September 23, 2019 Minutes – Approved

A meeting of the Board of Directors of Arrowhead at Vail Association (the “Association”) was held on Monday, September 23, 2019. Board members present were Dan Gallagher, Randy Smith, George Bigley, Cathie Bennett and Tim Gropp. Board member, Diane Loosbrock, attended via video conference. Chad Hollingsworth, Board Member, and Bob Shafer, representing Arrowhead Metro District, attended by phone. Others present were Jerry Hensel, Association Manager, Nadia Guerriero, Vice President and COO of Beaver Creek Resort, Mike Trueblood, Sr. Director of Village Operations, Koby Kenny, Director of Public Safety, Erin McCauley, Financial Analyst, Sid Schultz with Design Review Administration, Bill Hughes, General Manager and COO of Country Club of the Rockies, Mark Nobel and Mary Pat Rapp, Board nominees, George Coleman, Ex officio, and Carol Floyd, Secretary to the Meeting. The meeting was called to order at 9:59 a.m., and it was noted a quorum was present. Introductions were made.

Nadia Guerriero

Nadia Guerriero gave a brief overview of her background. She arrived in Beaver Creek May 1st following 12 years at Northstar California Ski Resort where, over the past three years, she held the position of Vice President and General Manager. She grew up in Boulder and is returning with a husband and ten-year old daughter in tow. She spoke about plans for Beaver Creek Resort. Snowmaking is expected to begin soon. Moving forward, the goal will be to build and improve on the momentum that the team had coming out of last season related to guest service and the brand promise of legendary attention to detail, rarified experiences, and being perpetual hosts. Nadia talked about improvements that have taken place this summer, including a refreshed and renewed children’s ski school facility and experience, snowmaking improvements, and trail connections. Planning continues and tree removal has begun in McCoy Park. George Coleman commented on the Association’s willingness to work closely with the resort. Bill Hughes remarked about Country Club of the Rockies’ (“CCR”) similarities in customer service priorities. Bob Shafer asked Nadia to introduce herself at an upcoming Arrowhead Metro District (“AMD”) meeting.

This is Arrowhead

Randy Smith gave a presentation on what Arrowhead is and the direction it is going. He spoke about a couple of years ago when the Board began to evaluate how Arrowhead needs to be positioned for the next five years. He said that involved a lot of components including brand, organizational and community priorities, how to enhance the amenities, increased awareness, and a detailed plan to take Arrowhead to the next level. Randy stated 20% of Arrowhead residents are full-time year-round, 60% – 80% summer, and approximately the same percentage of property owners and family members are in residence during the winter. The number of short-term rentals is estimated to be between 130 and 180. Randy referenced a number of amenities and activities, with the ski mountain and CCR being two world-class aspects of Arrowhead. Transportation is offered door to the bottom of Chairlift 17, and Village-to-Village between Arrowhead, Bachelor Gulch, and Centennial Station during the winter season. Service was expanded for special events this summer. Last year, Design Review Administration updated the Design Guidelines to provide flexibility in the size of homes and change in appearance. 16 items have been identified to define the Arrowhead brand, and those elements will be imbedded into social media activity. A presence has been established on Facebook and Instagram. 210,000 people were reached on Facebook between March and July with a 6.37% interaction rate. Fresh Tape Media creates the organization posts and are using cinemagraphs to garner attention. Creating a site for photo activation, a shareable do-it-yourself photo opportunity, is under consideration. With Arrowhead being the western gateway to the resort, Randy talked about opportunities for collaboration to make Arrowhead more engaged in the Beaver Creek community. Nadia commented that there appear to be a lot of synergies and parallel paths in terms of what Beaver Creek is looking at and thinking about.

Public Comment

Bob Shafer reported the sales tax initiative is moving forward for a vote in November. He informed the Board that Zach’s Cabin is now in Arrowhead Metro District (“AMD”).

Resolution in Support of Local Sales Tax

Cathie Bennett moved to approve the Resolution in Support of Arrowhead Metro District Sales Tax Ballot Issue as presented. Randy Smith seconded the motion and it was unanimously approved.

Design Review

Sid Schultz said the Design Review Committee (“DRC”) has been working on modifications to the Design Guidelines related to duplexes. Once finalized, he will present the changes to the Association Board. Randy Smith inquired about the possibility of setting a construction timeframe based on the scope of a project. Sid answered that DRC has discussed this, and made the decision to continue allowing 18 months for all projects while encouraging construction to proceed as quickly as possible. Mary Pat Rapp suggested requesting approval from owners to publish before and after photos of their construction projects.

Public Safety

Dan Gallagher requested Public Safety be aware and report irrigation and other common area issues that are in need of attention or repair while patrolling the neighborhoods. Koby Kenny said he and John Herbert have had a conversation regarding this matter and will incorporate such into their normal patrols. Dan voiced concern in regard to dogs off leash on the lawn area near the lift and asked for Public Safety’s assistance to rein it in. Koby Kenny suggested fencing to designate an area for dogs off leash. George Coleman suggested a long narrow strip similar to a dog run. Dan referred this matter to the Strategic Planning Committee.

Committees Reports/Action Item Update:

Hiking: Dan Gallagher reported the Ute Trail is complete. It is approximately 5 miles around. Jerry Hensel added there is approximately seven to ten days of handwork yet to be done. Winter use was discussed, and Jerry said he is in talks with an athletic group to stomp down portions of the trail with snowshoes. Dan noted there is nothing in the proposed budget for trail maintenance. Dan mentioned noxious weeds invading the Cherokee and kids trails, and that the equipment on those trails are in need of refurbishing. Jerry said the trails are inspected a couple of time each year and the side banks will be mowed soon. He further stated the equipment is scheduled to be sanded and re-varnished this fall.

Alpine Club Pool Advisory Committee: George Bigley confirmed the committee has reviewed and approved the FY20 budget. He announced a decision has been made to move the pool closing time to 8:00 p.m. in the winter for consistency year-round. George Coleman suggested review and possible update of the 2002 pool operating agreement.

Communication and Marketing: Randy Smith informed the Board of a meeting scheduled for later today with a perspective local webmaster to hear his philosophy, how he would approach servicing the Association, and the cost structure. Tim Gropp mentioned another potential contact, and will forward this information to Randy.

Nominating: Diane Loosbrock announced the committee has nominated Mary Pat Rapp and Mark Noble as candidates for the annual election of Board of Directors. Dan Gallagher welcomed the candidates and thanked the committee for their work.

Tim Gropp moved to approve nominations of candidates, Mary Pat Rapp and Mark Noble, for the Association’s annual election as submitted by the Nominating Committee. Cathie Bennett seconded the motion and it was unanimously approved.

Financials

Tim Gropp reported $967K in real estate transfer assessments (“RETA”) have been received through today. A line item has been added for short-term rental fees. Erin McCauley confirmed two annual assessments remain outstanding. She noted official notices of delinquency will be sent this week. 30 days after the notice is sent, if payment is not received, the Association’s attorney will proceed with placing a lien on the properties.

Proposed 2020 Budget

Tim Gropp reviewed the 2020 proposed budget. He noted RETA is budgeted flat. With RETA anticipated to end 2019 between $150K and $200K over budget, there will likely be a surplus. Previous discussions suggested investing some of the surplus into CDs. Tim recommended monitoring RETA received and how the economy is trending the first six months of next year before making an investment decision. He further noted two existing CDs will mature in the spring. Transportation expense will be determined once the service level is established. Bob Shafer confirmed AMD will contribute one-third toward the social media initiative. Tim said short-term rental income and Host Compliance expense has been included. Tim referenced the list of proposed capital projects and Jerry Hensel explained these items were taken from the ten-year improvement schedule. Dan Gallagher and Bob Shafer agreed to get AMD and Association Board representatives together to determine priorities. Discussion took place in consideration of an increase to the annual assessment. Comment was made that a portion of the increase could be designated to fund capital projects or build a reserve. Dan Gallagher said the Board has been focused on a longer-term view, considering many multi-year projects. Dan asked the Board to send him, Tim Gropp, and Randy Smith their prioritization of projects and thoughts on increasing the annual assessment.

Other Business

Highway 6 Crossing Update: Dan Gallagher spoke about the effort to find a safe solution for pedestrians crossing Highway 6. $3,800 has been spent on an engineer and two traffic studies. Preliminary findings indicate a round-about would be one of the more viable options. Additional funds will be needed for further professional studies to determine all options. Collaboration with AMD and funding sources are being explored. Mark Nobel suggested construction of a pedestrian/bike path from the main entrance of Arrowhead to the existing traffic light. Bob Shafer brought up the matter of bike safety on Cresta Road. Preventing cyclist from entering through the east and west gates was discussed.

Transportation Initiative Update: Dan Gallagher said the Association has added on to transportation as an amenity to the community in response to the ULI Study and 2017 homeowner survey. So far it has been well received and utilized. Expanding winter transportation in collaboration with AMD and possibly Arrowhead Property Management and Beaver Creek Resort is being examined. Dan noted there would be flexibility to layer service up or down depending on usage. He said the working group views this as a great benefit for residents and an amenity that would enhance property values.

Lighting Study Update: Dan Gallagher reported the revised lighting study has been received. Once the working group has reviewed the study and pricing is determined, a second estimate will be sought. Dan noted AMD requires a minimum of two bids for all projects.

Mountain Safety Update: Dan Gallagher will meet with Gary Shimanowitz, Vice President of Mountain Operations for Beaver Creek, next week. A draft letter outlining safety improvements that will take place for Arrowhead Mountain this season will be signed by Gary at the meeting. This information addressing safety concerns will be shared with the community. There will be a skier education piece featuring a couple of presentations by Ski Patrol at the Alpine Club to promote safety awareness. Gary’s team is looking at a few mountain enhancements to determine whether they are feasible and would be of interest to Beaver Creek or the Association.

Arrowhead Map Update: Jerry Hensel said he is expecting a first draft of the Arrowhead map very soon. Dan Gallagher explained the creative process and purpose. Arrowhead is being extracted from the Beaver Creek trail map to produce an Arrowhead-specific map showing all neighborhoods, wetlands, fishing ponds, and amenities. It will be used for welcome packages, Arrowhead Property Management, and marketing. The cost for a digital version is $2,800. Printing costs will be in addition.

Short-term Rental/Host Compliance Update: Cathie Bennett said a letter has been prepared to alert all property owners that Host Compliance is the Association’s agent and licensing will go live on October 1st. Jerry Hensel will send a link for the Board to test the licensing process.

Future Committees: Randy Smith asked the Board to consider the committee structure and its effectiveness. There are currently 15 committees. The objective has been to get broader participation from the community, and identify and encourage future Board members. Dan Gallagher added it was intended to lessen the workload of Board members. Randy said the alternative would be for Board members to take a functional area of responsibility and work closely with Jerry Hensel to bring recommendations to the Board. Jerry’s responsibilities would be defined in the Management Agreement currently being revised. Randy asked the Board to be prepared to discuss this matter at the next Board meeting. Bob Shafer mentioned the importance of integrating AMD Board members more directly, in particular, for bigger projects.

Annual Meeting Date: Scheduling the Annual Meeting was discussed. George Bigley noted the Alpine Club holiday party is set for December 27th. Jerry Hensel will send a couple of suggested dates and times. He will follow-up with the Association’s attorney on advice pertaining to electronic voting.

Management Agreement: Tim Gropp inquired about the status of the Association’s management agreement with Vail Resorts currently being updated. Dan noted it has not been revised in twenty years and will expire at the end of this year. Jerry Hensel said he and Mike Trueblood received the updated version for review today, and expect to forward it to the Board within the week.

There being no further business, Cathie Bennett moved to adjourn the meeting. Tim Gropp seconded the motion and the meeting was adjourned at 11:57 a.m.

Respectfully submitted,

Carol Floyd

Secretary for the Meeting