2005-04-26
CITY OF ENCINITAS
ENCINITAS RANCH GOLF AUTHORITY
MINUTES OF REGULAR MEETING
TUESDAY. APRIL 26, 2005 AT 4:00 p.m.
Lilac Room, Civic Center
505 South Vulcan Avenue
CALL TO ORDER/ROLL CALL
Chairman Kaiser called the meeting to order at 4:06 p.m.
DIRECTORS PRESENT: Ed Kaiser, Kerry Miller, Peter Cota-Robles and Chris Hazeltine.
DIRECTOR ABSENT: Cindy Jacob.
ALSO PRESENT: Chris Calkins, Carltas Co.; John McNair, Rod Linville and Kent
Graff, JC Resorts; John Nabors, Project Manager; Patrick Murphy,
City's Planning and Building Director; Staff member Nancy
Sullivan; Member of Public Ray McGarity, and Board Secretary Pat
Drew.
ORAL COMMUNICATION [3 minutes for each speaker. Maximum 15 minutes for
oral communication.]
None.
AGENDIZED BUSINESS ITEMS
1. Approve Minutes of Regular Meeting of March 22,2005.
Mr. Calkins asked the Secretary to make a clarification change in the last sentence of page
two and first paragraph of page 3, to read "He said that looking at it from that perspective he
doesn't believe that they would object unless the Board chose to change its policy and adopt
budgeting that would substantially reduce the projected revenues. On that basis they won't
object at this time to the characterization of the cell tower revenues as capital."
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Director Cota-Robles moved approval of the minutes of the meeting of March 22, 2005
as amended, seconded by Chairman Kaiser. Approved 4-0-1 (Jacob)
2. Review Summary of Revenues and ExpenditureslFinancial Statement/update on Capital
Reserves for month of March, 2005. (Rod Linville/John McNair)
Mr. Linville reviewed the March financial statement.
Revenues for March were $400,875 compared to a budget of $406,548 or 99% of budget;
Expenditures were $238,633 compared to a budget of $255,653 or 93% of budget; Net
income before Cell Tower income was $161,342 compared to a budget of $149,861 or
108% of budget; Total rounds were 6,226 compared to a budget of 6,032 or 103% of
budget.
Year-to-date Net Income before Cell tower income was $963,425 compared to a budget of
$1,135,179 or 85% of budget. Including Cell Tower income year-to-date was $1,412.358
compared to a budget of $1,180,179 or 120% of budget. Total rounds were 48,567
compared to a budget of 52,248 or 93% of budget.
Capital reserve at March 31, 2005 was $52,318.80. Projected Capital Reserve at June 30,
2005 is $91,223.00 with a Capital Expense vs. Account Variance of$4l,223.00.
Expenditures for Club House Expansion were $39,355.63; Club House Reserve at March
31,2005 was $394,278.18. Total All Reserves were $479,740.95.
Mr. Linville handed out some draft budget options for consideration at the next Board
meeting.
4.
Update on Status of Clubhouse Improvements.
(John McNair)
Taken out of order.
John Nabors, project manager for the Clubhouse improvements, reported that he had
obtained approval from the Planning Commission for a temporary building with
instructions to go back in seven years with a permanent building and then to make whatever
argument they might have. He said that he thinks it will be, and the argument he finally got
through to them, was that this is not a retail establishment where they can make money and
go out and borrow money, build the expansion, make more money and pay off the loan. We
don't have that ability. He said that no matter how much he told them that, they (the
Commissioners) didn't seem to catch that until the very end. They approved the plans as
submitted with no stucco panel - just a metal building. Chairman Kaiser said the
Commission was under a misconception. One of the commissioners was under the
impression that prefab stucco panels were going to be used, and according to the architect
afterwards, that is not the intent at all.
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Mr. McNair said he tried to explain to the commission the financing of the golf course and
the concept of the "buckets" that have to be paid off each year. He said that JC Resorts is
simply managing the golf course operations for ERGA. However, the commissioners still
couldn't grasp the concept that ERGA still cannot borrow the money.
Mr. Nabors said the approach was two-pronged: design review and change oftemporary to
permanent. Chairman Kaiser asked if anyone could enlighten the Board on how the
building was classified as a temporary structure initially. Mr. Murphy said that's the way it
was sold initially, to put up a clubhouse with the dollars ERGA had and the Commission
said fine, is the five year period OK where you can come back and upgrade to permanent
and they were assured it was. He said that's where the irritation started with the
Commission, even though most of the commissioners have been replaced, they still see it as
an irritation. From their perspective it is no different than a developer promising to do
something and not following through with the promise. Mr. Murphy said he has always
been a proponent of getting rid of that condition, to just call it a permanent building. In
other words to call it what it is and get out of the loop. He advised that he personally felt
ERGA should appeal to the Council and get out ofthat loop - temporary versus permanent.
Mr. Calkins said that he felt that in coming back at this point ERGA is responsive to one of
the issues that were in front of the Commission; one of the reasons it was originally sold as
a temporary building is that it was clearly undersized to provide tournament support etc.
The other issue was the idea of having a metal building. How was that going to look? He
said the argument that he made was that he felt the informality of the building with the
water tower has, over time, proven to be a good fit for the course. He believes Mr. Murphy
is right - ERGA has brought something back; it is an expanded full-sized facility that has
design elements incorporated in it to do that.
Director Miller said that circumstances change. He could see that when it was originally
proposed there was probably a good faith expectation that it would ultimately have a large
clubhouse. He said that from prior discussions of what they should do about the clubhouse,
of whether they wanted to move in the direction of planning for a much more sophisticated
permanent structure, the board had come to the conclusion that economically it didn't make
a lot of sense. JC Resorts had presented evidence that those type of golf course operations
tend to be losers so why would ERGA want to put the golf course in a situation where it had
an element that was dragging its financial viability down and not creating a significant asset
either to the course or to the community. So that was why the Board chose to go this route.
Mr. Murphy said that if ERGA did appeal the Planning Commission's decision to the City
Council it would be appealing the temporary versus permanent use and also the deletion of
the seven year requirement to go back to the Commission which would basically be saying
it was a permanent structure. It was also agreed that the stucco would be colored green to
blend in with the landscaping.
John Nabors, John McNair, Chris Hazeltine, Chris Calkins and Ed Kaiser will be the team
to put the appeal together. It was agreed the appeal and presentation would be a different
approach to that taken with the Planning Commission.
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Chairman Kaiser moved, Director Hazeltine seconded, that the Board appeal the
permanent nature of the club house and the design review, specifically the color
scheme of the stucco, and that John Nabors file the appeal on behalf of ERGA.
Approved 4-0-1 (Jacob)
Patrick Murphy and John Nabors left the meeting.
3.
Report on Course Enhancements
(Kent Graff/Subcommittee)
Mr. Graff reported on improvements being made to the golf course in preparation for the
Bloom in America committee's visit May 6.
Mr. McNair spoke about the new concept for aerating the greens. He said they aerate three
times a year to keep the greens healthy. The challenge with that is that they lose a week or
almost two weeks of revenue because golfers do not want to play on aerified greens because
it affects their putting. So, they have come up with the concept where they will aerify half
the green and for ten days keep the cup in the front half of the green and reverse the
procedure and do it for the back half. They tried this on one of their other courses and it
worked. There was not one complaint. The superintendent is on board with the idea and
operationally thinks it's fantastic. They kept the momentum and revenues were up and they
didn't lose any ground for those two weeks. It worked well and he wants to do it company-
wide but before he did so he wanted to bring it to the ERGA Board to report on what they
are doing.
The Board was unanimous in its approval of the plan.
5.
Update on Cell Tower Discussions.
(John McNair)
Mr. McNair said that he is still working with Nextel and hopes to have something to report
at the next meeting.
6.
Incidents and Accidents.
(Rod Linville)
Mr. Graff reported that about three weeks previously a gentleman on his crew was struck by
a vehicle while he was in the parking lot cleaning up debris. He was sent to Scripts and
released that day. He is on temporary disability and it is being handled by their Risk
Manager.
7. Directors and/or Manager 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.]
None.
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8. Next Meeting - Tuesday, May 24, 2005 at 4:00 p.m.
9. Adjournment
Chairman Kaiser adjourned the meeting at 5: 17 p.m.
Respectfully submitted,
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Patricia Drew, Board Secretary
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EdwarCl O. Kaiser, Chairman of the Board
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