HERONS GLEN RECREATION DISTRICT REGULAR BOARD WORKSHOP NOVEMBER 14, 2016, 2 P.M., CARD ROOM C AGENDA

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1 HGRD Reg Bd Wksp, Nov 14, 2016, Page 1 of 6 HERONS GLEN RECREATION DISTRICT REGULAR BOARD WORKSHOP NOVEMBER 14, 2016, 2 P.M., CARD ROOM C AGENDA BOARD PRESENT OTHERS PRESENT Chair Dick Thomas X Gen. Mgr. Loraine Vienne X Vice Chair/Asst Treas Larry Cummings X Controller Lynn Garcia X Treasurer Jim Gormley District Counsel Tom Hart X Secretary Larry Pedersen X Board Asst. Mary Ellen Marvin X Asst Sec Bill Tolstyka X Residents 40 I. CALL TO ORDER Chair Thomas II. ANY PROPOSED CHANGES TO MINUTES Oct 24 Regular Board Workshop and Oct 26 Regular Board Meeting III. REVIEW OF FINANCIALS Controller Lynn Garcia A. October Financials All departments year to date were better than budget by $4,875 which included golf operations better than budget by $7,753 and the other departments worse than budget by $2,878 (ATTACHMENT A). Questions How was the inventory done differently than in the past? The volunteer and the chef did not use the previous inventory spreadsheets but wrote down the number and size/weight of every item on paper. For the next inventory a revised sheet-to-shelf spreadsheet with updated prices will be used that will speed up the process. B. Mistakes on the tax rolls The annual assessments for those owners who own lots without houses are supposed to go on the tax rolls and for those who are more than two quarters behind in assessment payments. There were a couple of owners put the rolls that should not have been, and there was an error in the amount put on the tax roll, as it was taken from Version 2 of the budget, not the final version. District Counsel commented that the two owners who should not have been put on the rolls were his error, and they will be informed that they are entitled to make quarterly payments. The second error was made by Fishkind in that those owners received a tax bill of $54 more than they were required to pay. The easiest way to deal with that would be to give them a $54 credit on their accounts. IV. DISTRICT COUNSEL S REPORT Thomas Hart, Esq. A. Bond refinancing The bond underwriter has informed Mr. Hart that there are interest rates that could be favorable for refinancing. There are two options to consider: (1) Using the market, $100 per lot per year might be saved; and (2) using private placement, $127 per lot per year might be saved. There is a March date that would be very convenient to pay off the old bonds if that is what the District decides to do. A community vote would be required only if the amount of the bond increased. There could be no change in the amount or the term. There may be insurance available so that the total bond would not have to be increased. The Board agreed that the underwriter may make a presentation on this topic either at the January 23 Board Workshop or sooner if they decide it requires a Special Workshop or Meeting. A resident

2 HGRD Reg Bd Wksp, Nov 14, 2016, Page 2 of 6 asked if the bond would ever go away. The reply was the it would go away in 2036 if there is no need to increase it. B. Forensic Audit The auditor should have some preliminary information for the Board by the November 16 Board Meeting. There are a few more interviews to be conducted at Herons Glen, and then the final report should be prepared and submitted. C. Letter to FEMA regarding flood insurance The surveyor has completed the elevation certificates, and Lee County has reviewed them and reported that all HGRD buildings are outside of the flood zone. This means that flood insurance is not required. V. GENERAL MANAGER S REPORT The new GM Loraine Ellis Vienne thanked everyone for their warm welcome. She said she is looking forward to getting to know everyone and is thrilled to be a part of the Herons Glen community and staff. VI. COMMITTEE REPORTS & RECOMMENDATIONS A. Ad Hoc Committee for Rev of Pol & Proc/Rules & Regs Final Report Committee Chair Karen Mars reported that the committee has completed their review and recommendations. Copies of all their complete recommendations have been submitted to the Board and the GM. She presented a summary of those recommendations (ATTACHMENT B). Chair Thomas and the Board thanked Chair Mars and the committee members for all their work. He said the Board would review the documents and decide on the action to take on them at the January Workshop and Meeting. B. Committee for Selection of Annual Audit Firm Chair Thomas reported that the RFP was advertised and sent to eight audit firms with governmental auditing experience. So far two have contacted HGRD. Bids are due by close of business on November 16 and will be opened at 8:30 a.m. on November 18. Interviews with bidders will be held the week of November 28. VII. OLD BUSINESS A. Update on forensic audit This was covered in District Counsel s report. B. Discussion re guidelines for nonresidents using HGRD facilities in league/tournament play for tennis, bocce, shuffleboard and pickleball Chair reported that the Shuffleboard Association has reported that their league will have about seven league sessions at Herons Glen with about 10 people at each session. He said that the league participation may come about in the future for the other activities that use HGRD facilities, so some guidelines should be discussed regarding how to handle all those that could occur. Supervisor Tolstyka commented that possibly darts should be added to that list. Possibly an Ad Hoc Committee should be established or have an advisory group set up that would involve the GM and a member from each of those organizations. His list of topics that could be considered by a committee included: Do other clubs charge fees for recreation dues pay-to-play fees or nonresident play; how much time is requested; what other clubs participate; who pays a fee to play at other clubs; should fees be paid for court reservations; should fees be paid for maintenance; what rights should District sporting teams have; should the Fitness Center, swimming pool or other amenities be included; should good will with other SW Florida communities be considered; would this result in players from other communities deciding to

3 HGRD Reg Bd Wksp, Nov 14, 2016, Page 3 of 6 move to Herons Glen; and should any costs resulting from the league play be included in assessments. Chair and the other Board members agreed that an advisory committee is needed and should include members of each of those activities and other residents who do not have a vested interest in those activities. Resident comments When did it become an issue to have other clubs come to Herons Glen to participate in sports. In the past, tennis players paid $100 per year to participate in the league, which was because the players had wanted to courts converted into Har-Tru courts to help pay for court maintenance. Now we are told that fee is for having other clubs come in to compete with us. The response was that the courts were converted to Har-Tru because other clubs were refusing to play at Herons Glen on the old asphalt courts and the Tennis Association is permitted to block out time for their play with outside teams. How to handle this with issue with other sports leagues needs to be decided. The Shuffleboard league matches (seven home) would only use five courts so seven other courts would still be available for residents use when matches are played. There are eight teams including Herons Glen, and none charge fees to have other teams come in to play. This league is scheduled to start the first week in December, so a response is needed soon re if Herons Glen can hold their seven home league sessions. The fee that tennis pays to the District started out as being for the cost of maintaining the Har- Tru courts, not for having other teams come in to play in tournaments. Often members of those teams who come in to play end up buying homes in Herons Glen. Don t close the door to the opportunity to expose Herons Glen to possible buyers. There was much dissension within the community when the Board was asked to convert the tennis courts to Har-Tru courts. It was an expensive project and the fee was agreed on with the Tennis Association to help appease those who were against renovating the courts. The original fee was based on maintenance costs, but it was established to give the Tennis Association the right to book their matches with outside teams in advance of the normal seven days advance booking allowed for other residents to reserve the courts. The Board agreed that the Shuffleboard Association could go ahead and make the commitment to have the other teams play at Herons Glen during the coming season, and that an advisory committee would be established to study this issue for all activities and make recommendations. Chair said these two topics would be on the November 16 Board Meeting agenda. C. Discussion/update of HOA/HGRD agreement and project Chair reported that the HGRD/HOA Mutual Concerns Council met last week and at this point the plan for the Sozio purchase of the 15 lots does not look good. Sozio needs eight buyers commitments to obtain financing, and they have only one. There is the potential for 30 homes on the lots. If the Sozio deal is not in place by the end of this month, there is the possibility of the sale of another tax certificate at the end of the tax year, March 31, If the HOA would approve and the HGRD Board would take ownership of the property and pay off the tax certificates, the money would have to be available to do so. Supervisor Tolstyka asked if the HOA has agreed to the terms set forth in the HGRD Resolution regarding this property, and Chair said they have not

4 HGRD Reg Bd Wksp, Nov 14, 2016, Page 4 of 6 as they have been waiting to see if the Sozio project would happen. There was a discussion about how much money would be needed to pay the tax certificates, and the estimate was about $110,000. There was discussion about what HGRD could do with the property and about the rezoning required if it were not used for homes. D. Review of 2015/2016 H2B Program Cost Supervisor Tolstyka said that the original estimate of last year s program was about $19,000 (not including payroll), but the actual final cost was $39,163. Most of the rent, utilities, and some other costs were supposed to be recaptured from the program employees, but that recapture was $10,000 short. Food & Beverage Manager Drescher explained some of the problems that occurred during the first season of using this program. There were a lot of one-time costs for the first year that will not recur this year, such as household furnishings purchased for the rental apartments used by the program employees. Many residents donated items, but many had to be purchased. There were major delays with the processing of Visas for the workers to travel to the US, which resulted in all of them not arriving at the same time, so the costs of some tickets increased and there were increased costs involved in making more trips to the airport to pick them up. The apartments for the workers had to be rented for a set number of months even though they were not occupied during all of that time and therefore no payroll deduction for rent, etc. could be made until they the workers actually were here. Also, one worker left the program before the season was over. He said that an attorney s fee that was showing in the program cost report was for this year s program, not last year s. This year, the workers have all arrived at the same time with one exception, and only two apartments are rented, not three as were last year. A resident asked if the program employees are vetted, and the response was that they are vetted by the US government. The resident asked if HGRD receives money from the government for using this program, and the reply was that no money is received. The resident asked if HGRD intended to keep using this program in future years, and the response was that in the past trying to recruit local workers for seasonal work has been very unsuccessful. GM commented that in her past experience with the H2B Program, the first year always is a learning curve, but it is a great program because of the quality of the individuals that are generally provided. She said she will work with the F&B Manager to maintain an efficient program. The F&B Manager said that there was a lot of positive feedback from residents last year about this program. E. Any other old business to come before the Board There was none. VIII. NEW BUSINESS A. Presentation of residents petition re noise pollution from Pickleball Courts Resident Don Radtke of Tisbury Lane said that Herons Glen is a great community and adding the Pickleball Courts was an improvement. However, there is a problem with the click sound that is produced by the paddles. He presented a petition requesting that all pickleball players use a sound deadening paddle to reduce the high level of noise pollution generated from the courts. The petition states that residents should all be respectful and considerate of each other, and all should be able to enjoy the outdoor space in a peaceful manner. The petition was signed by 40 residents that are affected by this noise. Mr. Radtke stressed that no one wants any of the amenities to go away, but the sound deadening materials that have been installed help in only certain areas. He said that the

5 HGRD Reg Bd Wksp, Nov 14, 2016, Page 5 of 6 research he has done shows that the foam ball changes the sound pollution, and there are other types of paddles available that reduce the noise. Some of the comments from residents of that area were that the noise starts early in the morning and awakens them, they find the constant clicking noise very irritating, and they are avoiding opening their windows or using their lanais now due to the noise. Mr. Radtke provided the petition and his research material to the Board Assistant for distribution to the Board members for their review. The president of the Pickleball Association said that they will work with the residents to try to resolve this issue. Chair said that the Association should also work with the GM on this problem and bring a recommendation to the January Board Meeting. B. Form 1099 Miscellaneous Taxable Income was not issued for the car allowances paid in The Board should direct the controller to do this Supervisor Tolstyka said that this was discussed at the October Board Workshop. There was a discussion about whether this should be done. After discussion, the Board agreed that separate corrective actions could be taken on the two individual 2015 tax forms needed, and that in 2016, the car allowance is being correctly treated as taxable income. Mr. Hart will provide information from a tax attorney regarding the issuance of 1099 s at the January Board Meeting. C. If an employee violates the NO CASH policy, what are the penalties Chair said that this topic would be included in the action under Item D. below. D. Establish an ad hoc committee to review and make recommendations for updating the Employee Handbook Chair and the Board agreed that this topic will be on the November 16 Board Meeting agenda for approval. Supervisor Tolstyka commented that the GM and the Controller should be involved with that committee. E. Any other new business to come before the Board Asked if both dinner and lunch menus are available in the lounge in the evenings. The reply was they are as long as the ingredients for the lunch item requested are still available for preparing that item during the dinner period. F. Bonus for Controller The Board asked that the Controller leave the meeting, after which they discussed giving her a bonus for her discovering and reporting the fraud carried out by the former GM and for her long hours of work performed far beyond the normal work week since the departure of the former GM. The decided that she be given a bonus of $5,000. IX. RESIDENTS CORRESPONDENCE AND COMMENTS None. X. NEXT WORKSHOP/MEETINGS A. Regular Board Meeting, Wednesday, Nov 16, 5 p.m., Cd Rm C B. Auditor Selection Committee, Friday, Nov 18, 8:30 a.m., Cd Rm C (opening of bids) C. Ad Hoc Committee on Long Range Planning, Monday, Nov 21, 11 a.m., Card Rm C D. Auditor Selection Committee, Interviews of Bidders, Monday, Nov 28, 1:30-5 p.m.; Tues., Nov 29, 9 a.m.-12 p.m.; & Wed., Nov. 30, 1:30-5 p.m., all in Card Rm C XI. ADJOURNMENT The meeting was adjourned at 4:30 p.m.

6 HGRD Reg Bd Wksp, Nov 14, 2016, Page 6 of 6 Attachments /mem January 23, 2017 Date Dick Thomas, HGRD Chair