POA board reviews sale contract

Bailey suggests joint meeting to discuss home maintenance concerns

Wednesday, July 17, 2013

At their regular work session on Thursday, July 11, the board of directors of the Bella Vista Property Owners Association had a first look at a contract General Manager Tommy Bailey wants to offer to the city to finalize the purchase of three buildings.

The membership authorized the sale of the buildings in May. All three contain emergency services that are now run by the city.

The Town Center building houses both the police department and fire station number one. The POA’s Membership Services Department is also in that building. The other two building are fire stations, one on the east side of the city near Metfield Park and one on the west side, near Branchwood Recreation Center.

The price of the buildings, $1.8 million, was set when the city made an offer in December 2012. After POA members voted to authorize the board to sell the buildings, the city asked to pay the agreed upon price in three installments, so Bailey had the contract drawn up that way.

According to the contract, the first installment would be due when the contract was signed, the second would be due on July 1, 2014 and the final payment would be due on January15, 2015.

The building would remain the property of the POA until all three payments are made and the city would continue to pay rent, while the POA would continue to pay for insurance and to provide maintenance. There would be no interest charged.

One advantage of the contract, POA attorney Chastity Fittro pointed out, is that it gives the POA 18 months to relocate its Membership Services Department.

“This should have been discussed before the vote,” board member Linda Leffler said about the payment plan, but Bailey told her there was no reason to discuss the method of payment before the membership agreed to sell the buildings.

Members, she said, may want to see interest charged on the second two payments since the sale price was already well below market value.

Dave Barfield said he would rather see the city pay in one lump sum, but if the transition is drawn out, rent on the buildings should be increased to cover the costs of liability insurance.

Fittro warned him that if the city pays the full price of the buildings, they would be within their rights to charge rent for the space used by membership services. The fair market value for that space might be more than the cost of insurance, she said.

Mike Erixon said the board should consider public relations when they negotiate with the city. With an assessment increase election coming up, it might be worthwhile to safeguard the relationship between the POA and the city.

Neither Bailey nor Fittro is sure if the city will owe assessments to the POA after the sale. Currently, the buildings are common property and not subject to an assessment. It may be up to the developer, Cooper Inc., to change the designation of the buildings to private property. Other businesses in the city are private property and pay assessments, Bailey confirmed.

The board agreed to continue to consider the contract and email suggestions to Bailey. It will probably be on the agenda of the next board meeting on July 18. The meeting will begin at 6:30 p.m. in the Country Club Board Room.

Bailey has also been communicating with the city on the issue of homes in need of maintenance around the Village. He said he receives several complaints a week about unattractive homes and lots.

The Declaration and Covenants that created Bella Vista gave the power to enforce the covenants to the Architectural Control Committee, Bailey explained. The ACC is not part of the POA, it is appointed by the developer, Cooper Inc.

The only method the ACC has to enforce the rules is to take the property owner to court. In recent years, the court cases have become expensive and seldom have the desired effect, Bailey said.

The POA has the option of suspending membership privileges if a member doesn’t keep their property maintained, but that’s not effective either, he said. He believes the city would be the logical choice to enforce the covenants, but first the covenants would have to become ordinances.

He suggested a joint meeting of the POA board and the City Council to discuss the issue. The board authorized him to set it up.

News, Pages 1 on 07/17/2013