DSROA Board of Directors

Minutes

Date of Meeting:     November 26, 2005

Location:                Zions Bank building, Kanab, UT

Board members present:  Candice Bosze, Larry Clarkson, Shawna Cox, Val Cram, Larry Walters

Board members not present: Dale Clarkson, Phil Hall

Others present:       Larry Baer, Taylor Button, Nathan Button, Fred Searle, May Woolsey, Bob Woolsey, Byron Schimpp, Vance Green, Kathy Green, Brent Fullmer, Lary Sims, Joe Bosze, Barbara Button

Meeting was called to order at 9:04 AM by President Bosze

Minutes of the meeting held on October 15, 2005 were reviewed. Larry Clarkson moved they be approved. Shawna Cox provided a 2^nd. The motion was unanimously approved.

Minutes of all meetings will be posted on the website as they become available, with the note that they are subject to approval by the Board.

Finance report was presented by Shawna Cox. The checking account balance was reported to be $29,684.73, and the capital improvement account balance is about $9,224. The $15,000 transfer from the capital improvement account to the operating account as approved in the previous Board meeting is reflected in these account balances.

Treasurer Cox also provided a summary report of the total and net cost of the new water system, a copy of which is attached as exhibit A. She reported that the total amount spent on the system was $39,176.13 over two years, including maintenance and repair costs of $1,031.66. Of this amount, $16,000 was recovered from members in donations ($1,000) and contributions in exchange for direct connections to the new pipeline. Three members (Rodney Johnson, Alan Ehlert, Allan Bartell) provided $5,000 each for these connections. An additional $15,000 was taken from the capital improvement fund. The balance of $8,176.13 came out of the operating fund, mostly in 2004.

Barbara Button presented the manager’s report.

• Gasoline usage is down significantly in the past couple of months due to changes in operating procedures.
• Significant savings have also been realized in doing the laundry because Barbara has been doing it rather than having it done by a laundry. This change results in both a savings in direct costs and in the number of sheets, towels, etc. that are needed since the turn around is so much faster.
• Cabin usage has been quite heavy this fall, with occupancy rates of 70% to 100% on weekends.
• Road grading is underway, with all roads completed except for an area in lower Slide Canyon. The grader had a flat tire which delayed completion somewhat, but there should be no problem completing the grading very soon.
• The Red Reservoir has been repaired and the head gate there has been excavated and is now in use. The head gate was buried under about 12 feet of silt. Further silt removal in the reservoir is needed, and if not done soon the head gate could be buried again by next spring.
• The need for maintenance work on some of the culverts and cattle guards was discussed, and it was noted that if this work is not done this year, the ranch could see significant road erosion by late spring. It was also suggested that dirt used to support the old water tanks by the county road could be moved and used to cover the trash that has been dumped in the ravine below the ranch headquarters.
• There is no further update from Donna Owens of the US Forest Service regarding our request for an easement in Pipeline Canyon.
• Cabins 7 and 8 will be available all winter. Other cabins will be closed and winterized until spring.

After some discussion of equipment options, timing and costs, Larry Walters moved that the Board authorize the expenditure of $2,000 for silt removal and repairs at the Red Reservoir this year. Val Cram seconded the motion, which was unanimously approved.

Larry Walters moved that the Board authorize the expenditure of up to $1,500 to repair and clean culverts and cattle guards and move dirt to cover previously dumped trash. Motion seconded by Larry Clarkson. Val Cram said he thought it would be more effective to seed the area where the trash had been dumped rather than pay to have dirt hauled there. The motion passed with three votes in favor, one opposed and one abstention.

The Board began the discussion of the budget for 2006 with a presentation by Treasurer Shawna Cox (see attached exhibit B). The proposed approach would require that all operating expenses fit within the revenue generated by the annual member assessments, which were estimated to be $106,650 (net of uncollectible amounts). Other income (approximately $13,500) would be channeled to the capital improvement budget.

A second approach was offered by Larry Walters (see exhibit C). This approach looks at typical revenue and expenditure levels for the 2002-2005 period and attempts to identify a budget based on these typical levels. Under this approach, extraordinary or one-time income would be used to fund capital improvements.

The Board focused their discussion on likely revenues for 2006. While no formal vote was taken, several points were agreed to during the discussion, which will be continued at the Dec 10 meeting when the final budget will be approved.

• If it appears that DSROA will owe a significant amount of income tax for the year as a result of the sale of the lot and other extraordinary income, the Board will consider an early payment on our loan as a way to reduce our tax liability and our debt.

• The operating budget for 2006 will be based on the following income assumptions
• Assessment paid: $110,000
• Building and facilities rental income: $1,500
• Reservation fees: $3,000
• Store sales: $1,500
• Tractor work income: $1,800
• Horse rides: $2,000
• Livestock and grazing income: $5,000
• Miscellaneous income: $500
• Total operating income: $125,300
• The capital improvement budget for 2006 will be based on the following income estimates:
• Cabin maintenance donations: $800
• Interest income: $250
• Road donations: $200
• Wildlife income: $3,000
• Proceeds from any raffles or other one-time revenues
• Byron Schimpp indicated a willingness to pay more for cabin use.

Fred Searle’s request to transfer 1.35 acre feet of water to his new well was received and discussed. Since the productivity of the well is still uncertain, Mr. Searle requested that the request be tabled for the time being.

Board and committee assignments were discussed very briefly, but it was agreed to continue this discussion after the budget is finalized.

The next meeting will be held in the Skywest Airline building, 444 South River Road, St. George, UT on December 10, 2005 at 10:00 AM.

The meeting adjourned at 1:00 PM