Virginia City Highlands Property Owner’s Association

Minutes of the Special Meeting – Saturday September 29, 2012

Virginia City Highlands Fire Station Training Room

 

Present:  Dave Thomas, Mary Tallent-Stewart, Pat Flanagan, Karlyn

                 McPartlin

 

I.              Call to Order, Declaration of a Quorum and Approval of Meeting Agenda

Association President Dave Thomas called the meeting to order at 1:16 pm and declared a quorum present.  Pat Flanagan made a motion to approve the meeting agenda with a second from Mary Tallent-Stewart.

 

II.            Firehouse Station 2 Sale MOU

Dave discussed the memorandum of understanding regarding the sale of Station 2 to Storey County.  County Manager Pat Whitten would like this on next Tuesday’s agenda for the County Commissioner’s meeting.  The sale terms are the appraised (2009) price of $250,000 with $50,000 due the association on closing and $50,000 per year for the next four years.  The 2009 appraisal did not include the training room which was paid for by Storey County and from a fiduciary perspective it was decided by the board not to have the property reappraised due to the risk that a reappraisal would result in a lower valuation.  The sale is being transacted under the laws of eminent domain.  The property is not an Association common element and historically has been characterized as a rental property on the Association’s corporate tax filings.  NRS 116.3112 requires that conveyance or encumbrance of a common element of a common interest community requires approval of 50% of all members. The non-common element characterization of the property and the fact that the property is being sold under eminent domain condemnation releases the Association from that requirement.  President Thomas also consulted with the Association’s attorney Jay Hampton, who was of the opinion that this transaction was acceptable and actually a great idea.  Installment payments will be made by the County to the Association to reduce the tax liability associated with the taxable gain.  The cost basis on the property is $19,000.  The installment sale aspect of the transaction will save the Association approximately $40,000 in federal income taxes.  The interest rate on the note is to be the mid-term applicable federal rate in effect during the month in which the transaction closes.  The District Attorney will finalize the necessary documents.

 

Karlyn expressed concern that the County would not abide by their promise to curtail water usage that affects the surrounding wells and about the light abatement at the Station should the sale take place.  It is a residential community and we should be vigilant regarding the situation.

 

Pat Flanagan made a motion to approve the MOU, Mary Tallent-Stewart seconded, all voted in favor.

 

Meeting adjourned at 1:43 p.m.

 

     Respectfully submitted,

     Mary Tallent-Stewart

     First Vice President