Record of the Jekyll Island State Park Authority (JISPA) Board Meeting of
19 November 2012, in the Jekyll Island Convention Center,
as recorded for JICA


Note: IPJI has placed some text in "bold" type for emphasis and has clarified
some statements in blue.

Chairman Bob Krueger brought the meeting to order at 9:30 AM.  Board members present were Buddy DeLoach, Mike Hodges, Al Ike, Sybil Lynn, and Richard Royal.  Mark Williams was on conference telephone.  Also present were Park Authority Executive Director Jones Hooks and Nancy Gallagher from the State AG’s Office.  The audience numbered about 40 persons.

Chairman Krueger noted that the canceled meeting in October was near the date of Veterans’ Day.  He called upon veterans in the audience to stand and be recognized, and the audience gave the veterans a round of applause.


COMMITTEE SESSIONS:


FINANCE

Chairman Hodges presented financial figures for both September and October.  For September, net operating cash income was a loss of $250 thousand, a 25% lower loss than had been expected.  For October, net income was a loss of $356 thousand, 30% worse than had been expected.  For the year to date, the net income was $647 thousand, 27% better than expected, but 36% less than in the prior year at this point.

Accounting Director Marjorie Johnson requested that contract expenses for the feline spay-and-neuter program (which has been discontinued) be moved to payment of a part-time assistant in the Park’s Conservation Program.  That assistant will be working on control of feral cats in the Park.  Johnson also requested that $77 thousand be moved from temporary labor services, and $30 thousand in liability insurance, both in the Convention Center budget, to contract expenses to pay for hirees at the Center.  These changes are neutral to the bottom line, and they were approved by the Board.

Personel

Chief Communications Officer Eric Garvey recognized the magnificent job that Park retiree Debra Wilkes has done in transitioning of the old Welcome Center to the new operations of the Center.  Wilkes was presented with a gift of a framed photo from the Park’s Coffeetable Book.  Wilkes thanked all of her colleagues from her 30 years of service



MARKETING

Chief Communications Officer Eric Garvey provided a video showcasing the pitch that is used to draw conventions to return to the Park’s Center.  Garvey emphasized the fact that his staff is continuing to use site tours as a means of convincing convention planners to choose the Park’s Center in the near future.  There are currently 107 active proposals to meeting planners, and about a 28% positive conversion of the proposals.  There are currently 97 bookings through 2017.

COMMITTEE OF THE WHOLE

Jonathon Roberts of Roberts Civil Engineering (St. Simons Island) presented his plan for change to the Ben Fortson Entrance to the Park.  The plan is intended to simplify traffic flow, decrease the amount of impervious surface, and have the plan be cost effective.  There will be a left-turn lane for incoming traffic, for those who wish to drive directly to the Historic District, and much of the northern portion of asphalt at the entrance area will be removed, and replaced with a section of bike path and greenery.  Estimated cost is just under $300 thousand.  The Board approved the concept of Roberts’ plan.

Director Hooks reported that the monies now available from the SPLOST ($720 thousand) for use in constructing bike paths did not quite come to the amount needed for all of the planned work (the low bidder was Poppell-Eller, of Brunswick, at $784 thousand).  Therefore, the work that will be done first will connect the existing north-end bike paths, with the goal of removing the need to dump riders onto automobile roadways.  Resurfacing of the Captain Wylly bike paths, some of which are quite rough, will have to be postponed, but hopefully not for very long.  It may well be that savings on the cost, or use of Park staff, would permit completion of the Captain Wylly resurfacing.  The Board approved the bike-path contract.

Project Manager Jim Broadwell presented drawings of the planned Retail Village portion of the Convention Center’s Beach Village.  Broadwell stated that the design group (HHCP Architects) is about 65% finished with the design work.  Broadwell noted that the condominium lofts originally proposed are no longer in the plans.  Al Ike noted that storms such as Superstorm Sandy prompted him to inquire about the elevation of the first floor of the retail shops?  Answer: they are at 14 feet above mean sea level (i.e., above the base flood elevation = above the level of a 100-year flood), just as is the Convention Center.

Director Hooks described the latest outcome of the work with the Retail Center’s consultant out of Atlanta (Retail USA).  The first batch of potential occupants of the Center has been identified (5 of about 25 interested entrepreneurs, representing about 17,000 square feet out of 31,000 square feet in Phase 1).  Deposits have been submitted and initial discussions have been held with the first 5 entrepreneurs.  The tenants of the R1 segment of the Center, first-floor, would be the Jekyll IGA as the grocer, and two realtors (Jekyll Real Estate and Parker Kaufmann Real Estate).  In R1 second floor would be Southeast Georgia Health System (SGHS).  There would be an oversize elevator connecting the first and second floors of R1.  In R3, first floor, would be the bank, which would be Ameris Bank.  Buddy DeLoach inquired about the process of selection of entrepreneurs?  Answer: the selections are being made based primarily upon the need for each type of service by conventioneers (the tattoo parlor that has applied will likely be declined), and in cases of multiple desires for a particular location in the Center, the Board would be consulted.  Chairman Krueger wondered about the nature of the service to be supplied by SGHS?  Answer: it is likely to be immediate care.  Mike Hodges wondered whether restaurants and bars are being considered?  Answer: yes, various groups of this nature have applied.  The Board approved the drawing-up of leases for the five entrepreneurs.

Director Hooks described the current state of progress in the planning of the full-service (Westin) hotel for the Beach Village.  Alterations of the current lease agreement with the group in charge of the Westin project (Jekyll Ocean Oaks Group, which is the group in charge of the Hampton Inn, and the developers of the Westin) would enhance profitability and financial soundness for the combined hospitality businesses of this group.  The lease amendment involves lowering the amount of maintenance-reserve monies that must be kept on hand.  This step, along with potential use of incentive monies from the new Tourism Development Fund of the Park, has facilitated the financing commitments needed for beginning the Westin construction.  BAE Urban Economics was hired to study the economic impact of the potential new Westin hotel, and they determined that the initial impact would amount to $47 million for the State of Georgia ($36 million for Glynn County).  Nearly as large an economic impact was projected annually following the hotel’s business establishment.  BAE estimated that the input of monies from the Park Authority’s Tourism Development Fund would be much more than compensated by financial returns to the Authority.  The Board approved the lease amendment regarding Hampton’s reserve funds.  A second amendment was presented, for the Westin property lease.  This amendment included: design deadlines (already completed in Nov 2012); financial closing date (now 1 Apr 2013), to be followed within 30 days by the initiation of construction; hotel-opening date (31 Aug 2014); maintenance reserves lowered to 3-4% of gross revenues; availability of monies from the Park Authority’s Tourism Development Fund.  The Board approved the amendment of the Westin lease.  It will be required of the Westin operators to apply for any State of Georgia tourism-tax credits that would become available; should this application be successful, the Park’s Tourism Development Fund would  be used less extensively for Westin development.

Director Hooks followed the Westin updating with an updating of the progress in the Hyatt project (the mid-priced hotel) in the Beach Village.  Spherical Energy & Environmental Systems LLC (SEES) and Provartis AG (a Swiss financing firm) are taking over the financing and developing of the Hyatt.  SEES will become the primary leaseholder, as SEES Jekyll Island Hotel LLC (a step approved by the Authority Board).  Their goal is to have the Hyatt open for guests by the end of 2013, or at the latest, early 2014.  The Hyatt people have approved the proposed hotel as planned by SEES.  Phelps Development (the original Hyatt developer) will be working with SEES on the project.  BAE has produced an economic-impact analysis for the Hyatt project, indicating one time and annual impacts in the tens of millions of dollars.  The Park Authority proposes to contribute $1.5 million in Tourism Development Fund monies, which would result in $14 million in new revenue to the Park Authority, Glynn County, and the State of Georgia over 10 years.  The amended lease to SEES contains new deadlines: funding commitment letters by 15 December 2012; schematic design drawings by February 2013; detailed hotel plans by April 2013; financial closing date by 31 December 2012 (with the right to terminate by either party should the closing fail to take place before the deadline).  Construction of the Hyatt Place hotel must be complete before February 2014.

Legal Associate Chris O’Donnell outlined the revisions to the rent policies for the shops to be included in the Retail Center of the Beach Village, and for the Pier Road Shops.  A flat rate, based on square footage of leaseholds, rather than a percentage rate, will be used.  The Board approved this change.

Director Hooks announced that the south-end Riverview bike paths should be completed by the end of December 2012.  A new merchandising manager hired by the Authority has resulted in the Park’s sales rising substantially.  The Park has, as of September 2012, been lowered from a 5 ISO insurance rating to a 3, largely through the work of the Jekyll Island Fire Department and Chief Jason Richardson in improving fire safety.  The Jekyll Island Restaurant at the Atlanta Airport (Concourse F) is open and doing well.  Defibrillators have been installed at the Park’s Tennis Center and at other locations in the Park.


CHAIRMAN'S COMMENTS

Chairman Krueger commended the Authority members who have worked hard through a variety of challenges to get the Beach Village to the verge of having construction get underway.

Norm Haft asked for the number of shops to be included in the Retail Center?  Answer: this cannot yet be reported, because the square footage of individual, accepted entrepreneurs has not yet been committed.  Haft also inquired whether conditions for financing of the Westin project have been satisfied?  Answer: the conditions have been satisfied.

Joe Malbasa echoed Chairman Kruegers commendation of the Authority personnel who have brought the Beach Village close to finalization.

Representative Elect Jeff Chapman inquired whether the members of the Jekyll Island State Park Legislative Oversight Committee have been informed of the proceedings leading to the satisfaction of the financing conditions for the Westin Hotel?  Answer: yes, both House and Senate versions of the Committee.  Chapman offered his services to the Park Authority in his new position in the State House of Representatives.

David Egan asked whether the Park’s Tourism Development Funds would be maxed out after incentivizing the Westin and the Hyatt, or would there be monies available to potential further hotel developers (e.g., Trammell Crow)?  Answer: the Fund is intended for development of new hotels, rather than replacement of old hotels.

Chairman Krueger adjourned the Committee Meeting at 11:47 AM.


Respectfully submitted,
Steven Y. Newell, Jekyll Island Citizens Association; produced after transcribing from a digital voice recorder.