HART RANCH CAMPING RESORT
BOARD OF DIRECTORS QUARTERLY MEMBERSHIP MEETING MINUTES
November 19, 2005
President Dean Sankovich called the meeting to order at 10:04 a.m. on Saturday, November 19, 2005. Present were Dean Sankovich, Kent Larson, Randy Baker, Dale Myren, Keith Wurtele, and approximately 15 Hart Ranch Resort members. All present enjoyed a brunch before the meeting.
Sankovich introduced the Board members to the membership assembled.
Minutes of the August 27, 2005 Quarterly Membership Meeting, and the November 17 & 18, 2005 working session of the Board, were reviewed for the membership. Dale Myren made a motion to approve the minutes, Larson seconded. Motion carried unanimously.
Randy Baker presented the Treasurer’s Report to the membership (attached). He reported that the Resort Reserve Fund balance was $911,700 as of 10-31-05, including the Capital Reserve Account Balance at $145,588 and the Short Term Reserve Balance at $150,022 also as of 10-31-05. Baker also reviewed the Resort financial statements as of 10-31-05, indicating that our operating profit YTD was at $493,722, up 14% from 2004. Baker moved his report be approved, Wurtele seconded, motion carried unanimously.
Keith Wurtele presented the Membership Report. As of 10-31-05, the Resort has 4610 current members with 1184 P, 977 A, 2257 B, 1 T, 161 C, and 30 Miscellaneous memberships. Wurtele moved his report be approved, Myren seconded. Motion carried unanimously.
Sankovich then asked Tracy Heitsch to present her manager’s report. She introduced all the departmental supervisors and thanked Shirley Petro and crew for the great brunch! Heitsch reminded the members of the pending December 2nd, 2005 Holiday Lodge Decorating that would take place at 9 a.m. that morning. Bring goodies to share and join in! The 2006 Resort Guide, in its new 5” x 8” format was presented to the members present. She updated the membership present on the wireless internet system. Comments were positive. She reviewed the progress of the previously approved Fall 2005 Capital Projects and asked Kevin Root to present a Maintenance Report. Shirley Petro also updated the membership on the Sales numbers for 2005 – 18 New Sales, 7 New Sales from RPI Golden Legacy, 74 Pre-owned sales, 15 Associate Activations, 18 Membership upgrades, 38 RPI Preferred sales, and 44 Membership Transfers. She also informed the membership of the creation of a new membership category – “D” memberships for Day Use Only. These memberships will sell for $800 each and will pay annual dues equivalent to a “C” membership. They are entitled to Day Use Only of the Resort – no overnight privileges on their sites or cabins.
Under Old Business, Sankovich asked Larson to review the Resort’s property tax situation and utility expense issues. As such, Larson updated the membership on the dramatic increase in our property tax valuations in the past couple of years, and thus the skyrocketing associated property taxes. As a result, the Board has made a decision to appeal our property taxes, which is the process we are currently in. Likewise, our utility expenses are rising substantially. It appears our utilities will increase by another $35,000 from 2005 to 2006, or 16%. Even so, the Board of Directors has decided to hold the line at the $1/day utility fee as implemented for 2005. At this time, it will not increase for 2006, but the study is ongoing. The $1/day generated approximately $57,000 in 2005, thereby paying for only 24% of the entire utility bill this year.
Sankovich also asked Larson to report on the negotiations with the Hart Ranch Development Company relating to the Water & Sewer Contract. Larson indicated that the meeting held with HRD on November 17, 2005 showed indications of our water/sewer rates rising by 16.2% as of January 2006. Additionally, HRD plans to establish a fund for shared maintenance expenses relating to the upkeep of the aging water and sewer system, with funds being deposited by the users of the system. Therefore, in addition to the 16.2% rise in rates, we’re going to be met with additional funding requirements for the maintenance of the system. These are expense we are going to have to deal with, head on.
Sankovich went on to explain that the Board approved a full audit for the fiscal year 2005. The auditor we’ve contracted the past two years is no longer auditing, so a new auditor has been selected, based on an extensive competitive bidding process. The Board felt strongly that a full annual audit is a sound business investment. It equates to $1.63 per membership and is less than ½ of 1% of the operations budget. The audit will be conducted in February 2006.
Sankovich updated the membership on the change to the Workamper Policy for 2006 – expanded sites will be available to workampers. Previously, expanded sites were not allowed to be occupied by workampers. As of 2006, we will have 52% of the sites expanded. Even with a maximum of 40 sites in use by workampers, we still have a net gain of 20 expanded sites from 2005 to 2006.
Myren was asked to brief the membership on the recent rental unit occupancy study that was completed (attached). He indicated that the staff had compiled data over five years (2001-2005), studying 100 days in season (Memorial Day weekend thru Labor Day weekend). The study showed that overall, rental units averaged a 74.3% occupancy (industry average is 62-68%) and sites averaged 83%. Rental units, after all expenses including 100% of the housekeeping department, 15% of utilities, 100% of R&M-Rentals, and 75% of the Building Supervisor’s wages, produced a net income of $15,400 in 2001 to $39,400 in 2005.
Under New Business, Sankovich visited the Newsletter Policy #15, regarding potential member editorials. The Board discussed the policy at length during the working session and ultimately, the Board felt that the original intent of the newsletter was to serve as the primary communication tool of Resort Management and the Board for information dispersion to the membership, therefore, member editorials were found to be contrary to the intent of the policy. This decision was made unanimously. In addition, the Board passed a unanimous motion to change item #3 on the policy – changing BULK mail to 1ST CLASS MAIL, thereby sending all newsletter first class from now on.
Sankovich announced the details of the approved 2006 Operations and Capital Budgets. He reiterated the amount of time and attention that goes into the preparation, study, scrutiny, and eventual approval of the revised budget. The staff spends the entire year compiling budget information, then intensely works on its presentation from early September until the November Board meeting. He thanked the staff for their attention to detail. Likewise, the Board begins the budget process in August of each year, with a preview of budget items, then receives the 50 plus pages of proposed budget at least three weeks in advance of the annual budget meeting. They do their own homework, then come to the November budget meeting and spend another 20 hours pouring over each line item. Ultimately, a new budget is approved and the strategic planning process, along with the long range planning, and the next year’s budget compilation process begin again. The Board, as well as the staff, take this fiduciary responsibility very seriously. As a testimony to that, as of 10-31-05, the year to date actual numbers were within 6/10 of 1% of the approved budget – very close!
Therefore, the 2006 Approved Operations and Capital Budget are as follows: Income $2,415,990
Cost of Goods Sold $ 379,625
Expenses $1,535,845
OPERATING PROFT $ 497,520
Fee increases for 2006 are:
- Maintenance Fees increase by the 4.1% COLA adjustment (approximately $9.60 per membership).
- Annual storage increases by $50, to $150 annual fee.
- A $10 fee will be assessed for each associate membership card printed (details to follow).
- Laundry fees will increase for $.25 for a wash and $.25 for a dryer cycle.
Likewise, the $5 wash fee has been eliminated. Washing of units on site will be permitted without a fee. However, conservation is essential and a shut off nozzle will still be required.
The 2006 Capital Budget was approved for $340,850 to include the following items:
- Light pole replacements around the Resort $5,000
- Expanded sites $40,000
- Patios for the Cheyenne cabins $7,200
- Freezer condensing unit for the Restaurant $4,200
- Breckenridge carpet replacement $9,750
- Cyclical rental unit furnishing replacements $2,000
- Sales office furnishings $2,000
- Gutters on Cheyenne cabins $4,400
- Replacement van $5,000
- Mower $8,300
- Pool pavilion roof replacement $35,000
- Maintenance storage building $10,000
- Snack Bar addition $18,500
- Lighting at the volleyball court $1,000
- Gas pumps at the Hart Mart $19,500
- Five additional Cheyenne Cabins $165,000
- Development cost for new comfort station/housekeeping $4,000
GRAND TOTAL $340,850
Sankovich explained that the new comfort station/housekeeping department headquarters is slated to be located near the Meadowlands area, adjacent to the new parking lot. Based on one bid, the cost of the facility is projected to come in at well over the maximum $150,000 spending authority for ONE project, as allowed by the Bylaws. Therefore, the Board has approved a fee for drafting of blueprints and specs relating to the building, so as to initiate the competitive bidding process and have a specific cost and plan to present to the membership on the 2006 ballot.
Resumes will be accepted for two seats on the Board of Directors that will be up for re-election in 2006. Those seats include Keith Wurtele’s and Dale Myren’s. Biographies up to 200 words will be accepted until January 31, 2006. See the upcoming newsletter for more details.
Sankovich then opened the meeting to comments from the membership.
Keith Wurtele made a motion to adjourn the meeting at 10:46 a.m. Myren seconded the motion. Motion carried unanimously.
Respectfully Submitted,
Dale Myren, Secretary
