HISID offers counter-proposal to Table Rock Landing lawsuit settlement offer
HOLIDAY ISLAND -- A month after receiving a six-point offer from Table Rock Landing Owners Association to settle its lawsuit against Holiday Island, the HISID Board convened a special meeting Thursday and approved counter-offers on five of the six points.
HISID attorney Matt Bishop summarized the lawsuit and started out by pointing out that HISID's Assessment of Benefits classifications of R-1, C-1, etc. are not "zoning," contrary to accusations the district had changed zoning.
"You have never zoned," he said. "These are covenants on the land."
Ken Brown challenged fellow commissioner Greg Davis to recuse from voting on the TRL settlement because county records show Davis owns a TRL time-share, which Davis denied, saying he had turned it back in more than a year ago. Later, during public comment, property owner and former commissioner Peter Putnam said he was "disappointed" that the board member (Davis) who accepted a quit-claimed deed valued at $15,000 as a gift from Holiday Island Development Corporation (owned by developer Tom Dees) refused to recuse himself. (Ed. note -- correction: This paraphrase was misattributed to David Blackford in our Oct. 18 Weekend print edition. Carroll County News apologizes for this error and any embarrassment it may have caused and will run a correction in the next print edition.) Davis did not recuse.
Point #1 of TRL's settlement offer was that TRL units would be assessed at a rate equal to an R-1 improved lot. This was discussed at length, with commissioners attempting to decide what should be the assessment amount on time-share units, which had been 10 times the amount of an R-1 assessment in the past, then were reduced to 2.23 times the 2011 R-1 rate by the 2011 Assessment of Benefits.
Based on calculations by Commissioner Linda Graves, which define how much of the time-share fee goes to assessments and to infrastructure vs. amenities, the board voted unanimously to waive late fees for 2012 and 2013 on advice of Bishop because the assessments are in a legal appeal, and then voted to charge TRL $17,000 per year in assessed benefits per unti from 2012 and going forward.
Point #2 of TRL's offer was that it would dismiss claims for punitive damages, refund of assessments paid prior to 2011 in excess of the R-1 rate, its claim for excess amenity charges to TRL property owners in 2012 and its attorney fees if HISID would pay $100,000. This was soundly rejected by the board, who approved unanimously a counter-offer of $10,000.
Point #3 calls for an agreed declaration that TRL owners are "Holiday Island property owners year-round and for all purposes." Commissioners objected that they know of no other time-share that gives its owners year-round privileges and that the phrase "for all purposes" leaves the door open to giving time-share owners votes. The board voted 4-1, Davis voting nay, to ask TRL to clarify what it means by "for all purposes."
Point #4 asks HISID to accept its assessment payments for 2011 and 2012 (each around $18,000) as payment in full and that the 2013 assessment will be paid at the R-1 rate. The 2012 assessment was addressed in Point #2, and for 2011, TRL owes around $129,000, of which $25,000 is penalties.
In consideration of the large amount of money, Graves suggested a compromise of TRL instead giving HISID 800 available nights of time-share use to market Holiday Island.
"They're not going to give us 800 nights in the time-shares," said Davis. "That's the craziest thing I've ever heard in my life.... If we're not willing to negotiate that down to the rate we're willing to collect for 2012 and 13, then we're wasting our time."
The board approved 4-1, Davis voting nay, to waive the $25,000 penalty on 2011 and then approved 4-1, again Davis voting nay, to ask TRL to come up with alternative means of paying the $104,000 balance.
Point #5 asks that the temporary restraining order against the district, not to tell time-share owners that they are not property owners, be made permanent. Bishop said no motion was needed because the issue was dealt with in Point #3.
Point #6 asks that the pending litigation be dismissed with prejudice, which means it cannot be sued again, except for the issue of voting rights, which can be sued again within a year.
Bishop said the plaintiff always has the right to dismiss without prejudice "whether you like it or not." The board voted 4-1, Davis voting nay, to leave it as is.
Bishop will present these counter-offers to the TRL attorneys.
The board then allowed a lengthy public comment session, during which Dees, who sits on the TRL board, spoke for about 45 minutes, chiding the board for not coming to him to resolve the problems and avoid the lawsuits. He said major problems selling lots were exacerbated by HISID making the golf course public and told the board this lawsuit will probably cost $400,000." He warned the lawsuit could end up at the Supreme Court.
"So we've made our own mess, and we've got to clean it up. And it's going to be extremely difficult to do."
He ended by saying, "I can't save you. I could have five or six years ago."
(Ed. note: To hear the portion of the meeting containing Dees' comments, click here.)