1996-08-15
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CITY OF ENCINITAS
ENCINITAS RANCH GOLF AUTHORITY
MINUTES OF REGULAR MEETING
Carnation Room, Civic Center
THURSDAY, AUGUST 15, 1996
CALL TO ORDER/ROLL CALL
Chairman Kaiser called the meeting to order at 3:22 p.m., immediately following the
Encinitas Ranch Golf Corporation Organization meeting.
PRESENT:
Chairman Ed Kaiser, Vice Chairperson Kathy Riggins, Directors Lauren Wasserman,
Alan Archibald, David Wigginton, being all of the Directors
Also Present: Carltas Representatives Chris Calkins and John White; Authority
Counsel Roger Krauel; Manager Jim Benson; Meeting Secretary Pat Drew; City staff
member Leslie Suelter, Financial Services Manager; Attorneys Bill Madison, Disclosure
Counsel Kim Byrens, City Financial Advisor Tom Johnsen, Underwriter Representative
Ramiro Albarran; and Paul Reed from C.J. Resorts, the Operating Management
Company for the golf course;
Members of the Public Present: Arthur Beardsley, President of the Encinitas Golf
Association; John Guidero, Vice President and Alan Rzovski, Treasurer of the Golf
Association.
ORAL COMMUNICATION
Mr. Arthur Beardsley, President of the Encinitas Golf Association asked the Board who is
going to select the association to rate the golf course. Is C.J. Resorts going to pick the
rating association?
Mr. Reed responded that C.J. Resorts would come back and make a recommendation to
this Board and the Authority's Board would be the one approving the organization to rate
the golf course. He stated that it had not been determined, nor discussed, how the
association would be selected. Mr. Beardsley stated he would like to have a letter
drafted to the Southern California Golf Association and the So. California Public Links
Golf Association, asking them to present their ratings, their charges, and what they will
supply to the course and the club when it comes into existence. Mr. Beardsley indicated
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they were the only choices we have for rating. Mr. Reed advised that this was an issue
that should be addressed toward the end - you don't rate a course until it is about to be
opened. He indicated that SCGA have normally rated their courses in the past. A
suggestion was made that maybe CJ Resorts would go ahead and send an inquiry letter
to the two Associations mentioned.
REGULAR AGENDA
1. Approve Minutes of Regular Meeting of June 6, 1996
Director Wasserman moved that the June 6 minutes be approved; seconded by
Director Riggins and approved unanimously.
2. Report by ERGA Manager, Carltas Representatives and Board members on
the Status of Golf Course.
Manager Benson reviewed for the Board the background of putting the golf course
together and a status report of where it stands at this time. Reviewed a revised
routing plan and compared with the original plan on which the original construction
plans were developed. As now constructed the course will have a clockwise
pattern. Described what had been finalized in the area of Quail Gardens Drive
and the parking. Director Archibald agreed with Manager Benson that this final
routing plan was a superior design; it had been developed as a team effort.
Chris Calkins spoke to the status of the construction contract between
Environmental Golf and Carltas Company. Have agreed to a contract which is a
fixed bid contract, with very limited exceptions. Construction price is going to be
$8 Million +/- but will not exceed the amount in the construction contract. Expects
to have a contract by Monday. Contractor has been able to secure from Wassau
Insurance, which is a major insurer, a performance and payment bond which is
somewhat different from the normal - it basically provides for penalties that would
payoff the entire revenue bond if they don't deliver at budget and on time. That
effectively assures the proposed purchasers of the revenue bonds that they aren't
bearing any construction risk. Likewise it assures us that we are not incurring any
construction risk. Jim Benson explained that he would be handing out some
additional documents with changes that recognize certain procedural issues that
have come out of the discussions with Wassau Insurance, most of the changes
are to make it more explainable to Wassau.
Manager Benson reviewed the financing schedule. Underwriter Representative
Albarran reviewed the schedule of the golf course revenue bonds, Projected
Sources and Uses of Funds, and pointed out it includes $950,000 to fund the
required bond reserve fund.
Director Archibald reported that they are in the process of clearing the course and
starting on the water line sometime next week. Will be taking down some of the
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trees - some will be relocated. Schedule calls for the water reservoir to be
ready/completed just about the same time as the course is ready in Fall '97.
3. Resolution No. 96-02 Authorizing the Issuance and Sale of not to exceed
$11,000,000 Principal Amount of Revenue Bonds to Finance Improvements
to Encinitas Ranch Golf Course, Approving Related Documents as follows
A. Indenture of Trust
B. Site Lease
C. Lease Agreement
D. Official Statement
E. Bond Purchase Agreement,
and Authorizing Related Documents and Official Actions;
Other Related Documents include
F. Assignment Agreement for Construction Contract
G. Assignment Agreement Between ERGA and ERGC
H. Golf Course Consulting and Management Agreement (as Revised) with
C.J. Resorts.
Manager Benson handed out a change to page 3-3 of resolution 96-02. He
explained that Disclosure Counsel Kim Byrens has been working with Wassau
Insurance and the change to the resolution essentially delegates to staff to sign off
on the documents.
Manager Benson and Bond Counsel Bill Madison reviewed each of the documents
listed in this item. Bond Counsel Madison explained that once the pricing of the
bonds occurs the blanks will be filled in. At closing the final forms of the
documents will be prepared. Copies will be delivered to members of the Financing
Team and copies will be available for directors if needed.
Manager Benson reviewed Item H which is the management agreement with C.J.
Resorts. The changes that have been incorporated into the agreement leave us
some options to finance and put the course together - around $220,000 to pay
C.J. Resorts for their costs. Underwriter Representative Albarran said that to the
extent that the bonds come in at the interest rate hoped for, there will be moneys
for this expenditure.
Director Wigginton moved approval of Resolution 96-02 to include agreement
regarding the golf course construction. Director Archibald seconded; resolution
unanimously approved.
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4.
Directors and/or Manager Reports
There were no further reports other than what had already been given.
5.
Next Meeting - Thursday, September 5,1996 at 3:00 p.m.
6.
Adjournment
Chairman Kaiser adjourned the meeting at 4: 17 p.m.
Respectfully Submitted:
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Edward Kaiser, Chairman
Patricia Drew, Meeting Secretary
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