SUGGESTIONS AND COMMENTS (Questions and Answers are found elsewhere on Web)
[Includes verbal and written comments through 2/25/08 -- this is not verbatim.]


1. Appreciate having the Judge's arbitration decision put on the Web Site.
2. Different people are running the Tribe now that ran it years ago; it was previously run by the Wilbur family. The Edwards family is running the Tribe now. Years ago, for the most part the Tribe was running in the red, now it is running in the black and there's no sense of urgency to get an agreement with Shelter Bay. The Tribe now hires good lawyers and is much more sophisticated than it was in 1993. Shelter Bay has not been the Tribe's priority. They have more cause and more time.
3. Appreciate having the town meetings and appreciate Shelter Bay.
4. The value is equitable and it is important to deal in good faith with the Tribe.
5. It is unfair to charge back rent to members who have not owned their homes the entire time since July 1, 2003.
6. It is not fair to compare the lease payment to what we would pay in county taxes as you get some services with county taxes that we pay with added assessments to the Community.
7. Shelter Bay should continue to appeal the rent and there should be a vote on whether to appeal.
8. The value is fair, it is not outrageous.
9. Keep Shelter Bay intact.
10. We have paid so little in the past; knew the day of reckoning would come.
11. Don't think it would be fair to charge an equal amount for the excess rent.
12. Fee Simple lot owners (Division 1) need to be treated differently. It is not correct that Fee Simple lot owners have not been paying for their amenities just like everyone else. It would not be fair for Fee Simple to pay a portion for the common areas based on the flat rate per lot.
13. Thanks to the Boards, past and present.
14. Skagit County assessed values should be use to distribute the excess rent.
15. Keep good relations with the Tribe.
16. Important to keep good faith with arbitration as this is a good way to go.
17. Grateful to the Tribe that they are willing to work with us.
18. Important that we look at an alternative to arbitration for the future.
19. Not fair to charge new members for back rent.
20. Sympathize with newcomers; it would not be fair, however, for the rest of the members to make up the difference because others have sold their homes.
21. Should have Community vote for people to accept arbitration and whether to appeal the Judge's decision.
22. Consider a Land Trust to purchase leasehold interests.
23. Board should appeal to the B.I.A. Pay now, but try to get B.I.A. to change the final value.
24. Still having trouble grasping why Fee Simple owners will have to pay anything. Fee Simple should be exempt from any assessment related to this.
25. Only 14 of 44 members joined the Fee Simple lawsuit, and 30 members did not pursue the lawsuit.
26. We should pay whatever we need to pay to continue to function as a Community.
27. A lot of us have had a pretty good ride.
28. Comments made about Fee Simple by prior commenter (#24) are correct.
29. Recently looked for property all over the West Coast; $19.4 million is an incredible value for what we have in Shelter Bay.
30. Would be nice to get out of limbo with the Tribe and move on with a solution.
31. Concern that if we appeal to the B.I.A. is made it will come back as a much higher value.
32. Thank you to the Board for coming up with some valuable information and some possible numbers.
33. Check with legal counsel to find out all of the ramifications of default.
34. Prorate assessment according to tenure.
35. The negotiation offers and counter offers have been declassified by Board action and will be available in the Office and posted on the Web Site.
36. Comparing the fee title CPI to the Seattle CPI is awkward. Comparing property tax to lease fees has different implications. Doesn't like dealing with Tribe for separate leases on every lot.
37. Tribe thinks they got a good deal; $19.4 million value is fair.
38. The increase per year is a fair amount.
39. The 56% for future rent and back rent should be used Option #2 -- pay per Skagit Co. assessed value.
40. Pay by assessed value.
41. Need to vote on 1) Default, 2) Sell Marina, and 3) Assess new lease fees based on Skagit Co. Appraisal.
42. As a non-boating family, we disagree with the concept that the marina is the centerpiece of the community and that it adds considerable value to all lots. Even if the Tribe runs the marina, it still remains as a drawing card to boaters. Non-boaters must not subsidize boaters (i.e. Marina).
43. Since the Tribe has not, and may not ever, grant an extension to the master lease, our "good faith" adherence to the decision under arbitration could still, eventually, lead to the Tribe owning all properties in Shelter Bay. It happened with Bishop Estate leases in Hawaii, and most owners were displaced. If they hold all the cards, default now instead of later.
44. From a member who holds a Bishop Estate Ag Lease in Hawaii, and has for 16 years, there has been only cooperation between Bishop Estate and its lessees who have an agriculture interest on the Big Island. There has been no move to displace the farmers who are giving back to the Bishop Trust a return from their annual crop production. Bishop Estate has been attempting to get its lessees to live up to the terms of their Ag leases. Our circumstances here are very different. If the goal of the Tribe is to have an income stream into the future, not one that is declining as property values decline, then it should from a good business point of view desire to have the leases extended. Money would be the issue.
45. For those who think it would be less expensive to live in Shelter Bay than the county they should look again. It would cost me $2,000 less per year to live in the county considering present year county taxes, and present Shelter Bay assessment, plus leasehold rent, plus county taxes.
46. It is not fair that all sublessees pay the same amount of assessment for back and future rents. Tiny lots and log cabins in the woods do not enjoy the same amenities as view and waterfront lots with private docks.
47. Board hostile toward the Community. Would not allow people to get up more than once - even though some folks asked several questions. This is important to all not just the Board. Shame on you.
48. I think the assessed value method is fair. I do not think that Shelter Bay Company should default.
49. I think we should begin payments on rent due July 1, 2008 on time. I think we should begin payments of back rent as soon as possible. Once this is done, I think we should make a strong press for an extension of the master lease. Stability is important.
50. We need an accurate assessed lot value. It is only fair and the only way to determine what each owner owes for both: 1) yearly lease fee, and 2) retroactive back rent and interest. There is no fair way that all of us should be paying equally. Those who have bought marina view lots, bay lots, etc. should pay their assessed lot value in lease and back rent.
51. Since the marina is singularly our greatest asset, increase that percentage accordingly.
52. Property taxes: standard used all over the U.S. Assessed lease rate according to land value. This is the standard -- not an issue based on a vote. A vote would mean that those with high value will vote for the equal share basis. The Board needs to make the cost on value because we all know that is the standard.
53. We have been residents of SB for just one year. Our major concern is that you are not prorating the retroactive new rent that is due. It was explained that we are receiving benefits for this period, but these benefits were considered as part of the value of the purchase price of our home. Expecting us to pay back rent on the property before our ownership is just asking for legal response.
54. Nothing seemed to be mentioned regarding the legal expenses incurred to arrive at the negotiated assessment concerning adjustment to the SB Master Lease and the extension thereof.
55. Slide 14 talks about 'Good Faith'; wondering if the Tribe has been dealing in 'Good Faith' refusing to agree to extend the master leases.
56. Slide 15 talks about reducing the property values and especially, re-sale potential. Without the master lease it will be virtually impossible to sell. Most people buy a home expecting it to go up in value. They expect that when they sell the home the growth of their investment will help them move up the ladder in the housing market, or, if they are ready to retire or are already retired, the extra money will help make their later years more comfortable. There are many folks who worked hard and bought in SB with hopes of raising their families or retiring in this community. These folks will "loose their shirts" without a lease extension and the Tribe knows it.
57. Slide 7, "Master Lease, periodic rent adjustments". Item 3, as shown, is, in my opinion, an abomination of "legalese". It should either read, "the rent is based on agreed value of unimproved land" ($7.6 million), or "rent is based on agreed upon value as improved by the owner "($26 million). But, the owners (Tribe) didn't make the improvements. An analogy of the current statement might be, a producer of raw iron ore expects payment for the value of the raw ore AND for the value of Rolls Royce automobile it ultimately became. Have their cake and eat it too. So, what can we do to protect ourselves and our investment against this sad and worsening situation? The answer seems to be ..."Nothing!" For all our sakes, I hope I am wrong.
58. Payment options of: one time payment or paying over time should be made available to members having to pay back rent.
59. Rather than ask the Tribe for terms, suggest we consider a loan from a financial institution so that we can make a one-time payment to the Tribe. We should, with current low interest rates on loans, be able to get a better deal than the Tribe would want to give us. The savings could be considerable.
60. Much emphasis was made on how the community should retain control of the marina during the presentation. The marina is the major asset of the community, and it substantially increases the desirability and value of SB properties. It is also the only producer of regular revenue for the community. The value of the marina was shown to be 10% based on the acreage it covers (Slide 21). If it decided that payment option #2 on Slide 21 is chosen, then the percentage of payment by the Marina should be in line with its value, not just its size, as would be the case in Option #1. As a revenue generator and highly desirable facility, it could and should be used to its greatest potential, providing for its own costs as well as providing income for the rest of the community.
61. Please disclose the total arbitration costs.
62. Please insure the Tribe understands the significance of not extending the lease, i.e. 30 year mortgages, and the ramifications to resale value
63. Question that the marina is a high priority and of high value. When Osberg owned the marina, it seemed to work just fine and the "draw" of being a marina development was not diminished. Thus the ownership of the marina does not affect the marina appeal of Shelter Bay. The marina is only one of the appeals of Shelter Bay. The inference that it is the primary appeal of the community is just not correct. As a non-boat person, the marina had no bearing on our purchase of our home in 1985. In my informal chats with neighbors, the non-boat owners seem to outnumber the boat owners by a significant majority and they share my opinion. Our purchase of the marina has no apparent enhancement to the community. The mandatory assessment of $1,800 per lot owner amounted to a subsidy of the boat owners by the non-boat owners. Had the non-boat owners been given a choice of not purchasing the marina and saving the $1,800, it was clear that the majority would have opted out. This subsidy continues indirectly by the ongoing cost of owning the marina. While this issue is being addressed to some degree by the contribution of the Shelter Bay reserves to cover the 2008 rent and by the 10% contribution for the future lease fees, it does not contribute to the payment of past due lease fees. Those fees will be assessed boat owners and non-boat owners alike. We need to find a way to separate the marina from the rest of the community. The marina must be self sufficient and supported only by boat owners. Non-boat owners must be reimbursed for the $1800 that they were involuntarily assessed for which they have gained no benefit. If we wish to retain ownership of the marina, then it should be run like a country club. There would be initiation fees and monthly dues. The initiation fee would cover the reimbursement of the pro rata past due lease fees and the reimbursement of the non-boat owners $1,800 contribution to the marina purchase. Monthly dues would pay for expenses not covered by current docking fees. Just as with a country club, the membership in the marina could be sold when a member leaves the community. The other choice would be to sell the marina and use the proceeds to pay past due lease fees. As stated before, the ownership of the marina seems to have little value to the community as a whole. I believe this proposal should be brought before the whole community. Certainly the sale of the marina could very possibly cover all the costs of our past due lease fees, which will amount to about $7,000 per lot.
64. It is wrong to assess fee simple owners.
65. When it comes to a vote, we should have the option of deciding on whether to pay equally or by assessed value.
66. I think default is out of the question. Planning for 2013 should take place tomorrow. Lots of communications is needed. Lots of town meetings. Also, the rates should be raised in the marina and in the storage lot.
67. Agrees that Shelter Bay is a very good deal even with the higher rent payment.
68. Can't agree as a newcomer that she should have to pay back rent. Expressed concern about the payment methodologies. Would encourage other methods to be explored. Agrees to pay her fair share but wants a definition of her fair share.
69. Current lease payment is absurdly low. Don't spend money for lawyers to sue, just pay.
70. Concerned about ability to pay.
71. After reading the declassified information from the web site about the negotiations, some information doesn't match what was said yesterday. This was clarified and certain documents were put into context.
72. Default is not of interest. Fairness, equally, doesn't ring as well as equitably. The tax comparison was a bad analogy, compares apples and oranges.
73. Worst case scenario looked at -- what was her personal impact. After adding the $1,500 for lease rent, her mortgage and homeowners insurance and utilities, it is still less than $1,300/month for a 2,800 sq. ft. house with a water and mountain view. Where else could anyone live like this!
74. The new lease fee allocation should be based on the sliding scale based on the current lease fee.
75. Obvious Shelter Bay is in trouble. We need to look at the Company budget for cutbacks. May need to take the reserves to pay this rent.
76. Board is starting the Community budget work session this month and needs to adopt a budget for next year on March19th. Sessions are open to members to come and participate.
77. Recently purchased -- struggled with perceived secrecy. We did our homework, sellers agreed to pick up the liability.
78. Marina is centerpiece of the Community, and also an asset. Make marina pay more, raise slip moorage; would prefer back rent come out of marina revenues.
79. Marina not up to standards of other commercial marinas. Encourage everyone to work together to solve this problem; stay away from litigation.
80. Was involved with due diligence prior to purchase of Shelter Bay Company. Marina rates were raised and reserves were accumulated initially for deferred maintenance, dredging, and improvements. Community should not be asked to assume or pay for these maintenance needs.
81. The amount of lease fees is about what you would pay on your land if you paid the county taxes on the land. Just take your assessed value x 9.04 mills to get your answer.
82. Thank you very much for holding the Town Meetings on the lease issues this weekend. I was able to attend the Sunday afternoon meeting and it really helped clarify things in my mind and put to rest a lot of the concerns I had. I can certainly understand a lot better now why we didn't accept the earlier offer from the tribe. To agree to anything that would give away our marina would have been a terrible mistake so I'm very glad we didn't do that. I still do have one major concern left, though, and after the meeting, I thought long and hard about it. I don't think it should be an option to have everyone paying the same amount of back rent and/or annual lease fees. I live on a small lot with no view so I'm one of those whose current lease is $183.00 a year. To me that has been a real steal and I have no qualms about paying my fair share of the new lease amount, but I don't feel that I should pay the same amount as someone who has a waterfront lot with their own dock (or something in between that). I will still have to pay for a slip in the marina to keep my boat in the water. I've come up with two analogies that I feel are appropriate to explain why I don't think a flat lease rate is fair:

An apartment building would not be able to rent their studio apartments (small lot, no view) for the same rate as they can charge for the penthouse apartment (water front property with a dock, or on a hill with an amazing view). I would never pay the same lease fee for a $12,000 SmartCar as I would pay to lease a $100,000 Lexus.

I'm very concerned that those residents who have the more expensive (and more valuable) lots may vote for the flat rate. I was told (privately by a friend who has a magnificent view) that it would be naive to think otherwise. That comment is what really got me concerned about the outcome of putting that option up for a vote. The only two fair options for how we are accessed for the new rates are either use a multiple of our current rates or use the county tax assessment values to determine our new rates.

Therefore, I don't feel that unfair resolution should even be put up to the residents for a vote. I have no problem paying a flat rental fee for the common areas as we all have the option to use them equally, but I think it should be absolutely mandatory that the amount of the rental fees we pay continues to be based on the value of the property our houses sit on.
83. Lengthy statement from Anita Lang will be attached to the Town Meeting notes.
84. I want to present a scenario that should be presented to the Tribe when the lease extension or lack thereof is being discussed. It appears many of these residents are older and on set incomes and were not expecting the assessment amount, that appears to be fair, and will come to pass. Their situation will result in an attempt to sell their house to get out of a financial situation which they cannot afford. We understand that at least two homes did not sell because of the negotiation situation and lack of lease extension. With this situation, the homeowner does not have the money, yet cannot sell to get out from under, and the money is therefore not available to the Tribe from them. A lien can be placed against their home, but unless an extension on the lease is granted, that lien can only sit there as the house will not sell. We will end up with a stalemate with unpaid assessments and homeowners unable to sell. This starts a chain of events that I would think the Tribe, as well as the homeowners here, would wish to avoid. This results in a devaluation of homes, which can be avoided not only by the payment settlement which Shelter Bay is trying to do, but by the Tribe agreeing to an extension of the lease to avoid this situation. It takes both parties to participate in a "good faith" settlement. This should be brought to the Tribe's attention as quickly as possible before more homes are in this situation of not being able to be sold.
85. Two suggestions in response to Future Rent Payment Option (Box 21).
#1. Re: marina payment of 10%. When residents bought the master lease, we were silently told that we could expect lower payments in the future as a result of marina income. Suggestion: 2044 minus 2008 = 36 years. $1,800 (amount paid per resident for master lease)/36 years = $50 per year per lot. $50 per lot (914) per year = $45,700. The Marina is then responsible for the first $45,700 of common property plus 10% of the balance for about $177,930 annually.
#2. Re: sublessee's payment of 56%. This should be based on the historical payment structure currently used for sublease payments. It looks like about $734,900 annually for the 870 leased property owners.
86. Put the financial information on the Web rather than taking valuable employee time and office resources for individual copies.
87. Slide #23 does not show the $450,000 of lease fees already paid.
88. Dick Sabin -- lengthy correspondence will be made a part of the Town Meeting Notes