December 2012 Progress

December 2012

Vol. 8, No. 9

410-641-6029

www.oceanpinesprogress.com

Insurance may not pay for repairs to Yacht Club pool

THE OCEAN PINES JOURNAL OF NEWS & COMMENTARY COVER STORY

Ocean Pines’ robust investment in golf The OPA has launched its next phase of golf course greens and drainage improvements costing about $1 million. When the first phase of greens replacement is included, along with about $500,000 in operating losses projected for the current fiscal year, Ocean Pines property owners’ contributions toward golf will exceed $2 million in roughly one year.

By TOM STAUSS Publisher

A

fter months of debate over financing issues that only concluded in early November, when the board of directors agreed to push funding decisions on golf course drainage improvements to the pending Fiscal Year 2014 budget process, McDonald and Sons, the Jessup, Md., based golf course contractor, began work on greens replacement and golf course drainage improvements in early December.

The combined greens and drainage projects represent an early Christmas present from the Ocean Pines Association to the small contingent of committed Ocean Pines golfers, those who purchase annual golf memberships. These golfers reside in 155 Ocean Pines households; that’s according to the OPA’s

club membership report dated Oct. 31. Also on the receiving end of Ocean Pines’ largesse are three associate golf members, those who neither live in Ocean Pines nor own property here.

The course is also open to non-member golfers, of course, both residents and non-residents, whose relationship to the course is more tenuous than the committed core members.

Once these course improvements are complete and the course is in much better shape, more likely to attract nonmember play in greater numbers, Ocean Pines property owners’ considerable investment in golf may constitute a gift enjoyed by far more than the core group of 155 member To Page 8

DRAMA IN THE BOARD ROOM

Clarke under investigation for alleged conduct violations Colleagues lodge complaints against outspoken director, who is ‘lawyered up’ to defend himself

By TOM STAUSS Publisher n closed session following their regular meeting Nov. 28, Ocean Pines Association directors apparently informally authorized their counsel, Joe Moore, to conduct an investigation into complaints against one of their colleagues, Marty Clarke, who had departed the meeting prior to Moore being given his marching orders.

Near the close of the open session, when Director Ray Unger made a motion to reconvene in closed session for an unspecified legal matter, Clarke objected. He wanted the matter discussed in public.

I

He announced that OPA President Tom Terry previously had informed him that he was being charged by some of his colleagues, including OPA General Manager Bob Thompson, with violating Board Policy Resolution 1-05-40, a code of conduct that purports to regulate behavior and decorum of OPA board members.

Although the code of conduct doesn’t actually exist – it was repealed by board action in a meeting on May 16 in 2007 – Moore’s investigation could at least in theory lead to a board vote to remove Clarke from office.

Joining Clarke in preferring a public airing of the charges was Director Dave

Stevens, who seemed to suggest that Clarke was being unfairly accused of charges by unnamed accusers.

“Isn’t it a basic right to know what you’re being accused of?” Stevens asked of Moore.

The OPA counsel, whose presence at any OPA board meeting is atypical, declined to discuss any of the specific charges leveled against Clarke. He flatly told the directors that he would not offer any legal advice to them in open session.

Stevens then said any closed session should be limited to process questions, with “no discussion of any charges or acTo Page 21

There is no official word yet as to whether or not the Ocean Pines Association’s insurance carrier will pay for repairs or replacement of the Yacht Club swimming pool, but it isn’t looking good, according to General Manager Bob Thompson.

The pool was damaged - with a portion of it popping out of the ground - by Hurricane Sandy.

During the Nov. 28 monthly board of directors meeting, Thompson said that the storm surge that accompanied Hurricane Sandy pushed water underneath the pool structure, lifting it away from the ground. “Because there was such a significant storm surge, the whole thing got lifted,” he said. /Page 5

Board spars over release of land offer details Ocean Pines Association directors during their Nov. 28 monthly meeting couldn’t agree on the method they decided on in late October to release information about the OPA’s standing $1.49 million offer on the table for the purchase of the Pine Shore Golf property on Beauchamp Road, just north of Ocean Pines.

Three directors said during the Nov. 28 meeting that the motion called for Thompson to issue a press release about the rescinded offer in the days following Hurricane Sandy. The press released never happened. /Page 24

Forecast predicts $335,000 loss for OPA at end of year Operations at the Ocean Pines golA financial forecast for the remainder of the current fiscal year recently presented by General Manager Bob Thompson shows that the Ocean Pines Association will be generating a substantial operating loss for the current fiscal year, absent a course correction that so far has not been presented by management.

During the general manager’s report segment of the Nov. 28 meeting of the OPA Board of Directors, Thompson presented a “by the numbers” chart that forecasts a $334,659 operational loss for the fiscal year ending this coming April 30./ Page 14

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December 2012 Ocean Pines PROGRESS

3

OCEAN PINES BRIEFS Stevens provides golf council update

Ocean Pines unofficial golf committee, the golf council, is doing a lot of good in the community, according to Dave Stevens, its liaison to the OPA board of directors.

“The golf council is elected by the members of the golf club and consists only of members. They elect their own board and basically they do a lot of things that are community oriented...”

Stevens said during the Nov. 28 meeting of the Ocean Pines Association’s board of directors.

Stevens said the group is involved in the junior golf program at the OPA’s course, provides scholarships, does fund-raising and interacts with the golf course’s contract management team regarding the conditions of the course.

He said the group of golfers has conducted about $17,000 worth of fundraising to sponsor scholarships and various activities around the community.

Director Dan Stachurski added that the golf council raised money to help cover costs for two OPA employees at the Tern’s Grille when they had serious medical conditions and could not work.

“It is a group of people who care. It’s not just caring about golf,” Stachurski said.

Although the golf council is comprised of golf club members, anyone is invited to attend its meetings and make comments related to the golf course, he said.

“As a group they play and are more familiar with the Ocean Pines golf course” than anyone, according to Stevens.

“They are not a formal Ocean Pines advisory committee. That, I believe, is a gap in our organization.”

Ocean Pines begins annual leaf removal

Ocean Pines customers of Waste Management are on notice to put out bagged leaves for collection. Waste Management will pick up four bags of leaves from each customer per trash pick-up or eight bags a week.

The Ocean Pines Public Works Department has also started the annual process of vacuuming leaves from the ditches in the community.

That process will run through midJanuary.

Public works will collect bagged leaves as well in its trash truck through Dec. 21.

Bagged leaves on the north side of Ocean Pines will be picked up on Tuesdays and Fridays and bagged leaves on the south side will be collected on Mondays and Thursdays.

Wednesday is an alternate collection day throughout Ocean Pines.

The public works yard is open Monday to Friday from 7:30 a.m. to 3 p.m. and Saturdays from 8 a.m. to 4 p.m. through Saturday, Dec. 22 for drop off of

any yard leaves.

Paper bags are preferred.

O’Hare seeks rehiring of animal control officer

Ocean Pines Association Director Sharyn O’Hare recently raised the possibility of restoring the position of animal control officer when the board of directors reviews the draft budget for Fiscal Year 2014 beginning this January.

With every indication that she supports restoration of the position, eliminated several years ago when the OPA was seeking to cut costs, O’Hare told members of the OPA’s Budget and Finance Advisory Committee during its Nov. 27 meeting that Ocean Pines Police Chief Dave Massey and Worcester County Animal Control support restoration.

Committee chair Dennis Hudson commented that recreating the position “shouldn’t cost us (the OPA) a dime,” because the Ocean Pines Department isn’t “that busy.”

O’Hare cited a recent tragedy suffered by an Ocean Pines resident whose dog was killed by a neighbor’s dog that was not on a leash, after several previous incidents involving the same animal went unreported to county animal control.

Gift-gathering

Anna Foultz and her Star Charities volunteers from Ocean Pines have been busy gathering gifts for soldiers in Afghanistan. On Dec 4, along with members from the Maryland National Guard in Salisbury, they packed the gifts in a van for delivery overseas. Shown with the gifts all loaded for the journey are from left: Front, sitting: Anna Foultz, Lou Ann Trummel, Lee Tilghman, and Sandy McAbee. Rear: Mary Ellen Schreiner; Sgt. Jessica Hunt; Jeremy Werner, Family Assistant Center Specialist; Christy Collins, Battalion Family Readiness Group Leader; Judy Chuvala; Barbara Mazzei; and Peggy Rumberg. Star Charities volunteers not present: Irmgard Heinecke and Lily Tunis.

Aquatics budget needs readjustment, Terry says

OPA President Tom Terry, after General Manager Bob Thompson offered explanations for why the aquatics department is not performing well financially, says the OPA in next year’s budget review process will “have to bite the bullet” and adopt a more realistic aquatics budget.

Terry made the comments during the Nov. 28 board of directors meeting.

Thompson cited declining membership revenue, offset by higher coupon and cash revenues, as well as swim lesson revenue that has not materialized as originally forecast, as reasons why aquatics is under budget.

The general manager said that state regulations for public pool operations require staffing at current levels, and Terry said he accepts that there is little room for cuts in the guard staff going forward.

Thompson noted that OPA Aquatics Director Tom Perry has been able to trim utility costs, resulting in savings relative to budget.

GM cites banquet decline for Yacht Club losses

OPA General Manager Bob Thompson, during the Nov. 28 board of directors meeting, once again cited declines in banquet business as the primary driver behind operating losses at the Ocean Pines Yacht Club. He added To Page 5

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December 2012 Ocean Pines PROGRESS

OCEAN PINES BRIEFS From Page 3 that expenses at the amenity have been managed better this year under food and beverage manager David McLaughlin.

He says that uncertainty caused by the pending construction of a new facility is a contributing factor to banquet declines, as potential banquet clients can’t be sure whether either the old facility or the new will be open when they want to schedule an event.

He predicts a much rosier banquet business once a new building is open and operational and marketing efforts can be beefed up.

The second story of the new Yacht Club is earmarked as a banquet hall.

OPA Director Marty Clarke told Thompson that it’s not just banquet revenues that are under pressure.

So are food and beverage revenues from retail operations, Clarke said.

Director Dave Stevens joined Clarke in critiquing Yacht Club operations under Thompson’s tenure as general manager.

“I have no confidence banquet business will come back with a new building,” Stevens said.

Director Terri Mohr sounded a more optimistic note, commenting that the existing Yacht Club is “looking a lot more decrepit” of late, and that the economy is hurting revenues.

But she said she would choose a “modern new building” over the old one any time.

“I agree with you, Terri,” Stevens replied. “But we just don’t know” whether a new Yacht Club will be the panacea that some of its proponents believe.

Pines road paving nears completion

Yacht Club loses much-praised chef

Chett Bland, the much heralded chef who by most accounts improved the quality of food produced at the Yacht Club over the prime summer months, recently departed on his own volition.

In a telephone interview in early November, Bland acknowledged that he had walked off the job after an unpleasant exchange with one of his coworkers, which he declined to detail for attribution.

“I don’t want to get anyone in trouble,” he said.

Bland said that OPA General Manager Bob Thompson, President Tom Terry, and Director Sharyn O’Hare all tried to persuade him to come back to work, but he regretfully decided that the Ocean Pines job was not the right fit for him.

“I kind of feel like I’m letting my community down,” Bland said candidly, but he said he doubted he would be available for employment when a new Yacht Club is open for business sometime in 2014.

He said he was actively engaged in a new job search and expected to have something lined up relatively soon.

Insurance may not pay for damaged Yacht Club pool Directors say it will be repaired or replaced as quickly as possible

By ROTA L. KNOTT Contributing Writer here is no official word yet as to whether or not the Ocean Pines Association’s insurance carrier will pay for repairs or replacement of the Yacht Club swimming pool, but it isn’t looking good, according to General Manager Bob Thompson. The pool was damaged - with a portion of it popping out of the ground - by Hurricane Sandy.

During the Nov. 28 monthly board of directors meeting, Thompson said that the storm surge that accompanied Hurricane Sandy pushed water underneath the pool structure, lifting it away from the ground. “Because there was such a significant storm surge, the whole thing got lifted,” he said.

The surge washed away the ground under the pool and the structure remains tilted, with one corner higher than the others. Thompson said there may be problems with the substructure of the pool, including plumbing connections that are not easily visible at this point.

“There was damage under as well as around the pool,” he said.

Thompson said he has been in contact with the OPA’s insurance company about the pool problem but is not sure if it will be covered based on the policy.

“Everything I’m seeing so far, it does not look like it’s covered by insurance,” he said. But because “a lot of people had a lot more damage than we did,” he said decisions regarding insurance claims are running behind.

Meanwhile, an engineer is looking at the pool to determine if it can be re-

T

t

Work crews began work in November

repaving four Ocean Pines streets, Sandyhook Road, Pinehurst Road, Teal Circle, and Beacon Hill Road.

The target completion date was Dec. 7, weather permitting.

Work has been taking place Monday through Saturday from 7 a.m. to dusk.

OPA General Manager Bob Thompson said recently that feedback from affected residents has been positive so far, despite the inconvenience of driving through a repaving zone.

The project is being financed out of local impact funds related to casino operations at Ocean Downs two miles south of Ocean Pines.

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paired or will need to be completely replaced. Thompson said when the pool was lifted up, some of the pipe connections underneath it came off or came loose, so it can’t just be pushed back down into the hole. He said he is “trying to get all of the reports” of the damage to the pool and will have a full report later in December.

Because of the likely severity of the damage, Thompson said he thinks the engineer is going to say that the Yacht Club pool must be completely replaced and not simply repaired. “We’re preparing for it,” he said of pool replacement, adding that “I want to be open as early as possible” at the Yacht Club pool next summer.

Director Marty Clarke said getting the Yacht Club pool open by Memorial Day 2013 should not be the priority in determining how to best proceed with repairs or replacement of the pool.

“I don’t want as a director to get an emergency bell ringing because we can’t get the pool open by Memorial Day,” he said adding, “Is it possible to even think this will be open?”

“If we can’t get there, we’re not going to hurry it up... because it won’t be open on Memorial Day,” Director Dave Stevens said.

Director Dan Stachurski agreed that the OPA should not “get trapped” in a situation where it cannot get competitive bids for repairing or replacing the pool because of the approaching opening of the pool season next year. “Can we start the process now?” he asked Thompson.

Thompson said the Yacht Club facility is a heavily used pool, but it is too soon to know what its status will be come next summer. “I hate to lose that pool for even a day in the season,” he said.

Clarke said the OPA should not rush to make any repairs or replace the pool but must weigh its options with care.

“We’re going to replace the pool, insured or not insured, correct?” he asked Thompson, who responded in the affirmative.

OPA President Tom Terry said that when the association is ready to begin work on the pool, it will “get the right bids with the right contactor” and not rush the job just to get the pool open on time. He said any new pool has to be built to last another 40 years.

Director Sharyn O’Hare said the damage to the pool may be a “blessing” because the structure was so old and likely to need replacement soon anyway.

O’Hare asked about problems with the existing pool pump house and wanted to know if the storm caused damage there, too.

t

OCEAN PINES

6 Ocean Pines PROGRESS

December 2012

Thompson mum on intentions to keep Yacht Club open during reconstruction

O

cean Pines Association General Manager Bob Thompson may be retreating somewhat on plans to keep the existing Yacht Club open after the new replacement facility breaks ground in January.

During the board of directors Nov. 28 monthly meeting, Thompson declined to repeat previous vows to keep the existing building open, when asked to do so.

He said the decision remains up in the air. A new concern that will factor into the decision is whether the Yacht Club pool, damaged by Hurricane Sandy, will need to be replaced, Thompson said.

If it has to be, that would mean the existing building would be surrounded by two construction sites, one for the new building and the other for a replacement swimming pool. That could make it difficult for Yacht Club patrons to navigate a path to the club.

Another factor that could weigh in the ultimate decision is the current financial condition of the amenity’s food and beverage operation and OPA operations generally. An end-of-year projection for the association forecasts a $334,659 operational deficit for the year, with the Yacht Club forecast to lose $204,570. At the end of October, the amenity was only in the red by $19,160, so a decision to close it after the New Year could help to bring it in closer to the original budget’s projected loss of $49,812.

Reducing the revised projected deficit for the Yacht Club would also reduce the OPA’s projected operating loss.

Some board members have previously expressed skepticism about prospects of keeping the existing facility open as the new building is under construction nearby.

Director Dan Stachurski as questioned the wisdom of trying to operate a restaurant in a construction zone.

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OCEAN PINES Yacht Club pool From Page 5 Thompson said he is unsure about the extent of any damage to the pump house. “If we replace the pool we’ll take care of the pump house at that time,” he said.

Clarke asked for verification that the pool was empty of water when the storm hit. He said Thompson chooses not to retain water in the association’s pools when winterizing them even though the manufacturer recommends doing so, indicating that if the Yacht Club pool had been filled with water then it would not have been damaged by the storm surge.

But Thompson said the manufacturer has made no such recommendation. “We’ve done both over the years,” he said, adding that the OPA has tried keeping the pools full of water and emptying them.

“There’s no standard in the industry,” he said. He said he has chosen to empty the pools at the end of the swimming season because the pools are not visited by staff regularly during the offseason.

He said having pools full of water could be a safety issue.

“Some of our facilities we’re not by but maybe once a week to check on them, he said, “I think we’re better dumping the pools.”

Director Ray Unger said the OPA’s aging pools are experiencing problems such as de-lamination on the bottom and need to be emptied so they can be repainted anyway.

Director Dave Stevens chastised Thompson for not immediately notifying board members about the damage to the Yacht Club pool.

He said numerous residents approached him regarding the issue, but he didn’t know anything about it.

“Why wasn’t the board notified that we had a major problem at the Yacht Club pool?” he asked.

He said Thompson could have called or sent board members an email apprising them of the problems, instead of making them wait a month to learn about it at the next board meeting.

“Those are significant things that we ought to know about,” Stevens said.

Other than the damage to the Yacht Club pool, the OPA suffered little as a result of Hurricane Sandy.

Thompson said a tree fell on a public works department pickup truck and another tree on the golf course fell on an adjacent house, causing damage.

In both cases the OPA’s out-of-pocket expense for the insurance deductible is $500. Additionally, the association had a storm-related labor expense of $7,425 for employee overtime.

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8 Ocean Pines PROGRESS Golf course

December 2012

From Page 1 households.

But make no mistake about it: Ocean Pines’ investment in its golf course this year and next will be considerable.

The combined cost of the pending improvements is close to $1 million – about $450,000 for greens replacement and $540,000 for drainage. Some of the cost of greens replacement will be absorbed by a handful of golfers purchasing lifetime memberships. The contractor received roughly $400,000 earlier this year for the first nine holes of greens replacement, which will bring the grand total of golf course improvement expenditures to $1.4 million in roughly a year’s time, not including smaller capital expenditures and routine maintenance costs.

It doesn’t end there, however. Golf course operations are forecast to lose a not insignificant $517,622 in the current fiscal year, according to a recent year-end projection completed by OPA Controller Art Carmine and unveiled

by General Manager Bob Thompson in late November. That’s a rough estimate, despite its apparent to-thedollar precision, and it doesn’t include depreciation expense, a number that’s added into the mix when the OPA’s

auditors publish a year-end report on the condition of Ocean Pines’ finances each summer.

Bottom line, Ocean Pines property owners’ investment in golf in little more than a year will likely exceed $2 million.

But wait: There’s probably more to come, as the next phase of golf drainage improvements on the eleventh and twelfth holes still leaves roughly half of the golf course fairways to be rebuilt with new drainage infrastructure, presumably over the next three or four years.

That’s a lot of ka-ching that Ocean Pines property owners are spending on golf.

Thompson disclosed during the Nov. 28 board of directors meeting that McDonald and Sons would be bringing equipment to the job site in Ocean Pines during the last week of November, with the project manager and four crews expected to arrive to begin work Dec. 3. The plan, Thompson said, is to start work on the eleventh green, which will result in the course short one hole from the usual 18. The general manager said the so-called “19th hole” located between the driving range and the second hole will be used initially as a substitute to allow for an 18-hole round.

At some point, however, presumably when cold temperatures make playing

OCEAN PINES golf in Ocean Pines an even greater challenge, the decision will be made to close the back nine as greens construction and golf drainage improvements on the eleventh and twelfth holes get into full swing, Thompson said. The shortened course will be in play until the back nine is reopened for play sometime in the spring of next year.

As part of the drainage project, Thompson said preliminary wetlands surveys have been completed and pipe alignments along Hingham road, which runs between the eleventh green and the twelfth tee box, have been finalized.

As work begins on greens replacement and drainage improvements, financing for both projects remain somewhat unresolved, although in ways that only those concerned about OPA budget minutiae will really care about.

There’s no question that the OPA has the funds available to pay the contractor when the bills come due.

In the case of golf drainage, the revised projected cost of $540,000 will be self-financed by the OPA, with an amortization schedule to be devised during the Fiscal Year 2014 budget

review process that will begin in January. At a special meeting in early November, the board voted to abandon the previous plan to borrow $450,000 from a bank at commercial rates for drainage projects this year.

During the same meeting, Thompson proposed to spend an additional $90,000 to the originally approved $450,000, to cover costs associated with solving related drainage issues on Hingham Lane. The additional expenditure was approved by the board at its Nov. 28 meeting.

Carmine, the OPA’s controller, recently told the Progress that once drainage improvements are completed, and McDonald and Sons is paid for the work, the $540,000 cost will be reflected as a negative amount in the golf drainage reserve, which currently is in deficit by about $106,000. The OPA’s reserve summary will then show a deficit in the golf drainage reserve column of about $646,000.

When the board approved the $850,000 greens replacement project in January of this year, in two phases, it To Page 9

Clarke, Thompson disagree on pool dumping practice

A

s early indications suggest that the Ocean Pines Association will need to replace the Yacht Club pool damaged by Hurricane Sandy, OPA Director Marty Clarke and General Manager Bob Thompson are engaging in a very public spat over whether poor pool maintenance practices caused or contributed to the damage.

In remarks responding to recent emails sent to him and board members, Thompson during the board of directors’ monthly meeting Nov. 28 defended the practice of emptying all of Ocean Pines’ outdoor pools at the end of the season.

Clarke has taken the position that pools should never be emptied.

Clarke told the Progress that Thompson is “dead wrong” on this issue.

Clarke said he has spoken to four “highly respected” local pool operators and “they all agree that our pools should never be left without water in them within a minimum of 2-feet’ below the skimmers. I have also searched the Internet” and “had been unable to find even one source” that suggests that Ocean Pines’ gunite pools “should ever be drained for any long period of time.”

Thompson said that there is no industry consensus on whether to drain gunite pools over the winter. He says keeping the pools filled would constitute a safety issue as they are left unattended for days at a time.

“I have always thought of Christmas time, when it has come round, as a good time; a kind, forgiving, charitable time; the only time I know of, in the long calendar of the year, when men and women seem by one consent to open their shut-up hearts freely, and to think of people below them as if they really were fellow passengers to the grave, and not another race of creatures bound on other journeys.”

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December 2012 Ocean Pines PROGRESS

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Golf course

From Page 8 adopted separate funding mechanisms for each component. The front nine, completed this past spring at a cost of about $400,000, was financed entirely out of the OPA’s major maintenance and replacement reserve.

The logic behind that was that the nine new greens on the front nine were replacing old ones, and that reserve was established precisely to fund replacement projects, as its name suggests.

The second phase of greens replacement was to be financed through the sale of lifetime golf memberships, which so far have fallen short of the goal by roughly $200,000. Thompson has said that he continues to work on selling the needed number of lifetime memberships. The idea behind them was to avoid burdening non-golf members of the association with the entire cost of greens replacement.

“Once we complete replacement of all the greens, and fix what is perhaps the worst hole on the golf course for drainage (the eleventh), I believe we will be in a better position to resume our efforts to sell lifetime memberships,” Thompson told the Progress recently.

But should the shortfall exist when the contractor submits a bill for the work done, the general manager has not said where the money will come from. Several months ago, he said he would be offering a solution to the board for consideration, but that has not yet happened.

He continues to insist that ultimately he believes the requisite number of lifetime memberships will be sold. If so, the revenue collected would be allocated to the replacement reserve under that scenario.

Greens replacement was approved

in January on a motion by former OPA Director Pete Gomsak, an Ocean Pines golf club member. The motion read: “The Board of Directors hereby authorizes and approves immediately undertaking a project (the “Project”) to rebuild all eighteen greens of the Ocean Pines Golf Course. Specifically, the Board authorizes entering into a contract with a qualified contractor to perform the Project, which will consist of reconstructing and regrassing the greens on nine holes in Fiscal Year 2012, such work to begin as soon as possible, and the remaining nine holes in Fiscal Year 2013, at a total cost not to exceed $850,000.

“The Board further authorizes and approves funding the Project costs utilizing funds from the Association’s Replacement Reserve Account, and additionally from funds received through the sale of Lifetime Golf Memberships to individuals, under a program separately approved by the Board of Directors, the goal of which will be to raise approximately 50 percent of the total Project cost of $850,000.”

As originally conceived by Thompson, greens replacement was to be funded entirely by the sale of lifetime golf memberships, roughly 40 of them at $25,000 a pop. After test marketing with local golfers, Thompson and Gomsak realized that the original program wouldn’t fly, that older golfers in particular wouldn’t pay $25,000 for a lifetime membership that, because of incapacity or death, they might not fully enjoy.

They presented a revised proposal, one ranging in cost of $12,500 for those 70 and over to $25,000 for those under 50, with 33 golfers, as opposed to the original 40, needed to participate. The revised program, if all 33 memberships are subscribed, would raise a projected $595,000.

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10 Ocean Pines PROGRESS

December 2012

OCEAN PINES

Board approves expanded golf drainage project for this year

By TOM STAUSS Publisher fter extensive debate, the Ocean Pines Association board of directors Nov. 6 gave its final approval for this year’s golf-drainage project, expanding it to include improvements on Hingham Lane and abandoning a previous decision to fund the more expensive project by borrowing from a bank.

Directors Marty Clarke and Dave Stevens raised several objections, including Stevens’ contention that his colleagues, in approving an expenditure of $540,000 for the project, failed to identify a funding source for it. Clarke objected to the fact that the project was awarded to McDonald and Sons without a bidding process and exceeded the amount budgeted for the project by $90,000, attributable to the cost of adding Hingham Lane improvements.

The cost associated with rebuilding the fairways on the eleventh and twelfth holes on Ocean Pines’ 18-hole golf course is $450,000, the amounted budgeted this year for golf drainage.

OPA General Manager Bob Thompson, in making the case for the increased spending, said that golf course improvements on holes 11 and 12 can’t be done correctly without dealing with the infrastructure on Hingham Lane, which bisects the eleventh green and twelfth tee box at the entrance to the Innerlinks.

OPA President Tom Terry said in lieu of borrowing at going commercial interest rates from a bank, the OPA would self-finance by drafting an amortization schedule that would be implemented beginning with next year’s budget, in effect “paying back” the cost over time.

During discussion, Thompson said he had “made a mistake” in his proposal at

A

Directors abandon previous decision to fund it through bank borrowing, instead opting for an in-house funding mechanism to be included in next year’s budget the October board meeting to finance the project by taking money out of the ”historic reserve” component of OPA’s major maintenance and replacement reserve.

Instead, he said construction costs would come out of “general reserves,” a heretofore unknown funding source.

All of the OPA’s reserves are earmarked, with the board having the authority, in a super majority vote, to transfer funds from one reserve fund to another or for a reason not in keeping with that reserve’s specific purpose.

No such transfer vote occurred during the Nov. 6 meeting. In effect, the board pushed off a decision on financing this year’s drainage project to next year’s budget process, slated to begin in January.

OPA Controller Art Carmine, in response to a reporter’s question days later, said that once McDonald and Sons, the drainage project contractors, submits an invoice to cover the cost of the work it completed, and that invoice is paid, $540,000 will be added to the golf drainage reserve’s existing $110,000 deficit, increasing that deficit to $650,000.

The effect when that occurs would be to decrease the total amount of OPA’s reserves as reflected in the OPA’s monthly reserve summary published in most editions of the Progress.

The self-financing mechanism envisioned by Terry presumably will reduce that deficit over time. However, after this year’s project is completed, roughly half of the course will remain untouched

by drainage improvements. Holes eight and nine on the front nine remain to be done, with hole seven partially completed. On the back nine, holes ten and thirteen through eighteen remain on to the to-do list.

No funding source to complete golf drainage on the rest of the course has been identified. It’s unknown whether Thompson’s draft budget for next year will include additional golf drainage funding or whether he will propose doing drainage improvements or another two or three holes.

The board discussion during the Nov. 6 special meeting began after a brief project summary by Thompson. Clarke asked whether residents of the Innerlinks through their sub-association should share in the cost of the project, since Hingham Lane is the sole access road into that section. He then objected to the fact that McDonald and Sons was awarded the drainage project without a bid.

Thompson said the Innerlinks residents shouldn’t be asked to pay a share of the project, contending that Hingham Lane improvements are integral to ensuring the effectiveness of the golf course improvements. He repeated previous assertions that the entire neighborhood of properties that lies along the golf course will benefit from improved drainage on the course.

He also said that McDonald and Sons, the Jessup, Md., based company that has been awarded the second phase of greens replacement and has done

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most of the golf drainage improvements completed thus far, has a demonstrated track record working in Ocean Pines and can more easily deploy, making it more likely that work will be completed within tight deadlines. The company completed the first phase of greens replacement, the front nine holes, earlier this year.

Stevens said that the recommendation not to fund the project through bank borrowing means that the OPA is approving a project without funding it.

Terry said that it would be self-financed with details to be worked out during next year’s budgeting process.

He also took issue with Clarke’s criticism that golf drainage was “over budget,” suggesting that the portion of drainage on the golf course was within the budgeted $450,000, with the additional $90,000 attributed to Hingham Lane.

Stevens objected to Thompson’s use of the term “general reserves” as the project’s funding source.

“I don’t know where that is,” he said.

“Where is the money coming from?

When are we going to pay it back, and how are we going to pay it back?”

While suggesting that the project would be funded by “borrowing from ourselves,” through an amortization schedule to be included with next year’s budget, Terry said that he would be unwilling to continue taking that approach in the future.

“We don’t have enough money to keep borrowing from ourselves (in this way),” he said.

Director Dan Stachurski suggested that Terry suspend regular order to ask former director Pete Gomsak, who is currently serving as an OPA assistant treasurer, to address the board to explain the funding issue with respect to golf drainage.

Gomsak, invited to sit at the table, offered a history lesson on how golf drainage and greens replacement projects heretofore have been funded. He distinguished between the two. Greens replacement is appropriately funded from the major maintenance and replacement reserve, he said, while golf drainage is not, because the anticipated improvements are not, strictly speaking, replacement of existing assets.

He said the board could circumvent that problem by voting to transfer funds from the replacement reserve for golf drainage, action that he noted requires a super majority of five directors to accomplish.

When subsequent discussion seemed to shift focus to greens replacement from golf drainage, Terry tried to bring it back to drainage.

He divided the issue before the board into three separate questions: whether the board should approve the Hingham Lane expansion, whether the entire project should be approved, and whethTo Page 12

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12 Ocean Pines PROGRESS

December 2012

Golf drainage

From Page 10 er Thompson’s recommendation to abandon bank borrowing as the funding mechanism and replacing it with self-financing should be accepted.

The first question was settled on a 5-1-1 vote, with Stevens in opposition and Clarke abstaining. The second vote passed by an identical 5-1-1 vote, with Stevens abstaining and Clarke voting against. The third vote was 6-1, with Clarke in opposition and Stevens voting in the affirmative, despite his aversion to the lack of an identified funding source.

The votes taken during the Nov. 6 special meeting resolved the debate over the drainage issue, framed by Thompson during the board’s regular monthly meeting Oct. 27. Because of objections raised then by Stevens that he needed more time to consider the expanded project, including issues of financing, Terry proposed a special meeting on Oct. 31, subsequently pushed up one day to Nov. 1 and finally to Nov 6.

Thompson told the board that delaying a decision until the board’s regular meeting in November could jeopardize the planned construction timetable of Dec. 15 through April 15 next year.

During discussion, Clarke said he didn’t like the fact that the Hingham

OCEAN PINES

Lane portion of the project was not part of the approved budget for the current fiscal year. Stevens objected to the financing mechanism, questioning use of the OPA’s major maintenance and replacement reserve as the funding source.

Those objections were reprised during the Nov. 6 special meeting.

During the Oct. 27 discussion, directors other than Clarke and Stevens seemed receptive to Thompson’s argument that solving the drainage problem on Hingham Lane would be less expensive now if it was combined as part of the golf drainage portion of the project.

Thompson argued that Hingham Lane drainage issues really are inseparable from the drainage problems on the eleventh and twelve holes of the Ocean Pines golf course and therefore should be addressed together.

Thompson recommended then that the entire cost of the $540,286 project should be “borrowed” – effectively that means it would be taken out and spent - from the OPA’s major maintenance and replacement reserve, rather than from a bank at typical commercial interest rates of six or seven percent. The bank borrowing option had been approved by the board in February as part of the approved budget for the current fiscal year.

Thompson identified the portion of the replacement reserve attributed to historic depreciation, rather than the

funding stream created by the five-year funding plan four years ago, as the specific funding source.

He abandoned that approach by the Nov. 6 special meeting, probably on advice from Gomsak.

Subsequently, Stevens told the Progress he wasn’t sure of the propriety of using a reserve built up from funded depreciation for the proposed purpose of golf drainage. He said the reserve set up specifically for golf drainage has been underfunded in recent years, but that it, rather than the major maintenance and replacement reserve, was the more appropriate source for funding the proposed golf course drainage improvements.

The problem with that particular reserve, however, is that it currently is in deficit by roughly $110,000.

A similar concern about the appropriate use of particular reserves was expressed by Stachurski several months ago in the context of golf course greens replacement. He was subsequently satisfied that in fact the major replacement and maintenance reserve is an appropriate source of funding for greens replacement. OPA general counsel Joe Moore reportedly rendered an opinion in support of that approach.

Gomsak reiterated the same point during the Nov. 6 special meeting.

As explained by Thompson, the golf

course portion of the project involves rebuilding the eleventh and twelfth holes by regrading the fairways in an undulating pattern and, roughly in the center of the fairway in newly created trough areas, installing underground pipes that will carry stormwater from Ocean Pines through new outfall drain pipes.

The holes were originally built using 1970’s technology, in which the fairways were built higher in the middle with the expectation that stormwater on fairways would drain to ditches that run along the holes, Thompson said.

It often doesn’t work as intended, with water pooling in low areas and then effectively boiling grass on hot summer days, creating unsightly bare spots on the course.

Over the years, an outfall pipe that was designed to drain Hingham Lane failed, causing a pooling problem on the road that also floods the golf course, Thompson said. The failed pipe effectively has moved to such an extent that instead of directing water out of Ocean Pines, it effectively moves stormwater “in the opposite direction,” he said.

The project will install 40 inlet points for stormwater on the two golf course holes, add one mile of drainage pipes, and, according to Thompson citing an earlier drainage study on the To Page 14

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OCEAN PINES BY�THE�NUMBERS End-of-year forecast projects $335,000 operational loss for the OPA 14 Ocean Pines PROGRESS

December 2012

28�November�2012

A

Golf drainage From Page 12 golf course’s back nine, will impact more than 23 acres of Ocean Pines development.

The original four outfalls serving the back nine holes will be expanded to eleven, he said, providing flexibility to continue drainage improvements on other back nine holes, specifically holes 13 through 16.

The project will also enlarge the pond on the right side of the twelfth hole close to the green, allowing for more water to collect. The existing pond is not outfitted with a pipe that drains to an outfall, and Thompson said the project includes a new drain outfall to remove water from the expanded pond.

The enlarged pond would expand stormwater storage, allow more water to flow away from neighboring homes, pro-

Quarterly Forecast Quarterly�Forecast

OPERATING RESULTS

REVENUE

EXPENSE

FORECAST NET

BUDGET NET

VARIANCE

$4,994,507

$1,393,108

$3,601,399

$3,510,491

$90,908

Public�Works

$149,800

$1,688,983

$1,539,183

$1,589,773

$ , $50,590

Public�Safety

$401,000

$2,077,645

$1,676,645

$1,681,231

$4,586

$1,043,532

$967,072

$76,460

$1,439

$ 5,0 $75,021

Aquatics

$576,400

$748,630

$172,230

$49,016

$123,214

Golf�Ops�+�F&B

$878,551

$1,396,173

$517,622

$160,159

$357,463

Beach�Club

$248,101

$150,369

$97,732

$90,600

$7,132

Yacht�Club

$833,132 ,

$1,037,702 , ,

$204,570 ,

$49,812 ,

$154,758

$9,125,023

$9,459,682

$334,659

$72,539

$407,198

Administration

Recreation

TOTALS

Fiscal 2013 Financial Forecast for Ocean Pines Association departments. Note: Recreation includes Parks and Recreation, Yacht Club and Beach Club parking to sugarcoat the results in his remarks to the board. He offered no plan to reverse course, although he mentioned briefly that he has been working with representatives from Billy Casper Golf, the OPA’s golf course contractor, to develop a new marketing plan to promote new golf membership and outside play.

Revenues generated by both of these sources are substantially off budget for the year.

A majority of OPA directors do not seem to be blaming Thompson for the budgetary performance, although two directors, Marty Clarke and Dave Stevens, in recent months have been out-

t

By TOM STAUSS Publisher financial forecast for the remainder of the current fiscal year recently presented by General Manager Bob Thompson shows that the Ocean Pines Association will be generating a substantial operating loss for the current fiscal year, absent a course correction that so far has not been presented by management.

During the general manager’s report segment of the Nov. 28 meeting of the OPA Board of Directors, Thompson presented a “by the numbers” chart that forecasts a $334,659 operational loss for the fiscal year ending this coming April 30.

The budget for the current year approved last February forecast a $72,539 surplus for the year. The projected loss in the revised numbers represents a rather substantial $407,198 negative variance to budget.

Amenity losses in golf, aquatics and Yacht Club food and beverage operations are driving the projected loss for the year. Thompson’s chart indicates that golf will lose $517,622 for the year, the Yacht Club will lose $204,570 and aquatics will be in deficit in the amount of $172,230.

The negative variance to budget for each of these amenities is projected at $357,463 in golf, $154,759 in Yacht Club food and beverage, and $123,214 in aquatics.

The budget forecast for the remainder of the fiscal year is based on actual financial results for the first six months of the fiscal year, May through October.

Though there were previous indications that losses for the year were likely, the forecast presented by Thompson quantifies it.

OPA Controller Art Carmine was involved with assembling the numbers in Thompson’s summary.

The general manager made no effort

vide soil to raise the fairway, and allow golfers to “see the pond better,” according to Thompson.

Thompson said that the holes would be reconstructed at the same time as greens reconstruction takes place on the back nine. McDonald and Sons will do both projects simultaneously, effectively making it impractical to have the back nine open for play during much of the mid-December to mid-April timeframe.

During the Nov. 6 special meeting, Thompson said that initially, at least, work could be confined to one hole at a time. By using the 19th hole on the front nine as a replacement, he said that initially the back nine could be kept open for play once work on the project begins in December.

He said the back nine will have to be closed as construction continues. He said he hopes to be able to reopen the back nine in the April-May timeframe.

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December 2012 Ocean Pines PROGRESS

Yacht Club slips into deficit for year Clarke, Stevens renew criticism of amenity’s performance that Thompson blames mostly on declining banquet business stemming from difficulty in booking new business as construction of new facility looms

By TOM STAUSS Publisher perations at the Ocean Pines Yacht Club restaurant slipped into deficit territory for the year in October, losing $23,157 for the month and recording a cumulative deficit through Oct. 30 of $19,160, which is slightly more than $100,000 under budget.

The year-to-date numbers also show an erosion from cumulative results through October of last year, when the Yacht Club showed a modest $10,473 surplus through October. The slide means that the amenity is about $30,000 behind last year’s pace.

It’s a performance that two critics,

O

End-of-year forecast From Page 14 spoken in their dismay over financial results this year. Their public comments have been interpreted by some as personal attacks against the general manager, with Thompson himself on occasion calling them mean.

Stevens said during the Nov. 28 board meeting that the criticism is not meant as personal attacks against Thompson. .

“I’m frustrated,” Stevens said.

OPA President Tom Terry singled out golf results as an area of particular concern.

“How are we off $350,000 in a budget they (BCG) prepared?” Terry said. “Sorry if I sound like a fellow board member,” he added, no doubt alluding to either Clarke or Stevens.

Thompson said he and Carmine based their projection of a total closure of the back nine as McDonald and Sons begins greens replacement and drainage improvements on the back nine this month. Thompson said work will begin on the eleventh green, with the intent of keeping the other holes on the back nine open for as long as possible, using the so-called 19th hole on the front nine as a replacement until it’s no longer possible to keep the back nine open.

Stevens wondered how the OPA is “going to crawl out” of a $500,000 hole, further asking how “much more investment in golf” will be needed to “make operational goals.”

Clarke said the board was responsible for creating “this mess” and he wondered whether “it’s even possible” to get out of it.

Thompson offered some hope for a financial recovery in golf, telling the Progress recently that he and the new BCG manager, John Malinowski, are developing a marketing plan designed to reintroduce the Ocean Pines golf course to potential members and the general public.

The plan is to unveil it in the spring.

Ocean Pines Association directors Marty Clarke and Dave Stevens, continue to criticize during monthly board meetings. Other directors have been muted in their comments, with Terri Mohr during the most recent board meeting commenting that she looks forward to a new Yacht Club which she said will dramatically improve opportunities to bring in new revenues.

As General Manager Bob Thompson tried to put the best possible face on the Yacht Club numbers, attributing them mostly to declining banquet business, Clarke and Stevens hammered the general manger for October results, using such terms as “horrible” and “terrible”

to describe them.

For the first time in a public forum, Thompson during the board’s Nov. 28 monthly meeting declined to definitively pledge his intentions to keep the existing Yacht Club open after the New Year once construction of a new, $4.3 million, 20,300 square foot facility commences.

Complicating that decision is the status of the Yacht Club swimming pool, damaged by Hurricane Sandy. T hompson said he is awaiting an engineering report that will recommend either a repair or complete reconstruction of the pool.

If the recommendation is for a new pool, as the general manager has indi-

OPA Net Financial Operations through Oct. 31, 2012

15

cated he believes is the more likely scenario, he would have to consider the fact that the existing Yacht Club, which he previously had said he hoped could remain open as construction proceeds on a new facility, would be sandwiched between two construction sites in the coming months.

The Clubs Advisory Committee has been debating a recommendation to close the Yacht Club during January and February, and the Budget and Finance Advisory Committee in previous years has recommended closure during the winter months as a way of controlling costs.

Thompson this year trimmed days of operation to four days, Thursday through Sunday after Labor Day, and has said keeping the restaurant open as much as possible during the off-season provides an important service to Ocean Pines residents.

Whether that objective will finally t

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OCEAN PINES OPA finances

From Page 15 yield to the exigencies of a construction site remains to be seen, but one possible consequence is that such a closure after the holiday season could work, to some degree at least, to keep the amenity’s losses from accumulating as the fiscal year enters its worst performing months.

Thompson and Controller Art Carmine recently prepared and released during the Nov. 28 meeting a budget forecast for the remainder of the fiscal year that indicates, absent any intervening event, that the Yacht Club will lose $204,570 for the year, compared to the budgeted $49,812 loss, a $154,758 negative variance.

While Clarke and Stevens aimed their heaviest fire during the Nov. 28

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meeting on Yacht Club performance, golf operations continue their worrisome trend. OPA President Tom Terry focused on golf ’s bottom line, at one point comparing his concern about mounting golf losses to his two colleagues’ concern about the Yacht Club.

The numbers to some extent show that golf, more so than the Yacht Club, explains why the OPA’s operating fund balance through the end of October is at an alarming negative variance for the year. That negative operating variance of $344,416 – it’s $316,122 excluding new capital expenditures – is very close to golf ’s negative variance to budget of $314,667 through Oct. 30.

In effect, that means, even with the Yacht Club’s $100,000 negative variance to budget, the OPA’s overall financial performance for the year would be more or less on budget had golf only performed consistent with the budget as drafted by Billy Casper Golf, the OPA golf contractor.

It didn’t, of course, and there, too, Thompson has explanations. Course conditions, which the OPA is working to remedy through ongoing greens replacement and course drainage projects, is generally regarded as the primary reasons for why golf membership and outside play revenue streams are not headed in the right direction.

While Stevens and Clarke were not open to Thompson’s attempts to cast the overall OPA financial performance in a more favorable light – Stevens at one point during the Nov. 28 meeting characterizing himself as frustrated by the general manager’s attempts – the general manager in a subsequent interview with the Progress said most OPA departments remain close to or even ahead of budget.

A decision to close the Yacht Club after the holidays, which Thompson said he is not ready to make, could stem losses there for the remainder of the fiscal year, leaving golf as the primary area of concern.

Reversing a slight operating surplus in September, golf during October recorded a $13,735 loss, a rather substantial negative variance to budget of $43,910. According to a financial summary released by OPA Controller Art Carmine, golf ’s cumulative deficit for the year is $135,435 through October.

According to a separate forecast for the remainder of the fiscal year, golf is on track to lose more than a half million dollars this fiscal year, and that’s before depreciation expense is added to that number. That loss also excludes golf-related capital expenses, which easily pushes combined golf related expenditures this fiscal year to well above $1 million.

That’s especially onerous in the context of declining annual golf membership, which stood at 158 households as of Oct. 31.

Thompson announced during the Oct. 27 monthly board of directors meet-

t

16 Ocean Pines PROGRESS

OCEAN PINES OPA finances

From Page 16 ing that Billy Casper Golf, the course manager, had brought a new director of golf and golf pro on board to replace the departed Damian Cosby, who had asked to be transferred to another BCG-managed course closer to family.

He has been replaced by John Malinowski, who Thompson said is already hard at work trying to reverse the troubling budgetary trends.

BCG officials have been invited to meet with OPA officials as part of the pending Fiscal Year 2014 budget review process that is set to begin in early January.

Revenue shortfalls continue to be the prime drivers behind the golf losses.

Greens fees were $11,751 under budget, cart fees were $8,032 under budget, and member dues were $7,805 behind for the month.

The driving range, food and beverage revenue in the Terns Grill, and pro shop merchandise sales were all under budget as well.

Net revenue for the month was $102,764, a $36,639 negative variance to budget.

Golf operations were a major factor in the OPA’s less-than-stellar financial performance in October, during which a negative operating variance of $80,619 was recorded, up from a negative $58,568 variance in September.

According to a financial report prepared by OPA Controller Art Carmine and made available to the board of directors in mid-November, revenues were under budget by $114,834 and total expenses were under budget by $34,215.

New capital expenditures were right on budget.

For the first six months of the fiscal year, the OPA had a negative operating variance to budget of $344,416, up from $263,798 through September and August’s cumulative negative variance of $205,233.

Through October, revenues are under budget by $442,511, total expenses are under by budget by $126,389, and new capital is over budget by $28,294.

Aquatics, not golf, was the worst performing major amenity as measured by operating losses for the month, with an actual deficit of $29,380, followed by the Yacht Club’s $23,157 loss and golf ’s $13,735 deficit.

Aquatics was still in the black through October with an $18,930 cumulative surplus.

That’s $74,464 less than what had been budgeted year-to-date, however, and, for October, aquatics missed budget by a relatively modest $5,549.

A major reason was the shortfall in swim class revenue relative to budget.

Labor costs also are exceeding budget forecasts.

Aquatics recorded $7,667 in class revenue for the month, $2,345 less than the $10,012 budgeted. But that represented an improvement over the previous month, when the negative variance

December 2012 Ocean Pines PROGRESS was $12,572.

Aquatics operations are actually doing better this year when compared to the same time period last year.

The cumulative $18,930 surplus through October compares to the October 2011 surplus of $12,461.

Even so, the numbers are suggesting that aquatics were aggressively budgeted for the year with projected red ink of slightly more than $49,000.

A recent forecast for the end of the fiscal year projects aquatics losses of about $172,000.

Status of reserves – A reserve summary released as part of the October financials shows that the OPA’s total reserve balance through Sept. 30 stands at $7,166,341, roughly $300,000 less than

September’s balance of $7,456,260.

The major maintenance and replacement reserve is the most flush with a $5,692,366 balance.

Of that, $1,280,322 is attributable to the five-year funding plan, currently in its fourth year of programmed assessment allocations amounting to $26 per year cumulatively, and another $4,412,044 is attributable to historical depreciation expense.

The approved $4.3 million expenditure for a new Yacht Club will take a substantial bite out of the major maintenance and replacement reserve whenever it is spent.

The intent when the current year’s budget was approved last February was to spread the construction cost

17

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Each year, the OPA collects about $3 million in assessment dollars that are allocated to various reserves.

What is depleted in the form of capital expenditures is replenished by this infusion of new assessment dollars.

Casino revenues – The OPA continues to reap local impact funds for casino operations at Ocean Downs and elsewhere in the state.

Through October, the OPA had collected $420,685 in casino funds, starting in January of 2011, according to the OPA’s October balance sheet.

The board of directors has decided to use these funds for road improvements, beginning in the current fiscal year.

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18 Ocean Pines PROGRESS

December 2012

Committee outlines budget preparation recommendations

By TOM STAUSS Publisher embers of the Ocean Pines Association’s Budget and Finance Advisory Committee are none too impressed with guidance approved by the board of directors in late October for staff preparation of the OPA budget for Fiscal Year 2014.

“I don’t know how with the board’s (approved) guidance, we can ever measure success,” committee chair Dennis Hudson told committee members during their Nov. 27 monthly meeting, adding that the guidance is “too general” to be of real value as OPA General Manager Bob Thompson and Controller Art Carmine finalize the draft budget for delivery to the board and committee in early January.

The approved guidance calls for the continuation of the five-year funding plan that allocates $26 from general revenues to the OPA’s major maintenance and replacement reserve, with another $4 allocated to a reserve fund dedicated to restoring previous year operating losses. The board approved guidance that said “the operational portion of the budget should support the operational segment of the dues, if possible, remaining at the same level” as the current year.

In addition, the approved guidance calls for “realistic amenity budgets” that “reflect continuing efforts to increase revenues through greater usage and a decrease in expenses.” The approved budget guidance refrains from directing, or proposing, that the general manager provide raises for the staff.

“The GM, however, may propose salary increases (raises) that in the aggregate amount to 3 percent of total employee salaries (not restricted as to individual employees). These raises need to be tied to specific merit measurements and not across the board. (The 3 percent maximum is not to be budgeted across the board by department, but should be placed in a separate fund for allocation at the appropriate time),” according to the approved language.

The budget guidance for FY 2014 incorporates previous year guidance that envisions the expenditure of association resources on major projects, such as road resurfacing and technology upgrades.

In addition, the approved guidance renews that board’s call for “business plans, executive summaries or business cases for new major programs or services, as well as for the operations” of the OPA’s most significant amenities, such as the Yacht Club, golf and aquatics.

“The (draft) budget should be accompanied by such business plans, executive summaries or business cases, even though they, understandably, may be preliminary and not completely developed,” according to the approved guidance.

M

Chairman says board’s approved budget guidance lacks specificity, and board liaison Terri Mohr promises committee’s detailed outline was forwarded to her colleagues and will be considered when the directors begin their budgetary review in January While not finding fault with the specifics of the approved guidance, such as they are, Hudson and his colleagues are urging that the board apply the committee’s far more detailed recommendations as it reviews the draft budget for next year. They had been hoping that the panel’s suggestions would have been incorporated in the board’s instructions to Thompson and his staff, but somehow they weren’t considered before the board acted during its late October monthly meeting.

Terri Mohr, the OPA treasurer and the committee’s board liaison, took responsibility for the apparent communication error that resulted in the committee’s recommendations not being considered prior to board action.

“I am new to the position (of board liaison)” and she said she “looked to others” for guidance with respect to the preparation of budget guidance, acknowledging that what the board approved “was general, cookie-cutter,” based on guidance approved in previous years. In failing to incorporate the committee’s recommendation as part of the board’s guidance, she said she was “going by what other people have done” in years prior.

But she told committee members that her board colleagues have all received copies of the committee recommendations, as has Thompson. She said she expects that they will be fully considered as part of the board’s pending budget deliberations.

The committee’s four-page document begins by saying that its “primary concern centers upon accurately forecasting revenue, which is the driver of associated expenses and cost structure.” By implication, the committee alludes to the fact that revenue forecasts in key OPA amenity departments, golf, aquatics and the Yacht Club, appear to be falling well short of budget forecasts in current fiscal year operations.

It’s turning out that current year forecasts, which were supposed to be based on “realistic” amenity budgets, are anything but. The association, through October, has a $344,416 negative operating variance relative to budget for the current fiscal year.

“Given the current economic environment, substantial consideration should be given to fiscal restraint, particularly to revenue calculations for discretionary items such as memberships, golf rounds, and restaurant sales volumes. Taken in combination, the slow projected economic growth (1-2 percent), and the chance of recession, rising taxes, lower county participation, little to no real growth in incomes, and the rapidly rising cost of

living (4-6 percent) to our members,” the committee is urging staff and the board “to make every attempt to hold current operating levels” to last year’s actual spending or this year’s budget,” whichever is lower.

In addition, the committee is urging the continuation of the reserve fund build-up, in effect endorsing a $30 increase in assessments if no offsetting savings are found in operating budgets.

On a macro level, the committee is suggesting that • The OPA should hold healthcare costs at last year’s levels, either by making plan revisions or implementing employee contributions, or both.

• The OPA should limit merit increases in the aggregate to no more than 1.3 percent, ranging from zero to 3 percent in specific instances.

• The general manager should include more monthly budget reviews in his staff meetings, concentrating on performance relative to budget.

The committee is suggesting that any variance in excess of 5 percent should be approved in advance by the general manager and should be classified as one-time events or permanent.

• The OPA should investigate the possibility/advisability of establishing an OPA community foundation to provide a conduit for tax deductible grants or charitable remainder trusts.

• The committee be supplied with organizational charts, including fulltime and part-time employees, for each department prior to the committee budget review sessions.

The committee then proceeds to offer department-level recommendations, with food and beverage operations, golf and aquatics the more notable.

The committee acknowledges that, with construction of a new Yacht Club expected to begin in January, budgeting for next year will be even more challenging than it already is.

“There should be a timeline reflecting the phase-in of the new club,” the committee’s document says. “Two separate and distinct budgets need to be compiled.” One would be for the existing facility and the other for the new building.

The committee urges Thompson to complete a Yacht Club “business plan, with financial projections for the new facility, prior to final budget review.”

The committee said that comments attributed to Thompson about concerns relating to proprietary marketing information “seem unfounded, based on our

performance and leadership position in the restaurant business.”

The committee also wants Thompson to employ “national standard measurements” of restaurant success when drafting the Yacht Club budget. Hudson has supplied a detailed study on industry standards to Thompson. Similarly, the committee is urging that the Yacht Club’s chart of accounts should reflect basic industry standards, “in order to facilitate performance measurements.”

Well aware that the golf budget is substantially under water for the year, both in actual terms but also relative to budget, the committee document seems mildly critical of the sale of lifetime golf memberships, which the committee indicates “has had a collateral effect on membership and numbers.” The committee does not recommend a suspension of lifetime membership sales, however.

The committee wants staff to itemize the costs associated with the next phase of greens replacement, alluding to a reduction or elimination of outside play for five to six months as the project unfolds on the back nine.

One committee recommendation, that the OPA avoiding borrowing at commercial bank rates for golf course improvements, has already been implemented by the board with respect to the next phase of golf drainage improvements.

“By doing so, we could realize a 6 percent favorable variance between interest earnings vs. interest expense. Since we are earning one percent or less on our investment accounts, prudence and fiscal due diligence need to be applied,” according to the committee document.

The committee urges Billy Casper Golf, the OPA’s golf course operator, to generate detailed statistics about rounds of golf played by members, OPA residents who aren’t golf members, package play and guests.

The committee then recommends that the OPA management “review BCG performance against national golf standards and other BCG courses, to determine the effectiveness of our contract with BCG.” On aquatics, the committee is recommending that the OPA pay off the Sports Core pool enclosure loan at 7.1 percent, to recoup difference between that and the current return on OPA’s investments in the area of 1 percent. The committee is also suggesting capacity and utilization studies for each OPA swimming pool.

In other recommendations, the committee suggests that the OPA should • complete a review of the adequacy of current reserves • conduct a cost-benefit analysis of outsourcing payroll functions • study contract services as an option for providing Public Works services To Page 20

December 2012 Ocean Pines PROGRESS

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20 Ocean Pines PROGRESS

December 2012

OCEAN PINES

Aquatics director discloses revenue, cost-cutting efforts

By TOM STAUSS Publisher o one is sugar-coating operating losses in the Ocean Pines aquatics department, but Ocean Pines Association Aquatics Director Tom Perry has some ideas for increasing revenues and reducing costs in the future.

At the Aquatics Advisory Committee’s Dec. 5 monthly meeting, Perry disclosed a new effort to reduce utility operating costs at the Sports Core indoor pool at the same he is working on an arrangement with the Worcester County school system that could increase aquatics revenues in the future.

The energy-saving idea, implemented at the Sports Core indoor pool during the first week of December, involves the installation of variable frequency drives on the motors that pump water through the pool. The regulators allow the pumps to power down beginning at 9 p.m. each night, when the pool closes, and then to power up at 6 the next morning when the pool reopens. Under state regulations, Perry said, the pumps can’t be shut off over night but can be powered down from the normal 420 gallons per minute to 336.

“The pay-off could be significant,” he said. The VFDs will also be installed at the OPA’s outdoor pools next summer, assuming that the implementation at the Sports Core produces savings over the winter.

On the revenue side, Perry told the committee he is in early discussions with the Worcester County school system for a water safety program targeted at fourth graders who attend schools in

N

Northern Worcester County. The venue for a four-session, hour-long program for participating fourth graders would be the Sports Core pool during non-peak hours, from 10 to 11 a.m. and 1-2 p.m. on days when the program is in session.

The classes would take up roughly three lanes, leaving space for lap swimmers or recreational swimmers who use the pool during those hours, Perry said.

Details remain to be worked out, but Perry is hoping to negotiate a per-head fee for the classes. Early estimates are that 400 fourth graders would participate in the program.

Ultra-violet filtering – Committee chair Virginia Reister reported on continuing efforts to quantify the cost and benefits from ultraviolet filtering equipment at the Sports Core pool that she hopes will be included in the aquatics budget this coming year, at a cost of about $35,000. She told the committee that previous indications that twice-annual pool dumps could be eliminated at a cost savings are not valid, because UV filtering does not eliminate total dissolved solids (TDS) in the pool.

She said UV, or other types of secondary filtering, probably will be required by state health officials in the future for indoor pools. UV filtering is designed to significantly reduce the amount of chlorine needed to disinfect a pool and controls the level of chlorine byproducts, called chloramines, in the water and air.

That reduces pool chemical costs and makes the pool experience more pleasant for swimmers, some of whom react badly to chlorine. Respiratory problems and skin reactions are typical.

Boat Club officers

The Ocean Pines Boat Club concluded its 22nd year with the annual meeting and change of watch dinner dance Nov. 11 at the Ocean City Golf & Country Club. Commodore Tim Mullin turned the Helm over to the Boat Club’s new Commodore, Pat Marchesiello, who will lead the way during the 2013 season. The 2013 officers are commodore, Pat Marchesiello; vice-commodore, Frank Watkins; rear commodore, William Gallagher; fleet captain, Doris Lloyd; treasurer, Fred Heinlen; and secretary, Dave Lloyd. Directors are Sharon Connelly, Robert Abele, Martin Baer, Tim Mullin, Bill Wentworth, and Walt Lischak. The winner of the 2012 outstanding member award was Pete Fox. Individuals wishing to join the Boat Club or obtain information may contact Marchesiello, who also serves as membership chair, at 410-208-6933. Pictured are, first row, left to right: Tim Mullin, outgoing commodore; Marchesiello, Gallagher, Dave Lloyd, Connelly, Lischak, Doris Lloyd, Watkins, and Baer.

Long range planning – Reister invited committee members to submit ideas for improvements in aquatics in Ocean Pines over the long-term. Comprehensive Plan Advisory Committee member Gail Blazer attended the aquatics committee meeting Dec. 5 to urge the aquatics committee to submit ideas that can be considered for inclusion on an updated comp plan for Ocean Pines.

Reister asked committee members to submit their ideas as soon as possible.

Yacht Club pool – Aquatics committee members are bracing for the possibility that the Yacht Club pool will not be open by the traditional Memorial Day launch and perhaps not anytime this

coming summer. OPA President Tom Terry, the committee’s board of directors’ liaison, told the committee that rebuilding or, if possible, repairing the pool is a high priority for the board. The pool was damaged by Hurricane Sandy.

If the decision is made for a new pool, which probably would include new decking and a relocated pump house, along with new plumbing, the question becomes whether it is realistic to expect the project to be completed in time for a new pool to be open for use this summer.

OPA General Manager Bob Thompson is awaiting an engineer report on the status of the pool sometime in December.

Budget committee From Page 10 • •

• •

review the possibility of leasing rather than purchasing new equipment combine Yacht Club restaurant and marina operations under the supervision of the facility’s food and beverage manager review the fee structure for Recreational Department classes and programs complete a comprehensive road replacement study

In addition, the committee recommends that Thompson and his staff include written justifications for requested capital projects. The panel wants “a complete review of operating and accounting systems” with the involvement of the relevant advisory committee chairs.

The committee also is urging the creation of a comprehensive marketing plan “to promote” Ocean Pines.

December 2012 Ocean Pines PROGRESS

Clarke investigation From Page 1 cusations against Marty.”

Moore responded that there is a process that should be followed when considering complaints against a board member and that consideration of those leveled against Clarke “cannot happen today.”

While removal of a board member by his colleagues for cause is permitted under OPA bylaws, that may not the likeliest scenario to unfold.

OPA Director Dan Stachurski told Ocean Pines Forum owner Joe Reynolds prior to the closed session that it was doubtful the board would be inclined to remove Clarke. Stachurski said the more likely outcome would be to “rein him in,” Reynolds said.

Removal of a director under OPA bylaws requires a two thirds supermajority, or five of seven directors, for cause, a concept that is not defined with any specificity in the bylaws. Under Section 5.12(b), “cause” includes “(but is not limited to) absence from three consecutive regular meetings of the board without sufficient justification, being more than 60 days delinquent in payment of any charges due the Association, or as provided in any resolutions adopted by the board which govern a director’s conduct.”

There are no such resolutions currently in the bylaws given the repeal action taken by the board in May of 2007, a fact that Terry may not have known prior to informing Clarke of pending charges under 1-05-40.

According to a commentary posted on the Ocean Pines Forum by Reynolds, which Clarke did not dispute when asked to comment by the Progress, there are four separate accusations against Clarke, one each by Terry, Stachurski and Sharyn O’Hare and one by Thompson. The commentary did not indicate how the Forum obtained information on the four alleged charges.

Clarke said the commentary “speaks for itself and you can quote that. For the record, it was me who tried to keep the meeting open and in the public eye.

I have done my best to serve our membership with integrity, care and loyalty.

I would much rather be judged by them than some of my fellow board members who did not want me on the board in the first place.”

According to the Forum commentary, Thompson has charged Clarke “with making comments about a possible insurance claim for damages to the Yacht Club pool caused by Hurricane Sandy.

Clarke has apparently made public comments suggesting such a claim might be denied because OPA drained the pool after the season.”

Clarke and Thompson have been engaged in a very public dispute over whether the Yacht Club pool should have been drained at the conclusion of the summer season. [See separate article in this edition of the Progress for de-

tails of their differing perspectives.]

The Forum commentary said that O’Hare has accused Clarke of “making comments about how the OPA handled notification of association members with regard to a mandatory evacuation notice from the National Weather Service during Hurricane Sandy. Clarke publicly pointed out that OPA took about three hours to notify the membership after the weather service called for mandatory evacuation.”

Clarke has said that notice should have occurred earlier and that Ocean Pines residents were put at risk, an assertion that Thompson has vigorously disputed.

According to the Forum commentary, Stachurski is accusing Clarke of disclosing items from closed board meetings. It is not known what items Stachurski is

21

“For the record, it was me who tried to keep the meeting open and in the public eye. I have done my best to serve our membership with integrity, care and loyalty. I would much rather be judged by them than some of my fellow board members who did not want me on the board in the first place.”

Marty Clarke referring to. He did not return a phone call from the Progress prior to this edition’s deadline for clarification.

Terry’s accusations against Clarke, the Forum commentary said, relates to comments Clarke made about “an OPA employee trying to ‘fix’ the OceanPinesForum.com poll on the Yacht Club referendum.” Reynolds, defending Clarke against that charge, said it was the Forum, not Clarke, who exposed the mat-

ter initially.

“Furthermore, the GM admitted the attempted ‘fix’ by an OPA staffer did indeed take place, and reprimanded the individual,” the commentary said.

Where all this goes from here is not clear. But it’s probably the case that Clarke will insist on as public a process as possible, with Stevens in support, once the results of Moore’s investigation are provided to board members.

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December 2012

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n order to fulfill its charge of notifying property owners about the annual board of directors election as well as any referendums, the Ocean Pines Association’s elections committee has recommended that related communications be sent to all owners of a lot as listed in the Worcester County land records.

Committee chairman Judy Butler presented the proposal, along with a series of other recommendations, during her annual report on the election and referendum process during the Nov. 28 board of directors’ meeting. Butler said

overall both the election and referendum this summer went well, but the committee had numerous recommendations for how to improve the process.

Currently election-related communications are sent only to the person listed first on the land records, but there can be numerous owners of a property in Ocean Pines. Those other owners receive no notifications from the OPA. The committee recommended sending all election and referendum notifications, including the annual meeting notice and copies of the Ocean Pines Report newsletter, to all owners of a property. Resolution M-06 regarding elections and referendums specifies that only a single voting package be sent for each lot or unit eligible to vote.

This applies to all joint owners of a lot or units, including co-tenants, joint tenants and tenants by the entireties.

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Committee chair Judy Butler says overall both the election and referendum this summer went well, but her committee has numerous recommendations for how to improve the process

December 2012 Ocean Pines PROGRESS

Elections committee From Page 22 owners of record at the billing address used for the association annual charge mailing.”

Director Marty Clarke said it is not practical or necessary to notify all property owners because only one vote per property can be cast in elections, even if the lot is owned by ten people. “Our articles of incorporation are pretty clear,” he said.

He said notifying every owner of property in Ocean Pines means that even everyone who owns a piece of a timeshare unit would have to receive notifications.

Clarke also said it is the property owners’ responsibility to ensure that the OPA has the appropriate mailing address on file in its administrative offices; that is the address to which election materials are mailed. It’s not the OPA’s responsibility to research property owner data in the county land records, he added.

“It is up to them to fight over who pulls the trigger. I don’t think that we want to get involved in that,” Clarke said.

Still, Butler argued that as property owners they deserve to know what’s going on in Ocean Pines’ elections. “I think those owners have the right to know about this information,” she said.

“We’re certainly not going to violate the one vote per owner,” OPA President

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Tom Terry said. But he agreed that the association may be able to “to take a look at the newsletter and see what we can do with that” to send it to all owners of property in the Pines.

Director Dave Stevens agreed, saying sending out more copies of the newsletter is “a different animal.”

Butler concurred that would “take would care of it” to serve as notification to all property owners about elections.

Director Sharyn O’Hare asked what the procedure is if a property changes ownership in the middle of the election process.

Butler said the owner of record at the time of eligibility determination by the OPA receives the ballot. However, she said owners can provide the ballot to the purchasers of their property and allow them to vote instead.

O’Hare also asked how residents who live in Ocean Pines during the summer only receive their ballots.

Butler said the elections committee can validate their membership and issue a duplicate ballot to summer residents, whose mail goes to their full-time permanent address elsewhere. Duplicate ballots are opened and checked against the list of eligible voters to verify that no one has voted twice.

Among the election committee’s initiatives for the 2013 board of directors election are better education of property owners about the proxy process and why it can be used, along with improving the proxy validation process.

Butler said many people were confused by the new proxy form, which is used by the property owners only to give someone else the right to appear on their behalf at the OPA’s annual meeting in order to generate a quorum.

“People misunderstood,” she said, adding, “We need to be clearer.”

During the recent Yacht Club referendum 72 ballots were considered invalid because property owners mailed them back in the envelopes marked for proxies instead of the correct ballot return envelope. Butler said a ballot is not considered valid unless it is mailed or handed back in the return envelope.

Other initiatives are to create a phased plan for election related news releases, development of an improved election information packet and mailing postcards to property owners to remind them of the election. Improvements to the candidate forum process, including more advertising, and changing the question structure are also on the list, as is learning how to operate the Scantron ballot counting equipment.

Procedures changes the elections committee has recommended are to change the candidate application deadline to May 10 to coincide with the requirements of the OPA’s bylaws. Another proposal is to eliminate language in the association’s resolution that requires the elections committee to meet with declared candidates for the board of directors within 10 days of the filing deadline. Butler said that simply is not

23

Santa sack for women inmates

On Dec. members of the Democratic Women’s Club delivered over 200 new toys, wrapping paper, bows and tags to the Worcester County Detention Center. The club’s Santa Sack project gives women inmates who are mothers and grandmothers a chance to select a Christmas present for their children. They can wrap their gifts and surprise their little ones when they come for a holiday visit. If the children cannot come to visit, the staff will make sure that the gifts get delivered. The inmates themselves are not forgotten. On Christmas morning, each woman receives a small Christmas bag filled with goodies. possible sometimes. Instead the committee wants to meet with the candidates when they draw for ballot position during the second week of June.

Butler said the elections committee ran into a snag with the OPA’s new property owner identification cards; because the cards do not contain the property owners name or section and lot number, they cannot be used to verify their identity at the annual meeting.

“The new id cards cannot be used for validation,” she said. “They are not a valid identification of a member to vote on anything.”

Expires 1-30-13

Director Dan Stachurski said that the identification data is contained on a magnetic strip on the back of the cards.

All the OPA needs to do is provide the elections committee with a scanner to read the cards when registering property owners at the annual meeting, he said.

Butler said there were other administrative problems that need to be addressed, including improved proofreading of the voting materials and making sure that election committee members have copies of the voter lists for verification by both name and section and lot.

Expires 1-30-13

December 2012

By TOM STAUSS Publisher cean Pines Association directors during their Nov. 28 monthly meeting couldn’t agree on the method they decided on in late October to release information about the OPA’s standing $1.49 million offer on the table for the purchase of the Pine Shore Golf property on Beauchamp Road, just north of Ocean Pines.

During an executive session of the board following its regular meeting Oct. 27, the board voted 7-0 to withdraw its offer to Cecil Bank for the property, which is just less than 100 acres. The vote was taken in executive session after vigorous debate. The motion allowed for continued exploration of the possible purchase of the property by OPA General Manager Bob Thompson, presumably by remaining in contact with bank officials.

A separate motion to allow for the disclosure of information about the offer, and its subsequent rescission, drafted

by Director Dan Stachurski, was as follows: “I move that the board authorize the president (Tom Terry) to instruct the general manager to release the information (about the motion to withdraw the offer) at such time as is convenient after the current emergency (Hurricane Sandy) is cleared up.”

Three directors – Marty Clarke, Dave Stevens and Ray Unger – said during the Nov. 28 meeting, in at times heated discussion, that the motion called for Thompson to issue a press release about the rescinded offer in the days following Hurricane Sandy. When that didn’t occur by the Friday of the week that the hurricane passed through Ocean Pines, Clarke confirmed what had been a poorly kept secret about the purchase offer and the vote in closed session to rescind it, in comments reported in the Progress’ November edition.

It turns out that four other directors – Terry, Terri Mohr, Sharyn O’Hare and the motion’s drafter, Stachurski – did not regard the motion as an explicit instruction to Thompson to issue a press release, which he still has not done.

Instead, Terry instructed Thompson to release the relevant information about the purchase offer and the reasons for it in a town meeting on Dec. 4 in the Ocean Pines Community Center.

Thompson provided key details aout the offer during the general manager’s report segment of the Nov. 28 board meeting. He said the primary reason for initially making the purchase offer back in April was that the property could be used to help resolve stormwater management issues in Ocean Pines Section 3 neighborhoods immediately across Beauchamp Road from the former golf course.

After Thompson’s brief comments during the Nov. 28 meeting, Stevens and Clarke criticized Terry and Thompson for the lack of a press release. They later said that Stachurski’s motion had been offered in the context of board dis-

O

OPA directors spar over release of Pines Shore offer information Stevens’ motion to cancel scheduled town meeting fails in 4-3 vote cussion about a press release.

Terry begged to differ.

“We all agreed that we needed to move the information (about the offer and its rescission) out to the public,” Terry said. “There is a disagreement” about how that information was to be conveyed. Terry said he decided on the town meeting approach as the best way to get the information out, because in addition to providing a venue for releasing detailed information, it also allows

for the general manager to obtain community feedback on the possible purchase of land outside of Ocean Pines.

Stevens offered a motion to cancel the scheduled Dec. 4 town meeting. It was seconded by Clarke. Stevens said that the general manager had no authority to schedule a town meeting “unilaterally” without board approval, especially in light of the board’s decision to rescind the purchase offer.

In support of Stevens’ motion, Unger

OCEAN PINES said the board had voted 7-0 “to take the offer off the table and then (took) another 7-0 vote to send out a press release.”

Under those circumstances, he said there is no need to host a town meeting.

But Terry said the board had given Thompson the authority “to continue exploring” the possible purchase of the Pine Shore property, and that holding a town meeting to keep the community apprised was fully consistent with that.

OPA attorney Joe Moore, who normally does not attend OPA meetings, told the board that the OPA bylaws give authority to the OPA president to set special meetings of the members.

“To say that it is illegal is not correct,” Moore said.

Stevens pushed back.

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24 Ocean Pines PROGRESS

OCEAN PINES Pine Shore From Page 24 “He (Terry) didn’t call the meeting,�

Stevens said. “It’s not the same thing.�

He went on to say that holding a town meeting on a proposal that is no longer on the table will cause confusion.

Mohr said that holding a town meeting will give Thompson and the board feedback on how the community feels about a potential purchase of the property.

Stachurski said the intent of the motion was to take the offer off the table while continuing to explore the possibility. “We didn’t instruct the GM how to do any of that,� he said. “If (Terry and Thompson) say a public meeting is a good way to get feedback, why would we oppose it?�

Unger then said that the original reason for making the purchase offer – the property’s possible use as a stormwater management site – had been overtaken by more recent developments. He cited a proposed solution to Section 3 drainage issues lies with nearby River Run. Terry then repeated that the intent of the motion “clearly� was to get information out to the public.

He then called for a vote on Stevens’ motion. It failed by a 4-3 margin, with Stevens, Clarke, and Unger voting to cancel the town meeting.

According to sources, it was Clarke who led the effort during the Oct. 27 board meeting to tell the general manager to withdraw the purchase offer.

Thompson, who originally brought the proposal to purchase the property to the board, was not present to defend it, having left to attend an emergency preparedness meeting in Ocean City related to Hurricane Sandy.

Initially in Clarke’s corner were Stevens and Unger. Terry is said to have reminded his colleagues that he had opposed the offer earlier in the year because of potential adverse reactions in the community, then focused on a debate whether to approve the reconstruction of the Ocean Pines Yacht Club.

Stevens told the Progress in a private conversation prior to the executive session that any purchase of the Pines Shore property, regardless of price, should only take place after a referendum of property owners. But he declined to provide details from private board meetings.

The offer on the table did not include a contingency provision for a successful referendum.

Also prior to the executive session, Stachurski did not attempt to refute a reporter’s comment that the likely subject of the executive session – a reported contractual matter involving negotiations – had to be the Pine Shore offer.

Reportedly initially leaning in favor of keeping the offer on the table were Mohr and O’Hare. Stachurski’s support was soft. He told the Progress minutes before going into the closed session that he was concerned how the proposed

December 2012 Ocean Pines PROGRESS expenditure of almost $1.5 million for Pines Shore would be perceived in the community, so soon after property owners authorized $4.3 million for a new Yacht Club. “It would undermine the good will we’ve built up with the successful passage of the Yacht Club referendum,� he said.

A possible tipping point in the process leading to withdrawal of the offer was Clarke’s reported reaction when he was told how the association arrived at its $1.49 million purchase offer. “It was based on a calculation of what was needed to avoid a referendum,� Stevens told the Progress recently.

One of the ideas initially propounded by Thompson for buying the property was its potential use to help solve drainage problems along Beauchamp Road, but that has been overtaken by more recently proposed solutions that would carry stormwater out of Ocean Pines through water mains that would run out to a stormwater management pond in River Run, a subdivision located just east of the former Pine Shore property, county commissioner Jim Bunting told the Progress recently. Estimated cost of that project is about $50,000.

Another possible use for the Pines Shore parcel is as a disposal site for dredge spoil or leaves. Board members were reportedly advised that the property’s estate zoning would not permit that kind of use, even through a special exception or variance.

Thompson also reportedly has said that some of the Pines Shore property could be developed for use as a soccer facility that could be rented out to local sports teams, but a couple of soccer fields within Ocean Pines, including one in Bainbridge Park, have fallen into disuse, so it’s unclear how much demand there would be for a dedicated soccer

facility.

Mohr reportedly argued that the property could be valuable as a way of “protecting� areas around Ocean Pines from development, citing the fact that she has heard concerns expressed about the lot clearing on the Gillis property adjacent to the North Gate.

Clarke responded that protecting Ocean Pines residents from nearby development is not a proper function of a homeowners association.

Stevens told the Progress in a recent conversation that there might be value in buying the property simply as an investment.

Unconfirmed reports have indicated that the OPA’s latest purchase offer on the table, not accepted by representatives of Cecil Bank, was for $1.49 million, slightly higher than an unconfirmed $1.3 to $1.35 million offer reported by the Progress in July of this year.

Sources say the bank has been adamant in not being willing to accept anything less than $1.7 million, close to half of the debt carried on its books for the property.

One source told the Progress recently that the individual in charge of the bank’s loan portfolio was no longer with the bank and that his replacement might be receptive to an offer lower than its previous floor.

The reported board action, while not absolutely taking the OPA out of the market for a possible purchase, means whoever controls the property no longer has a formal offer on the table from the OPA that can be accepted or countered.

The recent board activity involving the Pines Shore property is the latest that has surfaced since July, when the Progress reported that no one in the OPA was officially confirming that the OPA had made a formal offer to purchase the property.

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Pines continues with Republican registration advantage

A

s Ocean Pines voters prepared to go to the polls on General Election Day Nov. 6, or cast ballots in early voting, they were continuing on a well-established path that is trending Republican in its party registration, a pattern that is also showing up in Worcester County at-large.

All three Ocean Pines precincts have Republican pluralities.

Precinct 5-1, which voted at the Community Church of Ocean Pines on Route 589, as of Oct. 22 had 1,768 Republicans, 1,433 Democrats, and 735 unaffiliated on the rolls. Precinct 5-2, which voted at the Ocean Pines library, had 923 Republicans, 849 Democrats and 458 unaffiliated voters on the rolls. Precinct 6-1, which voted in the Ocean Pines Community Center, had 1,062 Republicans, 659 Democrats and 359 unaffiliated voters on the rolls.

Just prior to the deadline for party registration, Ocean Pines resident Charlotte Cathell, the county’s elected register of wills, changed her registration from Democrat to Republican. She told the Progress that she didn’t want to “make a huge deal� out of the party switch, adding that she did not make the change in order to improve her reelection chances in November of 2014.

She said she was uncertain about how running as a Republican would affect her electoral prospects. “I didn’t leave the Democratic party.

The national party left me,� she said.

Cathell hopes to be able to maintain support and friendships among local Democrats in her “non-partisan� duties as register of wills.

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OCEAN PINES

December 2012

GENERAL ELECTION SUMMARY

Ocean Pines’ voters defy Maryland’s ‘blue state’ hue

W

Romney, Bongino, Harris, and expanded gaming carry local precincts, while majorities oppose gay marriage and Maryland Dream Act Romney and Bongino both carried Worcester County.

In the presidential contest, Romney garnered 1,364 in District 5-1, 739 in District 5-2, and 772 in District 6-1, compared to 792, 537 and 390, respectively, for Obama. Voters in all three precincts live within Ocean Pines.

Countywide, Romney won 15,951 votes compared to Obama’s 11,014.

While exceeding Cardin’s totals in all three Ocean Pines precincts, Bongino’s totals lagged those recorded by Romney in the presidential race. Bongino beat Cardin 1050 to 679 in District 5-1, 550 to 445 in District 5-2, and 618 to 337 in District 6-1.

Countywide, Bongino beat Cardin 11,270 to 9,676.

Republican-leaning Ocean Pines also threw a majority of its votes to Congressman Andy Harris in his reelection bid for Maryland’s First District seat in the U.S. House of Representatives.

Harris faced an eleventh hour write-in candidate because his presumed opponent, Democrat Wendy Rosen, withdrew

her candidacy because of reports that she may have been registered to vote in Florida. Maryland’s First District, including all Eastern Shore counties, usually votes for the Republican candidate running for Congress every two years, even with Democratic registration advantages.

Rosen remained on the ballot because her withdrawal occurred after the official ballot deadline.

Harris has conducted numerous town meetings in Ocean Pines since his successful Congressional bid two years ago.

Harris’ Ocean Pines totals exceeded those of Romney by a nominal number.

Harris led Rosen 1,381 to 490 in District 5-1, 753 to 362 in District 5-2, and 774 to 218 in District 6-1.

Countywide, Harris beat Rosen by a 15,879 to 7,096 margin.

Worcester County voters voted by a wide margin to confirm Brian Daniel Shockley as a Worcester County Circuit Court judge, as well as Stuart R. Berger as a judge in Maryland’s Court of Special Appeals, the state’s second highest

appeals court.

Ocean Pines resident Jonathan Cook ran unopposed to the Worcester County Board of Education, representing District 5 (Ocean Pines). He won 3637 votes, against 14 write-ins.

The ballot included seven referendum questions, two of which didn’t directly affect Worcester County (questions one and two). They related to qualifications for Orphans Court judges in Prince George and Baltimore counties. Voters statewide changed the Maryland constitution to require Orphans Court judges in those counties to be licensed lawyers in the state. Voters in Ocean Pines and elsewhere in the county voted, as did voters statewide to approve these constitutional changes.

A third ballot question involved a proposed amendment to the Maryland constitution that changed the point in time when an elected official charged with certain crimes is automatically suspended or removed from office. This amendment easily won voter approval statewide, and here, too, Ocean Pines and county voters were in synch with the state. Question 3 recorded 1,813 t

By TOM STAUSS Publisher hen Ocean Pines residents went to the polls to vote in the General Election on Tuesday, Nov. 6, they, along with other voters throughout Maryland, chose among candidates for U.S. president, U.S. Senator, and U.S. House of Representatives.

The outcome of these contests among state voters weren’t particularly suspenseful in blue-state Maryland.

The statewide results did not mirror those in Worcester County, however, or those in the three Ocean Pines voter precincts, which have Republican registration pluralities. Significant Democratic voter registration advantages in the state resulted in President Barack Obama and U.S. Senator Ben Cardin cruising to victories, but the likely results in Ocean Pines precincts told a different story about local political preferences.

Former Massachusetts Gov. Mitt Romney, the Republican candidate for president, easily carried Ocean Pines precincts, as did Republican U.S. Senate candidate Daniel Bongino, who failed in his uphill bid to unseat Cardin.

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WORCESTER COUNTY Election From Page 26 “for” votes and 260 no votes in District 5-1. The margin was 1,073 to 166 in District 5-2 and 998 to 133 in District 6-1.

The Worcester County total was 22,083 in favor and 3,404 opposed.

The remaining four referendum questions received far more media scrutiny in the recent election cycle. Ocean Pines voters had a voice in helping the state decide the fate of the Maryland Dream act, concerning tuition rates for undocumented immigrants; on the gerrymandered Congressional districting plan passed by the Democrat-dominated General Assembly but petitioned to referendum; and gay marriage legislation, which allows gays and lesbians to be married in the state while providing for certain religious protections.

Ocean Pines voters also had a role in deciding whether to permit an expansion of gaming in the state, particularly table games at Ocean Downs casino, and the establishment of a new gaming venue at National Harbor in Prince George’s County.

This referendum, passed by state voters and endorsed by a majority of voters in Ocean Pines and the Worcester County, should result in increased revenues over time that will be distributed to the Ocean Pines Association and the county’s four municipalities, in the form of local impact funds. Ocean Pines share of the impact funds have been earmarked by the OPA for road improvements.

The law also will allow the county commissioners to vote to allow Ocean Downs to operate on a 24-hour schedule.

Of these four ballot questions, Ocean Pines and county voters cast ballots in synch with the state on two and diverged on the other two. The County and Ocean Pines voted with the state in endorsing the expansion of gambling and for a Congressional redistricting plan. County and Ocean Pines totals diverged from statewide results on questions relating to gay marriage and the Dream Act Question 7, on the expansion of gaming, county voters voted in favor with 14,474 votes, with 12,414 opposed.

In District 5-1, the margin was 1,257 to 9,132; in District 5-2, 753 to 536; and District 6-1, 678 to 490.

On Question 6, pertaining to the gay marriage amendment, 1,179 votes in opposition were cast in District 5-1 with 946 in favor. In District 5-2, the tally was 649 against and 617 in favor, and in District 6-1, the margin was 677 against and 458 in favor.

Countywide, voters were in opposition to gay marriage, 15,212 in favor with 11,096 opposed. Statewide, the amendment passed by a 52 to 48 percent. As of Jan. 1, gays in the county will be able to obtain marriage licenses in Snow Hill at the courthouse.

Question 5 pertained to a Congressional redistricting map that resulted in six Congressional districts tilting towards Democrats, a gerrymander that resulted in the defeat of a veteran

December 2012 Ocean Pines PROGRESS

AROUND THE COUNTY School officials present capital improvement plan

The Worcester County Commissioners in November gave their approval to the proposed fiscal year 2013 school construction and capital improvement plan for Worcester County Public Schools.

Jerry Wilson, superintendent of schools, presented the plan, saying it was developed in compliance with Maryland Interagency Committee for Public School Construction guidelines. The IAC is the state agency charged with approving school construction.

A feasibility study regarding the renovation of Showell Elementary School is included in the plan for the fall of FY 13.

The school system will seek state autho-

Republican Congressman in one of the newly redrawn districts in November.

The state’s Congressional delegation is now 6 to 1 Democrat, with Andy Harris the sole remaining Republican in the first Congressional district. The gerrymander added more Republican-leaning precincts to Harris’ district, making a Democrat’s chances of capturing the seat in future elections more difficult.

Ocean Pines voters favored the Congressional gerrymander – 1,243 to 703 in District 5-1, 807 to 367 in District 5-2, and 682 to 402 in District 6-1.

Countywide, voters endorsed the new redistricting map by a 16,153 to 7,963 margin.

On Question 4, pertaining to the Maryland Dream Act, county voters were in opposition by a margin of 13,725 to 12,183. In District 5-1, the tally was 1,122 against to 984 in favor; in District 5-2, 654 against to 602 in favor. In District 6-1, 635 were opposed while 511 votes were cast in favor.

rization to begin architectural planning in FY 16 and construction funding in FY 17.

For FY 14 the plan includes the renovation and expansion of Snow Hill High School, with anticipated state funding of $4.66 million and the county shouldering a financial burden of $45 to $46 million. Bid documents for the project are expected to be issued in the summer of 2013 with construction contracts to be issued next fall. A smaller project to renovate lamps/ballasts at Snow Hill Middle School is also included for FY 14, with the state contributing $166,000 and the county funding $40,000. The project is expected to save $40,000 annually in electric costs at the school.

With the commissioners’ approval of the plan, the school system can submit the document to the IAC for review.

County sells $6.2 million in general obligation bonds

During a November meeting, the Worcester County Commissioners approved legislation authorizing the county to sell general obligation bonds and the following bond anticipating notes for an amount up to $6.2 million.

The bond sale will refinance the prepayment of the county’s outstanding special accrued liability contributions resulting from the transfer of the correctional officers at the jail from a county retirement system to the state retirement system, which occurred in July 2008.

The refinancing is expected to save the county about $1.5 million in future interest expenses, according to Harold Higgins, county finance officer. Higgins said the bulk of the savings will occur during the next six years.

The commissioners plan to travel to

27

New York in December for the bond sale.

Worcester school counselors take part in DEF roundtable

Counselors from Worcester County Public Schools joined with their counterparts from across the lower Delmarva Peninsula during the Delmarva Education Foundation’s second High School Counselors Roundtable to discuss ways to successfully help students achieve their dreams of attending college.

More than 30 high school counselors from Worcester, Wicomico, Somerset and Dorchester counties in Maryland, Sussex County, Delaware and Accomack County, Virginia gathered on Oct. 26 to talk about issues related to the college preparation and financial aid process and to share best practices. Dr. Lynn Wiljanen, dean of student development at Wor-Wic Community College, facilitated the roundtable discussion, which addressed topics like working with sponsors to promote their scholarships, using social media to increase awareness of financial aid, and how to make the scholarship application process easier for students.

Church is president, Lockfaw is vice-president

Not much ever changes in Worcester County government; on Tuesday, Dec. 4, the Worcester County Commissioners re-elected Bud Church as commissioner president for the coming year. Commissioner Merrill W. Lockfaw, Jr. was selected as vice-president, replacing Commissioner James Purnell in that position.

Church was elected commissioner in 2002 to represent District 3. He is the Broker Owner of Coldwell Banker Bud Church Realty, Inc. in Ocean City. Lockfaw was elected as a commissioner in 2010. He retired as the Worcester County Roads superintendent after19 years.

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December 2012 Ocean Pines PROGRESS

CAPTAIN’S COVE

Cove utility seeks expedited decision on new rate structure

Some property owners would pay more, others less, under a revised rate structure that could be implemented as soon as January billing cycle if corporation commission acts

By TOM STAUSS Publisher

A

pparently frustrated by the length of time it’s taking for the Virginia State Corporation Commission to resolve the pending rate case involving rates it charges Captain’s Cove customers for water and wastewater treatment services, the Captain’s Cove Utility Company recently filed a request for an expedited review.

The request, filed in mid-November, asks the commission to immediately rule on a hearing examiner’s recommendation in June for a modified rate structure reflecting a recalculation of interest expense related to a disputed promissory note of $86,916 and on adjusted annual revenue of $937,318.

The CCUC is asking the commission’s permission to immediately begin billing Cove customers under the new rates and to apply them retroactively from February of 2011. The company is currently operating under an injunction to maintain operations and water and wastewater treatment services to its customers, but “CCUC is operating at a loss because it is being forced to operate pursuant to an underfunded budget,” according to the filing.

Since February of 2011, the company has been operating under an interim rate structure, $30 a month each for water and sewer usage and $15 each for water and sewer availability. These rates have been billed quarterly, with a portion of the collected funds held in escrow.

If the corporation commission grants the expedited request, those escrowed funds would be released to the utility company.

Under the revised structure, water service customers are to be billed $42.07 monthly, while water availability customers would face a $6.40 monthly rate.

Water availability customers would be entitled to a refund of rates paid since February of 2011 under the new rate structure. Water service customers would be retroactively billed for the difference between $30 and $42.07 monthly dating back to February of 2011. At $12.07 per month over 23 months, the retroactive payment would be $277.61.

No retroactive billing can occur without corporation commission approval.

Sewer service customers – many Captain’s Cove residents maintain individual septic systems, so this fee is not universally applied – would pay $62.55 per month. The new rate for sewer availability is $20.69. Under the new rate structure, both classes of sewer customers would owe more than the interim rates now in effect. Sewer service customers would owe the difference between $30 and $62.55 monthly while sewer availability customers would owe the difference between $20.69 and $15 per month, again retroactive to February of 2011.

The new rate for the Cove property owner association’s Marina Club building would be $1,051 per month for water and $1,563,68 for sewer.

According to the filing, if CCUC is “forced to continue operations without

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sufficient revenue due to not being able to implement new rates, or due to not being able to bill retroactively to Feb. 2011, CCUC will not be able to achieve, or maintain quality services” to customers.

In addition, the CCUC filing indicates that the new rate design “would more accurately allocate the cost of service to each class of customer and prevent larger adjustments in the future.”

At the recent annual meeting of the Cove POA, CCUC President Tim Hearn told residents that once this latest rate structure is put in effect, it’s likely that the company will need to file for another round of rate adjustments, based on current expenses and planned capital improvements to the Cove water and wastewater collection system.

Consistent with recommendations from the hearing examiner in the case, CCUC “intends to make appropriate bill credits for those in the water availability class who are entitled to a rate refund,” the filing says. “However, it is imperative that if CCUC is required to issue bill credits for the water and/or sewer availability classes, CCUC must be able to bill at the new rates retrospectively to Feb. 15, 2011.”

Aware that the corporation commission may make adjustments to the proposed new rates, “additional billing and/ or credits may be required at that time,” according to the filing, which also asks for permission “to immediately begin using the funds acquired through the new billing in accordance with the hearing examiner’s proposed budget.”

The company is requesting that the commission authorize it to begin billing customers under the new rate structure beginning with the January, 2013, billing cycle.

As of Dec. 3, the commission had not responded to the request for expedited review. No individual or organization had filed briefs opposing the proposed rate increase by that date. Previous CCUC motions filed in the case, which dates back to June of 2010, have produced a number of opposition briefs, including some filed by the Cove POA. With recent changes on the Cove’s board of directors, including the election of Hearn to the board and his subsequent election as president of the Cove POA, the association’s legal battles with the utility company are over.

Billy Casper Golf contract – Billy Casper Golf’s contract with the Cove POA to manage the community’s golf course and food and beverage operations began Dec. 1. Previously, Hearn said the contract establishes an annual management fee of $90,000. The contract also calls for BCG to operate the Cove’s three swimming pools, two outdoor and one indoor.

Hearn told the Progress in a telephone interview in late November that BCG executives would be in the Cove on that date interviewing Marina Club employees “and they will probably retain the existing work force.” In about

29

90 days, BCG management in the Cove will include a food and beverage manager and an assistant golf pro position, Hearn said.

Accounting force reductions – As indicated by Hearn during the early November annual meeting, the move away from in-house accounting functions to an outside firm, L&H Consulting, has resulted in a reduction in force in POA employees.

Ten people have lost their Cove jobs, Hearn said, “regrettable but necessary” to reduce operating costs. Two were in accounting while another eight were in maintenance.

The savings in personnel costs were not as much as might have been expected, Hearn said, because some of the employees who were let go had accrued vacation time.

He said that new software is being installed that will allow property owners to make payments on-line within the next 30 to 60 days, and that the association’s Web site is being revamped to facilitate that.

Monthly payments – Hearn has retreated from remarks made at the annual meeting suggesting that the POA might be eliminating the option of property owners making monthly installment payments for their lot assessments in the future.

He now says that monthly payments will be allowed “but will include a monthly handling fee,” still to be determined based on the costs of implementation. The new handling fee will most likely go into effect with the next billing cycle. In the meantime, property owners can continue with the existing payment system.

Roughly 600 Cove property owners currently make use of the monthly option rather than paying twice yearly, Hearn said Roads construction – Hearn appears determined to make good on intentions to begin build-out of roads in sections without them.

One step in accomplishing that is a thorough “scrubbing of the Cove balance sheet” in order to be able to go to lending institutions to obtain a $1 million line of credit to finance the construction. The intent is to start with Section 5, probably moving next to Sections 12 and 13, Hearn said.

Previously he has said he hopes that road construction can begin this year.

The Pocomoke firm hired under a $95,000 contract to engineer the roads project, George E. Young, has completed surveys and submitted construction drawings to Accomack County for review, Hearn said.

On-line meetings – Internet-based streaming of Cove association meetings using the GotoMeeting.com Web site will begin soon, Hearn said.

Residents and non-resident owners will be able to watch Cove board meetings on-line, Hearn said, and on the Marina Club’s big screen television.

Details will be announced shortly.

30 Ocean Pines PROGRESS

December 2012

OCEAN PINES

COMMENTARY

A

Yacht Club closure makes sense in a construction zone

favorite sport in Ocean Pines is obsessing over deficits in three of Ocean Pines’ amenity budgets: golf, aquatics and the Yacht Club restaurant. The too-easy result from that might be to conclude that, were only those three departments breaking even or better, the Ocean Pines Association would be swimming in surpluses.

Scan the operating results by department and an OPA member will come up away with a somewhat more nuanced view. Through the first six months of the year, aquatics is in the black by $18,930. The Yacht Club is in the red by a mere $19,160. Golf’s deficit is $135,435. Granted, the latter is buried deeply in the rough.

But other departments’ actual six-month operating “deficits” are much worse. They don’t receive the attention that the three high-profile amenities receive.

For instance, the Parks and Recreation Department is $233,865 “in the red.” Fire and ambulance services have cost property owners $288,666 through six months, police net expenses are $346,002, and public works have taxed OPA resources by $505,772. All of these net results appear on the OPA’s Oct. 31 financial statement by department, published elsewhere in this edition of the Progress.

These are all negative numbers, but they don’t receive the same attention as golf, aquatics and the Yacht Club because these “deficits” are all expected and are funded out of the annual lot assessment. In fact, it may not even be fair and accurate to say any of these departments are in deficit, because, relative to budget, they’re all performing as well or better than expected. A nuanced understanding of the OPA’s finances takes into account both actual performance

Monday, Dec. 10 Friends of the Ocean Pines library monthly meeting, large meeting room at the library, 9:30 a.m. coffee and conversation, 10 a.m. meeting begins. Featuring Wendy Myers, program manager for the Cricket Center in Berlin, on the center’s “Enough Abuse” program. Includes short film. 410-208-4014 Thursday, Dec. 13 Worcester County Tea Party monthly meeting, Ocean Pines Community Center, doors open 6:30 p.m., meeting 7 p.m., 410-430-7282, email WorTeaParty@gmail.com, visit WorcesterCountyTeaParty.com.

Saturday, Dec. 15 Swim with Santa, Sports Core pool, Cathell Road, Ocean Pines. 11 a.m. to 1 p.m. Includes food and toy drive for the Worcester County Sheriff Department’s “Christmas for the needy” program. 410-641-5255.

Christmas cookie walk, 9 a.m., Ocean Pines Community Church, 9 a.m. to 12:30 p.m. Cookie sale $ 7/pound or bring 5 dozen homemade Christmas cookies to receive a dozen cookies free.

Sunday, Dec. 16 Closing day for the 2012 season of The Pine’eer Craft and Gift Shop, White Horse Park, Ocean Pines. Open 10 a.m. to 4 p.m. Handcrafted home decor, jewelry, and fashion accessories, created

and results compared to budget.

The problem with the Yacht Club, golf and aquatics is that all three are performing poorly relative to budget forecasts, which says more about the quality of the budgeting than it does about each department’s actual performance through the first six months of Fiscal Year 2013. Then again, we’re entering the slower time of the year when actual losses in these three departments are more or less baked into expectations for the remainder of the fiscal year.

OPA financial performance at the half way point does give one pause. The year-to-date operating fund variance is in the red by $344,416, including some overages in new capital expenditures, and that, barring some sort of intervention by management and the board of directors, does not bode well for the rest of the year. By way of comparison, golf is behind budget by a rather alarming $314,677 for the year.

Had golf operations performed in accordance with budget forecasts, the OPA itself would be more or less on track for the year.

The OPA board of directors will be meeting early in the new year with Billy Casper Golf executives for insight and solutions.

Meanwhile, the Yacht Club is $100,000 behind budget for the year. With the pending construction of a new building, and the likely need to replace the damaged pool, the area will soon become a cluttered construction zone, hardly a welcoming place for a restaurant. That may be fortuitous, because closing the old building after the holidays may be the best way to curb mounting Yacht Club losses, making it possible to end the year with only a modest deficit.

Reopening operations with a brand new building

in 2014, perhaps with a grand opening on or about Memorial Day weekend, means that interim operating losses can be virtually eliminated, depending on how key personnel issues are handled.

Should Billy Casper Golf and the OPA find a basis for continuing their contractual relationship despite worrisome results at the Ocean Pines golf course thus far, the course management company, for no additional management fee, might be encouraged to expand its modest food and beverage operation at the Country Club, in lieu of the OPA trying to operate a Yacht Club in the middle of a construction zone.

The underutilized upper floor of the Country Club will need some sprucing up (and deodorizing) to make it dining ready, but maybe BCG will see some advantage in incurring the cost of that in light of the precarious state of its Ocean Pines golf operations. A Casper executive recently told an assembled group in Captain’s Cove, Ocean Pines’ sister development on the Eastern Shore of Virginia, that none of the company’s 120 restaurant operations across the country lose money for their owners, country clubs and homeowner associations similar to Ocean Pines.

Perhaps the company will be willing to demonstrate its management prowess this summer at the Country Club. With no rent to pay and no competition from the Yacht Club, it conceivably could do very well.

Do really, really well, and, who knows, maybe OPA decision-makers will even consider turning over management of the new Yacht Club to BCG in the summer of 2014. Counter-intuitive, perhaps, but difficulties in running a “challenged” golf course do not necessarily mean similar results in running a restaurant. – Tom Stauss

HAPPENINGS by members of the Pine’eer Craft Club.

Tuesday, Dec. 18 The Worcester County Commission for Women’s monthly meeting and holiday social, 5-7 p.m., at the Si’Culi Italian Restaurant, Berlin.

Followed by a social gathering. 410-2082569.

Aretha Franklin, Frank Sinatra, B. B. King, Tony Bennett, and Bonnie Raitt. $40 per person. Advanced reservations required. Call Coleman Bunting at 410726-7207 for further information and reservations.

Tuesday, Dec. 25 Noel Community’s 15th annual Christmas Day dinner for people who are homeless, unemployed, underemployed, shut-in or alone. Free turkey and ham dinner with all the trimmings, 11 a.m. – 2 p.m., St. Paul’s by-the-Sea, 3rd Street and Baltimore Avenue, Ocean City. Donations of non-perishable food and toiletries from individuals or organizations will be collected on Dec. 22 and 24 from 10 a.m. to noon at St. Paul’s bythe-Sea. 410-289-3453.

Saturday, Jan. 19 Annual beef and beer dinner, hosted by Star Charities, 1-5 p.m., American Legion Post, 24th Street, Ocean City. Benefitting wounded soldiers in Maryland. All-you-can-eat buffet catered by Em-ings. Guest speaker Maj. Gen. James Adkins, adjutant general, Maryland National Guard.

Entertainment Earl’s Dixie Land Band, WW Tunes (UMES), Woodlands String Band. Door prizes. Donation $26 per person. Reservations required: Anna Foultz, 410-641-7667; LouAnn Trummel, 410-208-9514; or Barbara Mazzei, 410208-0430.

Saturday, Dec. 29 Huey Memorial fundraiser, sponsored by the Ocean City Aviation Association, Carousel Resort Hotel, Coastal Hwy. & 118th Street, Ocean City, 5:30 p.m. registration and an open bar. At 6 p.m. selection of prime rib or broiled flounder, with sides and beverage. Suzette Pritchett, guest vocalist, singing oldies, country, gospel, and favorites of popular artists such as

Ongoing Pancake breakfast every Saturday, 8 a.m. till noon, Ocean City Airport, to support the Ocean City Aviation Association’s Huey Memorial Display restoration and continuous maintenance fund. The display is located near the Terminal and requires no security procedures to view. Contact Tom Oneto, 410-641-6888, or Airport Operations,410-213-2471

Kiwanis Club meets every Wednesday at 7:45 a.m. in the Ocean Pines Community Center except Wednesday, Nov. 14, and the third Wednesday of the month when they meet at the Woodlands in Ocean Pines from January through May 2013 for an evening dinner meeting starting 6 p.m., $18 per person. Doors open 5:30 p.m. all 410-641-7330.

Sanctioned duplicate bridge games, Ocean Pines Community Center, Sundays 1 p.m., Mondays noon, Tuesdays 10 a.m. Partners guaranteed. $5, special games $6. Third Sunday of every month is Swiss teams (no partner guaranteed for teams). Felicia Daly, 410208-1272; Pat Kanz, 410-641-8071 The U.S. Coast Guard Auxiliary, Flotilla 12-05, meets the first Monday of each month at 7:30 p.m. in the U.S.C.G. Station, Ocean City. Visitors and new members are welcome. Dennis Kalinowski, 410-208-4147. Web site http://a0541205.uscgaux.info.

Life after loss support group, second and fourth Tuesday of each month at the Community Church at Ocean Pines, 11227 Race Track Road, Berlin, 11 a.m. Help in coping with any type of loss. 410-641-5433.

Worcester County Democratic Club meeting, fourth Thursday of each month, 7 p.m., Marlin Room of Ocean Pines Community Center. No December meeting. Club membership is not required. All those interested in Democratic agendas are welcome.

OPINION

WORCESTER COUNTY

December 2012 Ocean Pines PROGRESS

31

Clarke ‘investigation’ deserves a mercifully quick dispatch

N

ews that Ocean Pines Association Director Marty Clarke is being “investigated” for some alleged violations of a board of directors “code of conduct” that actually doesn’t exist surfaced near the end of the board’s Nov. 28 meeting, when Clarke voted against a motion to go behind closed doors to discuss whatever it is he’s said or did that so upset some of his colleagues.

Or maybe said or did. We really can’t be sure, because anyone who might know anything about what this “investigation” is all about isn’t talking or even returning phone calls to say “no comment.” In a way, you can’t blame them; anything they say might make this situation, and them, look even worse than it already does.

The supposed “charges” that have been leveled against Clarke have managed to leak without attribution to the Internet, more specifically Joe Reynolds’ OceanPinesForum.com Web site, where a rather scathing commentary directed at certain directors appeared recently.

The opinion piece listed four alleged conduct violations, all made of thin gruel, it would seem, and linked them rather conveniently to three directors – Terry, O’Hare and Stachurski – and the general manager, Bob Thompson.

When asked about the Clarke allegations, Terry and Thompson said they couldn’t talk about a topic discussed in closed session; O’Hare and Stachurski didn’t return phone calls. Same with Joe Moore, the OPA attorney. If they had, they no doubt would have been just as tight-lipped as their associates.

There’s probably more than one of these individuals who by now wishes these allegations would magically push themselves back into the toothpaste tube. There might even some from among these alleged accusers who never actually accused Clarke of anything, let alone the particular allegation linked to their names.

The whole sorry mess might have

pressed Ocean Pines staffer complains to a colleague that he is losing the ability to distinguish real life from what he An excursion through the curious cul-de-sacs An excursion through theby-ways curious and by-ways and cul-de-sacs sees up on the television screen. of Worcester County’s County’s most densely community. of Worcester mostpopulated densely populated community.

The action then shifts to Joe Moore’s

By TOM STAUSS/ BURlin law offices, or wherever it is

By TOM Publisher STAUSS/Publisher he’s hanging his shingle these days.

All he really said in public is to in- The actor playing Moore – who could it sailed beneath the radar. One clue that it would not was Moore’s presence at the form the directors that he had no inten- be? Larry Hagman is dead, so perhaps meeting – a dead give-away that some- tion of giving them any legal advice in a post-Scientology Tom Cruise? -- opens thing hot was cookin’. He rarely attends public, which in itself was a form of legal a Number 10 envelope addressed to his OPA board meetings and when he does, advice. The subtext was he didn’t want law firm from the OPA. A copy of an init’s not to complement anyone’s ward- them saying anything of substance, or voice to the OPA spills out on his desk, robe (though on his annual personal ap- anything at all, lest they say something along with a sizable check for services pearances for “orientation” of new board that might get them into trouble. rendered. His OPINION eyes light up. He barely (Clarke, as they say, is lawyered up. stifles a chuckle. He goes on the Internet members he does mention BURlin, his hometown, our lovely neighboring town Everyone knows this. With his legal to book his next cruise. Then the inevwith which we share a Zip code. He will bills, he might be the first director in the itable flashback in time to where it all namedrop Roger Titus, the lawyer from history of Ocean Pines who can itemize started. across the bay who preceded him as the his substantial financial losses incurred Don’t like the movie so far?

The Ocean Pines a journal serving as Progress, a volunteer boardofmemOPA lawyer (before 1983) and who’s now while Agreed. news and commentary, is published a federal judge; and he will sermonize ber.)

The farthe wiser courseand herecul-de-sacs is for anyAn excursion through the curious by-ways An Itexcursion through curious by-ways and culthroughout the year. isof os- one with his or her fingerprints on this – By some mysterious process on Ocean Pines’ founding documents monthly of Worcester County’s most densely populated community. of Worcester County’s most densely populated circulated Ocean Pines, Berlin, West on they know who they are, even if we don’tcom theincharges surfaced anyway, and the depository (sometimes called a mosis Publisher By TOM STAUSS/ TOM STAUSS/ They’re Ocean City,forum.

Snow By Hill, Oceanalso Citypublished and Publisher repository, but never a suppository, one Reynolds’ – to end this as painlessly as possible. this edition Capain’s Cove,Va.of the Progress, such as If the gods are smiling, the price will be supposes) down in Snow Hill, where in are, andsubmissions: without attri- a simple apology and a deeper underLetters andunverified other editorial they’re stored for posterity). Same spiel, they just sort of hanging Please submit via email only. Weout do there not as standing that this still is a free coundifferent year, revolving cast of slack- bution, that this board, too, like oth- try, more or less, with directors having accept faxes or submissions that require jawed newbies seduced by the sound of evidence before it, has been up in a the right to speak their minds even if, retyping.

Letters should be caught original and Joe’s voice, very much unlike that vis- ers of to silliness.

Clarke informed iting judge in the YMCA case not too binge exclusive the Progress.

Include phone the on occasion, their words are offensive to Progress that the allegations “speak for others. many years ago.

Perhaps an earlier version of the OPA themselves” – what they’re saying prebylaws are on file down there in Slow cisely, he doesn’t say, leaving that for the 127 Nottingham Lane, Hill, a version of them that contains a imagination of us mortals -- but it hardOcean Pines, that MD such charges ly constitutes a denial board code of conduct, before it was reexist, in one form or another. pealed, something like four or five years Moore also alluded to a “process” in PUBLISHER/EDITOR ago, after some silliness regarding anPUBLISHER/EDITOR as this, which presumother director or two who found them- matters such Tom Stauss Tom Stauss The Ocean Pines Progress, a journal of ably refers to an “investigation” into selves on the outs with some of their tstauss1@mchsi.com news and commentary, is published tstauss1@mchsi.com Clarke’s behavior that will result in colleagues.

410-641-6029 monthly throughout the year. It is of conclusion and maybe even Clarke seemed to covet a full airing of some sort 410-641-6029 Advertising circulated in Ocean Pines, Berlin, West a recommended action.

Expulsion from all the charges against him, with chapAdvertising Ocean City, Snow Hill, Ocean City and ter and verse and his accusers named, the board is theoretically possible, but ART DIRECTOR Capain’s Cove,Va. whereupon the reason for Moore’s pres- as a practical matter, the needed suARTRota DIRECTOR Letters and other editorial submissions: Knott permajority wouldn’t be.

Some kind of ence at the meeting became perfectly Hugh Dougherty Please submit via email only. We do not reining in might be one way out of this, clear. He was there to make sure there accept faxes or submissions that require highly unlikely, given Clarke’s CONTRIBUTING was no public airing of the allegations but that’s retyping. Letters should be original and temperament andWRITER a unwillingness against Clarke, and in that respect he feisty WRITERS CONTRIBUTING exclusive to the Progress. Include phone to play well with others. no doubt earned his fee.

Rota Knott Knott More probably what will result from Ginny Reister thisInkwellmedia@comcast.net “process” is advice from Moore that 443-880-1348 the directors do what they can to get this 127 Nottingham Lane, unfortunate matter behind them, with Ocean Pines, MD as little damage to their reputations as possible, and some shred of dignity inPUBLISHER/EDITOR tact. It probably means there won’t be PUBLISHER/EDITOR a special town meeting called to air the Tom TomStauss Stauss results. tstauss1@mchsi.com tstauss1@mchsi.com Here’s an alternative idea: Let Joe 410-641-6029 410-641-6029 Moore write up his investigatory concluAdvertising Advertising sions. He would then be authorized to exploit his extensive contacts in HollyART DIRECTOR wood to find an action movie screenwritARTRota DIRECTOR Knott er who would draft a made-for-televiHugh Dougherty sion, straight-to-DVD script based on it.

CONTRIBUTING BURlin and Ocean City have served as movie sets in recent years; here’s an WRITERSWRITER CONTRIBUTING opportunity for Ocean Pines to get in on Rota Knott Knott the action. The camera pans to an unGinny Reister Inkwellmedia@comcast.net flatscreen television perched on a shelf Thatchers 443-880-1348 in the admin building’s staff break room, Aerators tuned to an afternoon soap opera. A de-

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