CLUB DONATELLO OWNERS ASSOCIATION
BOARD OF DIRECTORS MEETING
October 24, 2007

I. The meeting was called to order at 8:30 a.m. by President Don Thomas.  Board Members
     present were Lexis Allen, Daryl Clark, Robert Egan, Wayne Jerves, Larry Stephens, Don
     Thomas and Les Yeffa.  Also present were Committee Chairs Nadya Andrews, Mike
     Milnes, Dennis Myers and Acting FMC Chair, Julie Jerves. 

Other Owners present were Hannah Goody, Marcia Silver, Bruce and Jean Dunn, William Curtis, Nancy Yeffa, Ken and Loretta Reaves, Don Beeman, Michael Burwen, Jan Clark, Harry Aho, Earl Corin, LeRoy Gilsdorf and Howard Seto. In addition, Team Management Members were Marie Vergara, Mandy Vergara and Quincy Lozada-Moss.

II. Following roll call, we had the Pledge of Allegiance to our Flag.

III.     The agenda was approved as presented.

IV.     OWNERS FORUM
A. Les Yeffa said that the Guest Services directory needs to be updated with the new TV channel listings. 

This was followed by a discussion regarding the new larger flat-screen TV’s and that the new listing is in all Club rooms with the TV remote unit.
B. Don Beeman commented that we had one of the best and least expensive mini bars of the various places that he has stayed.
C. Jan Clark thanks Marie for setting up the dinner the night before at Zingari’s. We all agreed it was one of the best meals we have had there.  This was followed by the comments that only 28 people had RSVPd and 36 showed up.
D. Don Thomas discussed that we should be looking for the next generation of leadership for the CDOA in our own families.  Many of us have children that are Owners and we should encourage them to become active in the CDOA.  Mike Burwen commented that many of the younger generation may not have time to get involved as they are working and raising families.

V.      BOARD COMMITTEE REPORTS
Before beginning the reports, Don Thomas said that the format of the agenda would be changing due to January 1, 2008 changes in the law.  Each committee is going to have to submit their agenda at least 10 days before the quarterly Board Meeting so that it can be included with the Board of Directors agenda.

A. *MARKETING & BUSINESS DEVELOPMENT: Chair Nadya Andrews presented a recommendation from the committee that the CDOA enter into an agreement with Leisure Link for a six-month trial period with no cost to us.   We will give Leisure Link a list of our no more than 3 unbooked rooms during the Sunday – Thursday periods and they will be able to try and sell the nights for us.  We will be able to pull back rooms in real time if we need some additional ones for our Owners.   Bob Egan moved that we execute a contract for a six-month basis, as reviewed and recommended by the Marketing Committee.  Motion seconded by Larry Stephens and passed unanimously.

B. *FINANCIAL/INVESTMENT MANAGEMENT:  Acting Chair Julie Jerves reported that the committee was recommending that the 2008 Annual Dues Assessment be allocated as follows: $655 per PIU will go to the Operating Fund and $140 per PIU to go to the Reserves/Capital Funds. Julie presented the balanced budget as prepared by the FMC.  She also reported that the Committee recommended that our collection policy for delinquent Owners should go directly to a lien rather than Small Claims Court first.  This would require a change in the current policy.  It was further recommended that the parking rate for Owners Use time be increased from $15. to $18, as the perdiem parking rate will probably increase above $28 in January.   The 2008 Budget and all of these FMC-recommended items will be acted upon in the New Business section of the Agenda.

C. *EDUCATIONAL/SOCIAL EVENTS:  In the absence of the Chair, Marie Vergara reported that the committee had canceled the lunch at Copia. There are currently 60 people signed up for the Christmas/Holiday party. We need to have 40 more sign up.

D. *CBR/NOMINATING:  Committee Chair Dennis Myers reported that the committee had reviewed the new state laws regarding meetings and the way we do our agendas. There was a dispute regarding someone watching certain channels and then not wanting to pay. That is being followed up and a full payment will be pursued from the Owner. The committee is working on a list of infractions and the specific penalties for them so that we are handling these matters in compliance with CA law governing such actions. The recommendation to move to a complete non-smoking environment was made so that the final 3 smoking rooms will be changed to non-smoking as of January 1, 2008. This was moved by Daryl Clark, seconded by Lexis Allen and passed unanimously. There was discussion about the advance communications process, and it was confirmed that this would be taken care of by the Club Management Team.

E. RISK MANAGEMENT: In the absence of the Chair, Mandy Vergara gave the report. The committee reviewed the Earthquake Insurance and D&O Insurance. There was an audit conducted by Farmers Insurance and they have given us a positive report on their findings and observations of our safety/security environment.

F. *HRM: In the absence of the Chairman, Daryl Clark gave the report. The committee recommended that the PTO schedule be amended as shown on the sheet presented to the Board.  This will reduce long term liability for the CDOA and accelerate the accrual rate.  Bob Egan moved that the Board adopt the new schedule.  Motion was seconded by Wayne Jerves and passed unanimously.

G. LEGAL: Chairman Mike Milnes stated that the new laws that were just passed would not require any changes in our By-Laws or CC&Rs.  The Board will have to notify all Owners when the Board-appointed Committees and Board of Directors are meeting.  He recommended that we include all dates for meeting in the Annual Billing Package and on the WEB site approved Calendar.  Ten days before a meeting, the agenda must be published.   He also said the PPCA lawsuit regarding the chiller has been filed, and there are some additional exhibits being required that will be provided to him for submission to the Court in the near future.

H. *CHIEF TECHNOLOGY OFFICER: Wayne Jerves said the new Server system was ordered and has been received. It is scheduled for installation this month. Larry Stephens will continue looking for a new/updated CDOA-secured Accounting System that will interact with the OPERA Reservation System.

I. *CLUB MANAGEMENT: 
A. Supervisor Rodolfo Pelaez reported that there now 15 rooms with new sleeper sofas.  The new larger flat-screen TVs have 68 new channels. He also said the draperies and sheers are being replaced in 15 rooms.  There will be new bathroom amenities after the first of the year. They will have the Club Logo on them, and gift packages can be purchased from the Club.  He is looking into the Guest Link component for ease of access to electrical outlets for computers, cellphone chargers, etc., and some of these enable the Owner/Guest to use the new TV screen as their monitor.

B. Mandy Vergara reported that the Club is looking at future improvements in the overall room designs, better lighting, such as ceiling installed lights over the beds and reading areas, and future design options will be presented to the Board next year for possible pilot Club Room conversions (2-3) in 2009.

C. Quincy Moss-Lozada reported that there are new partners for discounts: Biscuit and Blues, the shops at Pier 39, and we will sell Blue and Gold Fleet tickets at a discount.

VI.     OLD BUSINESS
A. There was a discussion regarding the need for any updating of the CC&Rs.  The recommendation was that we do not need to update or change them at this time.

B. Daryl Clark moved that we transfer $89,816 from the Reserves to the Operating Account for reimbursement of capital items paid for out of the Operating Account during the third quarter.  Lexis Allen seconded the motion, which passed unanimously.

C. In order to close out the accounting as soon as possible at the end of the year, the amount for reimbursement from the Reserves to the Operating Account will be circulated in January for electronic approval by the Board under the Action Without A Meeting provision in our Bylaws.
D. Don Thomas reviewed the Chairs and Vice Chairs of the Board-appointed committees. There was discussion that only committee members may vote, Board Liaisons may not vote.

VII.     NEW BUSINESS
A. Daryl Clark moved that the Board approve the balanced budget for 2008, as presented by the FMC, and that the Dues remain at $795, with $655 to be applied to the Operating Account and $140 be put into the Reserves, the parking rate for Owners Use time is to be increased to $18 and the Bonus Night Rate to be increased to $129.  Motion seconded by Les Yeffa and passed unanimously.  It was noted that the increases are driven by actual increases in operating costs to the CDOA.

B. Assessment Collection Fee: Wayne Jerves moved that the new 2008 Administrative Collection Fee Policy be approved as presented.  Motion seconded by Daryl Clark and passed unanimously.

C. The Board reviewed the new Lien Recordation and Assessment policy. Daryl Clark moved that we accept the policy with the changes.  Motion seconded by Bob Egan and passed unanimously.

VIII.     HOTEL MANAGEMENT REPORT
     Trond Aakre said that the new TV stations were working well, but there was still some tweaking that had to be done.  No one has complained that there is no more Pay Per View. He said that the VCR Library in Club 1500 would be donated to a charitable group. There are no more VCRs in the Hotel or the Clubrooms.  All rooms have gone to DVD. Don Thomas suggested that we speak with the local DVD retailer, which is close by, and see if we can get a pickup and delivery as well as a discount for our Owners and Guests.Trond said that a runaway truck had sheared off the fire hydrant in front of the Hotel on Post. St. It had crossed through the intersection, took out the police call box and our  awning. The Hotel has received a check for $8,600 from the insurance company.  Trond said that we may just need to put up a different type of covering, but it will look better than the former one, which was starting to look unattractive. Trond also said that new outside furniture has been ordered for Club 1500. It will be more  modern and look nicer than the former ones and it is usable year round.  The permit for replacing the Spa had to changed into the name of the PPCA, and we are pursuing final approval from the City/County of San Francisco next week.  The old one was continuing to leak into Club rooms on the 14th floor, and the new stainless steel one has been ordered.  Lastly, Trond said that the new interior furniture in Club 1500 is being redone, as it was not done properly by the manufacturer, and it should be fixed within two weeks.

IX.     PPCA REPORT
Don said the next meeting of the PPCA Board of Directors would be Nov. 8, 2007.  We are still pursing the accounting correction that will improve on both the PPCA and the CDOA balance sheet.   He also reported that Shell Vacation Club is trying to increase the earthquake insurance coverage for their Master Plan coverage, which will increase the premium for PPCA. They are tying it in with their other properties which increases the cost to the PPCA and then the CDOA.  Don also mentioned the new furniture in Club 1500 and said that the smoking area on the Post Street side up there is being painted and signage provided to designate it as such, bur no smoking will be permitted near the doors or on the Mason Street and South side of the 15th floor terrace.

X.     EXECUTIVE SESSION
     The Board moved into Executive Session at 11:05 a.m.  HRM matter, legal matters and Confidential Owner disciplinary Matters were discussed.

No further business appearing, it was moved, seconded and passed the meeting be adjourned.
Meeting adjourned at 12:55 p.m.

Respectfully submitted,

                                            .
Leslie A. Yeffa, Secretary

                                                     .
Don R. Thomas, President & CEO