FII BOARD MINUTES
OCTOBER 21, 2000

A.        CALL TO ORDER:

The meeting was called to order by President Thomas at 11:30 A.M.

B.            ATTENDANCE:

Present were Steve Comley, Dave Decker, Bill Gately, Dick Giggey, Fritz Mueller, Oleg Svetlichny, Mark Thomas and General Manager Rich Roedner.  Diane Babineau and Carl Hommel teleconferenced.  Fritz Mueller was absent.

C.            APPROVAL OF MINUTES:

The Minutes of FII Board Meeting of 9/30/00 were not available.  They will be approved during our next meeting.

D.            FINANCIAL REPORT YTD:

The current financials to date indicate that the corporation is operating well.  Unfortunately, they show a $116,875.57 operating income before tax, including $91,000 in land sales. 

E.            REPORT ON Fll RESERVE ACCOUNTS

The specific total for each reserve account was not available.

Last week Rich Roedner and Mark Thomas met with a tax consultant, Elizabeth Shaw (Sandy), to review actions FII could take to limit our tax liability.  One of her suggestions was to establish Appropriated Retained Earnings account for our reserves.  She indicated this would designate specific purposes for the reserves which would protect them from additional taxation.

Diane Babineau indicated that she thought there were disadvantages to us designating a purpose for the reserves and we would not recognize any tax benefit. 

The Board decided to table this issue until the January meeting in order for us to clarify the particulars.

F.            REPORTS

1.         Real Estate The sales of Lots 229, 294, 1223, 137 and 91 were discussed.

229 - Tabled until next year. Committee couldn't find a lot numbered 229. We think this lot is on corner of Leisure and Birch  Roads and lake. Question of privacy rights was raised as bidder isn't an abutting home owner. Bid price was not taken seriously by any of the committee members who responded to the bid.

294 - Ongoing negotiations with town manager and Mr. Palli concerning the trade of this lot for a building to be built on a lot on Route 121 in Raymond.  Lot 294 probably will need zoning hearing because of size of lot in relation to shorefront, side and road setback requirements.   The Board is interested in pursuing this matter.  The manager will continue negotiations with Mr. Palli. Specifically, the Manager will provide Mr. Palli with a letter indicating FII's intention to pursue this option, making it clear that Mr. Palli will have to secure all building and use permits, and build the building to our size specifications. The Manager was instructed to obtain building layout plans for Mr. Palli's use.

1223 - Tabled until next year. The majority of the committee members felt that bid was too low. Also, question of road frontage (approx 35ft)  being sufficient. Town manager is to research the grandfather rights to road frontage (the initial interpretation is that the 35 frontage is not a problem.)  Finally, abutting home owner has contacted chairman of the committee to express his objection to the bid based on road frontage and narrowness of road. The Board reviewed Mr. Doloff's letter of objection, with concerns about lot frontage, narrowness of the road, and the lack of garbage collection this past summer.

137 - Tabled until next year. Question still exists about possible waste treatment (leach field or pipes) being on the lot. The committee recommended, and the board agreed, that town manager should attempt to determine the status of the septic systems. Bidder was present and agreed to wait until next spring.

91 Ongoing.  Bid previously accepted by Board subject to perc test.  Lot 91 failed perc tes.  As previously agreed, a test will be done on corner lot for possible pumpback lot. If this lot fails too, test will be done on FII property in back of Hadley's lot across the street from 91. These tests will be done on thursday 10/26.  The bidder is aware of the tests.

The Chairman of the committee asked the FII board members to present  their thinking on future Real estate sales. The majority of the members present implied that the committee should continue with its philosophy of considering the buying back of private lots either for retirement or for use as lot "right" for FII to sell a FII lot. Also, the committee should continue researching the idea of donating certain lots to the town for specific purposes ie. recreation, conservation, etc.

The Board voted to provide the Manager and President the authority to spend up to $15,000 to acquire lots from private owners for the purpose of gaining septic systems.  The authorization included a provision that not more than $2500 could be paid for any lot.

2.         Golf Committee Work is progressing on the irrigation system.  At a minimum, 1 and 9 will be completed this year.  The only remaining work will be the fairway for 2. Jay has hired one or more additional people to help finish the work.

3.         Marina Committee Membership was discussed (in who is on this committee) and the Board was updated as to the survey plans at Quail Circle. There was also discussion about trailer storage at the Marina, and the need to accommodate larger boats, and possibly an earlier set in date for the docks.

G.        OLD BUSINESS

1.         As discussed above Mark Thomas and Rich Roedner met with a tax consultant to discuss actions that can be taken to reduce our tax liability.

2.         Asset evaluation In a previous meeting individuals were assigned to study the pros and cons of transferring FII assets to the Town, and to present their reports at the Winter FII Meeting on January 20.  The assignments are:

        Ferry w/landings - Dave and Oleg

        Water - Carl

        Roads - Carl

        Golf - Bill and Mark

        Marina - Dave

        Dump - Need FII volunteer and John Crosby

        Buildable and Non-Buildable Lots - Dick and Oleg

        Tennis, Ball Field, Pool, Beaches - Steve and Dick

        Buildings (Community Center, Office, Old Fire Barn, Maintenance Bldg, Jed Shed) - Mark and Dave

Thomas asked that all members forward a preliminary copy of their findings to all members on or before January 4.  This will allow Board members two weeks to consider the information prior to the January meeting.

H.        NEW BUSINESS

1.         Cumberland County Surplus Material This material will be auctioned off.  Rich discussed this with Jay.  FII has no interest in this auction.

2.         Employee Benefits It was voted to immediately provide Jay with health insurance.  A retirement plan will be evaluated next year with potential implementation in 2002.

3.                 Donations for Ball Field Construction The issue of individuals donating resources or money for the construction of the ball field was discussed.  Donations to FII are not tax deductible.  It was decided that any donations for the field should be made to the Town with the understanding that the donation be used for the ball field.

4.                 Discussion regarding donating land According to Sandy Shaw and Diane Babineau, we can only deduct 10% of our taxable income through contributions (land or otherwise).  For tax purposes, it makes no difference if we donate land to the Town or a trust.  It, therefore, seems simpler if we just donate unbuildable land to the Town for green space.  Manager was instructed to finish prepare letter to property owners indicating their ability to donate land to the Town. This letter would be sent to property owners clusters, in the Middle Beach Road area.

5.                 Authorize Manager and President to close on property sales We have only passed papers on a portion of the property we sold this year.  The Board voted to authorize the Manager and President to pass papers this year on the number of lots that will minimize the tax liability of the corporation. Papers will be passed on the remaining lots next year.

6.                 Authorize Manager and President to donate land - The Board voted to authorize the Manager and President (in consultation with the chairman of the real estate sub committee) to donate land to the Town to a level that will maximize the tax benefit to the corporation.  The donated land will not include buildable lots.

7.                 There was also discussion, and a decision, to pay for the window replacement at the Community Center.

I.            OTHER BUSINESS

J.            ADJOURN