Minutes August 26, 2017 (10:00 am)
/Annual General Meeting
Subject to approval and correction at the Annual General Meeting on August 25, 2018
Call to Order: by President Mark Sexton at 10:00 am at the Scenic Estates Clubhouse
Board Members present: Mark Sexton, Don McCuiston, Leslie Dempsey, and Tim Slater.
Board Members absent: Doug Cash
Staff present: Kevin Southworth and Isaac Colgan
Voting Status: 46 members checked-in, 33 absentee ballots received, and 8 proxies received. Quorum
Welcome and Introduction: Sexton explained status of LISECC, introduction of board members, and auditor Susie Thompson.
Susie Thompson: Audit of statements Dec 2016. Small staff has oversight by board with external CPA. Because of the Reserve Study, members shouldn’t have surprise assessments due to budgeting realistically.
Frankie Small Firewise Coordinator: Members requested to provide hours worked to continue qualification as Firewise Community. LISECC was the second Firewise Community in State of Washington. Firewise qualifications, and more information at www.lisecc.com/firewise.
Kevin Southworth: The Department of Heatlh conducted a Sanitary Survey of the LISECC water system. The state engineer said, “One of the best maintained water systems we have seen.”
Sexton said that as former Office Manager moved out of state, that office hours are limited and to call the office number to schedule an appointment.
Kjell Johnsen made a motion to approve the August 27, 2016 Annual General Meeting minutes. Marie van den Driesen seconded. The motion passed.
Committee Reports
Sexton announced that the Marina has a new aluminum ramp ready for installation. The ramp is wide enough for the Fire Department to take a gurney down to the dock.
Administration:
Slater explained the three bylaw amendment proposals: reducing the term length of directors from three to two years with the change applicable to the current terms of all existing directors and those elected in the future; changing wording from “paid” to “reimbursed” to more accurately describe the process for “reimbursing” a Board member that incurs an expense of behalf of LISECC; a director stipend in the form of a credit to their LISECC membership account equal to 1/12 of the dues on a single lot for each regular monthly board meeting a director physically attends, starting in January 2018. Reserve study shows we are planning appropriately. The status of the litigation is plaintiffs received another extension to file their appellate brief to September 11, 2017. Mr. Ortego filed for Chapter 13 bankruptcy. There was concern that in an earlier deposition he testified he was beneficiary of a trust worth millions, and then months later he was filing for bankruptcy. Mr. Ortego’s bankruptcy attorney has acknowledged that this is a revocable trust, he is the sole beneficiary, and that he can terminated it at any time prior to his death. We will have to see how this impacts the lawsuit. Member discussion about the stipend proposal followed.
Finance Report
Dempsey reviewed the 2016 financial statement. The profit and loss, in the “Other Income” was an item for almost $69,000. Part of that was a special assessment of $100 for every lot regardless of whether bound or not. Under the Administration section of Expenses, we budgeted a little over $11,000 for insurance and actually paid $44,000 in insurance. The assessment funded that gap. To date our legal fees are $800,000 and is paid by the insurance company, but they cancelled our insurance. New insurance was at a significantly higher cost beginning May 2017, and that insurance was renewed with a minor change of cost through May 2018. The 2016 financial statement appeared to show we made a profit of about $46,000. As accrual basis, the “income” showed what was invoiced. If invoices are not paid that income is not actually received. Subtracting the uncollected dues of about $22,500 in 2016, and a transfer of about $45,000 to the reserve account, the actual cash net income is about $1000. The reserve study shows that $45,000 is the recommended annual deposit. If members vote in favor of the dues change, the annual dues will be reduced to $725 from $750. According to the July 2017 monthly statement, we received about $225,000, about 75% of our budgeted dues collection. Budget estimated by various income sources, including the 2017 adjustment of water usage tiers. The reserve study shows that $45,000 is the recommended about for annual deposit. Member discussion about the dues coupon book and insurance expense followed.
Operations Report
Discussion about quarry: will it be open as a park soon? Dempsey explained that the Lummi Island Heritage Trust is in process of reclamation. Reservoir level is good, about the same level as last year. Water system leaks have been repaired. Kevin doing a great job as Operation Manager. Member discussion about sharing dock use with non-members and parking at the marina.
Planning and Communications Report
McCuiston talked about switching to a prepay plan for staff mobile phones to reduce costs. CenturyLink is upgrading Lummi Island and our area will be the first in spring 2018. Member discussion about internet service at the swim lake. Looking adding security cameras for cabana and marina.
New Business
Discussion about parking/abandoned cars and barking dogs on Scenic Avenue, and improving the visuals at Island Drive and Baker Avenue. Sexton expressed that “board-down” actions can create an adversarial situation, but if the membership together voices concern to the County, the County will take action.
Discussion about AED units and life rings at clubhouse and cabana.
Slater opened the floor for nominations for Board Members: None
Meeting Adjourned 12:10 pm
