June 25, 2018 Minutes – Approved

A meeting of the Board of Directors of Arrowhead at Vail Association (the “Association”) was held on Monday, June 25, 2018.  In attendance were Board members Cathie Bennett and Randy Smith.  In attendance by phone was Bob Shafer representing Arrowhead Metro District, and Association Board members George Coleman, Patty Strunk, and Tim Gropp.  Also in attendance were Jerry Hensel, Association Manager, Jim Clancy, Director of Public Safety, Sid Schultz with Design Review Administration, Erin McCauley, Financial Analyst, Craig Heaydon, President of The Dakotas Homeowners Association, and Carol Floyd, Secretary to the Meeting.  The meeting was called to order at 9:02 a.m., and it was noted a quorum was present.  Introductions were made.

Public Comment

Bob Shafer gave an update of the Arrowhead Metro District (“AMD”) election that took place in May.  Chris Matlon and Dick Bourret were term limited after spending eight years on the AMD Board.  Tom Howard and Vince Riggio were elected as new members to the Board.  Bob Rosen, Bob Shafer, and Tom Svoboda remain on the Board.  Bob Shafer has accepted the position of President of the Board. Bob reported AMD has completed their financial audit and according to the auditor, they rank in the top of all the auditor’s clients in Colorado in terms of how their books are managed, balance sheet, and fund balances.  AMD has approximately $2m in the Reserve Fund.  Bob said the roads are in good shape, and the parking lot was recently resurfaced and lined.  Bob spoke about the Arrowhead sales tax initiative.  He explained the Gallagher Amendment requires a certain percentage of real estate taxes must come residential and certain percentage from commercial property.  With the escalation of real estate values in the Front Range and resort areas, the residential tax has exceeded what is allowable.  While real estate values are going up, the tax percentage rate is going down.  In 2019, this tax will decrease by 15%.  Rather than raise the mill rate, AMD is looking at enacting a 5% to 5.5% sales tax in Arrowhead affecting Vista, Country Club of the Rockies hard goods and soft goods, Broken Arrow and Alpine Club food and beverage, and short-term rentals.  This sales tax is anticipated to generate over $350K annually.  Of this amount, approximately 50% is expected to come from non-residents.  Bob said it will require a vote in November by Colorado residents.  If a sales tax is passed, it would take effect six months after a vote of approval. George Coleman noted the importance of knowing what the tax will be before short-term rental regulations are instituted.  Bob further noted when the parking lot debt is paid off in 2032, taxes will decrease against the millage rate.  Bob requested Metro District representatives attend various AVA committee meetings. 

Craig Heaydon inquired as to what discussions have taken place in regard to short-term rentals. George Coleman indicated the committee is leaning toward allowing short-term rentals in the Village core. A six or seven-day minimum outside of the core is under consideration.  Randy Smith added there would likely be a set of regulations similar to other communities in the valley.  Homeowners who intend to do short-term rentals would be required to file, obtain a license, post that license in their dwelling, and agree to abide by the regulations.  There may or may not be inspections to ensure homeowners meet the criteria of the regulations and minimum stays.  Randy further stated, although legal counsel has not yet been sought, the opinion is this requirement would have to be added to the Declaration of Covenants of the Association requiring a vote by homeowners.  Randy noted this will be a key topic for the upcoming Town Hall meetings.  George Coleman said the Board will hear all voices before making an informed recommendation to the community.

Craig Heaydon spoke about fire mitigation efforts put forth at The Dakotas.  Jim Clancy stated residents who go through the County or Fire District evaluation process and proceed with the recommended work will receive priority for protection if there is a fire in the community.  Jim added there may also be an insurance impact depending on the carrier.  Craig asked the status of mowing near the pathway behind The Dakotas.  Jerry Hensel explained they have been waiting to receive moisture so when mowed the cut grass does not turn brown.

Design Review

Sid Schultz reported three new homes have come through review.  84 Riverbend Drive will begin demoing the old house this week.  20 Glen Eagles received their final approval.  38 Riverbend Drive will come back for final review at the July meeting.   Sid informed the Board the Design Guideline Revision Committee (“Revision Committee”) will meet following the Design Review Committee (“DRC”) meeting on July 5th to discuss changes to area calculations.  Cathie Bennett noted the DRC has the ultimate authority to determine if a project is approved.  George Coleman said if the Revision Committee makes a recommendation to the DRC on July 5th, the DRC will reconvene.  If the DRC approves the revised guidelines, George will set up a conference call with the Board to acknowledge the adoption of the new guidelines for the Association.  Patty raised the issue of a few lawns within the community in need of attention. Discussion took place in regard to brown grass on many lawns within the community as a result of limited rain and hot temperatures.  Jerry Hensel said inspections of these properties will continue, but there will be some leniency for browning grass with the exception of extreme cases and other details. 

Public Safety

Jim Clancy informed the Board of reasons for the delay in completing the security upgrade system.  Lead times for the hardware was longer than anticipated. Once the software was installed, it became evident more equipment was needed.  A larger monitor and three additional phones were installed.  The software continues to be refined to ensure it does everything Public Safety wants it to do.  Jim said the upgrade will be a benefit to the community with the ability to see the driver of a vehicle, record the image of the driver, license plate, and vehicle on the same time stamp and recording system for access up to 30 days. Discussion took place in regard to timing of implementation. The Board was in agreement to roll-out instructions and protocol at the upcoming Town Hall meeting with an email to property owners immediately following.

Committees

Hiking: Jerry Hensel reported trail construction is going well with approximately one mile complete. The final agreement has been received and is being reviewed.  George Coleman notified the Board of an amendment to the agreement he requested whereby Vail Resorts would reimburse the Association for their investment to construct the trails if Vail Resorts were to rescind trails access within the next five years.  With Bachelor Gulch Village Association’s contribution toward the trails being less than anticipated, George informed the Board that Vail Resorts has agreed to a payment arrangement with final payment due in January, 2019, allowing for all trails to be completed this summer.  Arrowhead will participate in the WECMRD event. 

Pool:  George spoke about the pool estimate which has been received and will be shared at the Town Hall meeting.

Short-term Rentals: George said the committee is preparing a matrix of regulations in effect in nearby communities. 

Inter-community Council: Randy Smith spoke about a recent comprehensive meeting.  Two firms presented proposals for development of a marketing strategy for the community and associated entities.  Key follow up this week will be to begin an investigation with the realtor community to engage those who are not highly dedicated to the Arrowhead market, potentially providing materials about the community.  Cost-sharing was discussed.  Randy said there is additional work to be done to fine tune one company’s scope of work.  Bob Shafer offered to participate on behalf of AMD. 

Public Safety: Bicycle traffic and associated safety issues on Cresta Road was discussed.  Bob Shafer suggested holding a meeting with the committee and AMD.  George Coleman asked the committee to provide their definitive recommendation before the next Board meeting to be appropriately responsive.  Jim Clancy added some of the bicycle traffic will be alleviated when the elk closure is lifted on July 1st allowing access to the mountain trails.

Financials

Cathie Bennett reviewed the financials as of May 31, 2018, noting expenses are tracking on budget.  Real Estate Transfer Assessments (“RETA”) are currently $99K below budget.  Cathie further noted RETA was $89K below at this time last year.  She said sales are normally strongest in the summer, and those closings would occur in the fall.  She reported the financial audit is not yet complete.

Town Hall Meeting

George Coleman stated he anticipates the conversation to include the new security systems, Design Guidelines revision, pool update, short-term rentals, and a sales tax presentation by AMD.  Discussion took place in regard to timing of the meeting scheduled the same day as the Country Club of the Rockies (“CCR”) member guest tournament.  The Board came to agreement to hold the meeting on July 14th at 4:00 pm as previously scheduled noting a recording and written summary of the meeting will be posted on the Association’s website. 

Other Business

George Coleman relayed a request received in regard to a visual screening of the phone/cable boxes at the southeast corner of the east gate near the entrance to the maintenance area.  Jerry Hensel and Patty Strunk will examine the area and come back to the Board with options to consider.

Cathie Bennett inquired about the status of lighting on Cresta.  Jerry Hensel answered this will be addressed in Wednesday’s AMD meeting. 

Patty Strunk asked about problems with the irrigation system, and Jerry replied everything is working well.  He explained the timing issues with CCR’s clock have been resolved. 

There being no further business, motion was made by Patty Strunk to adjourn the meeting.  Cathie Bennett seconded the motion and the meeting was adjourned at 10:15 a.m.

Respectfully submitted,

Carol Floyd, Secretary to the Meeting