Special American Lutheran Church Council Minutes

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May 13, 2012

Special American Lutheran Church Council Minutes
All were in attendance except Susan Anderson, Pastor Gretchen Bingea and Cliff Meyer.
Deyo Blake called the meeting with a prayer. (10:50 a.m.)
This meeting was held to go over the lease and addendum agreement for San Fernando Valley Professional School.

Lisa Argenziano had some of her concerns alleviated with Addendum A, #54.

This states that the school would pay us $3000 per month for no longer than 90 days after they receive permits from the City of Burbank and construction starts. Then the rent of $6000 per month would begin.

It would be best if we take $1000 per month off the rent the first 9 months of the first year. It is not totally clear why we need to reimburse the three months of $3000. Lisa thinks we should be compensated for the time it takes for calling; rescheduling and getting keys back from all our groups. We also have to clear out all the desks and chairs and teacher’s stuff that was left in the school building.

Jill Richards has concerns with Addendum A, #57 as well as #54.

This states that the school has exclusive right subject to City of Burbank Approval to add an office or classroom space in the area encompassing the fixed awning area adjacent to the 2-story school building. This can be done with construction or a portable office.

She wants to know if we have a say in the plans.

Joni Stanford has a concern about the language regarding Addendum A, #51e.

This is in regards to reimbursement for utility costs that on average are above our normal utility costs.

We cannot ask them to reimburse us for utilities as a separate item as that would be considered reselling the utilities, which is against the law since we are not a utility company. These costs would have to be part of the rent monies. We have to show this on our accounting as part of the rental and not show that it is a utility cost.

Ron Reid has concerns about Addendum A, #52c, #56 #58, and #63.

#52c states that the school would professionally maintain the premises including air conditioning, heating, electrical, plumbing, water system, roof, windows & doors.

#52 is only for the school. The heat and air conditioning is totally separate from the church office. He wants to know if they are responsible for a roof leak in the 2-story building.

#56 states that the school is responsible for the payment of all renovation construction costs. They have to get the necessary permits from the City of Burbank and hire licensed contractors. It states that the church has a say in approving all reasonable and necessary construction and plans, with intended use.

He has concerns about the grammar used in #56. The word required seems a problem with the sentence.
#58 states the school shall have absolute right to terminate he contract prior to commencement of construction should any of the plans & permitting requirements not meet the school boards approval.

There is no clause in the Addendum that states the church has the right to terminate the contract. In other parts of the lease, there are criteria that give the church the right to terminate the contract.

#63 states that attorney fees wherever mentioned in the agreement will be reasonable and necessary.

This is part of all lease agreements.

We discussed Addendum B regarding selling of property and brokerage fees. We do not plan at this time to sell our property.

Deyo Blake’ s concern was the last page from Century 21 Crest which states “due to the nature of this transaction, Century 21 Crest strongly recommends American Lutheran Church to have their own legal advisor to review, look over the lease documents prior to signing the lease agreement.

We did not have legal counsel before signing of the lease. The Council had not seen the lease after the recommendations were made at the April 2012 meeting. Deyo talked to his CPA/Lawyer about this agreement and was told that the people whoever signs the document are personally legally responsible if something goes wrong. Mark Baker told us that our church insurance will cover us under those circumstances.

Deyo has questions regarding the language in Addendum A, #51b. #51c, #59a, #62, and #64.

#51 b -Friendship room usage – exclusive use M-F 8a.m.-3p.m. Exclusive use of closet space on far north side at all times and shared use most evenings and weekends, during which times use is exclusive.

This does not specify what is exclusively being used and what is being shared.

This should specify if it means we share the room. The language needs to be more specific. We read it that they have exclusive use of the room and we will have to ask permission to use it. Jill Richards did not like the fact that they included renting the friendship room along with the school building.

#51c states the school shall have the right to use all interior common areas and shared use of all outside common areas.

The common areas would be the hallway, bathrooms, patio etc.

The feeling is that we are being pushed out of our space. The Women’s Group is not happy with the kitchen and Friendship room not being at their disposal since they use these rooms the most. The whole congregation as a whole does not use these spaces very often.

Ron reworded this as lessee shall have the option with the approval of the lessor to use all interior common areas and shared use of all outside common areas. This would change the meaning of the whole sentence.

#59a Parking Lot – The school gets exclusive use of the parking lot M-F 8a.m.-3p.m., unless the church needs the parking for a funeral in which we are given 6 spaces and shared use of parking at all other times.

This is not an acceptable statement.

#62 states interest rate to be at current prevailing interest rate.

This means that if there is any circumstance where interest is needed to be charged it has to be at the going rate, not usury rate.

#64 states all rules and regulations when ever required shall not unreasonably and or unnecessarily interfere and or impede lessee’s intended use.

Do we form another Addendum and go over our concerns at another meeting? We would prefer the lease agreement be reviewed by a lawyer before we move forward.

Procedurally we should reconvene and put down on a sheet of paper what our issues are. We can use part of the $25,000 to hire a lawyer.

Motion to have Addendum A and entire lease review by a lawyer was made by Jill Richards, seconded by Mark Baker.

Motion was carried by quorum. 6 ayes 0 nays Lisa Argenziano left the meeting before the vote.

Meeting Adjourned (11:58 a.m.)

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