President Mike Dixon's Report, December 4, 2007
Today I’d like to clear up several issues regarding Trumpets and the licenses for its operation.
There are 4 types of licenses required to operate a restaurant. Three are issued by the City of Henderson: a conditional use permit, business licenses and a liquor license. The fourth license, issued by Clark County, is a health permit.
The conditional use permit which costs around $30,000, was originally obtained by the Association during Del Webb’s control. After operating Trumpets for a few years, the
Association transferred the restaurant and its permits to S&D Cafe in September 2002.
Now that S&D has been evicted from the restaurant, a new transfer of the conditional use permit must be accomplished within 180 days. If we transfer the permit within the 180 days we can avoid the bureaucracy and costs involved in applying for a new permit and new licenses.
On behalf of the board, I’d like to thank the Trumpets Workgroup for meeting an aggressive schedule for producing the RFP for a new Trumpets operator.
At the October Town Hall Meeting, Andy Hafen, our City Councilman, said that he thought the conditional use permit could be suspended for up to a year (I remember him saying “put on ice”). Because there is some confusion about whether this is possible, I have scheduled a meeting with Councilman Hafen next week to clarify the situation.
One thing is clear: S&D cannot sell the business because, under the lease they do not own the Trumpets name. The also relinquished the licenses and permits on September 30 when their lease was terminated.
There has also been some confusion on the mailing list used for both the Spirit and our Association mailings. While there have been some problems with the former database, the 20% error number is grossly exaggerated. However, this is no longer a problem as the database used for mailing of the December Spirit and the meeting notice is completely updated.
On November 18, I met with Jeremy Fritz of Pulte about Rec Center 3 to determine what part of the $1.375 million in cogen funds would be added to our reserves. The estimated cost of the greening improvements reviewed by the prior board was $675,000. Pulte now estimates that the total cost of the greening modifications will be over $2 million, and no cogen funds will remain.
Because the current Board was not involved in the planning or review of these improvements, we have asked Pulte to delay construction of Rec 3 until we can complete our own due diligence on the project. We have asked Pulte to provide a cost benefit analysis on the components of the greening improvements. We are also working with an independent contractor to verify Pulte’s cost estimates and to determine the cost difference between a non-greened building and one with the green improvements.
As soon as we complete our analysis we will review our findings and make our decision how to proceed at an open board meeting.
Phil Baliff, the attorney on the Trumpets case, has left Jones Vargas to move to another state. He has been replaced by Amanda Cowley who prepared the following statement about the status of the lawsuit:
The Association has filed an Answer and Counterclaim against S&D Café V, LLC. The
Amended Answer and Counterclaim alleges causes of action for breach of contract and contractual breach of the implied covenant of good faith and fair dealing. S&D Café V, LLC filed a Reply to the Association's Amended Answer and Counterclaim. Accordingly, the preliminary pleading work for this case is complete and the parties will now begin their discovery efforts. The parties began the discovery process by agreeing to a discovery schedule. On October 16, 2007, Steve Shevorski, on behalf of the Association, attended the Early Case Conference. At this Conference, legal counsel for the respective parties discussed and agreed to a discovery schedule. Based on the parties' agreement, the Discovery Commissioner issued a Scheduling Order on November 26, 2007. This Order requires the discovery period to close on May 1, 2008 and all parties must make their initial expert disclosures on February 1, 2008.
The Association will now use the discovery process to establish the factual basis for its counterclaims and to disprove the factual basis for S&D Café V's claims. We will commence discovery with the service of written interrogatories on plaintiff's counsel this week. We will then prepare and serve document requests. We will also plan to interview certain witnesses. Later we anticipate taking the depositions of certain parties and key witnesses.
The Board made two important changes in our procedures in October. Each homeowner will receive their assessment invoices early this month. Instead of an invoice for one quarter, you will receive a book of four coupons, one for each quarter in 2008. This is very much like the coupons sent out by the assessor for property taxes. You can pay all four assessments at once, or you may pay four quarterly assessments during the course of 2008. In addition, credit cards will no longer be accepted in the office for payments of assessments. During the budget process we learned that we were paying $35,000 in fees to accept credit cards for member dues, and we decided that the Association was not getting any benefit for this cost. We are working on an alternative method for credit card payments which we hope to have in place early next year. In addition, you can have your assessments paid directly from your bank through the ACH process, you can pay them online, or you can pay by check.
There was one item on the December 5 agenda that provoked some confusion: that dealing with the April 26 meeting minutes. At the May Board meeting, the minutes of the April 26 meeting were approved pending a clarifying amendment to one item, that pertaining to the Villas agreement. At the June meeting, there was a motion to amend the text of that item, but since the vote on the amendment was 3-3, the amendment failed, according to Robert's Rules of Order. Since the May approval was conditioned on the amendment passing, once the amendment failed the original minutes prevailed and were thereby approved. No further votes were needed to approve the minutes of the April meeting.
On behalf of the Board, I’d like to wish everyone a happy and healthy holiday season and a prosperous new year.
Mike Dixon, President, Sun City Anthem Community Association