SGCC Lease Agreement Negotiations

The following summarizes our understanding on results of the July 2 meeting in Las Vegas between previous BOD members (Blake Smith, Tiffany Roland), the current  BOD President (Tony Fakonas), their respective attorneys and representatives of the Nevada Attorney General’s office.  Purpose was to discuss the alleged violations of law associated with the Country Club Lease Agreement and the filing of a “Complaint for Disciplinary Action and Notice of Hearing” before the Nevada Commission on Common Interest Communities and Condominiums.

  1. The AG’s office has stayed filing of the Complaint to allow the SOA BOD time to restructure the Lease Agreement with the Country Club and submit it to a vote of the homeowners.
  2. Vote on a restructured agreement will have to be accompanied by a corresponding amendment to the CC&R’s.
  3. The AG’s office has strongly encouraged that the Declarant (Blake Smith) reimburse the Association for all costs incurred with the voting process.
  4. If the homeowners ratify the restructured agreement and CC&R amendments with a majority vote, the AG’s office will in all probability drop the Complaint.
  5. If the homeowners vote not to ratify the agreement and CC&R amendments, the Complaint filing will go forward.
  6. If a deal on restructuring the Lease Agreement with the Country Club cannot be reached, and no vote is forthcoming, the Complaint filing will go forward.
  7. In the event of 5 or 6 above, the current BOD will be encouraged to void the current agreement as permitted under Nevada Law. This to preclude any liability on the part of the current BOD.

With regard to the restructured agreement, it appears that the current Country Club Committee (Tony Fakonas and Daniel Kirby) is proceeding with negotiations along the lines of that presented in the May 28 Homeowner “Information Presentation” Meeting. Significant elements include the following:

  1. A long term agreement of 8.5 years
  2. Substituting the original 2013 to be delivered amenity of a 18 Hole Putt-putt course with a 9 hole putting course and a sports court to accommodate pickle ball.
  3. Applicability to all unit owners with continued assessment amounts.
  4. The SGCC would be precluded from selling its assets to any third party during the agreement term except to the SOA.
  5. Voiding of the Land & Water Rights reverter clause in the current SGCC Deed and Bill of Sale. This is the clause that states all property, water rights, easements and equipment revert to the Developer if the property does not operate as an 18 hole championship golf course for 24 consecutive months.
  6. At the conclusion of the 8.5 year agreement, deeding over to the SGCC 5.5 acres of SGCC Land (i.e., that comprising the current area wherein the temporary buildings, bocce ball courts, parking lot and pipeline easements are located).

At the May 28 meeting there were many concerns raised by homeowners as to the viability of Items 4, 5 and 6.  Owning and/or having some control over operation of the SGCC comes with its attendant risks.  This as opposed to a simple “social membership” approach. 

Progress of the Fakonas/Kirby negotiations with the SGCC is unknown at this time. Hopefully, there will be more homeowner information meetings regarding content and soliciting homeowner input before going out for vote.

Readers are encouraged to let their opinions/preferences known to the BOD by submitting emails to soa@mysomersett.com and commenting via this website. For another perspective on this issue go to REReno.