SGCC Purchase Agreement – An Opposing View

Posted by Charnelle Wright, Somersett Association Member

The proposed new Somersett Golf and Country Club Agreement binding the entire Somersett Community to repayment, of a $2.75 million debt, is frivolous, detrimental and unnecessary.  It is obvious that negotiations were controlled by the demands of Blake Smith and Country Club president, Pat Gaskill.  This proposed Country Club Agreement will provide the greatest benefit to just 200 equity members of the Country Club, a very small minority of Somersett owners.  The 200 Country Club members want to keep the Country Club for their exclusive use.  They are controlling this agreement and causing the rest of the 2485 owners to pay for that exclusivity.  They want the community to take on a 15yr. debt of $2.75 million so they can build a clubhouse for their exclusive use.   They are giving nothing back to the community who will be paying for their clubhouse building.  In fact, this agreement limits play for owners to 4 times a year.  Is this what we get in exchange for taking on such a huge debt?  I say, let them pay for the clubhouse themselves if they want that exclusivity or, negotiate with Blake Smith to pay for it as was the original plan when Somersett was developed.  The only part of the agreement that is favorable to Somersett is obtaining “The Water Rights” and cancelling the reverter rights of the developer, Blake Smith.  The damaging parts of the deal are the 90 yr. lease, the $2.75m loan and the fact that the owners in Somersett can only play golf 4 times a year.  At the very least, Somersett owners should have been granted the ability to play golf at the country club for a fee whenever they wish.

We can only hope that if the agreement fails to pass with the required majority votes, the Attorney General’s office will proceed with its action against Blake Smith and maybe then, a new and better deal will be negotiated and developed. There are many owners in Somersett with professional backgrounds who could assist in these tough negotiations.  If they had been invited to form a strategy and assist in the negotiation process, we might have arrived at a more favorable proposal.  If the current proposed agreement passes, Somersett owners will be burdened with a very large debt in exchange for receiving nothing.

Charnelle Wright, Somersett owner and resident

15 thoughts on “SGCC Purchase Agreement – An Opposing View

  1. I am wondering if there isn’t a benefit to our overall property values even though individually my husband and I do not play golf or use the facility other than to occasionally enjoy the small restaurant. JoAnn Baird, Owner, Resident Del Webb

    1. I agree with Mr. Wright, why should 2100 residents pay for a country club for 200 residents . We should not subsidies their life style. If they want a country club let them pay for it. There are more improvements that can be made to Somersett that will benifit the majority of the residents.

    2. Frivolous, detrimental and unnecessary. Those are just words with no facts. Lets talk facts:

      Do we as homeowners want to insure that we control the 224 acres in the middle of our community?

      If yes, then lets purchase the land for $2,75M. Based upon the appraisal value of the Northgate property of $2.8M, the price is reasonable plus we get water rights which have a value in excess of $2.0M. LETS FOCUS ON WHAT WE GET AS BUYERS NOT WHAT “THEY” GET AS SELLERS.

      Per Charnelle, the 90 year lease is “the damaging part of the deal”. FACT IS that if we own the land we would have to pay for upkeep, etc. Leasing out the land on basically a triple net lease, allows us to protect our asset and enjoy the view at no annual cost.

      The other “damaging part of the deal” is that homeowners can ONLY play the private golf course 4 times a year. FACT IS that if you are not a member of a private golf course you DO NOT EVER get to play the course without a member’s invitation.

      Per Charnelle, “If the current proposed agreement passes, Somersett owners will be burden with a very large debt in exchange for receiving nothing.” FACT IS: The very large debt will cost each homeowner approximately $8 per month for 15 years or maybe less as more homes are built AND we do get 224 acres of land and 441 acre feet of water rights.

      What people think of Blake Smith, members of private country clubs or even current SOA Board members is not the issue. The issue is whether this deal (based on the facts) is good for Somersett homeowners.

    3. Hi JoAnn

      The value in buying the CGC is in the Water Rights.

      With regard to the property value issue, I reference my post of February 2014, published on the SU site, entitled “Golf Course View Property Values”, which shows that a functioning golf course has a marginal effect on added value to property values.

      D’Andrea often mentioned by various Somersett residents as a “bad thing”, has had its property values recover better than Somersett with a closed GC and open space* which could be developed into additional housing.

      (*desert plants like Northgate (soon to be Sierra View City Park))

      To access the reference post, simply select February from the ARCHIVE box and scroll down to February 17 “Golf Course View Property Values “ and click on the Does Living on a Golf Course Enhance Property Resale Value link contained therein. In this link, I address the property value controversy associated with Golf View homes. I quote facts obtained from the Washoe County Assessor’s office, which provides for some interesting conclusions.

  2. The misinformation that gets published here is amazing. Property values estimated by several real estate people (none of whom are SGCC members) has been estimated at around $40k per lot — something in the range or $100 million. Even if these estimates are off by 4 times, that is still $25 million. The trivial water rights over 50 years have been estimated by outsiders to be close to $25 million or more. The elimination or the reversion rights means the Somersett community has control of the what happens to the property.

    How can this be of benefit to Blake Smith, the development company or Pat Gaskill?

    How else could the SOA secure over 200 acres of green space with no added costs to the home owners and a potential decrease of monthly assessments within two years?

    1. Terry

      Not sure how you, or others, do their calculations on the value of the 220 reacreational acres – currently used as a Golf Course.

      Half acre lots – with infra-structure – are selling for around $140K in Somersett.

      To build on a lot that size you need just over 1AF of water. Interestingly the Developer has 410 AF assigned to the CGC. Which would allow for 410 lots on the CGC! Building lots without infra-structure are available (and have been recently bought) (en masse) for about $5K per acre near Somersett and within our PUD as well. I have heard numbers in the region of $75K + per lot just to put the infra-structrure in (streets, sewers, water, power) for Champion Hills.
      How much water does the CGC actually use? – maybe there are excess water rights that could be sold off (we dont need all that water for housing, do we?). This could reduce the cost to all the homeowners of the “borrowings” needed to allow us to all escape from the embrace of the developer, securing the future of the Somersett as “crafted” in our PUD!

      As you know, I did my own informal appraisal of the value of the Golf Course (it was published on the MySomersett web site) based on the comps available. This just valued the “opportunity” as if we were buying a Golf Course. The Mysomersett web site says that the costs of running the CGC would add ~ $60 per month to all our assessments, if the SGCC should fail. This explains the concerns of many about the financial stability of the private club, and what are they going to do with “our money”.

      I have formally and informally asked the Board to have a professional appraisal done, so that we can have an independent valuation of the deal. The board are happy to spend our money on having a professional valuation done on the “town center” lot available for community purchase
      – surely it is their fiduciary obligation to have one done, prior to requesting a vote from all the unit owners to spend and borrow $2.75 Million.

      The last point I would like to make is that the SGCC should perhaps sweeten the “access” to allow the residents (who wish to) play Golf; in light of everyone making a significant investment to preserve a private club. As an example – the Peppermill offers all residents of Reno – 20% off the food at their restaurants. Promote harmony and help draw the community together – give every resident at least one “free thankyou round” for voting to invest our monies in securing the future successs of our Private club – now inside the PUD.

      One more question does the SGCC have to pay SAD taxes like everyone else?

  3. Good Point JoAnn.

    BTW, Charnelle Wright is one of a handful (small handful) of Somersett residents that wants nothing that might be perceived to be good for the country club to happen, whether it’s good for the community or not.

    The Community and Owners Association was Very Well represented throughout the discussions and negotiations by the board president. He fought hard for a good deal for the community and it is hardly a one sided deal. Besides the water rights the community insures that it maintains control over the centerpiece of Somersett, IF anything bad were to happen and insures that OUR property values are protected.

    And BTW Charnelle, if you want to play unlimited golf at the SGCC you are more than welcome to join the club and pay your monthly dues like everyone else that has the right to play does. If you would like me to connect you with the membership director, I would be pleased to do so.

  4. May I use the new club house the same way I can use the small restaurant up there now? Also, can I rent space there for special occasions? That plus the potential to increase my home’s value would be attractive incentives to me even though I don’t use the golf

    1. Terry Retter Just posted that there will not be a new club house (and restaurant) – the monies will go into the reserves until financial stability is achieved.

      The small restaurant – the Sunsett Grille has been nicely appointed and upgraded using monies from our $15 a month (a total nearly $1.3 million over the last 3 years). I have heard that the new chef is excellent! I am sure that you will be able to rent and use for special occasions.

      The greens and fairways will be well maintained and green! Enjoy!

    2. JoAnn

      Per the proposed Purchase Agreement, Somersett homeowners will have access to the clubhouse dining room (either current or future building) paying same rates as Country Club members. However, Country Club Members may maintain a “members only” lounge exclusively for their use. The agreement is silent on homeowner renting space for special occasions. Not sure why you would want to given availability of TCTC and Aspen Lodge for such.

  5. You can like or dislike this plan but please do it based on the actual facts and not assumptions, opinions, lies or rumors. The documents are on the SOA website for everyone to read. The plan calls for shared use of all facilities, not “exclusive” use by SGCC members. The current amount paid to SGCC is $12 per household, not $15. Zillow is not an accurate database to figure home values but remember that the value of a home is based not only if you are located on the course but also if you are in an overall golf community. Most realtors offer free comps to help homeowners. The SOA has held, and will continue to hold, information sessions to address questions and concerns. Instead of posting questions on this website, or others, why not attend a meeting and get the answer directly? There is so much false information floating around that unless you read the documents and attend a meeting it will be difficult to base an opinion on the truth. The most important thing is to vote. This is our chance as residents to let the SOA know if we agree or disagree with their negotiations. PS – SGCC pays SAD taxes, you can look it up on the Washoe County Assessors website.

    1. Loves!

      Basing your decision on “actual” facts is an admirable goal if not a difficult one, given that knowledgeable people may interpret the facts differently. It is true that we are currently paying $12/mo and not $15/mo under the current agreement. However this is because, although the Country Club took our money, they did not build the resident Putting Course required by the current agreement. In this regard the SOA and SGCC reached an accommodation to reduce the rate to $12/mo,while a new agreement was proposed and voted on.

      BTW, your suggestion to attend a meeting is a little late. To my knowledge the BOD has not scheduled any additional meetings subsequent to the August 20th & 26th ones.

    2. When is the next information session ?

      Not apparent on the MySomersett site

      Perhaps the Board should answer the questions posed here on their web site

      1. I note that LovesSomersett says that the SGCC is only receiving $12 a month. Why havent we been given a reduction of $3 a month? Most believe that we are paying $15 a month – where is the $3 a month which we were paying to the SGCC going now.

        I also understand that the $12 a month paid to the SGCC from June 30th will be credited towards the $2.75 million purchase price – If we vote yes.
        So, if we close on December 31st, we will need to borrow only $2.55 million.

  6. And fellow Sommersett residents, this conflict/bad planning is exactly why I am moving back to Californian where the “laws” in HOAs are clearer and controls defining areas pertaining to land, water, etc. are Not voted upon due to the hydrology, geology and physical nature of the area invollved.!Dammit, you are living in a high desert!

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