Board of Directors
Regular Meeting
OCTOBER 3, 2005

President Bill Risen called the regular meeting of the Lake Moovalya Keys Board of Directors to order at 6:05 p.m.

President: Bill Risen
Board Members: Jack Sweeney, Gary Svider, Joe Price, Squeak, Richard Jaschke, Larry St. George

Vice President: Chuck Baker
Secretary/Treasurer: Chris Chambers
Board Members: Bob Stroud, Joe Maxwell
Security: Darrell Wilson, R&B Security

Guests: Blane Coon (lot 54); Steve Catlin (lot 177); Barbara Risen (lot 184); Sheryle Jaschke (lot 171)
Bookkeeper/Recording Secretary: Sue Thomson
General Manager: John Currie
Legal Counsel: John C. Churchill (6:25 p.m.)

Mr. Catlin stated he was attending his first meeting as an observer.

Mr. Risen reported that Darrell Wilson injured himself, and is absent tonight as a result of his injury. Mr. Risen stated that Mr. Wilson is doing a good job, except he is not submitting his paperwork in a timely fashion. Ms. Thomson was asked to send him a letter giving him formal notice that we expect his security reports and photographs to be submitted on a weekly basis, within seven days following the end of the week. No reports or photographs for September were submitted prior to the meeting.

Mr. Currie reported that R&B Security did a good job over the Labor Day holiday, even though there was a report of one of the guards sleeping in the guard shack, but Mr. Currie did not witness this. Mr. Currie stated that Mr. Sweeney has a handle on the sinkhole issue. Dan Kurtz, lot 214, complained about a tow due to no lot ID, and he threatened suit. Mr. Currie stated that Mr. Wilson has been making his rounds.

Mr. Risen stated that the Association won the recent towing-related court case, the court ruled the towing valid, and the $125 requested reimbursement was denied. He also stated that the Hutchins’ (plaintiffs in the case) complained about not towing when trailers are blocking other trailers. Mr. Catlin asked if the Association would accept street-address identification in lieu of lot numbers. Mr. Risen replied that an address would be acceptable. Mr. Sweeney suggested that we adopt a permanent form of identification which would prohibit sticker abuse from outside parties. It was decided that by the next Memorial Day holiday a permanent, official Lake Moovalya Keys ID sticker would be the only form of permitted vehicle/trailer sticker.

Mr. Risen commented on the improved situation with street clearance since the system of fines was established; where once it was almost impossible for a fire truck to get down the streets, the streets are now clear. Mr. Currie suggested that warnings be reinstituted, and Mr. Sweeney stated that while he used to believe in warnings, it has been too long now, and no warnings should be issued. Ms. Thomson stated that the lot-specific visitor passes are being distributed by the realtors to the renters.

Squeak asked if broken gate remotes are being replaced at no charge to the owners, and Mr. Risen stated that has been the Association’s policy.

Ms. Thomson reported on communications between the Association and Buckskin Sanitary District (BSD) regarding the identified sinkholes. Late fees were assessed against 11 lots for delinquent dues. Six metal R&B Security signs are being manufactured for installation on each street. The latest response from Dave Johnson (lot 74) regarding Squeak’s qualification to serve on the Board was previously circulated to the Board, and it was noted that the issue is now moot, since Squeak and Lauri Burke (lot 122) executed and recorded a deed this morning in both their names. Squeak also stated that Mike Roberts, our new landscape maintenance person, started this morning. Mike replaces Angel of Big River Landscaping, whose services were recently terminated.

Ms. Thomson reported that she did some Internet research on HOAs. She stated SB1151 protects HOA boards. HOA statutes come under Title 33, Chapter 9, Condominiums (33-1201 to 33-1270) and Chapter 16, Planned Communities (33-1801 to 33-1808) of the Arizona Revised Statutes. The provisions of Title 10, Corporations, and the chapters relating to membership nonprofit corporations also apply. Amendments to Liens can be found in sections 33-1256 and 33-1807. Also of interest is section 33-1902 relating to residential rental property, which requires owners to apprise assessors, in writing, of certain property and ownership information. These letters are considered public records and “failure to comply is subject to civil penalty of $1,000 plus $100 for each month after the date of the original violation until compliance occurs. The court shall not suspend any portion of the civil penalty provided by this subsection.”

Mr. Risen stated that he has been approached about the possibility of the Association doing away with rentals, and can we say “no more”, except to grandfather existing rentals? Squeak stated that none of the rental properties are getting assessed at the higher tax rate. He stated he gave Cliff Edey today a list of all rental properties in the Keys, and he was told they would be taxed accordingly. Mr. Risen reported that he was aware that the Hutchins’ property (lot 97) is being taxed at the higher rate. In reply to Mr. Coon’s query about long-term renters, Mr. Risen stated that we are talking only about short-term rentals in this regard, 30 days or less. Mr. Sweeney and Mr. Price both expressed the opinion that they didn’t think prohibiting rentals would be possible.

Mr. Sweeney made a motion that the late fee waiver request by lot 24 be approved, due to the owner’s statement that he did not receive his last statement, and he has never been late before. There was discussion about recent, frequent mail mishaps possibly due to our new postal delivery person. Squeak seconded the motion, and the motion carried, with Mr. Price opposing the motion.

Mr. St. George reported on rental issues at a new HOA in Surprise, where a friend of his had to sign a no-rent clause and a commitment to own the property for a minimum of two years. Mr. Sweeney also reported on new deed restrictions by some HOAs to eliminate speculative buyers.

Ms. Thomson reported that no additional security deposits were received this month subsequent to the collection letters being sent by Mr. Churchill’s office. Lot 214’s security deposit was returned due to a change in status and a pending sale of the property. Also, Security Real Estate is now handling two new rentals, lot 108 and lot 212, and both owners have been billed the security deposit.

Delinquent fines are outstanding on lots 188, 43, 161 and 10. No citations were issued, since R&B Security did not submit any reports for September.

Ms. Thomson did some Internet research on the owners of lot 64 and the Garden Grove Fire Department as a result of discussions at last month’s meeting. Mr. Risen stated that the Board would not be following up with the Garden Grove Fire Department regarding the owners of lot 64. Mr. Svider reported that as a private citizen and a retired fire department member, he is going to send his own letter.

A motion was made to approve the Accounts Payable as reported by Ms. Thomson. The motion was seconded, and the motion carried.

Mr. Price made a motion to approve the September Profit & Loss Statement and the September Balance Sheet. Mr. Sweeney pointed out errors on the Balance Sheet, and Ms. Thomson stated she would fix the errors and resubmit the Balance Sheet to the Board tomorrow. The motion was seconded, and the motion carried, except as to the corrections to be made to the Balance Sheet.

Mr. Risen and Mr. Sweeney reported on a movement to overthrow the current Board of Directors. Mr. Sweeney stated he was approached by the Hutchins’ (lot 97) to see if he would be interested in serving as President of a new Board. He stated the Hutchins’ are upset about the security deposit issue. Mr. Sweeney reported that he turned down the offer, and he told Mrs. Hutchins that she should come to a Board meeting. She replied that she didn’t have time except to attend the annual meeting. Mr. Sweeney stated that for those who do short-term rentals only in the summer, the Association could refund the security deposit at the end of the season, and collect it again at the beginning of the following rental season. Mr. Catlin reminded everyone that George Nault, La Paz County Assessor, at the last annual membership meeting, told us that if anyone knows of any rental properties to let him know. He said it’s almost impossible for them to keep current with the identification of rental properties.

Mr. Sweeney reported on 13 sinkholes and the two bids he received to accomplish the needed repairs. Stan Vescio’s bid is for $10,426.00. Steve Stanton Construction’s bid is for $10,894.17. Ms. Thomson discussed the status of her communications with Buckskin Sanitary District, and Mr. Svider reported that he attended the most recent BSD meeting where they stated that our letter to them was threatening, that they have other more pressing things to do, and that their sewer lines are in good condition. Mr. Price reported that the phone company made a repair on a speed bump they created, and he thought Cablevision was doing some work with their lines. Mr. Risen wondered if we would be risking damage to the sewer system if we go ahead with the sinkhole repairs on our own. Mr. Price suggested that we send a letter to BSD with the cost estimate and provide them with an opportunity to do the repairs. Mr. Churchill advised that we confirm with an expert that the sinkholes are not caused by the contractor or otherwise. We need someone to render an expert opinion. Mr. Sweeney stated that both contractors agreed in their bids to dig down and make a mark. Mr. Price stated that we don’t want to mess with the sewer line; we don’t need to dig to the laterals. Mr. Churchill stated that every homeowner contracted for their own work on their respective laterals. Mr. Sweeney stated that BSD was the only one to inspect them. Mr. Price stated that the damage done in the streets is sewer-company related, and homeowners didn’t pay for new laterals. BSD hired the contractor. It was noted that Mike Dyer recently did the one by the exit gate, and Mr. Price said that you could tell the difference.

Mr. Risen stated that we are still holding the approximate $19,000 Kenko money, which can be used for these repairs.

Mr. Churchill says that while he is not an expert, this could be due to a lack of compaction. Mr. Sweeney stated that he believed the only one that may be leaking is the one on Moovalya Drive. He also stated that he has been paid as an expert witness before in this area. Mr. Churchill stated that an expert could do a core sample to see if there is a compaction problem.

Mr. Price made a motion to hire Steve Stanton Construction for the bid price of $10,894.17 to dig out, re-base, compact and black concrete 13 sinkholes, our preference for Stanton being our ability to seek recourse against a licensed contractor, should recourse become necessary. The motion was carried, with Mr. Svider opposing the motion.

Mr. Currie was asked to take photos after underground alert has been contacted and marks made. Mr. Churchill advised that we contact BSD of what we will be doing. Mr. Sweeney asked Ms. Thomson to give him BSD’s phone number, and he will coordinate with Stanton and BSD.

Mr. Sweeney stated he has a source for a solar-powered camera that would go the physical distance, and that he is waiting on brochures.

Mr. Churchill stated that he has not had time to follow up on the Berge access matter.

Mr. Catlin asked if the Feedback function on the Association’s website has been fixed yet, and Ms. Thomson reported that it was supposed to be fixed as of this morning. Mr. Catlin will follow up and advise Ms. Thomson if there is still a problem.

The meeting adjourned to Executive Session at 7:08 p.m.

Submitted by Recording Secretary, Sue Thomson