Board of Directors Meeting Minutes
Date: December 10, 2014
Present: Dave Decker, Roger Rawson, Rich Hertel, Monte Thus, Gary Kluckman, and Darren Onwiler.
Quorum Present: Yes
Glenn Dalton, Rob Frey, Kat Schuetz, and Gary Wilson from the Holishor Office. Andy Carruthers- Attorney for Holiday Shores.
Holishor Members Present: 29
Meeting called to order at 7:30 PM
Pledge of Allegiance Recited
Minutes of November 12, 2014
Rich Hertel motions to approve. Darren Onwiler seconds.
Action: Motion carried.
Bills & Salaries
Monte Thus motions to approve. Roger Rawson seconds.
Action: Motion carried.
Profit Loss Budget
Transfers of Property
Four. Information Only.
Read by Glenn Dalton
Read by Glenn Dalton
Total Incidents 21, Total Citations 15, Animal Incidents 2, Vehicle Incidents 2, Property Incidents 13, Incidents Involving Persons 1, Alarm Responses 1, Other Incidents 2.
Read by Monte Thus
Our current balance on the North Property Loan is $217,951.21. The last payment towards that loan was $1,475.50. Our major bills for this month were paying the IRS, United Healthcare, the roads, and fish stocking.
Roger Rawson motions to approve. Rich Hertel seconds.
Action: Motion carried.
Letter from Michael Parker
Read by Dave Decker: Dear Board of Directors, I am submitting this letter to you as my resignation effective today 12-10-2014. I have enjoyed the time that I have served on the Board. But now feel that as my business is growing and more demanding, I canŐt give my position on the Board the attention it deserves. I wish all of you the best of luck. Thanks again, Michael Parker.
Dave Decker: I served with Mike on the Board and I appreciate all of the efforts that he has served as an officer. We are now looking for volunteers to fill this spot as we now have some big things in front of us to decide on.
Building Committee Report
Read by Rich Hertel.
The Building Committee cared for nine items. Three permits were closed with refunds approved, four permits were closed with refunds forfeited, one relocation of storage shed was on hold for more information, and one variance request was forwarded to the Board.
Read by Rich Hertel.
The variance is a desire to have an option to defer pouring driveway until weather breaks in spring of 2015. The reason being if concrete should freeze within 30 days of pouring, thereŐs a high probability of cracking. The Building Committee feels that the work should be completed on time or a permit extension could be requested. Timothy Bennett (11)- I am working on the driveway now and have started pouring this week. I no longer need this variance. I would like to request permission for the delay of planting shrubs and grass due to the weather. Gerry Theodor (1346)- The Building Committee will work with Tim in regards to the grass and shrubs due to the weather.
Covenant Amendment Status
Dave Decker: We have had a pretty good influx of affirmations received over the last few weeks. We now need around 250 affirmations to pass. In our billings for 2015, we sent out letters and self- addressed stamped envelopes specifically to the individuals that had not filled out their affirmations. This has made a dent.
Dave Decker: We signed a lease today with a new restaurateur. They are working on getting all of their permits in place and will take possession of the restaurant in January. They are hoping to open up in February. We are very anxious to use that amenity. Jeanie Votruba (493)- Are they going to keep the same name? Dave Decker: No. Laura Scatturro (1716)- Can you please tell us the name of the Restaurateur? Dave Decker: Their names are Rob Braband and Stefanie Filer. The name of the restaurant will be The Lake House.
Dave Decker: Our culvert is installed and complete other than some clean up that still needs to be done.
Dave Decker: We have been talking about the possibility of allowing barges on the lake for seawalls and dock repairs. Rich has put together a set of rules that were recommended by the Lakes and Dams Committee. If the Board has any additional recommendations, please send them to Rich. Due to the time, we will defer this until the next meeting.
Port Lane Drainage
Dave Decker: We have allocated some funds for an engineering study to see what opportunities are available up there and what the cost is going to be.
Dave Decker: There has been a lot of talk on the news in regards to an increase in minimum wage. If that minimum wage were to go into effect and every hourly employee were to get the same amount of raise ($1.75), it would be a $42,000-$45,000 hit to the Association. That is basically a 4% impact to our budget. We are going to keep a very close eye on that and keep an eye on the budget as a result to that.
2014 Allocation of MoniesAvailable Due to Expenses Less than Income
Monte Thus: The Finance Committee has met and went over numbers. There were a lot of numbers thrown out at the last meeting that were estimates. The estimates were done when we still had three more check signings. As of now, we have one more check signing before the end of the year. Those numbers were thrown out there for the Board to start looking at what to do with the excess dollars if we end up having excess dollars. The following is what the Finance Committee recommends to the Board for excess monies. We have a rough estimate of approximately $85,000 excess monies this year. We recommend that part of the excess funds be used to balance the 2014 reserves. ThatŐs $21,000. We would like to use 25% of the excess funds to pay on the North Property Loan of $22,000. The deck off of the ballroom needs repairs which will cost $5,000. We would like to install one Gabion Basket at the North End where we have been dredging with a cost $5,000. We also have a requirement in Port Lane. By the letter we received from the engineering firm, to do the first part of the study, its $22,000. Hopefully, we can get it cheaper than that. Our last priority would be to put $10,000 of the excess to the roads. Please remember that the $85,000 is just an estimate. Included in our last check signing of the year is our last interest payment on the loan. One thing that we have to take into consideration is the increase in the minimum wage that was on the state ballot this year. If it becomes official in 2015, we will probably have to take money from the roads to cover the increase. Dave Decker: When we first start looking at this and we see the excess of $85,000, the first thing that comes to everyoneŐs mind is where we got that money. ThatŐs a pretty significant amount of money and itŐs very rare that we are that much under our budget. It really boils down to several things. We forecast every year our income based upon the number of paying members. We have seen an increase in our building permits and our transfers of property which have initiation fees. Additionally, we are continuing to pursue collection of those who are failing to pay. As a result of those collection efforts, we have seen a lot of people start payment plans. We have a significant amount of money that is coming in on a monthly basis from those payment plans. That is just a little bit of background for the source of that money. Monte has brought to the Board a recommendation from the Finance Committee. Conversation Ensues regarding the interest and principal payments on the North Property. Darren Onwiler makes recommendation that all allocations be based upon a percentage. Rich Hertel: I recommend that we lock in the Gabion Basket and the deck repair and base everything else on a percentage. Monte Thus requests that the Board really think about the reserves. We really need the $21,000 there to cover the reserves. Roger Rawson: The reserves are the future expenditures that will happen. Dave Decker: That future expenditure could be next year or in 15 to 20 years. ThatŐs what the schedule is set up as based upon when each item needs to be replaced. Roger Rawson: I would like to request that Darren amend his motion to include locking in the reserves as well as the Gabion Basket and the deck repairs. Darren Onwiler: I would like to vote on the motion that I previously stated.
Darren Onwiler motions to lock in the Gabion Basket and the deck repairs at $5,000 and all other recommendations be allocated based on a percentage of the presented excess funds. Rich Hertel seconds.
Roger Rawson and Monte Thus voted no.
Darren Onwiler, Rich Hertel, and Gary Kluckman voted yes.
Action: Motion carried.
2015 Budget Adjustments
Dave Decker: We present a budget to the membership at the Annual Meeting. That budget is put together well in advance. It is approved at the Annual Meeting. We continue to take a look at our income, continue to take a look at our expenses, and we adjust that budget based upon the current market conditions. We are forecasting next year to have some additional incomes. We are not changing the amount of the assessment. We are changing what we are forecasting our income and expenses to be. Monte has worked with the office staff, Ray Garber, and the Finance Committee to come up with a proposed budget which is what we see here today. Monte Thus: On the income part of the budget, we are basing some of these numbers on the growth of Holiday Shores with new housing and more dues. The first major item on this budget is the current assessments. We have a member approved $700,000 adjusted to $706,250. We raised dues from new closings. Another big one is prior yearŐs dues and assessments due to collection efforts. Late fees are also raised. We have minor changes to the expense side of the budget. Postage has gone up a little bit and the Holiday Shores website was also changed a bit. Based on what the insurance company has supplied, it has jumped up a significant amount. Attorney fees have also jumped up being that we are taking more people to court. Some monies have also been knocked down from Public Safety. We will hopefully pay more on the principal next year because we have less interest. Bottom line is, the 2015 member approved is $982,020 and we revised the budget up to $1,016,485.
Monte Thus motions to accept this revised budget for 2015 operations. Gary Kluckman seconds.
Action: Motion carried.
Village Incorporation Committee Report
Ken Dulle: The Village Incorporation Committee has been investigating the pros and cons of Holiday Shores becoming a village. The members of this committee are Andy Carruthers, Glenn Dalton, Bob Lowrance, Gene Magac, Kent Schiebel, Monte Thus, and myself. The biggest thing that we were looking at was our eligibility to become a village based on our size and location. We needed to find out if it was feasible to incorporate under Illinois Municipal Code 65ILCS 5/2-3-5a. We have to have at least 3,000 people in the community to be eligible to incorporate. So yes, it is feasible for us to incorporate under this code. Assume that proposed Village Boundary is same as Holiday Shores Sanitary District. Current Equalized Assessed Valuation (EAV) for the Holiday Shores Sanitary District is $76,656,168. This would be the EAV for the proposed Village. The current Holishor Revenue for FY 2014 is $1,000,000. The Projected Holishor Revenue for FY 2015 is $1,000,000. So what are the pros and cons of incorporation? The following list are theÓProsÓ that the Village Incorporation Committee has come up with. More revenue, better government, ŇrealÓ police force, tax exempt municipality, authority to levy taxes, zoning, by lot assessment (1 vote per resident), and grants. There are numerous amounts of grants that we could apply for. The CDBG, PEP, CMAQ, and Playground Equip just to name a few. The ŇConsÓ are as follows. Another layer of government, possibly more ordinances, possible legal & professional costs, higher real estate taxes for small percentage, cost of police force estimated at $240,000 for 24/7 services. Noting that if we do nothing other than incorporate and leave all current assessments for the association the same and set our tax levy at $0. We will be eligible for the following assuming a population for 4,000 in the new village. This is all revenue. Revenue from these sources would be: Motor Fuel Tax - $96,000. ($24 per person), State Income Tax - $380,000. ($95 per person), and Road Grants - $300,000. The Road Grants are based upon discussion with the Mayor of Bethalto. They estimate receiving approximately $600,000 for road improvements and are roughly twice our size. In the alternative, if we want to replace our current base assessment with property taxes we can consider the following. Noting that the average sales price of a home sold through the MLS within the last ten years from 11/01/2004 through 11/01/2014 is approximately $187,000 and assuming there are 1,160 homes paying $625 per year (exclusive of the $50 for dues and special assessment) the resulting income would be $725,000. $187,000/3 = $62,333 - $6,000 (homestead) = $56,333 Avg. EAV. It would require a tax levy rate of approximately 1.10% per thousand of assessed value to replace such ($56,333 x .011 = $620 per year, rounded)Noting that our anticipated grants for roads are estimated at $300,000 and have to be used for a specific purpose, our income exclusive of those grants would still be increased by: State Income Tax Allocation - $380,000, Motor Fuel Tax (MFT) - $96,000 equaling $476,000. Less the cost of a police force $240,240 leaves the net increase at $236,240. The net increase of income divided by 1,160 homes = $203.65 savings per home per year. Considering our current assessment of $625.00 - $203.65 (savings per home) = $421.35. Our additional revenue needed per home to break even with our current assessment would only require a tax levy of 0.75% per thousand of assessed value instead of a 1.10% tax levy. There were 493 sales from $37,744 to $460,000 in the last ten years. In conclusion, noting that the Median Sales Price of a home in Holiday Shores is $168,000, only 13% of home would see a tax increase meaning only those valued above $268,000. $625.00 divided by .0075 = $83,333 + $6,000 = $89,333 x 3 = $268,000. After diligent and careful analysis of the data presented herein, it is our committeeŐs recommendation that we proceed with the Incorporation of Holiday Shores. Lake, Beaches, and Out lots will be private through a Lake Association. Similar to Dunlap in Edwardsville or Lake Saint Louis in Missouri. Andy Carruthers states that everything will still stay private and one of the main benefits of incorporating is road repairs. Dave Decker: I feel that we need to understand a whole lot more before we act on this and push it through. Bob Lowrance: We as a committee could dive into this much further and continue to investigate this. Conversation Ensued. Several recommendations were made by various members. Expressed concerns for potential higher property taxes for lakefront properties.
Monte Thus: According to our bylaws, we have to explain what we would like to spend out of our reserves for the coming year. The following is what is coming up in 2015. John Deere ATV, a Ford Ranger truck, seawall maintenance, seawall addition, and the morning glory gate. Dave Decker: The first January meeting, we are going to be spending a lot of time talking about the reserves and the reserve allocations.
Alan Campbell (325)- In regards to the Real Estate CommitteeŐs recommendations, we have yet to hear anything. Have you made a decision on the Holishor lots? Dave Decker: We wanted to pursue having those properties appraised and evaluated.
Roger Rawson makes a motion to move to Executive Session. Darren Onwiler seconds.
Meeting adjourned at 9:57 PM
Meeting minutes submitted by Rich Hertel.