THE RESIDENCES AT THE CHATEAUX CLUB ASSOCIATION
Q2 Board Meeting
Wednesday, May 18, 2016
Directors present: Mr. Cibotti - President, Mr. Von Plonski – Vice President, Mr. Pederson – Treasurer, Mr. Edenton – Secretary, Mr. Hollyand Mrs. Dorsey.
By invitation: Mr. Gendron, Celeste Armstrong and Mr. Lundskog, all from SELMC.
The meeting was called to order by the President at 5pm ET (3 pm MST).
The Minutes of the 3/9/16 Board Meeting were then unanimously approved.
Mr.Lundskog then presented the 2016Q1 Financial report. He noted the Balance Sheet is clean with 2 owners having prepaid full year dues, andtwo of the four owners showing delinquent havingpaid in full, leaving a positive total dues credit balance. The Total Reserve Account Balance ending Q1 was $478,729. Turning to the Profit and Loss Statement, he noted that 2016 was off to a strong start with Q1 Net Ordinary Income $39,197 better than Budget, due to higher than expected revenues and lower than expected expenses. Total Income was up $22,824 or 3.9%, namely due to PMCC Locker Sales at $13,560 and also higher revenues from Exchange Fees and Guest Service Revenues. 2016 YTD Total Expenses were under budget by $16,303 or 3%, namely from Food and Beverage savings as well as savings in Total Labor. Lastly, a Year over Year comparison and Cost Per Occupied Room analysis was also included in the Board Packet for review.
When opened to questions, Mrs. Dorsey asked for clarification regarding the Gratuity Balance shown. Gratuity Procedures for both credit card and cash gratuities were explained. Mr. Holly asked about Reserve Balances to cover major Mechanical Issues that could present themselves in the near future. Mr. Gendron explained that Major Mechanicals and Infrastructure are part of the Master HOA Budget (roofing, HVAC, Water Tanks) covering all three buildings and that the Res Club contributes to that separate Reserve Fund as part of the Master HOA dues, which has a current Reserves balance of approximately $500k.
Mr. Gendron then updated the Board on plannedCapital Expenditures. The major 2016 capital project is unit refurbishment at $849,979, and that project is underway with approximately half the units currently being painted and wall papered. The purchase of Mattresses at $65,000 will be delayed until late fall after refurbishment is completed and to make certain total capital expenditures are on budget. Other minor projects such as Bedding and Club Level Refurbishment will also be addressed in fall. He also briefly went over the Chateaux Master HOA Capital Expenditures, highlighting a new Commercial Washer and Dryer had been installed, andthat high efficiency bulbs installation is nearing completion, as well as the Wireless Access Point upgrade that was completed. Lastly, he noted that Emergency repairs of the Hot Water Tanks was needed and quickly approved by the Master HOA Board.
Mr. Lundskog then summarized Res Club Cash Flow. This topic led to a discussion regarding how much to keep in Emergency Reserves versus how much funding to borrow from the Bank for the Refurbishment. After lengthy discussion, a Motion was made to use portion of funds from the Initial Capital Contribution Account, as well as reducing the initial plan of holding $250,000 in Reserves coughers down to a $150,000 minimum balance, to reduce the amount of loan funds needed. The motion passed unanimously. Lastly on the topic, Mr. Lundskog recommended moving current Bank Accounts to Zions Bank, who is funding the project, which SELMC also uses. The Board instructed Mr. Lundskog to proceed as necessary for the benefit of the Association.
Turning to the Management Report, Mr. Gendron then gave some General Updates, first noting the Goldener Hirsch Development project is still awaiting approval for lot combinations and will apply for a Conditional Use Permit once lot combinations are approved. He then reported that our Cadillac program has been extended to August 31, 2016. Mr. Olsen is in the process of renegotiating the contract and we will update as necessary. Mr. Gendron gave a briefupdate on staffing changes, notably our new Guest Services Manager, Dan Tewksbury, as Cait Ferguson will be stepping into an hourly Concierge role.
Mr. Gendron then reviewedimportant upcoming dates starting with the Res Club opening on May 28 and closing on October 8. He further noted our Summer Breakfast will be served week days at Cena, and will be served in the Club Lounge on Saturdays and Sundays to reduce wait times for Club owners. He also updated on our YOY Exchange Summary, with winter weeks picked up being flat and owner deposit up 1% YOY.
Mr. Gendron then gave a report on Club Real Estate Sales and the Resale Committee. There are 3 active listings ranging from $285,000 to $329,000, with 4 resales since January 1, 2016 and 12 since January of 2015. The Resale Committee Action Plan for the upcoming months includes 3 key initiatives: a Social Media Blast, updates to our Current Website and purchasing an email database of 35,000 names of people with vetted interest in upscale Fractional Ownership in the Western United States to be sent 3 different email blasts focusing on Park Meadows, Unit Refurbishment and a Value Proposition.
Lastly, it was noted that Statistical Tables and Graphs on Operations covering Airport Transfers, Occupancy, breakfast counts and exchange program was included in the Board Packet for their reference.
There being no further business to be brought before the Board, the meeting was adjourned at 5:59 p.m. ET (3:59 p.m. MST).