As elsewhere described, IVGID purchased The Chateau in August of 1976 from Japan Golf Promotion (U.S.A.), Inc. (“JGP”), along with Incline Village’s two (2) golf courses and bowling alley. At the time, the Chateau was “dated…(in)efficient…and showing signs of…deterioration.”

Incline Village Recreation Facilities Master Plan: “In January of 1999…after seven (7 major) renovations since it opened…over 150 community members and IVGID staff met to create a community-wide strategic vision of Incline Village and Crystal Bay. The result was…a list of issues…cover(ing) a wide range of areas…The primary items related to administration infrastructure needs and recommendations as to how to meet the(m)…The intent of this…master plan (wa)s…to guide the community’s capital investment decisions for recreation opportunities for the next 10 to 15 years.”¹ In 2000 the District commissioned this recreation facilities master plan. The stated objective was to “enable IVGID to move forward with recreational improvements.” With this in mind, the Plan identified and prioritized a number of “capital investment decisions related to recreation.” And one of those decisions recommended “construction of a new…22,600 sq. ft…clubhouse.”¹

Estimated Financing² to Implement These Capital Projects: The Plan made it clear that these proposed “capital expenditure projects (we)re anticipated to be funded through a…$10.5 million…bond…planned to be issued in 2001.”³

The Source of Payment For These New Estimated Capital And Operational Expenses: Again according to the Plan, a “recreation fee…increase (of) $100 per (assessed) property…effective for the 1999/00 fiscal year.”⁴

On January 8, 2003 the Board adopted Resolution No. 1737 (“the 2003 Authorization and Sale Resolution”) which incurred up to $5,500,000 in new medium-term financing, in part, to “improve recreation projects for the District.” Listen to the alleged justification for this bonding which appears at Section 3 of the Resolution:

“The Board hereby finds and determines that the public interest requires (this) medium-term financing (because)…(a)…the tennis courts…are of major importance to the economy of the District, and the improvements to the…tennis courts…are necessary to improve the…operations of th(is) facilit(y)…(b) It is in the best interests of the District and its inhabitants, and would best serve the public interest thereof, if the Project is now accomplished, thereby assisting in alleviating the need mentioned in (a) above (and c) It is not feasible to finance the Project from other funds of the District, among other reasons because of restraints on the District’s budget for the current fiscal year and other demands on and needs for existing funds of the District.”

Where The Monies Came From to Service/Repay The 2003 Medium-Term Recreation Bonds: According to sections 4 and 5 of the Resolution:

“The…legally available…source of revenue of the District that is anticipated to be used to repay the medium-term obligations, and the dollar amount expected to be available from such source is monies derived from the District’s Recreation Fund expected to be available in the estimated annual range of $750,000 to $1,500,000 per year.”

What did this mean? According to then General Manager Bill Horn’s presentation at the January 8, 2003 “Public Hearing on (the) Resolution Authorizing up to $5.5 Million:”

“The bonds (would)…be repaid via an(other) increase in the Recreation Fee of $85, which w(ould) sunset at the end of ten years or sooner⁵ depending upon the ten-year forecasted Community Services fund balances or other…required…capital improvement projects.”

1. Go to https://www.yourtahoeplace.com/uploads/pdf-ivgid/2000_IVGID_Rec_Fac_Master_Plan.pdf.
2. In 2000 dollars.
3. $6,800,000 of which was estimated for the Chateau and adjacent parking lot upgrade component.
4. Although the Plan lists increased ad valorem, sales, lodging occupancy, and county real property transfer taxes, together with Washoe County community and federal grants as possible additional revenue sources, none was realistic. Demonstrating the consultant’s naivety.
5. We have examined the District’s 2003-2016 Comprehensive Annual (Audited) Financial Reports (“CAFRs”). These reports document that this $85 RFF increase began in fiscal year 2004, and it ended in fiscal year 2015. Moreover, page 38 of the 2012 CAFR and page 40 of the 2013 CAFR document that the 2023 Medium-Term Recreation Bonds were retired in fiscal year 2012-13. In other words, this $85 per year increase in the RFF did not sunset at the end of ten (10) years. Moreover, the RFF in fiscal year 2003 before this $85 per year increase was implemented, was $370 per parcel/dwelling unit. By fiscal year 2013, when this bond actually retired and the $85 RFF per parcel/dwelling unit increase was supposed to have sunset, the RFF totaled $730 per parcel/dwelling unit. So much for the credibility of staff’s representations! And as the reader will discover, this was one of the many “creative” techniques staff have used for years to improperly exact millions of dollars for its nefarious expenditures.