LAKE MOOVALYA KEYS, INC.
Board of Directors
Regular Meeting
MAY 1, 2006

CALL TO ORDER
President Bill Risen called the regular meeting of the Lake Moovalya Keys Board of Directors to order at 6:00 p.m.

PRESENT
President: Bill Risen
Vice President: Chuck Baker
Secretary/Treasurer: Chris Chambers
Board Members: Jack Sweeney, Gary Svider, William (Squeak) Kossnar, Bob Stroud, Joe Maxwell, Larry St. George, Richard Jaschke

ABSENT
Joe Price

OTHERS PRESENT
Guests: Blane Coon (lot 54), Barbara Risen (lot 184), Tricia Pollett (lot 43), Robert Spangler (lot 34), Rob Troxler (lot 160), Rochelle Anslyn (lot 113)
General Manager: Cheryl Shockley
Bookkeeper/Recording Secretary: Sue Thomson
Legal Counsel: John C. Churchill

CALL TO PUBLIC
Guests stated they were here to observe, with Ms. Pollett inquiring as to what additional documents exist, if any, subsequent to the 1995 CC&R’s that are posted on the web. Mr. Risen referred her to the Secretary.

MINUTES
Mr. Baker made a motion to approve the Minutes of the regular meeting held on April 3, 2006. Mr. Sweeney stated a correction was needed about the Hopi Drive sinkhole. It should state the sinkhole runs the entire width of the street rather than the entire length of the street. Ms. Thomson will make the change. The motion was seconded and the motion carried.

Mr. Sweeney made a motion to approve the Executive Session Minutes of April 3, 2006. The motion was seconded, and the motion carried.

FINANCIAL REPORTS
Mr. Baker made a motion to approve the April Balance Sheet and Profit & Loss. The motion was seconded, and the motion carried.

BOOKKEEPER’S REPORT
Squeak made a motion to approve the Bookkeeper’s Report. The motion was seconded, and the motion carried.

GENERAL MANAGER’S REPORT
Cheryl Shockley, the new General Manager, stated she had a trailer towed from the parking lot on April 21. Mr. Sweeney reported that Dennis Firestone, a Vista Del Monumento Acres’ owner has used the parking lot, and inquired if the VDMA owners are authorized to use the lot. Mr. Risen stated they are not authorized to use it. They are permitted ingress and egress only. Ms. Thomson was asked to send a letter to Mr. Firestone advising him that he is not permitted to park in the common parking lot. There was a question about whether or not warnings are being issued for those vehicles or trailers parked in the lot without an ID sticker. Ms. Thomson explained that a red tag is placed on the vehicle or trailer that has been ordered towed away, and if the owner claims it before the tow truck shows up, that would be the only warning; otherwise, the Association is not obligated to issue a warning.

Ms. Shockley stated she has spoken with several people whose vehicles were parked over the line, and all were cooperative in moving their vehicles, and appreciative that they did not receive a violation.

OLD BUSINESS
Mr. Sweeney gave an update on the deteriorating street conditions, including a problem at the Barrett house (lot 245); the streets are cracking and deteriorating everywhere. There’s one on Apache, and since Steve Stanton repaired the sinkholes in early December, two more sinkholes have appeared. The Board should now be concerned about liability issues. There are several cracks on Papago and Apache, and Mr. Sweeney recommended a ½” slurry, or patches.

Squeak reported that when sewers are installed, a sewer district person checks the system with a camera. He stated that this same problem is happening in another area, Yuma or Quartzsite, where, five years later, they discovered compaction problems. Mr. Baker reported that he was not able to quickly locate files with the names of soils engineers, stating that those records may be in storage. He suggests we do engineering, and that we seal the seams as a temporary fix. Slurry is also only a temporary fix. Mr. Chambers stated that on the Hopi Drive problem, slurry won’t work; it needs an overlay to cover the 2 ½” to 3” dip, side-to-side and lengthwise. The sinking on Hopi has since cracked on all four corners. Mr. Sweeney reported there are two soils engineers out of Laughlin and Yuma, and neither one is anxious to come here, but that’s the only way to know the street condition all the way down to the pipes, which are well within the water table. He said he gets water at 12’ on his street, with the pipes about 22’ down. Ms. Shockley was asked to check into soils engineers, and Mr. Baker suggested a seal coat, and he recommended T&C Seal Coating.

Mr. Risen reported that he installed the new stop signs on the gates. He inquired if the Board is interested in replacing the current non-reflective street signs with reflective signs, either plain or with a design. Mr. Sweeney suggested that we table the matter until at least the next Board meeting.

Ms. Shockley stated she priced replacement mailbox units from an Internet vendor at $887 each. Steve Stanton has not responded to her messages about bidding the concrete work. She stated Mike Dyer prepared a proposal to do all the work, (repair and clean up area, remove the damaged concrete and debris, replace broken concrete sections, set two large boulders, replace and install two mailbox units, repair and repaint stucco wall). Ms. Shockley is to get the Sheriff’s Incident Report, and Ms. Thomson is to get all the pertinent driver information to Mr. Churchill. Ms. Shockley was given approval to order the two mailbox units right away. Squeak stated that two irrigation pipes were damaged, and we should make sure the cost to repair those is also included.

Mr. Sweeney stated that Michael T. (wall contractor) is leaving for the summer, but that Super Dave is available to build the wall. The Board is interested in walling off the property line. Mr. Sweeney is to get a bid on the 8” cinder block from the large oleanders at the street, behind the mailboxes, along the cable line to the dumpsters. The height would be the same height as the trash enclosures. Question was raised about whether or not the wall should be stuccoed, and Mr. Baker stated he would look into it with the guys who are going to do the stucco on the house he is currently constructing in the Keys.

Ms. Thomson was asked to give to each Board member a list of all Vista Del Monumento Acres’ homeowners who have paid to use our trash dumpsters.

The committee assigned to review Mr. Stroud’s flooding problem at lot 202 met at the site to check the dip in the road, as well as the sinkhole. The dip spans about three house lots, and the committee recommends an overlay from Mr. Stroud’s side of the street to the center of the street, where the water could run along a gutter down the centerline of the street (north toward the first bridge and around the corner) to the bridge drain. Mr. Chambers stated they ran a string line from lot 202 to lot 199, and there’s a 2” slope between the four houses. There was previous talk about paving the dip, with Mr. Stroud reminding everyone that Buckskin Sanitary District offered to pay for half the cost. The property at lot 199 sits high, and any puddling would occur in the middle of the street before the natural flow takes the water down the street (north) and around the corner. Mr. Sweeney stated that the pooling of water in the center of Papago is what caused the sinkhole on that street. Mr. Stroud stated there should be a drain in the middle of his street. Mr. Sweeney reported that most city streets are crowned in the center to drain water away. Mr. Coon stated that Apache is cracking down the middle of the street, where the sewers are. Running water down the center of the street will make the streets crack more. Mr. Stroud suggested that sealing the streets should prevent water from seeping. Mr. Svider recommended that we not lay any material on the street until a soils engineer issues a report. Mr. Churchill advised that the Association is going to have an endless set of problems with the streets, as we have no gutters, curbs and drainage, and as more houses are built, the flow of water is redirected. Also, there’s the problem of only 6’ of soil in some parts over the water table, that soil consisting of clay, silt and expansive soil. Therefore, we are going to have continuing maintenance problems. For that reason, Mr. Churchill is reluctant to recommend street repairs without a survey, engineering and soil analysis; what you’ll end up with is merely nice asphalt over shit. And that will eventually sink.

Ms. Shockley reported that Colorado River Rock & Sand can deliver ¾” gravel for $156 per load, but we need someone to spread it. They will only make a pass with the dump truck. Trailers and cars will need to be moved with two days’ notice. Ms. Shockley stated that Mike Dyer said he would dump and spread two loads of ¾” gravel for $600. Mr. Sweeney made a motion that the Association hire Mike Dyer to dump and spread two loads of ¾” gravel for $600. The motion was seconded, and the motion carried. Ms. Thomson was asked to contact Joanne Hugaert to have her remove her equipment and materials from the south end of the lot where she recently finished a wall for the adjacent lot owner.

There was discussion about the Prop. 13-type Arizona property tax control petition circulating for signature. The proposed law does not include commercial properties, which is why an amended petition is circulating, to include only residential properties.

Mr. Churchill reported on the status of Mr. Willoughby’s loss of his property (lot 10). He stated Mr. Willoughby told him that he went to Buckskin Sanitary District in March 2003 to pay his delinquent sewer assessments, but they told him he couldn’t pay it off until he abandoned his septic tank. Six months later the property was sold for approximately $400. Mr. Willoughby never received any legal notices, with some notices going to a fake post office box. One year later someone got a deed to the property, but Mr. Willoughby never received any notices outlining his redemption options. When Mr. Willoughby contacted the Treasurer’s Office to find out why he wasn’t getting his property tax bills, he found out that someone had called the Treasurer’s Office to change the mailing address to a post office box. Mr. Churchill filed a lawsuit, with a lis pendens, on behalf of Mr. Willoughby. Mr. Churchill states he has no conflict of interest because Mr. Willoughby doesn’t own the lot. He also stated that Mr. Willoughby posted his delinquent Association dues with Mr. Churchill’s Trust Account. Mr. Willoughby also claims to have had some of his mail stolen in the past.

Mr. Svider inquired of Mr. Churchill as to the status of the lien notices to the landlords who have not paid their rental security deposits. Mr. Churchill stated they were in progress and should be going out soon.

NEW BUSINESS
Election of Officers. The following persons were nominated and elected as the Association’s officers for the new year:

Bill Risen – President
Chuck Baker – Vice President
Chris Chambers – Secretary/Treasurer

Mr. Risen stated he will be gone for the 2007 annual meeting, and Mr. Baker agreed to chair the next annual meeting.

The new General Manager, Cheryl Shockley, was formally introduced. Ms. Shockley stated that she also works for Mike Dyer, and she bartends at various local establishments. In response to inquiry about materials needed for the GM job duties, Ms. Shockley stated she has what she needs, including chalk for marking tires in the parking lot.

Mr. Stroud inquired if the Hummer incident on March 26 at the entrance was on tape. Mr. Sweeney stated that the Sheriff’s Office took care of it, alleviating our need to review our tape. Mr. Churchill stated he would get the police report on the incident.

Ms. Shockley asked for Board clarification of the Association’s policy on ticket writing and warnings. Mr. Stroud stated that repeat offenders get no warnings; Mr. Sweeney stated that our goal is compliance. Citations are to be issued at the GM’s discretion.

Squeak reported ongoing problems with the motor home at lot 32, with electricity and water lines running from it, and slide outs extended.

Squeak also stated that the dumpster doors should be in the open position during holidays, including Easter weekend, as our gardener spent a lot of time picking up misplaced trash. It was noted that our gardener needs to readjust some of the sprinklers. Squeak will have him take care of it.

Mr. Risen opened discussion on security service for the upcoming Memorial Day holiday. He spoke with Bruce Poolaw, and R&B Security will handle security for us, with Julian now in charge, as Darrell Wilson is no longer with the company. The Board decided that guards are to be posted beginning noon on Friday, May 26, departing noon on Monday, May 29.

A request for a County variance for a lot split by the Vista Del Monumento Acres’ owner (vacant lot), which is adjacent to the Association’s lot 1, is coming up for hearing soon. The Board was polled to see who is for or against the lot split. Mr. Sweeney stated that the owners of lot 1 are sending legal representation to the hearing, as they are opposed to it. The lot split would wipe out the 15’ buffer easement, and Mr. Sweeney opposes the lot split. In addition, two houses on one lot would adversely affect street parking which is already a problem. It was reported that the VDMA By-laws are the same as the Keys’ By-laws, and the lot split is possibly illegal. Lot 1 wants their 15’ easement. The Board should oppose the split. The County lost the file, so there is nothing that shows the existing easement. Mr. Svider will be attending the hearing. Mr. Baker suggested that Mr. Sweeney and Ms. Thomson write a letter outlining the Board’s opposition to the split, and give it to Mr. Svider to take to the meeting.

Mr. Risen inquired of the Board if they are interested in discontinuing use of gate clickers and use only gate cards, in the hopes of reducing unauthorized entry. Mr. St. George stated that using only gate cards would back up traffic. Mr. Maxwell said he likes using the clickers. Mr. Sweeney stated that if someone wants in, they’ll get in. The matter was dropped with no action taken.

Mr. Risen stated that the Traffic Committee consists of one non-Board member, and the outgoing non-Board member is Al Moroff. A new non-Board member needs to be installed next month for the upcoming year, so recommendations for a replacement member are being sought.

Ongoing, and increasing problems with our website vendor have made it necessary to seek a replacement vendor. Ms. Thomson stated she has a preliminary bid from TCI to take over the website for approximately $1,000, and she urged the Board to terminate the relationship with our current website vendor immediately. Ms. Thomson stated that it would be necessary to get a release of our web address from our current vendor, which could be a problem, as the reason for our discontent is that they have been non-responsive to all communications over the past month. Mr. Chambers made a motion that we proceed with the new website vendor if we can obtain the release of our web address from our current vendor. The motion was seconded, and the motion carried.

In response to a recent communication between a homeowner and Mr. Churchill, Mr. Churchill advised that his serving as the Association’s legal counsel is not a conflict of interest as a result of him also being a homeowner in the Keys. He also advised that proxy votes are valid in regard to Association lots (they are not valid for condominiums).

Mr. Baker responded to the landlords present at the meeting, who oppose the $1,000 security deposit and who voiced their opinions at the annual meeting, by suggesting that they get together and come up with a proposal to present the Board with ideas for changes they want to see happen. Mr. Baker asked Ms. Pollett if she had another solution to the rental damage problem. He further stated that years ago we couldn’t get renters to cooperate at all. Mr. Sweeney informed Ms. Pollett that one of her renters were recently all over Mr. Price’s property, as well as other neighbors’ properties. Mr. Coon stated that he watches Mr. Price’s house when he’s gone, and he has his phone number, but he doesn’t have Ms. Pollett’s telephone number to report problems at her residence. Ms. Pollett replied that she would give Mr. Coon her phone number.

Ms. Pollett indicated that she felt the security deposit issue was started as a result of the potato launcher incident. Mr. Coon stated that some of the renters are good, some are bad, but that we’re here all the time, so we see it all, and you’re not. Mr. Spangler stated that owners create noise too. Mr. Sweeney reported that one owner sustained black mold damage in the amount of $16,000 that the insurance company did not cover due to renters turning and leaving on patio misters during the homeowners’ extended absence. The ceiling collapsed due to water damage, and the owners were out of pocket for the repairs. Ms. Pollett indicated that she is interested in working on solutions with other owners. She is interested in making it good and being a good neighbor, as she intends to retire here.

Mr. Chambers who lives across the canal from JT’s on The Keys stated that he has fewer problems with JT’s guests than with the neighbor’s rental property, stating that they often get out of hand, and they destroyed his $500 water gym. Ms. Pollett stated she would not rent to repeat offenders.

Mr. Churchill reminded everyone of the 2004 members’ meeting that was legally noticed, for the purpose of discussing security deposits and fines, with a committee being previously assembled to determine rules and fines to present for vote to the general membership. What transpired at the members’ meeting was the majority of members voting to double or quadruple the Rules Committee’s recommendations for fines. Mr. Chambers, who chaired that meeting, confirmed that the $25 fines the committee recommended were all increased to $50 by the majority of members present at the meeting. Mr. Churchill informed everyone that the Association receives more complaints about renters than anything else.

Mr. Stroud reported that a renter crushed his paddleboat, and a renter threw a bottle through the legs of his pool table. He stated that a $500 deposit does not cover his property damage.

Mr. Churchill vigorously stated that there is no discrimination against the owners who rent. If he decided to rent his property, he would have no problem posting the $1,000 security deposit.

Ms. Pollett discussed the probability of having Saturday Board meetings. Mr. Churchill replied that the By-laws would have to be changed, as they call for Board meetings to be held on the first Monday of each month. Mr. Stroud stated, we’re the Board, and we don’t want Saturday meetings. Mr. Sweeney stated that the Board talked about trying it. Mr. Chambers stated that former board members who were weekenders used to hold over until Monday night to attend meetings. Mr. Churchill referred to Article III, Section 7b regarding establishment of Board meetings dates.

Ms. Pollett stated there are many new owners in the Keys, and they just want the opportunity to participate. Also, more communication is needed. She said that only 25% of the owners are full- time residents. Mr. Baker stated that number has increased to 35% full-time residents. Ms. Pollett said she is dropping the idea of Saturday meetings, but would like to see better communications, and she would like the General Manager available for contact. She also suggested semi-annual member meetings. Mr. Baker stated that they used to have to beg people to go on the Board.

The meeting adjourned to Executive Session at 7:50 p.m. and reconvened at 8:05 p.m.

Mr. Svider inquired whether the proposed building height issue will be presented again to the members for another vote. Mr. Risen stated that a larger house with more people would create sewer problems on weekends, as the sewer system is already running on maximum. Mr. Svider stated he recently brought up this matter with the sewer board, and they told him the sewer system is running at 93% capacity during peak use and that adding a second story to a house would not increase use of the sewer system. Mr. Risen suggested that we send a letter with the next dues’ statements seeking homeowners’ feelings on a proposed height increase.

Ms. Thomson was informed that the Board approved an increase in her monthly service contract to $1,600. Ms. Thomson thanked the Board for the increase.

ADJOURNMENT
The meeting adjourned at 8:10 p.m.

Submitted by Recording Secretary, Sue Thomson

APPROVED BY BOARD OF DIRECTORS JUNE 5, 2006