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					  NEVADA COMMISSION for the RECONSTRUCTION of the V&T RAILWAY

                           Monday, December 8, 2008 - 3:00 p.m.
                            STOREY COUNTY COURT HOUSE
                                             26 South B Street
                                          Virginia City, NV 89440

                                         MEETING MINUTES

                                              Finalized: 01-03-2009
                                                      11:55 a.m.

            **********************************************************************
               The following minutes are a summarized explanation of the topics discussed. A
                Taped recording of these proceedings will be kept for review. A printed copy is
                kept along with a copy on CD in Microsoft Word. A copy has been e-mailed to
                the Project Coordinator & Counsel.
            **********************************************************************

3:00 P.M.      CALL TO ORDER
               Chairman Hadfield called the meeting to order at 3:00 p.m. After welcoming everyone
               and thanking Commissioner Flanagan for the use of the Storey County Courthouse he
               called for the roll call.

       1.      ROLL CALL
               Chairman asked Kevin to call the roll.

               PRESENT:                                                      ABSENT:
               Chairman Hadfield
               Commissioner Millard
               Vice-Chairman Flanagan
               Commissioner Tyson
               Commissioner Allen
               Commissioner McPherson
               Commissioner Baushke
               Commissioner Teixeira
               Commissioner Weber (would be late)

               ALSO PRESENT:
               Kevin Ray, Project Coordinator
               Ken Dorr, Manhard Consultants
               Michael Rowe, Counsel

               It was noted there was a quorum.

       2.      APPROVAL OF THE AGENDA
               This is the tentative schedule for the meeting. The Commission reserves the right to take items in a
               different order to accomplish business in the most efficient manner.
     Chairman Hadfield had a change to the Agenda. Item #12, at the request of the Grays was
     being taken off the Agenda. Ken Dorr said that Item # 13 would not be needed on the
     Agenda, as it goes along with Item #12. Chairman called for discussion on the changes.
     Commissioner Allen made the motion to approve the Agenda with items 12 and 13 taken
     removed. Commissioner Flanagan seconded the motion. Chairman called for discussion on
     the motion, with none stated, he called the question. The motion carried and was so
     ordered.
3.   ACTION TO APPROVE THE MINUTES OF OCTOBER 6, 2008
     Chairman Hadfield called for changes or corrections to the minutes of October 6, 2008.
     With none stated he asked for a motion to approve the minutes. Commissioner Teixeira
     made the motion to approve the minutes of October 6, 2008. Commissioner Millard
     seconded the motion. . Chairman called for discussion on the motion, with none stated, he
     called the question. The motion carried and was so ordered.


4.   PUBLIC COMMENT ON AGENDIZED AND NON-AGENDIZED ITEMS: Discussion may be
     limited to three minutes per person at the discretion of the Chairman. No action may be taken on a matter raised
     under this portion of the agenda until the matter itself has been specifically included on an agenda as an item upon
     which action may be taken.
     There were no Public comments.
5.   COMMISSIONERS CONSENT AGENDA: All matters listed under the Consent Agenda are considered
     routine and may be acted upon by the Commission with one action and without an extensive hearing. ANY
     MEMBER OF THE COMMISSION OR ANY CITIZEN MAY REQUEST THAT AN ITEM BE TAKEN FROM THE
     CONSENT AGENDA, DISCUSSED AND ACTED UPON SEPARATELY DURING THIS MEETING.

     There was nothing under the Consent Agenda.
                                           **END OF CONSENT AGENDA**

6    TREASURER REPORT – RON ALLEN
     Commissioner Allen noted a copy of the report was in each Commissioner’s packet. His
     report reflected the expected cash revenue at the end of 06/30/2010. This was a very
     conservative figure of $787,414.10 and they hoped or thought there may be more than that
     at the end. Ron asked for questions on his report. Commissioner McPherson asked what
     Watson and Rounds was. Ron said they were attorneys retained by Mike Rowe to work on
     the Trademark and name issues. Mike discussed what the issue was. Commissioner
     Teixeira noted this was his last meeting and asked Ron if the figures given included the
     present contract of $6.6 million with Q&D, which should be completed June 2009. Marv
     said that even with the Carson City bond revenue there could still be a short fall from the
     City in 2009/2010. Ron said that was why they went conservative with their figures.
     Chairman Hadfield asked Marv if he wanted to comment on a meeting he had and Marv
     said he would comment on that later. Commissioner Millard asked about a figure listed
     under expenses, for Phase 2C, and wanted to clarify, since his copy was unclear, if it was
     $8, 601. Ron said it was $8,861,000. Dwight then asked what the contract bid was and
     Ron said it was $6,666,666. The difference was discussed by Ken Dorr who explained that
     it included the 10% contingency and discussed further. Commissioner Tyson asked about
     the trademark issue and why it has been going on for over two years. After further
     discussion, Commissioner Teixeira made the motion to approve the Treasurers Report.
     Commissioner Millard seconded the motion. Chairman called for discussion on the
     motion, with none stated, he called the question. The motion carried and was so ordered.
7     ACTION TO RATIFY THE PAYMENT OF BILLS SUBMITTED
     Chairman noted the total of the bills submitted for approval was $996,418.54.
     Commissioner McPherson had a couple of questions as to what Classic Options and Sierra
     Nevada Media was. Kevin explained both.
Commissioner Weber arrived
     Commissioner Tyson asked about the trademark issue which has been going on for over
     two years and where did they stand on it. Counsel Rowe explained and discussed this.
     Commissioner Baushke made the motion to ratify the payment of the bills. Commissioner
     Weber seconded the motion. Chairman called for discussion on the motion, with none
     stated, he called the question. The motion carried and was so ordered.

8     PHASE 2-4 ENGINEERING REPORT – KEN DORR
      Ken Dorr reported on the Construction Phase 2A-2B saying it was complete and the final
      paperwork was being finished. The Notice of Completion should be ready to publish in the
      newspapers for 35 days and then they could release the retention. Commissioner Teixeira
      asked if they went over budget and Ken said they did go over about 7% because of the
      landslide and from some of the rock cuts. Questions were called for on this phase of Ken’s
      report. Ken then went on to Phase 2C, saying that Q&D was making great progress. The
      Bridge supports for the bridge is going well. Roy Hallaburton from Q&D noted they are on
      schedule and the setting of the Bridge should be around the end of January. Footings and
      center column will be poured sometime in the next week or so. Roy said there is a good
      chance they could be done in May. This Phase was discussed further and questions were
      called for. Ken continued with Phase 3 saying the engineering work is on going. They are
      going ahead with the preliminary work from the head of the canyon to Carson City. When
      the plan is 60% complete they will be looking at the rights of way settings and when the
      funds are available they will be ready to go. Ken noted a letter recognizing donations made
      by the consultants and those working on the project.
9     ATTORNEY'S REPORT AND ACTION ON REQUEST FOR AUTHORITY TO START
      APPRAISAL PROCESS FOR PHASE 3 AT THE TIME THE RIGHT OF WAY SETTING
      FOR PHASE 3 MEMORANDUM IS ISSUED - MICHAEL ROWE
      Counsel Rowe said on Phase 3 they were heading forward with the right of way settings.
      Then comes the notification letter stating the property is going to be appraised. Mike said
      today he was asking for approval to start the appraisal process. Mike discussed the process
      of the appraisals. Commissioner Tyson asked if we owned any of the right of ways. Mike
      said they do own a lot of them. Mike discussed the ownerships of the properties involved.
      Commissioner Teixeira discussed the Economic Stimulus Package being prepared to be
      sent to Congress. He said this is a big ‘IF’ but the Commission does qualify and as soon as
      it he signs it, it will be sent by FedEx Wednesday. Marv also recommended the
      Commission take action on Mike’s request to get the right of way set. Chairman Hadfield
      called for discussion. Commissioner Teixeira made the motion to give Mike authority to
      start appraisal process for Phase 3 at the time the right of way setting for Phase 3 was
      issued. Commissioner Allen seconded the motion. Chairman called for discussion on the
      motion, with none stated, he called the question. The motion carried and was so ordered.
      Mike continued with his report discussing letters from Kafoury/Armstong regarding
      the operations of the V&T Commission. They have been getting information requested for
      the audit to be done. At this time other than the construction there are no claims against
      the Commission. The Commission should be receiving the audit for action in January 2009
      as it is expected to be completed December 18, 2008. Mike stated he had received from
      Johnson/Perkins the appraisal for the Svetic parcel and would get a copy to
     Steve Lincoln. Mike discussed the offer that was made,

10   REPORT ON FEATHER RIVER SHORTLINE ENGINE #8 – JOHN TYSON
     Commissioner Tyson reported the Feather River Shortline Engine #8 had passed its
     inspections. Tom Gray did a good job on the engine and it will be going to Gold Hill
     December 20th. Commissioner Tyson said he would discuss later possible uses of the
     Engine for fundraising. It is ready for service and it is in full compliance.
11   VIRGINIA AND TRUCKEE RAILROAD REPORT – TOM GRAY
     Tom Gray said they had just finished their 33rd season. They ran the Christmas Train last
     weekend. This season they worked to get the steam engine back and running, they worked
     on their infrastructures. Tom introduced Craig their new marketing director. They plan on
     getting more equipment and they have a good mechanical staff on board.
12   REVIEW AND POSSIBLE ACTION ON A TRACK USE AGREEMENT WITH VIRGINIA
     AND TRUCKEE RAILROAD COMPANY – KEN DORR, MICHAEL ROWE AND TOM
     GRAY
     This item was taken off the Agenda.
13   DISCUSSION AND POSSIBLE ACTION TO RETAIN THE SERVICES OF SHAW
     CONSULTING SERVICE FOR PREPARATION OF ARCHITECTURAL DRAWINGS
     AND BUILDING PERMIT APPLICATION FOR REMODEL OF THE SHAW/BWG
     FACILITY OFF DRAKO WAY TO CREATE INTERIM PASSENGER WAITING ROOM
     AND ADA COMPLIANT RESTROOM FACILITIES - KEN DORR
     This item was taken off the Agenda.
14   DISCUSSION AND POSSIBLE ACTION TO ROTATE MEETING LOCATION AMONG
     COUNTIES AND TO HOLD MEETINGS EVERY OTHER MONTH – BOB HADFIELD
     Chairman Hadfield thanked Commissioner Flanagan for arranging to have the meeting in
     Virginia City. Commissioner McPherson said he had confirmed a place in Dayton for the
     February meeting. Chairman Hadfield asked for the Commission’s opinion about the
     possibility of having a meeting every other month. Commissioner Allen made a motion to
     continue to meet on a monthly basis for now because of the audit and ongoing
     construction. Commissioner Tyson seconded the motion. Commissioner Weber said with
     the Legislature going on she would not be readily available. After discussion it was
     decided to meet monthly as they could always change. Chairman returned to the motion
     and called for discussion on the motion, with none stated, he called the question. The
     motion carried and was so ordered.

     Ken Dorr asked if they wanted to discuss the Track Use Contract with the Grays.
     Commissioner Millard wanted to clarify that the Gray’s would not be operating on the new
     track until an agreement was made. Tom acknowledged that their season was over and
     they would not be running until a new agreement was made.
15   REVIEW AND POSSIBLE ACTION ON A REQUEST BY SIERRA NEVADA RAILROAD
     CORPORATION AND ITS VICE PRESIDENT, ROBERT PINOLI, TO ASSIGN THE
     MEMORANDUM OF UNDERSTANDING BETWEEN THE COMMISSION AND SIERRA
     ENTERTAINMENT, A CALIFORNIA CORPORATION, TO SIERRA NEVADA
     RAILROAD CORPORATION, A NEVADA CORPORATION – ROBERT PINOLI
     Robert Pinoli, Vice President if Sierra Nevada Railroad, said they were requesting a name
     change in the Memorandum of Understanding between the Commission and Sierra
     Entertainment. Sierra Entertainment is a California Corporation and the name change
     would be to Sierra Nevada Railroad Corporation, a Nevada Corporation. Commissioner
     Allen pointed out that the Memorandum of Understanding did not list the Nevada Railroad
     Society as a participant. Commissioner Millard asked about the request being made by the
     new company and not the parent company. The names, the three company names and how
     they were connected was discussed. Commissioner Millard said the Commission had
     entered the agreement with a major company and are being asked by another to change the
     agreement. Robert Pinoli assured the Commissioners that all the players and structures
     were the same only the names of the companies were different. Robert discussed and
     explained the structure of their company. Robert also explained the connection between
     the three names. Commissioner Allen asked the reason for the change because there was
     nothing in the paperwork provided to show the connection between the three companies.
      Robert also assured that there has been no sale of the parent company, they are just
     dividing into corporation within the parent company. Commissioner McPherson asked
     what the purpose was to moving over to a Nevada Corporation. Robert Pinoli said it was
     for mainly for taxes and getting ready to do business in Nevada. Commissioner Tyson
     discussed the time frame they have been negotiating an agreement with Sierra Railroad.
     Chairman Hadfield said there was a Negotiating Committee formed to come up with some
     form of an agreement. Hadfield said all Sierra Railroad was doing was creating a Nevada
     Corporation so when they do business here they won’t have to pay California taxes on it.
     Chairman also noted that any delay has been created by the Commission and not Sierra
     Railroad. Commissioner Weber said it was simple and it needed to be done because Sierra
     Railroad needs to have a Nevada Corporation for tax purposes. There was further
     discussion. Commissioner Teixeira said they have a California Corporation who is not
     licensed to do business in Nevada and it is a simple process of creating a Nevada
     corporation to do business in Nevada. They are doing nothing more than transferring a
     Memorandum of Understanding to a Nevada Corporation within Sierra Railroad
     Corporation structure.
     Commissioner Tyson said they needed to provide a complete outline on the new
     corporation and get a letter from the parent company. Tyson said he would not vote on this
     until he had more information. Commissioner Weber asked the Commission counsel his
     opinion. Counsel Rowe said it was a non-binding Memorandum of Understanding and they
     are requesting the Commission to transfer the MOU from one subsidiary to another and all
     the Commission has to do is approve the request if they are satisfied with it.
     Commissioner Teixeira made a motion to approve the request by Sierra Nevada Railroad
     Corporation and its Vice-President, Robert Pinoli, to assign the Memorandum of
     Understanding between the Commission and Sierra Entertainment, a California
     Corporation, to Sierra Nevada Railroad Corporation, a Nevada Corporation as requested.
     Commissioner Weber seconded the motion. There was no discussion stated on the motion.
     Chairman called for a vote on the motion. There was a five to four vote. Commissioner
     McPherson, Flanagan, Allen and Tyson voted no on the motion. The motion carried and
     was so ordered.

16   REVIEW AND POSSIBLE ACTION ON A REQUEST BY SIERRA NEVADA RAILROAD
     CORPORATION AND ITS VICE PRESIDENT, ROBERT PINOLI, TO ASSIGN THE
     LEASE OF THE COMMISSION'S LOCOMOTIVE #18 FROM SIERRA
     ENTERTAINMENT, A CALIFORNIA CORPORATION, TO SIERRA NEVADA
     RAILROAD CORPORATION, A NEVADA CORPORATION - ROBERT PINOLI

     Robert Pinoli said he respected the opinion of the Commission and he would prepare some
     documents for them. Chairman Hadfield asked Robert to comment on the care and use of
     Engine #18. Robert said he had copies of the daily and annual inspection reports on
     Engine #18. Robert discussed the boiler time on the engine. There is a 15 year or 1,472
     days on the boiler, whichever comes first. The last inspection was conducted on February
     18, 2001 and will be up February 18, 2016 or at 1,472 days used which would make it
     sooner To date there are 1,333 days usage remaining. As for the engine’s care, it is in a
     locked and secured facility in Oakdale. It is only out in the weather when it is running.
     Commissioner Teixeira asked about the run time and Robert explained. Commissioner
     Allen said the contract regarding Engine #18 was binding and he didn’t think they could
     take action on this item until they got the MOU straightened out and the new contract
     documents for engine. Commissioner Allen made a motion to table Item 16 until the
     correct documentation was obtained from Sierra Railroad regarding the corporations and
     then draw up a new contract. Commissioner Tyson seconded the motion. Commissioner
     Millard asked if an expiration date could be added when the contract was redrawn because
     as it stands there is no expiration date on the use of the engine. After discussion
     Commissioner Teixeira said they needed to come back with all the information so they
     understand each other. Chairman called for discussion and public comment. Jim Clark
     came forward and said Engine #16 belonged to the citizens of Nevada and it needed to
     come back here. Chris Hart, President of Sierra Entertainment, said the engine could be
     brought back but we have no facility here to take care of it. There was further discussion.
     Chairman called for a vote on the motion and the motion carried and was so ordered.
     Robert also discussed the numbering of Engines.
17   SIERRA NEVADA RAILROAD REPORT - ROBERT PINOLI
     Chris Hart discussed their involvement in tourism and the interest shown by the tourism
     foundations. They have made up over a million brochures to bring awareness to the V&T
     Project and Engine #18. They plan to be attending the National Tourism Convention in
     Reno. Commissioner Allen told Chris there was nothing personal in his comments before
     and hoped no one took it personally.
18   NORTHERN NEVADA RAILWAY FOUNDATION REPORT – JANICE AYRES
     Jim Clark came forward said he was no longer a member of the Foundation. He reported
     for Ms. Burgess that their Treasurer’s report had been e-mailed. Jim reported on the ingots
     that had been minted and they were a success.
19   PROJECT COORDINATOR REPORT - KEVIN RAY
     Kevin thanked the Visitors Bureau and the Grays for the free train rides offered to Carson
     City residents in October. They gave out a total of 1500 tickets. Kevin discussed the
     presentations that he had given. On October 17 there was a presentation to the Railroad
     Symposium. On October 18 a presentation was given to the Washoe County Commission.
     On October 19, they had the ground breaking ceremony for Phase 2C. Kevin is working
     with the CCCVB on updating the V&T website.
20   COMMISSION CHAIRMAN REPORT - ROBERT HADFIELD
     Chairman Hadfield said even though there were differences of opinions everyone had one
     purpose and that was to continue the Project. Chairman discussed the suggestion from
     letters written to the editors stating the Commission find public funding.
21   COMMISSIONER COMMENTS
     Chairman Hadfield called for commissioner comments.
     Commissioner Teixeira said he was disappointed they didn’t get the funding but they have
     made outstanding progress and they are 2/3 of the way. He thanked everyone on the
     Commission for their dedication. Marv discussed his time and work with the Commission. He
     was going to miss everyone.
     Commissioner Tyson said it has been a pleasure working with Marv. John told Robert and
     Chris it wasn’t personal but he couldn’t and wouldn’t vote on something without the proper
     documentation.
     Commissioner Allen said it had been great working with Marv. Ron also explained to Robert
     and Chris his reasons for not voting for their agreement. He also said they need to keep an eye
     on Engine #18 so that it is taken care of.
     Vice-Chairman Flanagan wished Marv good luck in his retirement.
     Chairman Hadfield said he had a lot to say about Marv. Bob said he has been involved in
     Nevada for 35 years and in elected office for another 25 years. In all those years he had never
     met a better, more dedicated, honest man than Marv. Bob said Marv was never afraid to take a
     stand and will be missed on the Commission.
     Commissioner Millard made a comment to Marv. Dwight thanked the Gray’s for providing
     the train for people of Carson to ride. He thanked Marv for his dedicated time and told him he
     needed to stick around to help get more money.
     Commissioner McPherson said there are a number of people who think Lyon County
     shouldn’t be serving on the board. He said he was very passionate about the railroad and
     getting it built. Larry said that as a Mayor, Marv rocks.
     Commissioner Baushke. Jim thanked Marv for his great work over the years. Jim said this
     would like to say thank to everyone as this would also be his last meeting but it has been a
     pleasure serving the last five years on the Commission.
     Commissioner Weber wished everyone a Merry Christmas. Bonnie said it was great to
     serve with such wonderful gentlemen. She also said it was a pleasure to serve along with
     and outstanding person as Jim Baushke. She went on and thanked everyone for their
     participation and interest in the Project. Her last comment was Mayor Marv was the best.
     Chairman Hadfield thanked Jim Baushke for his outstanding work on the Commission.

22   ACTION ON THE NEXT COMMISSION MEETING – FEBRUARY 2, 2009
     The next meeting for the Commission will be held January 12, 2008. Kevin will verify the
     place and time.
23   ADJOURNMENT
     Commissioner Teixeira made the motion to adjourn and it was seconded by Commissioner
     Allen. The meeting was adjourned at 5:00p.m.

				
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