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JANUARY 16, 1997 SCHERTZ DEVELOPMENT FOUNDATION BOARD OF DIRECTORS' MEETING MINUTES January 16, 1997 - 8:00 a.m. Denny's Restaurant Item #1 Call to Order: The meeting of the Schertz Development Foundation Board of Directors was called to order at 8:00 a.m. by Chairperson Jackie Jones. Those present: Jackie Jones Lew Borgfeld Kerry Sweatt Ed Harris Don Jeffreys Jennifer Kolbe Mark Marquez Earleen Ehlers - G.V.E.C. Representative - Executive Director - Recording Secretary Item #2 Approval of Minutes: Minutes were amended to correct Fiber Art spelling in Item #3, Paragraph #2. And, Mr. Borgfeld changed wording in the middle of Page #2, Paragraph #4 from "first right of refusal" to "option to purchase". Mr. Sweatt made the motion to approve November 7, 1996, minutes as amended, seconded by Mr. Don Jeffreys; unanimously approved. Item #3 Discussion/Action Review Plans for GVEC Building on Lot #13/Architectural Committee: Ms. Jennifer Kolbe handed out plotted plans covering G.V.E.C.'s plans for landscaping and building specifications. The normal set back for a building is 25 feet as required by ordinances and covenants; G.V.E.C. opted to go back 60 feet. The building will be stone white (off white) with a taupe color (light brown). It will have a canvas awning over a glass front door. Mr. Sweatt asked if the floor would be finished? Ms. Kolbe said that no floor was to be built until purchased and then the buyer can draw up specific floor plans where plumbing, pipes, etc., should be installed. Mr. Sweatt/Mr. Borgfeld asked if there was an overhead door, but no back door for fire purposes. Mr. Marquez said there are doors directly in the back, all within code. Mr. Sweatt asked if the entrance is the front door that faces the street. Ms. Kolbe said yes. Mr. Sweatt added that the last building was not quite as large as this one. Ms. Kolbe went on to discuss the outside looks of the building saying there will be a pattern with the brick in the front for asthetic gurposes. Mr. Sweatt asked if the brick would wrap around to the side, a brick fasad with the rest being metal. Ms. Kolbe said that was correct. She added that power would run to the building with motion detection lights on all four sides. Mr. Harris asked if the power was three phase or single phase. Ms. Kolbe answered single phase. Mr. Sweatt asked if there was gas at the front of the building. Ms. -2- Kolbe said that power to the building will run underground to the rear. Mr. Harris added that water and sewer will run down the green belts to the footing then left for the purchaser of the building to make decisions on floor plans. Ms. Jones asked if anyone had additional questions. Mr. Harris asked if the asphault was correctly marked to be l' 2" thick. Ms. Kolbe was unsure. Mr. Marquez said he felt that there may have been an error and that it should probably read 1 1/2" thick. There were no other questions. Mr. Sweatt said that on behalf of the Architectural Committee he made the motion to approve the plans as submitted by G.V.E.C. Mr. Jeffreys seconded the motion. Motion carried unanimously with Mr. Borgfeld abstaining. Mr. Marquez said that discussion on Lot *13 would be closed after unanimous written consent by the Board. Consent form was sent around for signatures. Item *4 Discussion/Action on Sale of Lot *14, and Lots *7 and *8, Mr. Borgfeld: Mr. Marquez said that he had documentation on Lot *14, but would like an explanation on what the company does, etc. Mr. Borgfe1d explained that Mr. Jon Gray is the owner of Quality Tire in San Antonio. His attorney looked at the restrictions and felt they would not be in violation. Mr. Borgfeld said they do tires for big heavy equipment. They will do the work inside, not outside, working with tires and storing tires, etc. Mr. Borgfe1d said Mr. Gray seems to be a pretty reasonable fellow. He lives in Oak Forest here in Schertz. Mr. Sweatt asked if there would be any recapping. Recapping may cause a zoning issue if they are going to do it. Mr. Borgfeld said he did not believe they would do recapping. Mr. Marquez said that he would opt, doing the Architechtura1 Control Committee review with the fire chief to make sure everything is up to fire code, etc. Mr. Harris said that Lot *14 is backed by houses. Mr. Jeffreys asked if Mr. Gray should be asked about the recapping. Mr. Borgfe1d said they have had their attorneys look at the restrictions and talk to the City. I think in this case he is knowledgeable and knows he must comply. Mr. Harris said we might just say something to him regarding recapping. Mr. Sweatt said that if he is going to recap it would take some rezoning. Mr. Borgfeld reiterated that it is only indoor storage with no outside in talking with Mr. Gray. Mr. Jeffreys said that he did not see any problems if that is the case. Mr. Harris asked if they are required to put more of a privacy fence around the building. Mr. Borgfe1d said he did not know. Ms. Jone said as long as there is no activity outside there should not be a problem. Mr. Marquez added that in the case of Foreign Affair, he was required to put up a privacy fence because he has some outside work. Mr. Sweatt said there has to be a fence between business and residence and there is a fence in this case. Mr. Marquez added that there is also an alleyway between. He said that with inside activity only it should not -3- matter. Mr. Marquez said that tires are ugly if outside. He said he would not have trouble with proceeding but would like to touch base with the Quality Tire people to make sure they look at things the same way we look at them. Mr. Borgfeld said he had two conversations with them but if the Board would like Mark to talk with them to feel more comfortable that he should do so. Mr. Marquez recommended approval of sale as long as they meet all the requirements. He said he would talk with them about outside activities, zoning issues, etc. He said that the motion should be to authorize proceeding with the sale of this property and allow us (Mark Marquez/Jackie Jones) to sign all the necessary documents as well as the earnest money contract. Ms. Jones asked for the motion to sell Lot #14 pending satisfaction of stated requirements. Motion was made by Mr. Ed Harris with above considerations. Seconded by Mr. Borgfeld. Motion carried unanimously. Mr. Marquez said that the lot sold for the standard cost of $.40 per square foot equating to $16018.00. Ms. Jones proceeded to Lots 7 & 8, RCS, Inc. Mr. Borgfeld said that the company still has one question on the last item in the letter regarding deceptive trade practices. When their attorney received the earnest money contract they had several questions. They sent a letter and all were resolved except one (Section 12.20) regarding the deceptive trade practices act. The earnest money contract says you cannot open us up to triple damages. RCS has been closed for the holiday season. We put our attorneys in touch with theirs and according to Les Caldwell, our attorney, he was going to explain what would be acceptable. The day before yesterday RCS said that they had not talked with our attorney. Ms. Jones said we should tell them it stands as is. If they want it fine, if not fine too. Mr. Borgfeld said that is where we are right now. Mr. Sweatt added that the earnest money contract is standard and straight forward, he did not understand the problem. Mr. Borgfeld said that Mr. Caldwell explained it to them and they are to get back to us. Mr. Sweatt said that the wording we have here is the wording Mr. Caldwell gave them. Ms. Jones added that we need to wait and see. Mr. Jeffreys asked what RCS stands for. Mr. Marquez answered that he whas not sure of the R, but CS is Compressor Systems, Inc. He added that he would fax something over to them asking where we are. Mr. Borgfeld said they did not call Mr. Caldwell back but that after conversations with them he felt it is in their court. Ms. Jones asked how much the lots were selling Marquez said that the earnest money contract $21,988.95. Ms. Jones then asked the Board to move next item. for, was on to Mr. for the -4- Item #5 Discussion/Action on Payment of Legal Fees/Mark Marquez Resolution Attached: Mr. Marquez explained resolution 97-2 for attorney fees in the amount of $2225.53 saying that he needed the authorization to pay. Ms. Jones asked for a motion to approve payment fees in the amount of $2225.53. Mr. Sweatt made approve as billed and submitted. Mr. Harris motion which was unanimously approved. for the legal the motion to seconded the Item #6 - Discussion/Action on SAC Building Corporation/Mr. Borgfeld: Upon contacting SAC, Mr. Borgfeld found that they are involved in a law suit that involves the property. They had a hearing on December 10, 1996, but it was not resolved. As soon as they get away from that problem they will build a building on the site. They had another party that wanted to build on the other two lots. Until they are shed of the law suit they cannot build. Mr. Marquez asked Mr. Borgfeld if he had a sense of how long it was going to be before resolved. Mr. Borgfeld said he was not sure, but that they (SAC) did not feel it was going to be very long. He said that the building is planned to be 150 X 60, or about 9000 square feet. Their indication is that they will build as soon as the legal problems are resolved. On the other two lots, Mr. Borgfeld said that he thought they lost their client because they could not build in a timely fashion. They did not know if that would come back or not. Mr. Borgfeld suggested that the Board do some type of formally recorded extension of the time frame. Mr. Marquez asked if that is for the last two lots they purchased and Mr. Borgfeld agreed. Mr. Marquez said since that will take them to April, why not just offer to buy the property back. Ms. Jones asked if the property is tied up in legal problems, can we buy it back. Mr. Borgfeld said he did not think there were any judgments that would not allow the Board to repurchase. It's the last two that they had. Mr. Marquez added that he felt that lots 23 and 24 should be repurchased for what they paid for them, either $.35 or $.40 per square foot. Mr. Jeffreys said that the Board should not give them extra time. Mr. Marquez said that the Board might give them time, but also offer to buy them back. Mr. Borgfeld said that they expire in April so that the Board needs to go ahead and offer to repurchase so that it is timely. Mr. Jeffreys asked what if they want to build? Mr. Marquez said if they lost their client they don't need the lots. Mr. Jeffreys asked if SAC wants the Board to repurchase. Mr. Borgfeld said probably not. Mr. Jeffreys asked if the Board is offering or telling them we want them back. Mr. Harris said there should be a set date we are going to repurchase. Mr. Borgfeld said that one difficulty they expressed is that on a building they are going to build for another client, they are not getting approval on the building plans. Mr. Marquez said that they wanted double doors in the front and he told them they needed a variance from the Board. SAC did not want to deal with that. He said he -5- explained that they just needed to draw up what they wanted and submit it and request variance. They did not seem interested in submitting the plans. Mr. Harris said that if they are having a problem getting an elevation because they don't want the expense, there is a problem. They draw up plans for a living, it doesn't take that long. Mr. Marquez said that he told Mr Dollahan to show the Board what they wanted for a variance. Mr. Borgfeld said that he thought there was a misunderstanding. Ms. Jones said that this Board has been going through this thing for over a year. They have never been forthright with the Commission to tell them what's holding them back. Now out of the blue they have problems. "Why didn't they tell Mr. Marquez at first, instead of the nasty letters and legal fees, etc." Mr. Harris did not feel the Board should let it slip any further with the last two lots that we have leverage on. Mr. Sweatt added that the Board lost their leverage on the other lots. They bought all of the lots before we owned the property. They have some sort of structures down there that could be considered a building. Mr. Harris said that the court would probably wait for others to be settled before we could go ahead with the repurchase. Mr. Marquez asked if he should proceed on the repurchase. When the Board agreed he added a letter would go out as soon as possible. Mr. Borgfeld said he would notify SAC saying that the Board is going to exercise its right to repurchase. Mr. Marquez said he would take care of it. Mr. Sweatt made the motion to authorize the Executive Director to begin proceedings and notify SAC of the Boards intensions to repurchase lots #23 and #24, which was seconded by Mr. Borgfeld; all in favor, motion carried. Ms. Kolbe said that the Board might offer assistance to the company that was going to build. Mr. Borgfeld said he thought that it was basically dropped but might offer if there is still an opportunity there. Item #7 Action to Approve Payment of Legal Fees/Mark Marquez Resolution Attached: Mr. Marquez explained billing statements for taxes due with an overview of Resolutions 97-3 and 97-4. Mr. Borgfeld made a motion to approve Resolutions 97-3 and 97-4 for City and County taxes due. Mr. Harris seconded the motion which carried unanimously. Item #8 Board Member Comments: None. Item #9 Staff Comments: Mark Marquez explained Resolutions 97-1 and 97-2 with invoices due $275.00 and $2225.35 respectively; $275.00 for advertisement in the Austin-San Antonio Corridor Council Directory, and $2225.35 for attorneys fees, Fulbright and Jaworski. Mr. Harris made a motion to approve Resolutions 97-1 and 97-2 as submitted. Second made by Mr. Jeffreys which carried unanimously. -6- Mr. Marquez passed out Cross Talk magazines to the Board members. He told the Board he gave authorization to the Foundation's auditor to proceed to get SOl(C3) status which expired September, 1996. The Board had 120 days from that date to get it done, so he told the auditor to proceed. It was filed and mailed and we should hear within the next sixty days. Item *10 Chairman's Comments: to the Board about nominating nominated Mr. Jeffreys. Mr. Mr. Don Jeffreys will serve as Ms. Jones just wanted to talk a Vice-Chairman. Mr. Sweatt Harris seconded the nomination. the Board's Vice-Chairman. Item *11 Set Next Meeting Date/Annual Meeting: Next set for Thursday, February 13, 1997, at 8:00 a.m. at Restaurant. meeting Denny's Item *12 Adjourn: Meeting was adjourned at 9:27 a.m. Jackie Jones Chairperson ~abJ ~..h-l~ /Earleen Ehle'rs Recording Secretary