1996-05-02
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CITY OF ENCINITAS
ENCINITAS RANCH GOLF AUTHORITY
MINUTES OF REGULAR MEETING
MAY 2,1996
CALL TO ORDER/ROLL CALL
Chairman Kaiser called the meeting to order at 3:05 p.m.
PRESENT: Chairman Ed Kaiser, Vice Chairperson Kathy Riggins, Directors
Lauren Wasserman, Alan Archibald, David Wigginton, John White, Chris Calkins
(arr. 4:05 pm)
ALSO PRESENT: Manager Jim Benson, Bond Counsel Bill Madison, Buck Smith,
Secretary Pat Drew.
ABSENT:
General Counsel Roger Krauel.
A quorum being present meeting was in order.
ORAL COMMUNICATION
No oral communication
REGULAR AGENDA
1. Approve Minutes of Regular Meeting of April 18, 1996
Buck Smith, P.O. Box 230355, Encinitas turned in a slip to speak to agenda
item number 1. He had questions concerning the Bylaws that were adopted
at the April 18 meeting relative to whether staff members (i.e. Manager and
City Clerk) were officers of ERGA. Also why Pat Drew was handling the
secretary work when Bylaws indicate City Clerk responsible. Director
Wasserman and Manager Benson responded to his inquiry. It was also
pointed out that there was a duplication in Article V, Officers, Section 3, D.
Treasurer - should be corrected to show as subsection "E." Asked if staff
members would be paid by ERGA. Manager Benson explained the
payments, or lack of, to directors and staff.
On motion by Director Wasserman and seconded by Director Archibald, the
minutes of the April 18, 1996 meeting were approved as amended. 5-0
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2.
Adopt a Resolution Declaring Intention to Reimburse expenditures from the
Proceeds of Obligations to be Issued by the Encinitas Ranch Golf Authority and
Directing Certain Actions.
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Bond Counsel Madison explained the need for Resolution 96-01 in order to
be able to reimburse expenditures prior to the issuance of the bonds. Rules
designed by IRS to prevent abusive use of funds.
Manager Benson explained how records are currently being kept and
recorded.
On motion by Director Archibald, seconded by Director Riggins, Resolution
No. 96-01 Declaring Intention to Reimburse Expenditures from the Proceeds
of Obligations to be Issued was adopted 5-0
3. Review of CFD and Golf Course Finance Provisions in the Development
Agreement.
Manager Benson reviewed the Development Agreement and the golf course
financial structure explaining the concept for the revenue/operating
expenses/bond payment schedule, and explained how the surplus net
revenue will be used.
4.
Briefing by Bond Counsel on the Documents and Structure Required for Issuing
Non-Taxable Revenue Bonds.
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Bond Counsel Madison reviewed a copy of the draft Indenture of Trust for
the issuance of the golf course bonds, describing in general terms and
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pointing out some of the critical p~~yisions. The Board will be asked to . . r, tL
approve the final copy at the ~eeting in June. He noted that the 5~/,~//.,_ (0
Indenture does implement some of the provisions of the Development S f ~ /:~;
Agreement, and it does lock up funds and is also a controlling document. In \()>
addition, it is a good historical document.
Counsel Madison advised that other documents that will be involved will be
an official statement used to market the bonds which is being prepared by
Best, Best and Krieger. There will also be a purchase agreement to be
approved.
Item will be rolled over to next meeting for further discussion.
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5.
Discussion of Items to be Included in a Proposed Memorandum of Understanding
between ERGA and the Ecke Family.
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John White handed out a memorandum outlining discussion items for
preparing a Memorandum of Understanding (MOU) between ERGA and the
Carltas Company/Ecke Family (Contributing Land Owners). He advised that
a few of the items had already been covered in the Indenture and the
Development Agreement but feels they should also be included in any MOU
as historical facts for future reference. Particularly concerned with issues
pertaining to after the debt is retired.
Director Calkins joined the meeting at this point, 4:05 p.m.
Counsel Madison said that he sees the MOU as an ancillary document which
appears to be consistent with the Development Agreement.
It was agreed that the subject MOU would be brought back to the next
meeting for further discussion.
6.
Directors and/or Manager Reports
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Manager Benson handed out Waiver of Notice forms requesting the
Directors to sign and return to the Secretary and explained purpose of the
waiver.
Manager Benson also gave an update on the selection of an operator for the
course. He advised that C.J. Resorts, a.k.a. J.C. Resorts, has been selected.
It is headed by Paul Reed, Executive VP He has come back with a draft
contract which has addressed a number of operator/owner issues which had
not been considered. Will bring a draft of the Operator Agreement to the
May 16 Board meeting, and hopefully will be able to approve at the June 6
meeting.
Will also have a final review of the bond documents at the June 6 meeting
and final for approval at the June 20 meeting.
Manager Benson advised that since the first meeting in July falls on Fourth
of July holiday there will not be a meeting that week. Also, there may only
be a need for one meeting that month which would probably be the regular
meeting on July 18.
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Director Calkins gave an update on the selection of the Golf Course
Contractor. They have selected joint team of Hazard Construction and
Environmental Golf. They are in the process of reviewing construction plans
to confirm budget, etc. Expect this part to be completed by May 8.
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Presently working on a Completion Contract which they hope to have
completed next week. Will have formed basic strategy and preliminary cut
as to what they understand is to be done. However, they will not have
costs. October 31,1997 is now the anticipated opening of the course, rather
than September 1 as originally planned.
7.
Items for Future Meetings:
a) Review of documents required for Issuing Non-Taxable Revenue Bonds:
(a) Indenture of Trust
(b) Official Statement
(c) Purchase Agreement
b) Discussion of Issues for a Memorandum of Understanding Between ERGA
and the Carltas Company/Ecke Family (Contributing Land Owners).
(c) Review Draft of Operators Agreement.
8.
Next Meeting - Thursday, May 16, 1996 at 3:00 p.m.
9.
Adjournment
Chairman Kaiser adjourned the meeting at 4:27 p.m.
Respectfully submitted,
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Patricia Drew, Secretary
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