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HomeMy WebLinkAboutGolf Course Expansion Questions & AnswersOctober 13, 1995 Mr. Gerry Sweet 2567 NW 12th Meridian, ID 83642 887-1085 Dear Mr. Sweet, We are submitting these answers to your questions concerning the proposed expansion of the Cherry Lane Golf Course in hope that they may help you realize the complexity of this issue. We appreciate your interest. If you have any further questions please don't hesitate to ask. Question #1 Are you satisfied with the current lease between the City of Meridian and Cherry Lane Recreation, Inc.? The $6,000 lease payment was part of the lease agreement 17 years ago when the golf course was to be completed in a two year period. No property tax funds were used for the construction of the first nine holes nor for the completion of the next nine holes of the golf course. Do you believe that the payment of $6000.00 per year, as proposed in the lease for expansion of the Cherry Lane Golf Course to 18 holes, provides a reasonable return to the taxpayers of Meridian when our neighbors in Nampa generate approximately $125,000 (appropriated $130,000 95/96 FY) per year from their 18 hole golf course? The agreements of Nampa and Meridian are totally different. You can't compare them as equal. Question #2• Where will this balance of money come from, and what assurances do we have that it will be available when it is needed? The balance of the budgeted amount of $520,000 is from donations. There are no assurances of what amount will be donated, but donations can come in as money, labor, or materials. The golf course will be built with whatever funds are available at the time of construction. What written cont~•acts or guarantees do we, or will we have on the repayment schedule of the $350,000 to the Sewer Sti Water "enterprise fund". As each building permit is issued, the golf course development fee will be collected and will be applied to the principle and interest of the loan. What will happen if Cherry Lane Recreation, Inc. defaults on the repayment of the $350,000 loan? Cherry Lane Recreation, Inc. has nothing to do with the $350,000 loan. If the houses adjoining the golf course are not completed within a certain period of time, and therefore the $650 per home "late comer fee" is not collected in a timely fashion, will the developers be required to pay off the loan? If not, where will the money come from to complete the course? The golf course development fee plus interest will be collected for every project built and be used to pay off the loan. Question #3: Is all of the land in the existing 9 hole golf course deeded to the City of Meridian? Yes Is all of the land in the proposed 9 hole expansion deeded to the City of Meridian? If not, where will the money come from to complete the course? No & Yes All the land for plan A concept is not deeded to the City. All of'the land for plan B concept is deeded to the City. Question #4• What other so coil "informal agreements" exist between Cherry Lane Recreation and the City of Meridian in addition to the informal pledge for Cheny Lane Recreation to build a new club house? None, we are currently working on formalizing the club house agreement. Is it prudent for the City of Meridian, in protecting the best interests of the Meridian taxpayers, to be involved in these "informal agreements"? There are no informal agreements. Question #5: Is there any legitimate. reason why ~e City of Meridian needs to rush to finalize the proposed expansion dealings, considering the fact that the current lease extends through October 2, 2003 (year 2023)? This project was started in 1978 and it should be brought to a conclusion. We don't receive any benefits until it is completed. This amenity is deemed to be positive for the City, but without the development of the golf course, the City will lose the ownership of the land. Question #6• Do you believe it~would be reasonable for the City of Meridian to explore the possibility of renegotiating the lease with Cheny Lane Recreation, when comparing the $6,000.00 per year payment received by the City of Meridian versus the approximate $125,000 (appropriated $130,000 95/96 FY) per year received by the City of Nampa for their 18 hole golf course? Qualified yes, it is reasonable for the City to explore the possibility of renegotiating the lease. The terms of that re-negotiation would be set entirely by the lessee and subject to the City's financial capabilities to meet those terms. Question #7: What is the current status of the proposed expansion plan between the City of Meridian and Cherry Lane Recreation? Specifically, what steps have already been taken, and what is the proposed methodology and time frame proposed for completing the expansion plan? There is no expansion plan between the City of Meridian and Cherry Lane Recreation. Question #8: What will the proposed $6,000.00 per year tease payment for the 18 hole course be appropriated for by the City of Meridian if the proposed expansion is completed? By law the lease funds would be revenue in the General Fund. Each year the City Council would appropriate the funds as it sees fit, probably going to golf course improvement. ant P. Kingsford, ay Ronald R. Tolsma, City Councilman (~ . Yerri ton, Councilman alt W. Morrow, City Councilman F Meridian City Council Special Workshop September 26, 1995 Page 27 Morrow. To answer your question about Best Western Concrete the issue was the last time we were there which has been 6 months ago their engineer was supposed to get back with our engineer and look at the grading issue because our on site visit didn't appear that their grading information was correct. So the issue was and I have asked Shari a couple of times and here again this is one of deals where we should be pushing the ball toward resolution, we are not pushing the ball towards .resolution because we simply don't have any (inaudible). I know it is up to them to get a hold of our engineer but if they are not doing that the delay works to their benefit because pretty soon everybody forgets about it and then they get to do what it is they want to do. Kingsford: I got a call from (inaudible) may have been a month ago however, that they were supposed to meet within a day or two and I don't remember what all that they were looking at discussing. I (inaudible) Morrow. And he may have, it sounds to me like then if that is the case Jack has the most recent information. And in this particular case, this issue, is a prime example of an issue for the enforcement officer that we are trying to get hired. Kingsford: So we are clear on that, (inaudible) Morrow: (Inaudible) the issue will be that we don't get anything done. Kingsford: What is a reasonable time frame for this issue to try and hook this kind of stuff together? It is October 3rd (inaudible) 10th, we would meet on the 17th, would the next the fourth meeting of October be the realistic time to try and take a look at that? Morrow: How big is P & Z's agenda for the 10th? Berg: Eight public hearings. Morrow. Why don't you talk with Jim Johnson and tell him what our schedule is and what we want to do and what he suggests as them getting us the input. Kingsford: Or how they want to deal with it. Council is amenable to a consultant ask them (inaudible). Does that leave us then with the Sweet letter. Will Berg do you want to take some pretty detailed notes (inaudible). Are you satisfied with the current lease between the City and Cherry Lane Recreation Inc.? Morrow. I think what we have to do is brain storm and then try to get a consensus answer at least between Max and I. I think the answer at least from my perspective to that question Meridian City Council Special Workshop September 26, 1995 Page 28 is are you satisfied with the current lease between the City of Meridian and Cherry Lane Recreation, that is not (inaudible) there is nothing we can do about the current lease. The current lease was signed 17 years ago, it was approved 17 years ago settling the rates. Any businessman knows that if you are going to break a lease then you have to buy your way out of the lease. And so, Kingsford: Well I just suggest that probably the best answer to that question is no. Morrow: The point is that really we are the ones in violation of lease because according to the minutes 17 years ago, whoever was going to lease the golf course was promised 18 holes and a club house within a 2 year period which would have been 1980. So we have not performed. The long and the short of it is if we want more than the $6,000 then we are going to have to come up with money to buy the man out. I think that is an issue that needs to be made. Any businessman, anyone of the 5 or 6 of us sitting here if we had a lease on something and somebody wanted to raise our rate my answer to you is you buy out my improvements plus the value of my remaining lease. I think the second part of that question with respect to $125,000 per year from their 18 hole golf course doesn't cross compare, they have an 18 hole golf course that is true. They have almost a million dollar club house. I don't know if that number is right or not but it is based on a percentage of the business being done so one year it could be greater or lesser. Kingsford: Their rate is 15%, this year of gross. What they budgeted in Nampa was $135,000 and they do not know when that will be achieved (inaudible) but they did budget $135,000. Morrow. I think the other part of that answer is these folks got that golf course with all of those improvements based on it being completed and not having to put any kind of capital funds in to the golf course. I think the other thing that is interesting to me about that comparison is that the work was done with donated work from the private sector. It was done with City employees and city equipment. The bottom line is the end of the lease period whatever it might be from the City of Nampa the State of Idaho gets everything back period. Kingsford: The other thing that is a little different that I think needs to be indicated in all of our minds is people talk~to (inaudible) it is not a lease in Nampa it is a contract operator. They are under a contract to operate the golf course. Again that is from (inaudible) and he made that same point is it is hard to compare ours with theirs because the improvements that we put in are our improvements that Nampa (inaudible) State of Idaho. Morrow: Well, it is not a contract operator Wayne significantly different than a leased Meridian City Council Special Workshop September 26, 1995 Page 29 person. The lease person has basically all the property rights as an owner does, a contract operator is up against something different isn't he? Kingsford: He is operating under the provisions of a contract they put together in Nampa (inaudible). Crookston: Just legally there, I never have dealt with a contract operator. Morrow: What is a contract operator? Kingsford: A contract operator is fairly common in the golf course industry, it is what John (inaudible) did the last 3 or 4 years in McCall, it is what Carl (inaudible) he is under contract with the City of McCall to collect greens fees, collect golf cart trail fees, to collect money for tournaments. And under that contract then he has to submit daily information as to what came in, justify all of the play starting sheets, all of those things have to be submitted to the County or the city on a daily basis. Crookston: It could be a lease and a contract operator. A contract operator could have a right to operator the course for one year which apparently they do in Nampa. They could have a one year term, they could have a 25 year term, they could have a 50 year term it just depends on what is written into that contract agreement. Apparently they have requirements to do certain things. Either one is an agreement, it depends on what the terms say as to how it is to be interpreted. Kingsford: (Inaudible) they both have the strength of a contract (inaudible) Crookston: That is right, it is exactly the same. Tolsma: Well, is the contract operator for Nampa, now does he take the course from Nampa and he does all the maintenance, all the upkeep, the repairs and everything else as part of the gross? Or does he send all the bills to Nampa to be paid and he just operates it. Kingsford: It is my understanding that he had hired some people to maintain the course. Tolsma: He has to hire the people to maintain the course. Kingsford: In McCall it is a different contract, the City of McCall hires the people that take care of the grounds entirely (inaudible) hired by the City of McCall and Carl collects the money that comes in and turns all of that over to the City and then the City then pays him Cit Council Meridian °rkshoP Special W 1995 in Nampa $eptember 26, sa s. Clear) n from e 30 on what the contract tha comes that Pag So it just depends money -naudible) course (' rcenta9e (inaudible)• has told me is that all of thto °perate the before that his pe enses g% and then -naed- And clearly all of the exp two Years ago from what Mr ~ ( ear ago and -naed-b )° I believe a Y course isthis year 15 /°• including p% under that contract• ated at 0%? ennial has been ear he °per that was. Cent SO the first y many ise there Max? Morrow and I don't know how mould you surm The first years, ~ I lose track, what Kingsford: for 7 or 8 • roughly 12. for what now to 12. I would say around at least S envy has Now I do know this that K I think it is around a, ~ ~ntract rating the new 27 holes at Yerrington: ears it was a interested in °pe that. So the firstampa that he will not be doing ~ngsford: of N e is not interested in advised the C-ty. -naudible) h holes? ° He says -t -s not C ction nov~f? That is 27 15 /°• constru eXecutive course stuff that is under °lf from 9 hole Morrow That is the oles of regular 9 R-ght they have 18 more h Kingsford. (inaudible) round. art of that purchase -ghat again -s also on State 9 ere is (inaudible). It was all p Morrow oRect all of that land over th have you Kingsford: G with Lovan Enterprise, (inaudible) • lease as far as the City ie: Have you Wayne read that Corr looked at port-ons of it recently. read it? some time• - have that we have broken stop:) have read it, it has been what Walt is sayears and we didn't build Crook ou GOncur with is do y ~ven't made -t 18 holes in two Y main question COR1e: MY use we ha already beta .. . the lease use do you read it that way? a club ho ecific provis-on. vent read that sp alt said was in review-~9 the Crookston: I ha the lease, what W Walt said was not -n the minutes. Kingsford: What to the expectations from minutes we didn't live uP Meridian City Council Special Workshop September 26, 1995 Page 31 Morrow. By virtue of the man taking the lease to begin with, A, there was nobody else that wanted the lease. Corrie: That is debatable too. Kingsford: That is clearly in the minutes. Morrow. Bob I spent 6 hours on the fourth of July in the hole reviewing the minutes from 1978 to Corrie: Were those written or were they on tape? Morrow. Those were written and quite candidly a lot of what is out there on the grape line is not factual according to the minutes. Either that or the minutes are (inaudible) one of the two. This issue is that there was a person from Twin Falls that did approach about leasing the golf course but at time to lease had disappeared, did not submit and there was no further reference other than those one or two meetings concerning this person. The premise under which (inaudible) made their proposals and the City made its proposals and that Wally Lovan, Rick Stanwood and the third person accepted those proposals was that in 1980 there would be an additional nine holes and a club house that would be built by (inaudible). So when they executed the lease it was totally with the expectation of the second nine holes and the club house. Corrie: You said Lovan New Pacific was going to build the club house? Morrow: Lovan New Pacific built the original nine holes. They were going to build the additional nine holes and a club house. Corrie: They were going to. Morrow: That is correct. Corrie: Where is it that we broke the lease? Morrow: Given all- of this information we as a City signed the lease with Cherry Lane Recreation that they were going to have 18 holes and a club house within a 2 year period. Corrie: That is in the lease? Morrow. It is in the minutes. Meridian City Council Special Workshop September 26, 1995 Page 32 Corrie: Not in the lease? We are talking about the lease. Morrow. We are talking about the expectation, what I am saying is in essence the man with a company of the three individuals signed the lease with the expectation that in two years they had 18 holes and a club house. In reality what happened was is that they had signed that lease under that premise today they still don't have the 18 holes or a club house. Corrie: I understand that, but the lease doesn't say that, the lease (inaudible) the lease was broke that we broke the lease. Morrow: I am saying that in essence we broke the lease because we didn't provide. Corrie: You can't break a lease if it is not in there. Morrow: I don't want to argue semantics here but I am saying in principle we broke the lease because we didn't provide what was going to be part of them signing the lease. When they were signing that lease (End of Tape) Legally we didn't break a site specific lease, morally we had the obligation of saying that this is why they are signing the lease is because they expect these things to happen and they didn't' happen. So what I am saying is from that standpoint we haven't lived up to our side of the bargain they have lived up to their side. Corrie: (Inaudible) Kingsford: I think clearly they did, what the nine holes that they took possession of (inaudible). Morrow. Well that is part of the minutes too upwards of 1982 the issues are addressed with respect to the sprinkler system and other issues that (inaudible). Very candidly, the biggest offenders of the system we have now is the Chamber of Commerce. It is very clear that Mayor Storey was totally opposed to the entire process. Council supported it, the Chamber of Commerce was the main pusher behind the issue to get it done. And interestingly enough the same people or some of the same people that are on the Chamber of Commerce were also City Councilmen. That is a long answer to your question Bob. Kingsford: In terms of answering question 1, you are saying then that and Max (inaudible). City of Meridian and Cheny Lane Recreation Inc. then the lease issue you are going to address that by the standpoint that or we are I am going to sign off on the same thing that it is a lease, it was signed X number of years ago, it is for 37 more years and that is not Meridian City Council Special Workshop September 26, 1995 Page 33 (inaudible). Morrow. Well it can't be, obviously, I think there are two things outstanding by the point of the Council is that the lease was too god damn long and clearly the trash lease is way too long. But in both cases those folk did what they thought was right. It is not up to us today to second guess it. There is not a lot we can do about it unless we are willing to buy our way out of both of them. Kingsford: With regard to the $6,000 payment I think we covered that in the same stuff. We would point clarification of the anticipation and discuss the contract operator with regard to not $125,000 but $135,000 anticipated by this point (inaudible). Morrow: I think we address it in terms of the answer to that clear up to the mis- understanding is that obviously they are trying for political mileage here to say that the City of Meridian is taking a shaft and I think there is a little background in terms of the Nampa thing, A is that the first couple years was at 0% and slightly scaled up. Kingsford: 1 think something so that we are all singing from the same sheet of music and all know that (inaudible) how many years at each amount and spell out exactly that was and what monies. I think it is also important that since this is somewhat chambered really that we recognize that $135,000 in Nampa goes to the recreation center in Nampa, this has been earmarked for that until it is paid off. One thing I have trouble with is the Chamber of Commerce members frankly that would compete with the Wardle's here (inaudible) that is just my side. Question #2, it is my understanding that you, (inaudible) wilt cost approximately $870,000 to complete the remaining nine holes of the golf course. (Inaudible) budgeted from the sewer and water enterprise that needs to be updated, it is a little more than that. Do you have that figure Will from our budget, what was the amount based on the $650 is was a little over $350,000? Berg: (Inaudible) Morrow: Whatever the number was let's use it. Kingsford: (Inaudible) to accommodate whatever the other was. Where will the balance of money come from and what assurances that will be available when needed. Morrow. I think from my perspective this is a question or paragraph that needs to start out at ground zero and say we budgeted that much money from, clearly these people don't understand the budgeting process. That A we budgeted the only fixed amount in there is the $362,000 or whatever it is, the remaining is budgeted there by law and the donation Meridian City Council Special Workshop September 26, 1995 Page 34 fee will come, donations will fund that portion. Kingsford: And if the donations don't come then it don't get spent. Morrow. It doesn't get spent very simply. And that we are going to build whatever it is we have money to build from and the balance of the thing will have to be improved over the course of the years. Maybe you will reinvest the $6,000 every year in improvements in the golf course. We end up only getting $400,000 and we build 9 holes with the $400,000 and then be pretty bare bones and so maybe the $6,000 goes back into course improvements from year to year. Kingsford: Okay, the next part of that really is a mis-understanding on Mr. Sweet's part. What will happen to Cherry Lane Recreation Inc. (inaudible) $350,000 that is not being loaned to Cheny Lane Recreation, that is the City loaning the City money. It will be repaid by latecomers fees on development out there and clearly only if it happens. Only if development takes place. Then i think again reassert that this is an area where we are loaning ourself money, those are improvements that will be made on what will be the City's land. (Inaudible) Yerrington: Should something be said there about $650 per house fee after a period of time will be increased to off set that cost? Kingsford: Well, it is not all going to happen in one year. (Inaudible) Morrow. It is not per home it is per lot. Kingsford: Well, no, if we have condominiums out there it is per unit. So that wouldn't necessarily be per lot, it is per dwelling unit. Morrow. Well, each unit has part of the lot (inaudible) a vague line. So it is actually lot and (inaudible) Tolsma: (Inaudible) home fee or the unit fee because you don't pay until you pick up the building permit, you have already"acquired the ground. Morrow. You pay when you pick up the building permit but it is a lot fee it is not based on the value of the home is my point. Corrie: What if there are (inaudible) how is paid then. Meridian City Council Special Workshop September 26, 1995 Page 35 Morrow: Well it is based on the seven units (inaudible). Corrie: So it is not a lot fee it is a unit fee. Morrow: Well in that case it is a unit fee or you can make the argument in that case that each unit has 1 /7 of the dirt. Kingsford: (Inaudible) lot fee issue if in fact we have a lot that houses 100 units each. When they come in they are going to get hit with a $650 plus interest tag for each unit they develop. Just like they are going to have to pay that for water, sewer and so forth. So (inaudible). (inaudible) will the developer be required to pay off the loan. No, (inaudible). Morrow: Well, the developers aren't paying the thing anyway, and it is not a loan. Corrie: (Inaudible) the developers didn't want anything to do with it. Morrow. Well, Bob, clearly the issue here is, let me back up a minute, in every subdivision that I have built in, in terms of that had a golf course, in the price of the lots that I bought starting in Indian Lakes through Eagle Hills through Plantation through Cherry Lane Village in the price of those lots was the cost of that subdivision golf course. The closer I got to golf course frontage the more I paid for the lots. Case in point I paid $20,000 off course, I paid $23,000 on course. The issue was here from my perspective, originally we had one development (inaudible) one developer Corrie: (Inaudible) Morrow. What t am getting at here is we had one developer, the one developer (inaudible) the one developer could develop the golf course, fund the golf course, build the golf course. In our case if we had one developer then from my position I would say fine you build the golf course here are our specs. In this case we have potentially as many as 3 or 4. Corrie: Potentially 3 or 4? I thought it was two. Where are the other two coming from now? Kingsford: Well, Mr. Turnbull has not taken down all the options with Mr. Fuller. Morrow: So you have that issue, the other thing is with respect to the Doug Campbell, Steiner, Kent Barney, you also have the issue of like the two condo lots and the concept plan that they want to do a conditional use. Those things could be (inaudible) developed by somebody else. And could have been from the very beginning. My point in favoring Meridian City Council Special Workshop September 26, 1995 Page 36 this method is that the City has no with more than two developers has no way of insuring continuity of development, continuity of workmanship, has no vehicle by which to guarantee what it is we are going to get. So having said that, the City's best interest is to act as the developer itself to make sure it is developed to our standards and the easiest way for us to get those monies is to for us to collect those things ourself at point of building permit time instead of relying on a title company fo provide the monies because our people over here have no way of knowing if me as a builder has paid a title company at the time I come to get my building permit. So from the City standpoint to guarantee that we are going to get paid we collect the funds. Given that scenario, the safest way for us to guarantee the thing gets built and gets built to a standard where we are not maintenance intensive is for us to be our builder, for us to collect lot fees at point of building permit. We have the guarantees that both things, one we have the quality, two we get the money. If it would have been one developer than I would have said bologna let's do it. The one developer can build the golf course or he can fund it. Either or like was originally proposed but that scenario doesn't exist. Corrie: So we have four people involved now and possibly more than what it started out where maybe two or one was involved. Morrow. No, it was never just one. (Discussion Inaudible) Corrie: And now it has gone to four and could be as many as whatever happens to be. Kingsford: The thing that has come and gone to the point where my suspicion is if we don't do something with it in the very near future it will never happen (inaudible). Morrow. You are absolutely right, going back to the original premise it was one developer, it made sense at that time. Kingsford: Well I think historically you go back in there with two developers. Initially it started out that Bamey and Fuller were going to develop it. They then sold the project to New Pacific, New Pacific d~~l the first phase of the nine holes, baled out, it goes back to two. One of those guys starts again to do something he goes bankrupt goes to Simplot. He gets that back through an out of court settlement (inaudible) now he is one of two people involved with that because Steiner has not taken down all the options with Barney. Now, we have clear deed to all of that, Barney has given us deed to all of that property so we own it. But there are two people out there as of this moment doing, or possibly doing the subdivision. Steiner has not paid Barney for the rest of that property. You go over on Meridian City Council Special Workshop September 26, 1995 Page 37 the other side, I don't know just exactly what has happened there, but Mr. Fuller has not been paid for all of the money that (inaudible). As much as, Turnbull has as much as indicated to me that probably they, are not going to take it all now. Very likely the portion where the clubhouse currently exists which is on Fuller's property that they probably won't take that now. That is not necessarily public record information, that is the deal. Then you have another one down here that this golf course got expanded to try and improve it, it goes onto the Thomas/Baxter property. I have never seen clear title to that, I don't know whether there are others involved in there besides Brighton or not. With regard to one of the questions that is out there being circulated, no the City does not have title to that part of the golf course that is on the Baxter property. It was offered and refused under that context he is supposed to be re-wording (inaudible). I was not willing to even run it before you guys to sign off on the number of conditions he was putting in that gift. So, (inaudible Turnbull, Fuller, Steiner, Barney. Morrow. My point Bob, is supporting this particular this concept was that you had all those people, each developing their own little piece of the golf course, how are you going to coordinate all of that, how are you going to insure quality, how are you going to manage it so that we as a City got what we wanted. Kingsford: We started off on that mode, Bamey was going to develop it hole by hole. He started off on that issue. You might be a little (inaudible) and who maintains it if you have one hole, it is of no use. Wally indicated to us and say I don't have any problem I will maintain to do all that work if he has 3 holes so a person can play a loop there at least in practice and giving lessons and that sort of thing. Who is going to maintain when it comes in hole by hole? Tolsma: Didn't Barney propose his about 5 or 6~years ago? Kingsford: More than that, because it was in court for something like 6 or 7 or 8 years. Tolsma: Well, he put a pump out there and had the ground kind of laid out out there and we went out and looked at that right off the pond out there. (Inaudible) connect to the other part of the golf course at all, he was on the other side of the lake. Kingsford: No, the one went out a little to the left (inaudible). Yerrington: How many holes do we have deeded on the back nine? Kingsford: They are not holes the way that is laid out. What it amounts to is that part that comes into the Thomas property, there is a half of a hole on the west, a little over a half Meridian City Council Special Workshop September 26, 1995 Page 38 a hole, a (inaudible) comes back to the east, half a hole going back to the north that we don't have title to at this time. Yerrington: So roughly two holes then. Crookston: (Inaudible) just for your information I have reviewed the impact fee there is no statute, there is no requirement for, there is no authority to adopt an impact fee as an interim ordinance. Where my idea came from was from the original house bill for the impact fee statute. It said an interim impact ordinance or resolution may be approved as an emergency measure (inaudible) but that provision was taken out when they (inaudible). Tolsma: Wayne, which house bill was that? Crookston: 581 Tolsma: (Inaudible) Morrow: Okay, so we don't have an interim thing to work from we just have to go on the best (inaudible). The point that I was going to bring up on this was that part of my (inaudible) Point of part of my motions in terms of this zoning and annexation is those parcels, if you remember they v~re contingent upon us receiving the free and clear deed prior to the execution of that stuff. Point of the motion for that part of it was that we in fact got that land so that we could proceed with the procedure in terms of the development however, we chose to get it developed. At that point in time I was making the motions, in my own mind I didn't know how we were going to then we would bekn the dri versese'at existed there for a major mess. ff we had the property for how it would be developed. And that was the point of my motions stipulating that we receive the free and clear deeds. Corrie: Before then that was given (inaudible) I guess we are on two different parallels here. Morrow. What t am trying to bring out is as part of our discussion we were talking about how many potential developers (inaudible) when these things first came before us as a Council and I made the motion to annex and zone, part of the motion was that we be given as a City the free and clear title to the ground. Point of that motion was that part of the motion was at the time I didn't know how it was 9O1 otentiaefoe a ma odr mess f we owned to develop the golf course stuff out. But I saw the p the property then we could not be held hostage by aewhoseatunWe coou desubcontracOt the we had the property we as the City were in the dnv Meridian City Council Special Workshop September 26, 1995 Page 39 development to somebody, we could do it ourself, there was all kinds of possibilities for the development of that golf course. Cowie: At this point we don't have that. Morrow: At this point we have parts of that. Cowie: We don't have it all. Morrow We don't have it all and nor have given final approvals for all. Cowie: Okay, my point is we don't have that and that is a wise decision you have made. We are moving on with development and we don't have the properties. Kingsford: (Inaudible) is preparing the development plan. Now, (e doinrd lans and th s be out of bounds here, I did write a letter to Steiner when they we 9 P was based on Mr. Lovan's agreement that he would b snalli and we cou dn't developlthe those three holes and that if for some reason we had a g rest of it that we would go ahead and work on those thoee holes so that exists, the three holes that lie, the 2 1/2 holes that lie on the Sterner p p rtY Tolsma: That head towards the Thomas and Baxter property. Kingsford: They take off on the north side of the lake foectl to the we s on'the third hole the little dog leg on the second hole and then back di Y about 3l4 of the fairway And that third hole the green does not sit on the Steiner Property, does. Cowie: That was an agreement that you had with them was (inaudible). Kingsford: I had written a letter to Steiner for financing (ul~ droceed with development of happened that we didn't obtain. the other property we wo p those holes. Again on the basis that we have the °of a t mel I fash on thlat begins otherwise it would be coming (inaudible) some sort Y development. Morrow. And that would be normal for financing purposes. Kingsford: (Inaudible) Meridian City Council Special Workshop September 26, 1995 Page 40 other side of that particular coin in terms of that issu an it consumehs in terms Morrow The Development stuff as it develops out It g {ng r~e~ rr!n theuconcept plan we just approved of building those t e condos a d touwnhouses. that Is where al • Well there is just the one set just up there in the north { dust takesa ntdo account Kingsford. , me get that map so you can look at It. What this does What I discussed with you, what do this part takes into account the Turnbull (inaudible). e deeds for, it is this part that lies below this line. W nd most' of a hole here! we not hav was, incorrect (inaudible) So we are taisinbg the lake islth sl part tight here that you see the The part that I am talking about that y number one hole start off, right now the club house sits down inrherou have that number two or what is now it comes up here like this and is right here. The y that takes off down here. This is the practice tee tha{hen that bs on the ISteinee number two lake. The clubhouse is designed to go in here. The ne Inaudible). This begins then that property, actually this part here,I carrel whetheBYo ename it ten or the renumber of one portion and this would be, I don t ome discussion. This is the first hole that goes out hectrholee oau go a toss that there Is s this goes along and does a little dog leg back into here. The ne le The next hole then street that is cut and it goes almost directly xoandl then i comes ngback right here and that you go across the street again, It Is a tee b ,s and part of it is on Steiner or no the is this hole right here that part of it is on Bamey I talked about this hole, Turnbull property. So what we are talking about in this agreement, is hole and this portion of this hole, (inaudible). We have deeds to all of this. th Tolsma: (Inaudible) Ashford Greens part then? Kingsford: Ashford Greens is this part, all of this is termed Ashford Greens. Tolsma: (Inaudible) That is correct, no~N where you are talking about condominiums and so forth we Kingsford that medium density. are looking over into this are in here thTumbull.erSteineehes right up here into thls Steiner's is this over here, this Is Dave c that is up in here, he has 8 lots that could be town house or condo lots, town culdesa house is what I think you call that. Morrow The concept we just approved last Tuesday? Kingsford: That has nothing to do with this, that is over on the Teter property that is a Meridian City Council Special Workshop September 26, 1995 Page 41 whole different deal. Corrie: It is Steiner but it is a different deal. Morrow. Do they pay a lot fee? Kingsford: They don't pay a lot fee, they are not part of this deal. Morrow. They are not a part of this deal. Kingsford: Right, they are not anything to do with the golf course. Morrow. That is where the fire station is . Yerrington: Now you have the title to the golf course now, everything except this. 'n sford: This was all Jim's property here, this was Thomas's or Baxter's and then Ki g Thomas bought it from Baxter and I don't know what thk Idcan° the Thomas' were traded I am told by Turnbull, if you can believe that, and I thm , rest in Boise Research Center so that they have title of this.t'De to all f hi pbecaluse in rote me he did have title to all of this. He told me that he odrtion t at is down in here that would he had not yet paid Jim and (inaudible) at least this p 9 point something that they may not be, where the club house is now there is like 10 acres, take that down. That is also the medium density on that town house type stuff they are proposing there. (Inaudible) Corrie: And he has the deed to all of this up here but he hasn't' paid Fuller for it. Kingsford: That is correct, so Fuller is deeded us this up here. Corrie: So in other v~rords it doesn't make sford: It doesn't matter if he takes any of that down or not, we own this. This is the King where the golf course is then it is our point that Walt is driving at. If own this property and get this part over here as to who destiny. Where I have fought for 16 years was to try hell actually owned it. Because of Barney's financial prorec al Snaudible). Theee in the Farmers & Merchants foreclosed on him,r to this one questi n'that Mr. Sweet asked if we is a real possibility if we don t m answe well be that don't do something now with regard to iss forr10 ears, the ocktis Bunning. Jim has opportunity had passed us by. We owned thi Y Meridian City Council Special Workshop September 26, 1995 Page 42 id if we don't have a golf course there in ten years it i the onlefat achment to that sa s inaudible) but that is Y District's. I am not sure that you guy (' deed. Morrow: I don't think at this point that we would because (inaudible) Kingsford: Well, it is kind of an irregular shaped park. Corrie: So if Turnbull tells us to take a hike then that whole section out there is up in the air. I don't think he is going to do that. I agree Kingsford: If he tells us to take a hike on this, before we spend any money at all on this portion we clearly need to clarify that because, we have a concept plan that didn't include this and constitrties. If he default gon us here could fall back to and put all of that onto these two grope then he is (inaudible) and go back to square one. Corrie: You couldn't if that started to be built out. in sford: It is not going to build out until we have a deed for this. His motion was that K g nothing happens there until we have Corrie: So in other v~rords you are not going to get any of this zoned or anything until you get it all together? Kin sford: It is zoned, but you are just not going to get any building permits or anything 9 happening out there until we own this. orrie: So we don't own that, that doesn't get built and we are sitting there with $350,000 C interest rolling everyday, where is it coming from? in sford: No, now Bob, we haven't yet rolled any money to that golf course expansion K g fund, it is still drawing interest in the bank. Corrie: I understand that. sford: So if vve don't do any more than just this, we will start to get some of that King re a ment on this portion because already he has lot sales. We don't start turning a spa e pY in there on this portion until we own this. Meridian City Council Special Workshop September 26, 1995 Page 43 the coin, if Turnbull defaults on this and he de already own, we Morrow The other side of we build a golf course here less these houses, houses don t exist, w have title to this property. s were not as wide, it was an inferior program for this, the fairway Kingsford: Now, clearly they are more what the golf course has out there today. to have the houses there, you re- ou say you are not going Corrie: I understand that, oY are going to use part of the $350,000 to do it. design that but you still, y ro ert ,there are no houses to get built there, we build the golf Morrow: We have the p P Y course on the entire thing. Corrie: Who is going to pay for that $350,000? o back and look at the original concept plan Kingsford: What you need to do then is you g b the Council in 1979 or 1978 and that was ahSt there would e that was approved y houses. It was a concept plan that had houses around those fairw y ens you are still going to go ahead and put the Corrie: But still, that worst scenario happ nine holes in the area without the homes in there. would recommend ord: Homes would be on the original concept plan. Now what I Kingsf that until a developer steps to the Council is that no we don't go aheanfrastructureoto provide those houses. forward and says I am going to put in th the coin is at that point in time Bob is we cane al~ole newede'al Morrow. The other side of stuff to a developer out of the dirt and retain the~o er arceaand we step back and say lot wants to come in and develop that if somebody that parcel and the nine holes and these are okay Mr. Corrie here is are done and outlofhere. the standards and we to have three • • We already have three holes, (inaudible) the letter says we are going Come. holes regardless. oles 2 112 holes. We will do the golf course as designed for the Kingsford: Not three h , Steiner portion. Corrie: Where will that money come from to do those then? Meridian City Council Special Workshop September 26, 1995 Page 44 Kin sford: It will be their relative share (inaudible) $360,000 that we have assigned for that 9 and donations. (Discussion Inaudible) Kingsford: Okay guys, I have early class so I would just assume be out of here fairly fast. Question 3, Yerrington: The first part would be to answer yes. Kingsford: All of the existing nine holes is deeded to the the concel t plan approved by the is no. (Inaudible) it might bcan'ttremember~ do you remember Ron? Council, either 78 or 79 I Tolsma: (Inaudible) Kin sford: Regardless, whatever that researches out. Qu Cit° of Meridi nt? That~s and 9 agreements exist between Cherry Lane Recreation and the y assumption that there are agreements. Tolsma: 11th of October of 1978. Kin sford: I am not sure what he is talking about by the on eienlCherry Laner Receeat on 9 my knowledge the only informtae ag LaneeRecheationtwilbl build a club house. So far as I and the City of Meridian is C rry know that is the only informal agreement v~ have. The ne ntsa I am note sure(1wha thees Meridian taxpayers to be involved in these informal agreeme driving at there. Morrow: I ,guess the issue in my mind is that there are no oothe alnze the Icl ub house deal t I am aware of other than the club house deal and we will f Kin sford: With regard to question 5, is there (inaudible) Che fact hat'the current ease 9 to finalize the proposed expansion dealings. Considering extends through October 2, 2003 that should read 2032. 18e12032 I believe sdtheeright, you are talking about a 55 year le t know Itamenot sure what he is driving at. Is there any it is a lot closer than 2003. I don , legitimate reason why we don't? Morrow. What was the question there? Meridian City Council Special Workshop September 26, 1995 Page 45 Kingsford: The question that he has here is there any legitimate reason why the City of Meridian needs to rush to finalize the proposed expansion dealings considering the fact that the lease currently runs through, well I guess one fact is that we don't receive anything until there is (inaudible) but neither does the City of Meridian or the Chamber of Commerce enjoy an amenity that has at least been deemed to be positive for the city. Morrow. Well I think from my perspective we ought to bring to conclusion something that was started 17 years ago and has not been concluded to this point in time. We need to conclude that and then get on with other things. Kingsford: So a combination of those. Question 6, Morrow: The other factor is that part of that ground would revert to somebody else if it is not acted upon. Kingsford: Certainly that goes out and beyond upon what he is proposing there as 2003, still there is a ten year maximum there. Corrie: At ten years it reverts back to who? Kingsford: Western Ada Recreation is what is says. Okay, question 6, do you believe it would be reasonable for the City to explore the possibility of re-negotiating the lease with Cherry Lane Recreation (inaudible) versus approximately $125,000, that needs to be adjusted to $135,000. I think clearly the issue there is (inaudible) re-negotiate that. Morrow. We have answered that in question one. Corrie: You didn't answer it but you gave an answer. You didn't answer it because we don't know if he would or not. Yerrington: Would you if you were in his boots? Corrie: I don't know, (inaudible) I probably would. Kingsford: I talked~to Wally and he said that clearly if we would like we can buy out his improvements, bring in an appraiser and have at it. Corrie: I was under the impression too that he told us at one I believe you and I were sitting there together that he would be willing to re-negotiate that. Meridian City Council Special Workshop September 26, 1995 Page 46 Kingsford: I don't believe I have ever heard him say that. Corrie: I did, but (inaudible) I would think, this is your's not mine. Morrow: This issue here is that in this question he is raising the point of the $6,000 as opposed to the $125,000 or whatever it is and we have answered that part of the question which was also stated (inaudible). Kingsford: I can see that and it is a different situation between the (inaudible). Corrie: How you answer that is entirely up to you. Morrow. We have already seen it, do you think it is reasonable for the City to explore the possibility of renegotiating the lease. 1 think the answer to that question from my point of view is yes, we can ask if the other side is agreeable to a renegotiation and if the answer is no then that is it. If the answer is a qualified yes pay me for all my resold improvements to this point, clearly from a financial stand point we can't do that because we don't have the money to buy that. Corrie: We don't know what that is though, you are making an assumption that you don't know. Morrow. I am making an assumption that I don't know but the fact of the matter is Bob we have no money budgeted for that. Come: I understand what you are saying but don't' make an assumption that we can't until you find out. I am just trying to help you in on this one. Because we make an assumption we can't or we don't that just gives somebody some ammunition. Kingsford: I am sorry I wasn't listening to the first part of the statement. Corrie: He said that we cant' assume to buy it, we don't know what the buy out price would be anyway. I am just trying to save some problems here coming back and saying what is that buy out price. Do you know what it is, we don't. Morrow: We don't know what that is. Corrie: But I say we don't close the door. I wouldn't close the door, I think it is a possibility until we know exactly we can't. Meridian City Council Special Workshop September 26, 1995 Page 47 Morrow. I guess my answer is kind of you are absolutely correct, if in terms of year outside of this year when we can budget for that knowing what it is. But this year in the short term we can't do anything because we don't have the money to do it. Corrie: That I (inaudible) but I just don't think you want to get (inaudible) with that one. Tolsma: Well, this lease here he has to 30 years for renewal but he has also has the first right of 10 years additional for no limit thereafter. (Discussion Inaudible) Tolsma: But is says at the conclusion of each renewal term lessee shall have the further right to renew this lease on terms, conditions agreeable to each party here (inaudible) additional terms of ten years each (inaudible). (End of Tape) Kingsford: (Inaudible) how we might have the money. Corrie: (Inaudible) I am just saying we don't know what that property is worth, is that correct? Kingsford: I think we have some assumptions that there are some lease hold improvements and they are worth a quarter of .million dollars. Corrie: Well, that is an assumption because I don't think it is. Because a lot of that, I don't want to get in an argument here because this is yours not mine. I am just saying that trees forget it, that was donated you can forget that. Kingsford: Not all of those trees were donated. Corrie: Most of those trees were donated. Kingsford: No they weren't, I get involved in purchasing a couple of those trees when he made a purchase of a Large lot of them. (Discussion Inaudible) Kingsford: When you take a look at how much trees are worth after they are planted and those that survive they are worth considerably different amount. I am not suggesting that Meridian City Council Special Workshop September 26, 1995 Page 48 the trees are the bulk of that. Corrie: Well, again I understand where you are coming from. Kingsford: You tell my what do you think it is worth, how do you propose that we pay for it? Corrie: How do you know what it is worth, he won't tell you how much he makes. Kingsford: Do you think there are $50,000 dollars worth of improvements out there? Corrie: Very well could be it could be $200,000. Kingsford: How are we going to come up with $50,000? Corrie: I am not saying you are going to come up with it now, I am like Walt now, he says he doesn't know (inaudible). This year you can't how do you know you can't next year and two years down the road. How do you know (inaudible) what if they buy a private person can buy it and put in a private club. Kingsford: No they can't read the lease. Corrie: That is fine. Kingsford: What it says is it must be a municipal course open to the public, it must be, if it isn't it reverts back to the builder or his successor. You do that automatically Paul White automatically owns the golf course. Con'ie: That is fine I am just saying that you should not say you can't afford it unless you know it. Kingsford: I know we can't afford it. Corrie: Now you can't. Kingsford: I do too, we can't develop a park, we can't add onto City Hall how can we afford to buy out something (inaudible). You think we are taking some heat here what happens when you start spending tax payers money. Corrie: That is what you are paying to doing now, tax payers put the money in that sewer Meridian City Council Special Workshop September 26, 1995 Page 49 fund Grant. Kingsford: We are not spending their money it is being lent to us. Are taxpayers having to pay First Interstate and West One and so on. (Discussion Inaudible) Kingsford: I would suggest this, we can sit here and argue all night, we are talking about this being for two people, that does not constitute a quorum let's the three of us sit down and right the response to this. Tolsma: I am involved in this too. Kingsford: Alright I hadn't heard him say that. Morrow: So I think the answer to the question #6 is yes, I think it is possible, it is reasonable for the City to explore the possibility of renegotiating the lease. But the caveat there is that the terms of that renegotiation would be set entirely by the lessee and subject to appraisal and subject to the financial capability of the City to buy out the lease. I think the rest of the answer to that question is see question one because we have already addressed the issued about the $6,000 and the $125,000. Kingsford: I think you can add to that the City (inaudible) buy that out and/or a different lessee being willing to buy out that lease that is also a possibility. Morrow: You mean some other golf company? Kingsford: No, but it would still have to remain a municipal course and open to the public that sort of thing is a possibility if somebody would show up to spend the bucks. But the City I don't ever think is going to have the money to spend that. Morrow: I do have a question in terms of (inaudible) New Pacific provided the first nine holes, and in the minutes and stuff that I read if any of the original covenants and stuff are violated by the City that it revert to them. Clearly the outfit went bankrupt so who do they revert to? - Kingsford: It says to them or their successors. Their successor is currently Paul White and his partners. Morrow: Is that whole chain of, if I remember correctly when we were doing stuff with Meridian City Council Special Workshop September 26, 1995 Page 50 (inaudible) New Pacific it went to Leavit New Pacific to Ben Franklin Kingsford: To Equitable to Ben Franklin to Paul White and partners. Morrow. And neither Equitable or Ben Franklin survived is that correct? Kingsford: That is correct. Morrow: So Paul White would be the last survivor Tolsma: Leavitt New Pacific then did he contract with (inaudible) to build that whole thing (inaudible). Kingsford: I think there was a combination of (inaudible) and JUB Engineers. Because they were the ones that did the engineering. Particularly the big screw ups well there were a lot of them tended to be in the sprinkler system. And that was Marilyn Omstead with JUB and (inaudible) Wright I guess was also at fault for that. Most of (inaudible). Tolsma: I was involved in a lot of that pump station set up out there and the screening of the piping and stuff like that. (Inaudible) Kingsford: It was the first year of operation that the sprinkler station was totally fouled up. He had to replace most of the pipes out there. Tolsma: Yes, but that pipe inaudible) only it wasn't a PVC (inaudible) Kingsford: Went in and did cement vaults for all of that, put in the house over in the (inaudible) made some improvements on the well. Tolsma: (Inaudible) suction lines and piping and that inside the house. Yerrington: So he basically replaced practically everything that was originally there. Kingsford: He replaced or redid virtually the whole sprinkler system. Morrow. Question seven. Kingsford: (Inaudible) Well, 1 guess an expansion plan I don't think really exists between the City and Cherry Lane Recreation. Meridian City Council Special Workshop September 26, 1995 Page 51 Morrow. We don't have anything between the City and Chevy Lane Recreation. Kingsford: The thing that we have is what he addressed in the informal agreement that when we start the expansion Wally will do the club house. I think that, (inaudible). Morrow. We might also tell him that the City has employed someone to start the blue print. Kingsford: But that is not the question that he asked. Morrow. That is true that is side line information, his question, there is no expansion plan between the City of Meridian and Cherry Lane Recreation. Tolsma: (Inaudible) construction of the club house but then that relates back to the dollars before if he amortizes the cost of that club house (inaudible) it is going to be $50,000 to $60,000 a year of payments on a club house or maybe higher depends on (inaudible) cost factor for the City too. Kingsford: Well it is a lessee improvement that would revert back to the City. Tolsma: (Inaudible) building a club house out there. Morrow: What does that have to do with answering the question? Tolsma: (Inaudible) expansion plan (inaudible). Kingsford: Well, I guess to just answer the question the only proposed expansion between the City and Cherry Lane Recreation is with regard to the club house that the Cherry Lane Recreation has proposed to build a club house and (inaudible) golf course. Morrow. And they are not mutually exclusive, one is contingent on the other correct? We don't start the 8 or 9 holes and he doesn't start the club house. When we start the nine holes he starts the club house. Or at some point during the construction of the nine holes he starts the club house. Kingsford: And of cours8 that is something that we want to get (inaudible). But again by the lease he doesn't have to do that. Morrow. I understand that. Kingsford: Question 8, oh wait a minute (inaudible) I think there is where you answer the Meridian City Council Special Workshop September 26, 1995 Page 52 question that we have on board a planner. He will be making a presentation by the way at 1:30 on Friday to myself and Gary Smith (inaudible) like to attend with regard to where he is at with that. He sent me a fax with information he needed to have before he could (inaudible) and that will be this Friday. (Discussion Inaudible). Kingsford: Question S, what will the proposed $6,000 per year lease payment (inaudible) I have absolutely no control over that, that is something each Council year by year (inaudible) goes into the general fund and that is something that the Council will appropriate. Morrow: My perspective it depends on "how the golf course is completed. If it is a (inaudible) then I see it being used to fund (inaudible) Yerrington: How about restocking the ponds with fish. Kingsford: Well I think (inaudible) inappropriate to answer that in any way (inaudible) the Council has to appropriate that very clearly. It is a general fund receipt and it has to be appropriated by Council. Morrow. I think the answer to that is that any lease payment received by the City by law goes to the general fund and then appropriated by that City Council for whatever purpose it sees fit. Cowie: (Inaudible) I think a lot of people (inaudible) remaining 35 years. (Discussion Inaudible) Cowie: But this will answer that specific question, it answered it for me and I am on the Council and I didn't know that. Kingsford: If I happen to be sitting there I think it ought to go in the golf course until the golf course is at a decent standard, but I am not going to be there. (Inaudible) that is up to the Council, year by year they-have to decide that. Can you make a rough draft of that for us. You and your star secretary that works for you and myself and the City Council for our review. I would entertain a motion to adjourn. Yerrington: So moved