2003-03-27
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CITY OF ENCINIT AS
ENCINITAS RANCH GOLF AUTHORITY
MINUTES OF REGULAR MEETING
Lilac Room, Civic Center
505 South Vulcan Avenue
THURSDAY. MARCH 27, 2003 at 3:00 p.m.
CALL TO ORDER ROLL CALL
Chairman Kaiser called the meeting to order at 3:09 p.m.
DIRECTORS PRESENT:
Edward Kaiser, Cindy Jacob, Phil Cotton, Peter Cota-Robles
and Kerry Miller, being all of the Directors.
ALSO PRESENT:
Chris Calkins and John White, Carltas Co.; John McNair, Rod
Linville and Mark Warren, JC Resorts; Greg Lawlor, ERMC;
Connie Chapman, ERLadies Club; Staff members Paul
Bussey, Nancy Sullivan and Pat Drew, Recording Secretary.
ORAL COMMUNICATION [3 minutes for each speaker. Maximum 15
minutes for oral communication.]
None.
AGENDIZED BUSINESS ITEMS
1.
Approve Minutes of Special Meeting of February 20, 2003.
Director Miller moved approval of the February 20, 2003 minutes,
seconded by Director Cotton. Approved 5-0.
2.
Encinitas Ranch Men's Club - Proposal for "Paul Ecke Jr. Memorial"
Greg Lawlor of the Encinitas Ranch Men's Golf Club presented some sample
plaques and read the proposed wording for the plaque commemorating the
contributions and generosity of Paul Ecke Jr. and his family. Mr. Lawlor advised
that the Ecke family had reviewed and approved a copy of the wording. Mr.
Lawlor recommended the caste bronze plaque for a cost of about $700 and said
it was his understanding that the Golf Course is to build the platform for the
plaque. He was advised that this had not been discussed. Mr. Lawlor said this
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was not a problem since they had some money available and had received a
number of contributions from members, including a donation of $300 from the
Ladies' Golf Club. Essentially what he was looking for was approval by the ERGA
Board of the wording and the placement. They would like to install prior to the
Poinsettia Cup Tournament in early May. It was agreed to place the monument
in the grass just to the east of the Starter's area and agreed to the wording as
proposed.
Chairman Kaiser moved that ERGA make up the difference in cost to
pay for the stone on which to mount the plaque from the General
Operating Fund, not to exceed $1000, seconded by Director Miller who
added "the stone selection to be approved by Chairman Kaiser,"
seconded by Director Jacobs. Approved 5-0
3.
Review Summary of February, 2003 Revenues and Expenditures/Financial
Statement/Update on Capital Reserve Fund. (Rod Linville)
Mr. Linville reviewed the summary of the February financial statement.
Revenues for the month were $263,244 compared to a budget of $330,815 or
80% of budget; expenditures were $182,848 compared to a budget of $251,132
or 73% of budget; net income was $79,783 compared to a budget of $78,649 or
101 % of budget; total rounds were 4,422 compared to a budget of 5,309 or
83% of budget.
Year to date net income was $926,047 compared to a budget of $800,979 or
116% of budget; total rounds were 45,657 compared to a budget of 46,059 or
99% of budget.
Mr. Linville said that these figures reflect four days of heavy rain and two days of
aeration of the course.
Mr. McNair reported that the total Capital Expense for the year to date is
$134,270 from a Total Balance Capital Reserve Account of $134,289 showing a
variance of $19.00. Operational/Course Improvements totaled $24,000.
Discussion of 2003/04 Budget Review.
(John McNair)
Mr. McNair pointed out that this year in the preparation of the 2003/04 budget
they had separated the Lesson Revenue out of the budget. This is the big
difference from last year's budget, which was discussed with the Board a couple
of months ago.
Mr. Linville advised that the draft budget included a $2 across the board increase
in green fees in all categories. All other items remain the same as 2002/03
budget, including total rounds of 71,500. Mr. McNair also reviewed a rate
analysis of Encinitas Ranch and the competition courses. With the $2 greens
increase the projected revenue increase would be $148,000.
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Mr. Calkins asked about CFD payments. Ms. Sullivan responded that they come
out of cash at the end of the year and depends on whether there is sufficient
cash to cover the payments. Mr. Calkins noted that according to the projections
there will not be enough to cover payments and will be short about $200,000.
Mr. White noted that the Board was scheduled to revisit the 4% Cash Reserve
and Chairman Kaiser agreed that the cash reserve should be looked at again.
Director Jacob left the meeting at 3:50 p.m.
Director Miller said he needs to see the justification for increases and tends to
agree with Director Cota-Robles that he did want the rates to put ERGA in a solid
and good financial position but doesn't want to raise the rates just for the
purpose of raising revenue beyond the needs. He doesn't have a problem with
the course being affordable, which doesn't mean the cheapest because it clearly
isn't. He doesn't feel the need to be moving towards Torrey Pines in terms of
rates. One of the attractions of Encinitas Ranch course is that it is mid-priced.
One is paying more than some of the other courses but it is a quality experience
so a golfer is willing to pay more. He likes the idea of making an incremental
approach, fixing an increase that can be justified based upon the budget and
needs.
Chairman Kaiser said he would like to see the effect of raising the range rates
because if may offset what the Board wants to do with the other rates. Mr.
McNair said they will come back next month with scenarios of greens fee
increases of $3 and $4, and with and without range fee increases to $5-$8-$10
(small, medium and large buckets, respectively). They will also look at the
Capital Reserves and CFD payments. Director Miller asked that an analysis be
done and added to the bottom of the budget showing what really needs to be
done to accomplish $450,000 in CFD payments, then he is good with that result.
Mr. Calkins agreed that the justification should reflect the needs of the course.
The Board will approve the budget at the April board meeting.
5.
Report on Tree Enhancement/Markers
(SubCommittee)
Nothing to report.
6.
Update on Restrooms.
(John McNair)
Mr. McNair advised that they are now in the third plan check phase and if
everything goes through they are looking at May 1st for completion.
Update on Cell Towers
( John McNair)
Mr. McNair passed out drawings of the Cingular and Sprint site plans. The
Directors agreed with the design concept as presented in the drawings. Income
from the two companies will be $2500 per month each with a 4% cpi and is
estimated to bring in approximately $750,000 over a ten year period. Mr. McNair
said he will ask General Counsel Sabine to review the contracts and expects to
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have them back at the next Board meeting for directors' approval.
8.
Incidents and Accidents.
(Rod Linville)
Mr. Linville reported that the company working for Sprint started drilling for core
samples without permission, and hit the main 8" water line next to the parking
lot. Sprint was notified immediately and is aware of their responsibility. Mr.
Calkins suggested a letter be written putting the company on notice of potential
damage to the course if there is a delay in getting repaired.
9.
Potential Course Enhancements.
Mr. Linville said he had been getting comments from golfers about the markers
and complaints that they are hitting into the bush, however they are also getting
a lot of positive compliments.
10.
Discussion/Direction Concerning Course Operations, Conditions Needing
Change.
Mr. Linville advised that the Men's Club is requesting a second day for their
tournaments. Currently the Board has authorized the Men's Club to have twelve
weekend tournaments per year, one a month. The tournaments are getting very
popular and they are getting too many players and cannot accommodate
everyone. They are asking if for six of their tournaments they could have a
second day so that if their tournament is on a Saturday they could put their
overflow on a Sunday. If they don't need the extra time they would let the Pro
Shop know nine days ahead of playtime.
Chairman Kaiser said since they are already getting twelve weekend days plus
two other days for a total of 14 days, which is more than most municipal courses
give their member clubs, they should try to pull the Wednesday play up. Mr.
Linville was asked to go back to the Men's Club and tell them they will stay with
the 12 days for tournaments.
Directors Reports
[For reported topics not described on this agenda, State law prohibits
Board discussion, responses, and action. A Boardmember may ask
questions, but only to clarify what the speaker is reporting.]
Director Cota-Robles said that he had an update on an issue the Board had
previously authorized him and Director Cotton to work with Barratt on some of
their custom lot issues. There is an area adjacent to their custom lots along
Quail Gardens Drive where they had previously received approval to do some
grading on ERGA property in return for them going in and landscaping the area,
putting in some irrigation lines and perpetually maintaining the area. He had
also been authorized to execute permission for off-site grading to Barratt to allow
them to move forward on that project. Director Cota-Robles passed around a
copy of a Landscape Maintenance Easement Agreement which shows the area in
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question. They have checked it and it is accurate. He has preliminarily looked
at it and addressed all of his concerns and handed it to the General Counsel to
look at it from the perspective of a couple of legal issues. As soon as that is
done, based on the Board's previous authorization, he would propose to go
ahead and execute a letter of permission that would basically look like the draft
letter he distributed to the Board. If the Board had any additional conditions to
those already laid out in the draft letter, it could be formalized at the next
meeting. However, he and Director Cotton, as the subcommittee, would be the
designated representatives to execute the document and sign off on final
approval of plans. The letter will indicate that no access is allowed across the
ERGA property, and only allowed to directly access the easement area from the
lots or from Quail Gardens Drive. They also need to supply a schedule of
grading and construction of improvements prior to initiating the work and also
they need to contact ERGA prior to construction. Mark Warren would be the
person to coordinate the construction.
Mr. Calkins said that there is a peculiar structure in which the ownership of the
golf course is in one corporation which then leases it to the other. His only
question was which entity should get title to the easement, the Corporation or
the Authority. This should be checked with General Counsel Sabine to look at
the Bond Indenture.
12.
Next Meeting - Thursday, April 24, 2003 at 3:00 p.m.
13.
Adjournment
Chairman Kaiser adjourned the meeting at 5 p.m.
Respectfully submitted,
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Patricia Drew, Recording Secretary
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Edward O. Kaiser, Chairman of the Board