved with four directors in favor and one director abstaining (Earnest): 6

7 RESOLVED, to approve a management agreement with Eagle Crest Management, LLC as detailed in Attachment 17 ; and BE IT FURTHER RESOLVED, that the professional services agreement with Resort Resources, Inc. and related task orders as presented in Attachment 18 be hereby approved. Directors confirmed the second quarter meeting on Friday, May 18, 2012, 10:00 a.m., at the Eagle Crest Administrative Office in Redmond, Oregon. ADJOURNMENT There being no further business, the meeting was adjourned. Secretary to the Association 7