LAKE PANORAMA ASSOCIATION BOARD OF DIRECTORS MEETING

September 25, 2007 Unapproved minutes
LPA offices
Lake Panorama Association
       Board of Directors Meeting
       September 25, 2007
       Lake Panorama Association Office
        Unapproved minutes
       
       The Lake Panorama Association Board of Directors met Tuesday, September 25, 2007, at 4 p.m. at the Lake Panorama Association Office. Board members present were Courtney Allen, Bill Douglass, Tom Jeschke, John McDermott, Ron Morden, Duane Spicer and Susan Thompson. Staff members present were John Rutledge, General Manager, Judy K. Contner, Recording Secretary and John Dinnebier, LPN General Manager. Tom Polking, legal counsel, also was present.
       
       President Morden called the meeting to order at 4 p.m.
       
       Morden asked for additions to the meeting agenda. McDermott moved to approve the September 25, 2007, board meeting agenda as written. Motion seconded. All voted aye.
       
       Morden asked for additions or corrections to the August 28, 2007, board meeting minutes. Jeschke moved to approve the August 28, 2007, minutes as written. Motion seconded. Allen voted nay. Motion carried.
       
       In the treasurer’s report, Spicer told the board minor changes have been made to the financial statements, at his request, by Susan Lyons, Accountant.
       
       Allen asked why the price per cubic yard that LPA received for dredging was not consistent. Rutledge explained price is on a sliding scale as agreed upon in the RIZ contract for 2007.
       
       Allen explained the history behind the seal coating of the roads and the road assessment. When the road assessment was approved, the idea was that all of the new assessment would go to seal coating LPA roadways. Allen felt that by reducing the amount of seal coating done this year, money that should have gone to roads was used to balance the budget. Polking explained in 2003 members voted to change the bylaws to combine all special assessments, such as erosion control and roads, into one annual assessment upon which the annual budget is developed.
       
       Spicer moved to approve the third reading of the proposal for home construction inspection. The proposal:
       
       Inspections shall be done by a certified building inspector at the cost of the property owner on new construction, remodeling, building additions, structural alterations, and structural repairs of all residential building in the Lake Panorama Development. All accessory structures attached to residential construction shall comply with the current residential codes and be subject to inspection. Garages or accessory structures with less than six (6) feet of open space between the structure and a home shall be considered attached and be subject to current residential codes as adopted and structured for the LPA. All detached garages that incorporate water, electricity and second floor or sub grade spaces shall comply with the current residential codes and be subject to inspection. Detached garages or accessory structures that are not intended to have interior gathering spaces shall conform to UBC (Uniform Building Codes) to ensure a durable and safe structure and demonstrate acceptable workmanship and shall not be subject to inspection unless falling under the six foot open space definition. All garage and accessory structures shall comply with current code requirements for live loads, snow loads, wind loads, and seismic risk.
       
       Motion seconded. Douglass voted nay. Motion carried.
       
       Polking was asked at the August board meeting if a cul-de-sac could be sold to the property owner who is purchasing lots 1241-1244. Polking reported that after reviewing this situation, the cul-de-sac can be sold but permission in writing must be obtained from adjacent property owners. Rutledge to get an appraisal and work with the buyer and neighboring property owner on the necessary paperwork.
       
       Earlier in 2007, the proposal was made and adopted to eliminate the inter-company rental fee arrangement between the LPA and the LPN. The rental fee was designed to be approximately equal to the depreciation expense on the LPA’s books for the Conference Center building. The building asset is on the LPA’s books but is used exclusively by the LPN. Larry Bauer and Ron Morden met with LPA auditors who agreed that reinstituting this inter-company rental fee would have two advantages:
       1) More properly reflecting the operating results of the LPN operation, comparable to prior years’ results.
       2) Producing a reduction in income tax liability on the LPA/LPN consolidated returns since only land sales income is taxable in the LPA operation but all LPN operational results are taxable.
       Spicer moved to approve the retroactive (1-1-07) reinstituting of the inter-company rental charge to the LPN in an amount equal to the depreciation on the LPA’s books on the Conference Center building. Motion seconded. Allen nay. Motion carried.
       
       Earlier in the year, Rutledge made an administrative decision to allow the temporary closure of the road that passes through the St. Thomas More Center on days and during times when children are being dropped off and picked up from camp. This was done to address an immediate safety concern. Jeschke moved not to close the road next year, but instead have staff work with St. Thomas More officials to create a safe parking area, parking education and more signage. Motion seconded. All voted aye.
       
       Rutledge reported an issue that will require the attention of the board in the coming months. According to MHF Engineering, the new County Basin will hold 10 million cubic yards of silt. LPA pumping into the basin is covered by individual easement rights. It appears at current levels, the basin will not be full before the leases expire. In eight previous years, about 678,000 cubic yards per year were pumped. There are approximately 9.5 million cubic yards remaining in the County Basin. In 2006 and 2007 the dredge will average just over 300,000 cubic yards of silt pumped due to the cut in RIZ funding. But an annual rate of more than 400,000 cubic yards is needed to fill the basin before the easements expire. At the current funding pace from RIZ, it cannot come up with any more money unless the standby tax is extended. A booster pump and pipe is needed at a cost of $280,000 to $300,000. Standby tax creates $330,000 annually.
       
       Rutledge noted the current agreement between the County and RIZ requires the discontinuation of RIZ in 2017. Rutledge noted the RIZ Board intends to invite the County Board of Supervisors, LPA Board and other relevant parties to review this aspect of the agreement sometime next year. Rutledge has agreed to coordinate a comprehensive tour of dredging operations to provide perspective for this conversation.
       
       Open Forum: The owner of lots 5050 and 5051 requested a definition of the LPA property in front of his lots and if the land could be purchased. Polking stated it is a community area and a vote of the membership would be needed to approve a sale. Spicer suggested having staff do an inventory of all community areas, investigate fair market value and have the membership vote in the spring on all such areas the board feels it might make sense to sell. Rutledge to pursue.
       
       Board went back into regular session.
       
       Items pending:
       
       Rutledge reported letters had been sent to the property owners on Chimra road with a proposal on a tiling project. No responses have been received to date.
       
       A moratorium has been placed on the sale of all LPA-owned lots around the Par 3 golf course.
       
       Staff to review LPA rules and regulations for recommendations to the board for changes for 2008.
       
       Manganese in the water supply has caused discoloration. A permit to allow a chemical filtration to remove the manganese is pending with the DNR.
       
       The request for proposal for engineering has been sent regarding the dam spillway rip rapping project. An October response was requested.
       
       Rutledge reported work is continuing on the Jones Cove project. Some general clean-up and repairs are underway at the west campground.
       
       The upper basin is closed until Memorial Day as dredging is underway there.
       
       The lower parking lot at the LPN was seal-coated by LPA staff at a cost of $7,500. A second coat probably will be applied in the spring to make this improvement complete.
       
       The fuel dock at the marina will close Sept. 30. The LPA will remove the old gas dock and Atlantic Meeco will begin construction Oct. 15. The new gas dock is scheduled to open May 1.
       
       John Dinnebier reviewed the Par 3 dues structure and presented some recommendations on price increases for 2008. Jeschke stated the Par 3 committee and the Steering Committee should meet to discuss the recommendations and report back to the board.
       
       Dinnebier stated The Links restaurant and lounge already has surpassed its 2007 revenue budget and the pro shop is $10,000 ahead of its projected budget.
       
       Dinnebier reported beginning in October The Links will continue to be open Tuesday through Saturday for lunch and dinner and Sundays will be lunch only.
       
       Members from the Panorama Ski Team and Lyn Coulter were present to discuss an alternate ski practice and show location. One set of slips at the marina was replaced in 2006 and a new fuel dock will be installed in October. There is concern the wave action caused by the ski team boats moving at speeds of 15-40 mph in a no-wake area will create further destruction to the old slips, plus damage the new additions to the marina. Atlantic Meeco, the builder of the slips and gas dock, recommends these structures be placed in no-wake areas. There also is concern the ski team’s present weekly practice and annual show location hinders boats from getting to and from the fuel dock and/or rental slips.
       
       David Dwyer, representing the ski team, presented a Powerpoint on safety, possible practice and show locations and security issues. After discussion, it was decided members of the ski team, LPA management and any board members available will meet to look at the south shore as an alternate site.
       
       Spicer said he needs to resign from the Planning and Building Codes committee due to a prior commitment on the day of the monthly committee meetings. Jeschke consented to take the vacant seat.
       
       Thompson passed out promotional literature for the fundraising campaign to replace the old starter shack. The same material will go out with the water bills and newsletters to all LPA members in early October.
       
       Barry Monaghan of Guthrie County State Bank had contacted Rutledge about the possibility of changing the collateral for the repurchase agreements that LPA has invested with GCSB from obligations of federal agencies to obligations of political subdivisions, the income from which is tax exempt from federal income tax. The investment committee met to review this request. The committee recommended that not more than 50% of the collateral be in obligations of political subdivisions and that all such obligations be rated in the top two rating bands by the most recent ratings by either Moody’s or Standard & Poor’s and that all collateral have current pricing. Spicer moved the board approve the investment committee’s recommendation. Motion seconded. All voted aye.
       
       Douglass reported the hunting committee is in the process of marking the LPA perimeter with flags to show hunting areas.
       
       Rutledge reviewed the Capital Improvement Plan Powerpoint presentation to be shown at the informational meeting Sept. 30 that outlines projects completed this year, plus future projects facing LPA/LPN.
       
       The Board will be developing a funding plan in the next three months. The idea for the Sept. 30 meeting is to outline the needs and show a commitment on the board’s part to maintain current infrastructure, rather than allowing an emergency to occur which would require an emergency assessment. Rutledge said the facts are that for many years, membership dues and assessments have been kept as low as they have been because the LPA operation has been subsidized by land sales and lease payments from the LPN and the marina.
       
       Allen said he will not support an increase in assessments above the 5% increase the board can do without a membership vote. He presented material that he believes shows that normal cash flow, given a 5% annual increase, will be adequate over the next five years.
       
       Board asked management to present a list of capital purchases on a monthly basis.
       
       Meeting adjourned at 8:50 p.m. and went into Executive Session.
       
       Executive session ended at 9:30 p.m. Meeting adjourned.
       
       
       ___________________________________ __________________________________
       Judy K. Contner – Recording Secretary Susan Thompson - Board Secretary