Posted by Steve Guderian – Association Member & Candidate for the SOA Board:
“To the SU readers, for me personally a number of things have come out of the election process, one of which is that I do not know as much as I should about the Golf Course. I checked the SU docs section and found some things but I would like to go beyond that.
- Here is my understanding; SOA owns the land the Golf Course is on and Somersett Country Club owns the Country Club building.
- SOA also owns the water rights that go with the Golf Course… Where does the water come from, wells or purchased?
- SOA owns the land but the CC runs the golf course, what happens if the CC goes bankrupt?
- If the CC goes bankrupt what happens with the brand new building?
- Who runs the CC??
- I understand there is a BOD, who is on this board and how did they get there?
- Was is the communications protocol between the CC and SOA, who handles all of this?
- Any other info that anybody else can think of that would be helpful, please tell me.
- The SOA purchased the Somersett Country Club (SCC) land (approximately 220 acres) and water rights (approximately 1000 acre feet) in late 2014 for $2.75M. Purchase excludes approximately 6 acres of land on which the SCC Club House was subsequently built.
- Water rights are derived primarily from the Truckee River and wells.
- In conjunction with the Purchase Agreement, the SOA executed a lease-back agreement with the SCC. Lease-back rent is $1000/year escalation adjusted plus $1200/year unescalated. Term is for 50 years with two 20 year renewals at the discretion of the SCC. If the SCC declares bankruptcy or defaults on the lease agreement in any other way, the SOA may terminate the lease and assume full control and use of the premises.
- The SOA has no property rights to the SCC Clubhouse or the ground on which it stands. This remains exclusively the property of the SCC regardless of any default on the part of the SCC.
- It is believed that the SCC is run and operated by a its own equity members through a Board of Directors.. That is, not via a contracted for Management Company.
- Current SCC President is Glen Armstrong, Do not know the entire make-up of the SCC’s Board and how they are elected and/or appointed. Assume it is via vote of the equity members. Perhaps a SCC reader can provide this information.
- Communication protocol between the SOA and the SCC is handled by their respective Boards, or their respective lawyers over default or other legal issues.
Any comments, corrections or clarifications on the preceding response to Mr. Guderians inquiry are welcome.
Note that complete terms of the SCC purchase and lease agreement may be accessed via the References Tab and clicking on the “Country Club Purchase Agreement” link.