LAKE MOOVALYA KEYS, INC.
Board of Directors
Regular Meeting
FEBRUARY 7, 2011

CALL TO ORDER
President Jack Sweeney called the regular meeting of the Lake Moovalya Keys Board of Directors to order at 6:02pm.

PRESENT
President:  Jack Sweeney
Vice President:  Chuck Baker
Secretary/Treasurer:  Laura Lancaster
Board Members:  Blane Coon, Ryan Shubin, Joe Price, Gary Svider, Rob Troxler, Christie May and Chris Chambers
           
ABSENT
Board Members:  William “Squeak” Kossnar

OTHERS PRESENT
Guests:  Carla Faulkner (David Plunkett Realty), Charlie Ward Lot 227, Rich Ferber Tenant Lot 220 and David Plunkett
General Manager:  Cheryl Shockley
Legal Counsel:  John C. Churchill
           
INTRODUCTIONS

CALL TO THE PUBLIC

MINUTES
Joe Price moved to approve the Minutes of the Regular Meeting of January 10, 2010.  Discussion:  Mr. Price asked if the Sue had got HCB to waive the monthly service fees.  Mr. Baker replied that he thought she had.  Ms. Shockley said that she would check with Sue and have her make a note of the results on her next month’s report. The motion was seconded and carried unanimously.

Chuck Baker moved to approve the Executive Session Minutes of January 10, 2010.  The motion was seconded and carried unanimously.
 
FINANCIAL REPORTS
Chris Chambers made a motion to approve the January 2010 Bookkeeper’s Report, Prepaid Bills and Bills for Approval for December 2010.  Discussion:  Mr. Baker asked if the Board had agreed to pay $35 per hour for the extra security for New Year’s weekend.  Mr. Shockley replied yes.  The motion was seconded and carried unanimously.

Chris Chambers made a motion to approve the January 2010 Balance Sheet.  The motion was seconded and carried unanimously.

Chuck Baker made a motion to approve the January 2010 Profit and Loss Statement.  The motion was seconded and carried unanimously.

Collection Report Discussion:  Mr. Baker asked if the
Ms. Shockley said that Lot Arnold is still disputing the $150 lot clean up fee from 4 years ago.  Ms. Shockley said that every month she checks Arnold’s lot and every month there are the same weeds on his property that are growing from his side of the property not Richards side of the property which he is trying to say is where they are coming from.  Ms. Shockley stated that she even took Ms. Faulkner with her to decide if the weeds were indeed coming from Richards or Arnold’s property.  Ms. Faulkner observed the weeds were definitely coming from Arnolds’ property.

Mr. Churchill stated that he was proceeding with court actions against Grybowski Lot 201 and their non-payment of the reckless driving citations issued.

Mr. Churchill said that the Association should never write any balances off. 

The Board of Directors asked Ms. Thomson to clarify why there are two lot 237 balances on the Collection’s report, why the balances are being split out.

BOOKKEEPER REPORT
2/2/11
A rental security deposit was received from Lot 33. 

The 10’ front setback variance for Lot 100 was approved by the County.

The proposed 2011 budget is prepared and ready for review and approval at Monday’s meeting.  I bumped up security and accounting fees (it’s audit year).  Barbara O’Connor is no longer doing audit reviews.  I would suggest that Michael Bersch, CPA in Havasu be hired for this job.  I have a good working relationship with him, and he does reviews.  I will continue to send Barbara O’Connor our financials for tax preparation, which will occur in the next two weeks.

I will prepare the 2010 financials prior to month end for inclusion with the annual meeting mail out.  Do you want me to include bi-annual street crack fill and seal coating as a capital expenditure on the bottom of the Budget for the homeowners to see?  I understand we will only have to pay the same amount that we paid two years ago ($29,756), give or take any minor adjustments for fewer or additional crack fills.

The annual transfer to the Reserve account will be made before month end, and VDMA owners will be billed their annual trash assessment next month.

Rich Cortez (Bill Spires’ attorney, Lot 10) will not be reimbursing us $112.50 on John Churchill’s 12/31 invoice.  He told me he only contacted John to tell him not to do anymore work on the matter.  He also disputed the Carpenter, Hazlewood 12/31/10 invoice of $190.18 (not $254.39 as previously reported, due to their billing clerk faxing me the 12/31/09 invoice which I didn’t notice until after I submitted my December report).  Upon review, I noted the bulk of the charges were HOA general matters and should not have been on their “Willoughby” invoice.  Only $52 was attributable to the Willoughby matter and, again, that was only a communication instructing them to do nothing further on the matter, so we will not be reimbursed for that $52 either.

Delinquent dues’ accounts and status are listed on the enclosed spreadsheet.   

Citations issued:  NONE.

GENERAL MANAGER’S REPORT
Ms. Shockley said she had received a call from a potential buyer of lot 237 asking if the block wall was common Association property.  Mr. Sweeney said it is a wall between two properties so it cannot be common property.  Mr. Baker explained that the retaining wall was originally built by Bill Olson his old business partner on the lower lots.  A survey would have to be done by anyone who wanted to know where the property line is and if the wall in the middle of both properties then both parties would have to share responsibility and if not, the wall is the responsibility of who’s ever property it is on.

COMMITTEE REPORTS - None

OLD BUSINESS
Mr. Chambers said he would like to make a proposal to raise the height limit in the CC&R’s from 18 feet to 25 feet, if the proposal is approved by the Board he would like it put to a vote to the Association at the Annual Meeting.  Mr. Chambers said that if the Association votes in favor of the height increase then the Design Review Committee would be able approve such things as roof types, colors basically the esthetics of the outside of the building. He said the Design Review Committee would then set the guide lines/restrictions on each individual construction project in accordance with the CC&R’s.

Mr. Sweeney asked Mr. Churchill for clarification of the CC&R’s and the Design Review Committee.  Mr. Churchill stated that the CC&R’s height section has to be changed first, and then the Design Review Committee has the power to determine whether or not the proposed construction conforms to the CC&R’s.  Mr. Churchill said first, Mr. Chambers needs to get the Board of Directors approval for his proposal and once that is achieved then the proposal is submitted to the members of the Association for approval.

Mr. Chambers made a motion to put to a vote to the Association an increase in the height limit in the CC&R’s from 18 feet to 25 feet using the same provision as in Section 12.2.4 of the CC&R’s.  The final approval of all plans will be subject to the Design Review Committee. The motion was seconded.  Discussion:  Charlie Ward said the Keys are pretty much built out and there are not a lot of vacant lots left and by not increasing the height limit is will just stifle property values. The motion passed with a vote with (7) in favor and (3) opposed.

Mr. Price said that Sue was still not showing the $7,562.00 annual transfer to the Reserve account on the Budget and he would like it shown even if it has to be single line item noting the amount and what it is for.  Mr. Sweeney made a motion to approve the 2011 Budget for the Annual Meeting.  The motion was seconded and carried unanimously.

Mr. Shubin questioned the annual amount that VDMA owners pay for trash service versus the $28,000 that is listed on the budget.  Mr. Sweeney explained that VDMA owners used to have their trash picked up individually at their homes but when Allied Waste discontinued their service the Association told VDMA owners that they would charge them the same amount Allied Waste had and bill them annually for the service.  Ms. Lancaster asked if the amount was updated when the Association costs go up.  Mr. Sweeney stated that getting something out of them was better than nothing, because some of the VDMA owners who don’t pay the annual amount still use the dumpsters.

Mr. Sweeney stated that David Plunkett wanted to address the Board concerning the commercial zoning issues and HOA’s.  He said that he had himself looked on line and found that there were instances when a city re-zoned an HOA property and it had gone to court and the Association lost its rights concerning the property.  Mr. Plunkett said that he just wanted to ask the Board to let Mr. Churchill research these concerns with zoning issues.  Mr. Plunkett said regardless of the zoning whether it is C1 or C2, there have businesses in the past on these commercial properties such as bars, Jet Ski rentals and they have been allowed to do business without this conflict of zone C1 or C2, he just wanted to see that Mr. Ferber was afforded the same opportunity.

Mr. Churchill advised Mr. Plunkett and the Board that the Association’s CC&Rs are much more restrictive than the County zoning.  He said many people get confused with the powers of the state or federal government to change things versus the power of a property owners association.  Any time you buy land within a subdivision with CC&R’s, you automatically enter into a contract and the CC&R’s are part of that contract and if the CC&R’s are more restrictive than the county’s zoning than you are bound by what the CC&R’s say.  Mr. Churchill explained that if the City or County comes in and changes zoning, in a way that it takes away from your property value than you may have a constitutional right to claim that someone is taking your property without compensating you.  But a property owners association having restrictions does not do that.  He said that regardless of people’s internet research we are stuck with the CC&R’s unless they are changed.

Mr. Shubin asked if the “Use Permit” that was being drafted to be presented to the Association for a vote was the way to go.  Mr. Churchill replied that the CC&R’s do provide with the regards to the “Commercial Lots” the power to waive or modify provisions that otherwise apply to the commercial lots.  He also stated that the Board has to first approve the provisions of the use permit and then it has to go to the Association for a vote of approval.

The Board and Mr. Ferber reviewed the draft that Mr. Churchill was proposing to present to the Association at the Annual Meeting.  Mr. Ferber said that he was fine with most of Mr. Churchill’s draft.  He said he is opposed with option 9 (fencing) and asked that it be omitted.  He thinks that fencing will cause more of a distraction than the signs.  He said he is also opposed with option 2, (stop business for more than 30 consecutive days).  Mr. Ferber said that in the winter months he could possibly not be at the location even though he is not technically closed he might not be occupying the building. The Board said this provision is if he stops his business altogether, if he is posting a sign saying how he can be reached when he is not in the building it would mean that he is still in business.  This option will stay as it reads.

In Option 6 the Board is asking that Mr. Ferber instruct people properly on boating safety not assume liability if a renter does damage to other boats or property within the Keys, that is what insurance is for.  Mr. Ferber stated that most of the people he rents to do not even come into the Keys.  Mr. Ferber said that he goes over safety issues and boat operations with all renters as to avoid any unwarranted damage.  The Board said that all they are asking is that he provides adequate safety instructions to all renters.

Mr. Sweeney stated that he had a meeting with the homeowner who was complaining about the boat rental sign and the homeowner had told him that if Mr. Ferber took down the banner and had a sign that faced up and down the canal he would be fine with that and he would have no other complaints.  Mr. Sweeney stated that he had spoken with Mr. Ferber and he agreed to take down the banner.  Mr. Ferber said he would be seeking the approval of the board to put “Rentals” on his building.  Mr. Coon said that the majority of the traffic on the canal side of the building was people who already had boats so he did not think it was necessary to put any kind of sign on the canal side and that he needed to leave the issue alone so as not to irritate the homeowner any further.

Ryan Shubin made a motion to approve the Conditional Use Permit drafted by Mr. Churchill with the following changes: eliminate option 9, add Association after Keys on option 5 and change consent to the Board is seeking approval from the members of the Association.  The motion was seconded with vote of (8) in favor, (1) abstained.

NEW BUSINESS
None

ADJOURNMENT
The meeting adjourned at 7:34pm
Submitted by Recording Secretary, Cheryl Shockley