February 2015 ocean pines progress by Ocean Pines Progress

February - Early March 2015

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Vol. 10, No. 11

www.issuu.com/oceanpinesprogress Stevens: No increase in lot assessment This much is clear following a Feb. 7 meeting on the 2015-16 Ocean Pines Association budget: There is still no clarity on how much the assessment will increase next year or even if it will. If OPA President Dave Stevens’ view prevails, there will be no increase in the assessment from the current year’s $909. If the final budget reflects increased spending approved by the board during the Feb. 7 meeting, then the assessment could easily end up around somewhere $940 or $950. ~ Page 23

Silence deafening on Yacht Club costs

Sometimes, getting a straight answer from the Ocean Pines Association on how much something costs can be difficult or even simply not possible. Pines resident Robert Bauersmith recently sent an email to OPA General Manager Bob Thompson and the Board of Directors asking for “final cost” numbers for the new Yacht Club that opened for business in spring of last year. When his Jan. 29 email went unanswered, he tried again on Feb. 5, expressing the hope that he would receive an answer by Feb. 9. He did, but it was light on substance. ~ Page 11

‘Secret committee’ helping Thompson A closed-door “task force” comprised of Ocean Pines Association staff and hand-picked community members is helping to determine who gets the opportunity to use the Community Center, when they can use it and what they will pay for the privilege. OPA General Manager Bob Thompson confirmed during a Jan. 29 Board of Directors meeting that rumors of a committee helping him review use of the Community Center and develop policy are actually true, although he called it something other than a committee. ~ Page 9

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Three finalists competing to manage Pines golf course Lease proposal may not survive board vetting process, but partnership that submitted it apparently is still in the running under a fee-based management scenario. OPA General Manager Bob Thompson is making no secret of his continued support for retaining Billy Casper Golf, while a recent board procedural vote may have signaled ‘another direction’. OPA golf club members and other OPA members are invited to an all-day meeting Feb. 14 to hear finalists make their pitches. Board could be making its selection later in February. By TOM STAUSS Publisher he Board of Directors will soon decide which group among three finalists will be chosen to manage the Ocean Pines golf course, with a decision possible sometime in the latter part of February. The three finalists are Billy Casper Golf, the company that is in its fourth year managing the course for the Ocean Pines Association; Landscapes Unlimited, a golf course management company based in Lincoln, Neb., with a regional office in Annapolis; and the Haley-Marshall partnership, a group that includes Bob Haley, former owner of the Bay Club golf course near Berlin who served as the Ocean Pines golf pro throughout much of the 1970s and early 1980s. His partner is Marshall Enterprises, whose principal, Mike Marshall, is the son of the late Charles W. Marshall, a former general manager/executive director of the Ocean Pines Association in the late 1970s. He founded his hotel and restaurant management firm after leaving his position with the OPA. The company manages such prominent hotels in Ocean City as the Grand and the Fenwick Inn and has management contracts as far away as New York.

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Originally, the Haley-Marshall partnership submitted a proposal to lease the course from the OPA, with a provision asking that the association subsidize any operating loss for a number of years. The working group that had been coordinating the drafting and publication of an RFP (request for proposals) for golf course management decided that because of that provision, “in critical ways” it could not differentiate the lease proposal from a more conventional fee-based management proposal.

The Haley-Marshall partnership is reportedly submitting a revised proposal moving away from a lease to the feebased outsourcing model that has governed the OPA-Billy Casper Golf relationship since the initial threeyear management contract was To Page 18

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Stevens dismisses Thompson interview as nothing objectionable

OCEAN PINES BRIEFS rather its chief administrative officer. There apparently is a difference.

Board revises February meeting schedule

The Ocean Pines Board of Directors has revised budget and board meetings for February. The general manager’s budget presentation originally scheduled for Saturday, Feb. 7, has been postponed until Saturday, Feb. 21, delayed because the budget was still awaiting board review and decision-making on several key issues. Several directors including OPA President Dave Stevens effectively told General Manager Bob Thompson that it was premature to host a budget presentation on the originally scheduled date. Instead, the directors decided to conduct a budget review session on the morning of Feb. 7. The regular monthly meeting of the board, originally scheduled for Saturday, Feb. 21, has been moved up two days to Feb. 19 in the Community Center, beginning at 1 p.m. Thompson’s official presentation of the budget then will occur on Saturday, Feb. 21, beginning at 9 a.m. in the Community Center. Presentations of three competing proposals for the management of the Ocean Pines golf course remain scheduled for Saturday, Feb. 14, at the Country Club beginning at 9 a.m.

Marina fuel pump project expands again

Replacement of the fuel pumps at the Yacht Club Marina has become a much more extensive project than originally anticipated by the Ocean Pines Association. The project is over the original budgeted amount as well. OPA General Manager Bob Thompson during a Jan. 29 meeting told the Board of Directors that once again more work needs to be done on the docks before new fuel pumps can be installed. Plans now call for construction of an additional platform to accommodate new piping. “Work has been progressing slowly. Each step of the way has revealed additional work that needs to be addressed not only to fix ongoing issues but to

Road trimming to begin on Ocean Pines Parkway

Starting on Monday, Feb. 9, a licensed tree expert contracted by the Ocean Pines Association will be trimming trees along both sides of Ocean Parkway and the median from the North Gate to the entrance to the Point in far south Ocean Pones. The objective is to elevate trees to a height of 15-20 feet and cut back long,

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low hanging limbs over the Parkway to improve aesthetics and accessibility for trucks. All material trimmed will be chipped and cleaned up. The chips will be dumped in the Public Works yard. Anyone with questions or concerns is invited to contact Eddie Wells, director of Ocean Pines Public Works, by email at ewells@oceanpines.org.

bring the entire marina complex up to current standards/code,” Thompson said in his general manager’s report. “Unfortunately these items were not revealed until the contractor started the work and found some additional issues…” Thompson said that as contractors begin working on different facets of the project, they are uncovering other issues that were not originally anticipated. The latest snafu discovered by the OPA is that pipes running from the dispenser along the dock are not properly angled. He said the pipes are not bent correctly for flow and are not in compliance with code. The problem was discovered by the contractor hired to replace the marine grade electrical wiring required for the fuel dispensers. In order to correct the issue, engineers Soule and Associates recommended constructing an elevated platform under which new piping will be installed. The new platform will add about five inches of structure above the current dock and will sit on top of it. The original fuel dispenser project budget was $75,000. The additional work puts the total project cost more than $10,000 over budget. Director Sharyn O’Hare offered a motion, approved unanimously by the board, to move forward with the propos-

published newspaper interview that some interpreted as a veiled attack on the Board of Directors by General Manager Bob Thompson was no big deal and not even an attack, according to Ocean Pines Association President Dave Stevens. Thompson, who often likes to say that he doesn’t read local newspapers or online media that report on Ocean Pines, nonetheless answered questions posed to him recently by a local weekly newspaper that then published the interview in a front page article that in turn was jumped to pages inside. No word on whether Thompson read the article in question. In a subsequent commentary written by oceanpinesforum.com publisher Joe Reynolds, Thompson was scolded for a “bumbling” public relations move by submitting to an interview in which he referenced what he called “the board’s current posturing.” Thompson went on to concede that there is “contention” in his relationship with the board, and that his attempts to adapt to the new direction of the board since this past summer’s election are “still not being received well.” Initially Stevens said he had “nothing for publication” to say about the Thompson interview, but he then relented. He subsequently said he “didn’t find anything objectionable” in what the general manager was quoted as saying in the newspaper account. “I think he basically said that he does not have the confidence of the board,” Stevens said, adding that there isn’t anything particularly new or noteworthy about that observation. “I’ve been saying since last summer that I wanted (Thompson) to change his modus operandi,” Stevens told the Progress. That the general manager has been grappling with how to adapt to the new board has been evident to anyone who attends OPA board meetings or watches them online or on television. As one former OPA board member recently observed, Thomspon is really not Ocean Pines’ chief executive officer but

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From Page 3 al to correct the problem. Because the total project costs are now in excess of the original budget amount, it needed board approval to continue.

Board Oks candidate search committee

It’s already time for the Ocean Pines Association to start planning for the 2015 Board of Directors election. To get the ball rolling, the board during its Jan. 29 meeting appointed this year’s Search Committee. The 2015 committee is comprised of Martin Baer as chairman and members Grant Helvey, Bill Lee, Mickey Lobb, Dianne McGraw, Gary Miller and Les Purcell. The committee is charged with soliciting and reporting on potential candidates for two open Board of Director positions this year. Seats currently held by Sharyn O’Hare and Marty Clarke are up. O’Hare has said she won’t be seeking reelection, while Clarke has hinted more than once that he will be. Slobodan Trendic, an announced candidate last year who withdrew in a tactic seen as a boon to successful candidates Dave Stevens and Pat Renaud, who were running

The Search Committee replaced the OPA’s old Nominating Committee several years ago. While the Nominating Committee was charged with actually vetting candidates and recommending a slate, the Search Committee does not have that power. Any property owner can file for election, and many do so without any encouragement from the search committee. To be eligible a candidate must be the owner of record of property in Ocean Pines as of Jan. 1, 2015, eligible to vote as of May 15 and must complete an application and submit it to the Search Committee or the executive secretary in the administration building for routine processing.

OPA to sell property purchased at foreclosure

A property purchased by the Ocean Pines Association through a foreclosure sale is almost ready to be listed for sale. The property located at 37 Tail of the Fox Drive has been cleaned up and all debris removed and repairs are being made to both the interior and exterior of the home. OPA General Manager Bob Thompson recently disclosed that walls, doors,

OCEAN PINES flooring have been repaired or replaced as needed. Cabinets, countertops and appliances will be complete by the end of month and the 1,300-square-foot house should be ready to list for sale by mid-February. Based on a staff recommendation, the board agreed last year to purchase the home. At that time the board said the association is trying to collect money that is owed to it by property owners if there appears to be an opportunity to do so through the foreclosure process. Thompson anticipated that only minor repairs would be necessary before the OPA could flip the property to a new assessment-paying owner. After purchasing the home, the OPA estimated that the cost for materials for the necessary clean-up and repairs will be $9,465 and the cost of labor will be between $3,500 and $4,000. Thompson said the OPA reviewed its list of properties that are delinquent in payment of annual assessments to determine if any of them are in the foreclosure process. For those that are, the OPA is then trying to determine whether or not there is any value that can be reclaimed by a purchase. He said those properties are being evaluated on an individual basis.

Board delays action on CPI violation

Hoping that the owner will simply collect the debris on the lot and empty a trailer full of brush and trimmings, the board of directors on Jan. 29 opted to delay taking action against 42 Bramblewood Drive for a continuing violation of the restrictive covenants. The Compliance, Permits and Inspections Department recommended sending the issue to legal counsel for resolution. Director Marty Clarke pointed out that the trailer itself is permitted in Ocean Pines. It just has rubbish on it that needs to be removed, he said. General Manager Bob Thompson said staff has been in contact with the property owner and informed him that the debris must be removed or the OPA will take further action. Director Tom Terry said the member

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is also behind on payment of association dues. But Director Sharyn O’Hare pointed out that he is on a payment plan with the OPA and making an attempt to pay. “He’s trying,” she said. Clarke proposed finding the property owner in continuing violation of the restrictions but delaying any enforcement action until after the following weekend so the owner could have some time to remove the offending items from the trailer. His motion did not address the debris, including cut trees and underbrush, lying around the yard. Thompson asked how to address that issue. But Clarke responded that there is “no sense putting him under a deadline he can’t comply with.” He then offered to change his motion to give the property owner a month to comply. “We’ve been in discussions with this guy since October,” Terry pointed out. “We’re almost in February.” Ultimately, Terry offered a motion, approved by the board, to table action on the violation until the board’s next meeting in February, hoping that the situation will resolve itself in the meantime.

Clarke suggests Code Red program

Director Marty Clarke, board liaison to the Communications Advisory Committee, during a Jan. 29 meeting suggested that the Ocean Pines Association consider implementing a “Code Red” program. He said the program involves creating a database of residents who may need special assistance during emergency situations. “Hurricane, flood, locusts, whatever,” he said, emergency workers would be aware that someone in the household needs special assistance. Clarke said for the program to be successful the member would need to complete a form and return it to the OPA police department for incorporation into the database. He asked OPA General Manager Bob Thompson to consider ways to implement the program and distribute a registration form, including with the annu-

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OCEAN PINES OCEAN PINES BRIEFS From Page 4 al property assessment bill or as a tear off page in the quarterly Ocean Pines Report newsletter. “I know that nobody wants anything in with the assessment other than an envelope to send your check back,” he said, but doing so would save on the cost of a separate mailing.

OPA, Sam’s Club continue membership offer in 2015

Sam’s Club will continue to partner with the Ocean Pines Association through 2015 to bring a special membership offer to benefit area residents and the Ocean Pines Volunteer Fire Department. With the offer, applications for a new or renewed Sam’s Savings or Sam’s Business $45 annual membership will receive a $10 gift card. Sam’s Plus members receive a $10 reward for every $500 spent. Additionally, Sam’s Club will continue to donate $5 for every application to the Ocean Pines Volunteer Fire Department. For renewing Sam’s Club members, 12 months will be added to the current membership expiration date, regardless of when the membership was last renewed. A free second membership card for a household member is also included. This offer, which is available to both new and renewing Sam’s Club members, is not available for purchase online or at any Sam’s Club location. Sam’s Club membership applications are available at the Ocean Pines Association administration building at 239 Ocean Parkway or online at www. oceanpines.org. Applications must be returned to Ocean Pines Association, c/o Teresa Travatello, 239 Ocean Pkwy., Ocean Pines, MD 21811, with a check made payable to Sam’s Club. No credit card payments will be accepted for this offer.

Players to host audition for spring performances

The Ocean Pines Players are hosting

February - Early March 2015 Ocean Pines PROGRESS

Pine’eer Craft officers

At its December holiday huncheon, the Pine’eer Craft Club installed officers for 2015. Pictured are Luz Castillo, Shop Treasurer; Barbara Stilwell, Asst. Shop Treasurer; Grace McCormac, Asst. Treasurer; Jane Wolnik, Treasurer; Jacki Kollar, Shop Manager; Lois Schultz, 2nd Vice President; Janet Rosentsteel, 1st Vice President; Sharon Puser, President; Linda Brindley, recording secretary; and Louise Lassiter, corresponding Secretary. an open house, social and audition at the Ocean Pines Library on Saturday, Feb. 14, from 10:30 a.m. to 2:30 pm. The Players will be the featured entertainment at the Berlin Heritage Festival on April 25, 2015 and have more than 30 speaking roles available in four short plays to be performed at various times during the festival. They are also seeking individuals of all ages who would be willing to dress in period clothing, to add authenticity and flavor to the festival atmosphere. No experience is necessary. Guests can enjoy light refreshments while listening to music from several swinging eras, viewing sample costumes, and chatting with event coordinators, Players’ directors, and Berlin historian, Pat Diniar, about the festival and ways to participate in the entertainment. Those who wish to audition can either do it during the open house or sign up for an appointment at a later date. The Players plan to finish casting before the end of February. There will also be information and sign-up sheets for those who are not seeking speaking parts. Each play is only about 15 minutes long and parts are not challenging, even for beginners. Most of the characters

are colorful, quirky, and fun to play. Although many of the characters are fictional, several real life town heroes will also be portrayed, including Isaiah Fassett, the Reverend Charles Tindley, Rozelle Handy, Jesse Hollins, and Anna Burbage. Rosie the Riveter will also guest star. The plays are set in 1920, 1942, 1959, and 1975 and it is costume dressing at its finest. Flappers; hippies; greasers; Downton Abbey types; beatniks; 50’s preppies; Andrews Sisters; Lucy and

Ethel; Gatsby and Zelda; Fedora wearing businessmen; spats and gaiter-types; and the crazy fashions of the psychedelic 70’s are just a sampling of the looks needed. Kids can dress up as cowboys (or girls), Wally and the Beav, the Father Knows Best girls, the Our Gang kids, and more. Actors will have to learn lines independently and be available for at least four rehearsals and for the performances on April 25 between 11 am and 3 pm. Call 410-600-0462 or email oceanpinesplayers@gmail.com for details.

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By TOM STAUSS Publisher ate last year, Ocean Pines Association President Dave Stevens effectively took control of the process that eventually will produce an update capital improvement plan (CIP) for the OPA, eclipsing General Manager Bob Thompson’s previous primary role. Stevens appointed OPA Facilities Manager Jerry Aveda to a three-member task force that will oversee the process, along with contractor and Ocean Pines resident Ted Moroney. Stevens is the group’s third member. Thompson is not playing a direct role, by design, because Stevens has said the general manager has enough on his plate just running the day-to-day activities of the OPA. At the board’s Jan. 29 monthly meeting, Aveda briefly updated the board on the working group’s progress. He described the group’s objective as developing a “requirements-based” CIP, with two stages. The first stage involves identifying needs, some of which has already been done, with the second phase involving the establishment of working groups to focus on individual proposed projects. The first phase apparently will include an effort to assign priorities to various identified projects. Aveda, who said he would serve as project leader for most if not all of the working groups to be established, said

OCEAN PINES

February - Early March 2015

Capital improvement working group updates board on plan development It’s more of a process than a plan at this point, with more working groups to be formed in coming months they will begin by reviewing historical and current documentation, in an effort to identify past requirements and a facility’s current status or, as he put it, “what is left to be done” to accomplish a particular objective. “The goal is to identify hard requirements by when and how they must be met,” he said, telling the board that each working group would remain active for six months but not to exceed one fiscal year. Aveda listed a somewhat detailed list of high priority capital improvement projects that will be assigned working groups, admitting under questioning that it was not a complete list. Among the projects he cited were OPA bridges, one on Ocean Parkway, another on Clubhouse Drive near the Country Club, the North Gate and the Route 90 underpass. He also mentioned

the Country Club campus, comprised of the maintenance shop, the cart storage barn and the Country Club. Other areas needing attention included the Sports Core complex, specifically the pool and decking around the pool, along with water and air quality improvements and the overall structure; the Beach Club campus, including the pool, decking, clubhouse and bathrooms; information technology, especially as it relates to the OPA’s patchy network of computer hardware and software; racquet sports, as it relates to development of the Manklin Meadows complex with tennis, platform tennis and pickleball facilities; and the bulkhead replacement program. In response to a question from OPA Director Marty Clarke, Aveda said Ocean Pines roads would be added to the list of requirements. Aveda told the board initially that

working groups would be assigned to look into projects that appear on Thompson’s capital expenditure project list in his draft 2015-16 budget and that are approved by the board late in February as part of next year’s budget. When some directions questioned how that kind of scrutiny would result in the development of CIP, often thought of as a plan that covers a span of ten years or even longer, Aveda said that working groups would be established to flesh out longer-term projects as well. Stevens said the umbrella CIP working group that he heads would try to do both, even while acknowledging that the initial batch of working groups would resemble implementation groups that have provided oversight over OPA capital projects. Moroney in fact is serving on such a group that continues to deal with issues pertaining to the new Yacht Club. Aveda that he and Moroney were planning to post in February, on the OPA Web site, the first batch of working groups for which they are seeking volunteers. Dates will be set for working group orientation meetings for interested individuals to attend. Aveda said the objective of each working group will be to define a project scope, its cost, and how to keep it on schedule once it’s authorized. He also

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Capital improvements From Page 6 said a key element of a CIP will be to develop a plan for maintaining a new or refurbished amenity. Aveda’s presentation at the January meeting fulfilled a promise made by Stevens in November that an initial report by the CIP working group would be delivered at the board’s January meeting. The task was made more difficult because Stevens was out of the country for most of December.

Stevens said later he was impressed that Aveda and Moroney were able to stay on schedule despite his absence. The establishment of the working group without the direct participation of Thompson was a contentious issue, with Directors Bill Cordwell and Sharyn O’Hare opposing it for that reason while one of his department heads, Aveda, was appointed staff liaison. During debate last year, the directors spent much of the meeting skirmishing over Thompson’s role in CIP development, including whether Stevens uni-

laterally directed Thompson to abandon a longer term revision of the CIP after assuming the OPA presidency this past August. Stevens told the directors that he was not including Thompson on the working group because it would be difficult for him “to come up with a long-term plan” for the OPA at the same that he’s “busy in operations,” managing “the day-today” affairs of the OPA. Calling development of a new CIP “the highest need” of the OPA, Stevens said Thompson’s role would be comple-

mentary to the working group, and that he was not attempting to exclude the general manager from the process, only to allow him to step back from a role he described as policy-making and thereby within the purview of the board. Former OPA President Tom Terry said he was “not against” Stevens’ task force proposal but expressed concern that it not become too unwieldy with too many members or attempt to go back “to ground zero as if much of the content of the CIP “had never been ploughed. …

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8 Ocean Pines PROGRESS

OCEAN PINES

February - Early March 2015

Foultz bemoans levying of fees for use of Community Center Thompson says claims that volunteers were treated ‘poorly’ by OPA staff are untrue By ROTA L. KNOTT Contributing Writer tearful Anna Foultz pleaded with the Board of Directors during the public comments segment of the Jan. 29 board meeting to stop charging non-profits, like her pet project Star Charities, for use of the Ocean Pines Association’s Community Hall and said she was treated poorly by staff during a

ues charged too much and because they want to use and support the OPA’s facilities. But, she said, her charity can’t afford to pay even what the OPA charged this time. “We have no money. We have about $1,000 in our treasury,” Foultz said. She asked the board not to charge Star Charities in the future and for reimbursement of the funds that were allocated for use of the Community Center gymnasium, main meeting room and kitchen for their most recent event. She said she and her volunteers “don’t deserve to be charged for a place to do something to help our soldiers.” Wiping away tears, she added, “It makes

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me cry. I’m sorry. I get really emotional when it comes to the soldiers.” Foultz said the OPA charged $450 to use the Community Center spaces and “we didn’t even get the whole day.” She said volunteers arrived that morning to decorate and were told that they couldn’t do so until after 2 p.m. because another event was scheduled. “I don’t think they treated us very good this year,” Foultz said of OPA staff but told the board, “I feel so bad. Because I don’t want to be here doing this.” In response to Foultz’s comments, OPA General Manager Bob Thompson said according to the established fee schedule for the facility, Star Charities should have actually been charged more than they were and that rate they paid was $300 less that similar venues would have required. Thompson denied that OPA staff had treated Foultz’ group poorly. “I can assure you that wasn’t the case,” he said. Thompson said staff wasn’t aware that volunteers from Star Charities would be coming in early and made every effort to accommodate them when they turned up unannounced. He said he recognizes that it takes time to set up for events like their fund-raiser, but many others request use of the facility as well. Star Charities volunteer Mary Evans said she just wants to know what the fees are for use of the facilities by different groups. She said she has been involved with other groups that held fund-raisers at the Community Center and they were not charged. But now, there are fees, limits on access and use

receive event held there. Foultz, long-time Ocean Pines resident and founder of Star Charities, holds numerous events throughout the year to fund-raise for various causes. Her biggest annual fund-raiser, held earlier in January, raises money for veterans’ organizations. But this year, Foultz said working with the OPA was challenging and cost her more money that it should have. Star Charities is an all-volunteer group that works to support local residents, other organizations and particularly veterans groups, Foultz told the board. She said they held an event at the Community Center because other ven-

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From Page 7 The bigger it is, the less effective it will be,” Terry said. Stevens responded that a three-member task force heading up the effort will keep it focused, while additional volunteers will be sought for specific tasks for investigations. “The subject is so broad that three people won’t be able to do all the work,” Stevens said, telling his colleagues that he expects the working group by year’s end will identify the areas or projects that need investigation. He cited two examples: upgrades to the OPA’s antiquated information technology systems and what to do with the aging Country Club. Stevens said that in some cases the teams investigating specific areas or projects will begin with substantial material that has been assembled previously. O’Hare and Cordwell weren’t buying Steven’s rationale for excluding Thompson from membership on the task force. Cordwell called it a ‘straw man” argument and that he could see no conflict in the general’s manager day-to-day role and what the task force will do.

OCEAN PINES

February - Early March 2015 Ocean Pines PROGRESS

‘Secret committee’ revealed that is helping Thompson with Community Center Stevens says general manager has right to meet with informal advisors, but it comes with a caveat: Any recommendation resulting from those meetings may be considered ‘ unacceptable’ (or maybe needing a second opinion)

Star Charities From Page 8 of equipment. “Somewhere along the way something happened,” Evans said. She said the OPA required an extensive application for use of the facilities months in advance but didn’t get an answer back about whether or not the request was approved until November for a January event. She wondered about the delay in the approval process and said there needs to be very clear criteria for all organizations regarding who pays, who does not, and what equipment is available for use. The board of directors, in discussion after Foultz concluded her remarks, indicated that the Community Center use policy might need to be revisited for 401(c)(4) charities. [See separate article in this edition of the Progress for details.]

something other than a committee. One OPA member, Carol Ludwig, stepped forward during the meeting to acknowledge, with a healthy dose of sarcasm, that she is a member of the “secret committee” that has Thompson once again at odds with his board liaison, OPA President Dave Stevens. The issue of facility use resurfaced when Anna Foultz of Start Charities stepped forward during the public comments segment of the meeting to complain about the fees and restrictions on use of the Community Hall for a fund-raiser her group held there in January. Stevens said he had heard a “rumor” that this committee exists but told Thompson, “I don’t know what you’re doing.” Thompson said he doesn’t have a “committee” but rather a small task force of people who are helping him develop recommendations for use of the amenities. He said he reached out to a couple of staff members and community members to provide assistance in reviewing existing policies and developing a proposal to bring to the board for consideration. “It’s not ready to be put out there yet. We’re just kinda kicking around the pros and cons and trying to come up with the best possible solution,” he said. Stevens said Thompson is entitled to have all the advisors that he wants but “when something eventually does come to the board, we will not know anything other than what we see before us.” He said that is unacceptable and that if the

By ROTA L. KNOTT Contributing Writer closed-door “task force” comprised of Ocean Pines Association staff and hand-picked community members is helping to determine who gets the opportunity to use the Community Center, when they can use it and what they will pay for the privilege. OPA General Manager Bob Thompson confirmed during a Jan. 29 Board of Directors meeting that rumors of a committee helping him review use of the Community Center and develop policy are actually true, although he called it

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Secret committee From Page 9

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board has to form its own committee to study the issue then it will do so. “Mr. Stevens, you’re saying what I’m doing’s not right. Is pretty much what you just said,” the general manager said, adding that he has every right to meet with whomever he feels can assist him on the matter. Stevens quickly retorted, “I started by saying you have that right. You can meet with whoever you want to do your job. To do my job, I have to meet with the community and I have to understand what’s put in front of me and I have to understand the rationale behind it. I have to understand the pros and cons of it. And I don’t hear that the way you’re doing your job. I don’t get that. So that’s my point.” Thompson said Stevens seemed angry and upset about the issue. “I’m not sure why it’s even an issue,” Thompson said. “I’m not angry and upset. I apologize if I sound angry and upset. But I am making a point as strongly as I possibly can that we are not going to accept something that comes from you without getting the input from the community,” Stevens responded. Director Marty Clarke said he vaguely recalls Thompson saying he had formed a facilities use group in April of last year. But he said he has “no clue what they’re doing.” Resident and local blogger Joe Reynolds, during the public comments segment of the board meeting, said he opposed the concept of Thompson forming a private committee as a way of circumventing “open meeting” requirements of the Maryland Homeowners Association Act. “Mr. Thompson, for the first time in OPA history to my knowledge, has

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created committees of his own that he makes a case that they are not committees of the association (subject to the open meeting requirement). They are his committees,” Reynolds said. The problem with that is that Thompson appoints who he wants and gets the information he wants, Reynolds said. “The people meet in private and then he makes a decision as to what that committee really decided and brings it to this board and no one else in the community is able to sit in on these meetings. It’s not right,” he told the board. In response to Thompson’s assertion that he has the right to form such advisory committees or task forces, Reynolds said, “you only have whatever rights this board of directors gives you.” Jim Trummel, former chairman of Bylaws and Resolutions Advisory Committee, was asked by the board last year to review resolution M-02 and recommend revisions. He said the resolution clearly gives the responsibility to the general manager to establish a fee schedule for use of the amenities that would become a part of the OPA’s budget process. It also gives him the scheduling responsibility for the amenities. Trummel said he is unfamiliar with the committee to which everyone is referring but cautioned the board to “think about whether that’s the committee” that it wants to give develop a proposal for a revised amenity use policy. Ludwig, one of the OPA members helping Thompson, stepped forward and said she is a member of the “secret committee” of volunteers who are trying to help develop policies that will benefit everyone who wants to use the amenities. “We do have good usage of this building and we need to step up and help take care of this building,” she said, indicating that means paying fees, too. Directors queried Thompson about applicability of resolution M-02 on amenity use to Foultz’s situation and how it is being applied generally to groups requesting use of the Community Center. Thompson responded that’s what his task force is helping to determine. Ludwig said M-02 does not actually address the issue of groups holding fund-raisers or special events at the Community Center or other amenities. She said the Recreation and Parks Department has a budget that it must meet in order to order to support both the Community Center building and the programs offered there. To do that, the department needs to general revenue from events, she said. “We have to be aware of the fact that this building belongs to the entire community,” she said, adding that the OPA may not be able to provide free space for fund-raisers and charity events at a prime time when the facility can be rented out to a paying customer. “That’s something board will have to decide eventually,” she said. The board took no action curbing Thompson’s ability to meet with Ludwig’s group.

OCEAN PINES

February - Early March 2015 Ocean Pines PROGRESS

Silence is deafening on Yacht Club construction costs By TOM STAUSS Publisher ometimes, getting a straight answer from the Ocean Pines Association on how much something costs can be difficult or even simply not possible. Pines resident Robert Bauersmith recently sent an email to OPA General Manager Bob Thompson and the Board of Directors asking for “final cost” numbers for the new Yacht Club that opened for business in spring of last year. When his Jan. 29 email went unanswered, he tried again on Feb. 5, expressing the hope that he would receive an answer by the close of business on Feb. 9. “I’m once again sending you the message I sent a week ago inquiring about the unresolved matter with Harkins (the Yacht Club contractor),” he wrote in his second email. “I’m disappointed that I haven’t received a reply to a very simple, straightforward question which I’m sure Mr. Thompson could answer in about ten seconds in light of the fact that he was the principal OPA contact with Harkins, and would have been the one most likely to negotiate and sign an agreement if indeed there is one,” Bauersmith said. In his earlier email, the Ocean Pines property owner and resident told Thompson and the directors that he and a lot of property “are wondering what the final number will be for the cost of the new Yacht Club? I understand that until OPA and Harkins resolve the value of the work completed on the new facility, we can’t get a ‘final’ number. To that point I would like to know if we have anything in writing between Harkins and OP outlining the work that was done by Public Works personnel and the dollar value of that work?” Bauersmith suggested that if there is a written agreement between the OPA and Harkins “then the final amount due Harkins when all work is completed should be fairly straightforward, but if we don’t then we are going to have a real problem. I’m sure that (OPA attorney Joseph) Moore will agree that the absence of a written agreement leaves us at the mercy of Harkins, and Harkins can decline to give us any reduction in the final payment if they so choose.” By the close of business on Feb. 9, Bauersmith received a short email from OPA President Dave Stevens, who apologized for the delay in responding. “At this time the Board has no further information on this subject and considers the matter unresolved and in the hands of the General Manager,” Stevens said. Bauersmith did not receive a response from Thompson by Feb. 9. Bauersmith is not the only one who’s expressed frustration at the lack of new information from the OPA administration about “final” costs of building, equipping and furnishing the new Yacht Club.

Will $5 million be the ‘final’ number? Probably not, but information on status of Harkins negotiations is hard to come by Both OPA President Dave Stevens and Vice-President Marty Clarke have made public comments recently wondering about the status of negotiations with Harkins to resolve outstanding issues. The last construction “dashboard” itemizing costs was posted on the OPA Web site last summer, showing project costs of just under $5 million. That almost certainly won’t be the fi-

nal number. In the absence of hard facts, the Ocean Pines rumor mill will most likely speculate on the possibility that previously undisclosed costs will surface before there is a final reckoning. In the proposed capuital budget for the fiscal year beginning this coming May 1, there is roughly $150,000 of upgrades to the new facility, including new

kitchen equipment and furnishings as well as a new draught beer system and hurricane shutters for the outdoor tiki bar. If added to the dashboard, these additional capital expenses would push construction well beyond the $5 million OPA officials said the building would cost. Property owners approved a $4.3 million building in referendum in 2012. The directors subsequently approved an additional $500,000 or so for new kitchen equipment, after Thompson conceded that earlier plans to use old kitchen equipment from the old Yacht Club was not practical.

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Still no agreement between Sandpiper, OPA on natural gas By TOM STAUSS

Publisher nyone hoping and expecting anything new on the status of negotiations between the Ocean Pines Association and Sandpiper Energy over a new franchise agreement that could usher in the roll-out of natural gas conversion in Ocean Pines will be disappointed with the state of play as of early February. “There’s nothing new. Are you surprised?” OPA Director and Sandpiper task force member Marty Clarke told the Progress in early February. “Why would there be?” He said the Board of Directors have been focusing on the 2015-16 OPA budget and have barely discussed it since OPA General Manager Bob Thompson removed himself as chief OPA negotiator in December. In s snippet of news, Clarke confirmed that any agreement between the OPA and Sandpiper on a franchise agreement – one of the areas of contention between them – would most likely have to receive the approval of the Maryland Public Service Commission because it involves rates. “Probably, but that’s not a problem,” Clarke said. “If Sandpiper asks the PSC for approval, they’ll get it. I would imagine in any (new franchise) agreement with the OPA, the fee would be included contingent on PSC approval.” Reports are that the fee if approved by the PSC would be passed on to Sandpiper customers in $3 per month increments. A $3 per month add-on charge is said to be equivalent to a $150,000 annual franchise fee. Despite indications in early December that there had been a conceptual breakthrough in talks between the Ocean Pines Association and Sandpiper Energy over a new franchise agreement that could usher in the roll-out of natural gas conversion in Ocean Pines, a

pact seems as elusive as ever. In an email received by the OPA in early December, Sandpiper indicated it was willing to negotiate a franchise fee with the OPA to allow it to continue to use its pipeline to bring propane and natural gas to its Ocean Pines customer base. Clarke also said the email indicated willingness by Sandpiper to consider payment of OPA’s legal fees of roughly $70,000 incurred during protracted contract negotiations and to negotiate a turn-over agreement covering pipeline assets at the expiration of a new franchise pact. Because Sandpiper had not previously indicated willingness to negotiate these issues, at least not as forthrightly, the Progress characterized the early December email as a breakthrough in a headline and article published in its December-Early January edition. OPA President Dave Stevens later characterized the email as less of a break-through and more of a “promising” development that he subsequently called a delaying tactic. Should negotiations continue to drag on with no resolution, Clarke has said he would favor sending a letter to Sandpiper declaring the existing franchise agreement null and void and giving them plenty of notice to cease and desist using the pipeline buried on OPA property. Stevens so far has resisted that idea, preferring to allow the status quo of delivery of propane through the pipeline to continue pending completion of a new franchise agreement. Clarke also told the Progress in early February that there has been no appointment of a lead OPA negotiator following Thompson’s decision to remove himself from that role in December in a dispute with Clarke over comments attributed to Clarke about the status of negotiations.

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By ROTA L. KNOTT Contributing Writer lans for redevelopment of the Manklin Meadows Recreation Complex with additional racquet sports courts are moving ahead, only not as fast as some would hope During a Feb. 7 budget review meeting, the Board of Directors opted to fund a scaled-back alternative for two paddleball courts and four pickleball courts next year. Directors Tom Terry and Sharyn O’Hare were unable to persuade other directors to support eight pickle-

Scaled down racquet sport project approved by board

Manklin Meadows Recreation Complex master plan cost tops $339,000 if fully implemented ball courts rather than four. At a Jan. 29 board meeting, General Manager Bob Thompson presented cost estimates for both build-out of the full

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ed in the full master plan at $339,550, including eight pickleball courts at full build-out. “The dollars are the missing piece that we haven’t had up to this point,” OPA President Dave Stevens said. Thompson developed the cost estimated based on the master plan design approved by the board last year to guide additions and changes to the recreation facilities at the Manklin Meadows Recreation Complex. The project includes the addition of two paddle ball courts now and two more in the future, relocation of the playground, realignment of the parking lots and the addition of eight pickle ball courts. The overall master plan cost estimate includes $161,927 for building all eight proposed pickle ball courts, with site preparation and asphalt paving, fencing, lighting, painting, nets and poles. That pricing also incorporates $32,000 for the playground relocation, which will actually be completed regardless of whether or not the rest of the Manklin Meadows project moves forward. Portions of the playground structure are deteriorating and need to be replaced. The platform tennis portion of the master plan is estimated to cost $95,123, including site preparation, asphalt and lighted courts. General project costs account for another $82,500 and cover site preparation, engineering and a five percent contingency. With the cost estimates in hand, Thompson said he now needs board guidance as to whether or not to move forward with actually constructing the amenities included in that master plan. Funding currently designated for or proposed to be set aside for the project totals $229,272 across two fiscal years. The approved fiscal year 2014-15 budget includes $135,000 for four pickle ball courts and two platform tennis courts and $150,000 for ballfield lighting in Manklin Meadows. The lighting project was completed at just $122,403 for a savings of $27,587 that could be put toward additional work, for a total available funding this year of $162,597. The proposed FY 16 budget includes $35,000 for four pickleball courts and $31,675 for the playground equipment repairs for a total of $66,675.

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Directors immediately started seeking savings in the project and juggling numbers. Director Jack Collins asked if it is really necessary to provide lighting at the courts. “Do we know how much usage or utilization of the courts are at night? Do we have a study indicating that there is a genuine need for lights on all these courts?” Thompson said he does not have a formal study as to the night use of the courts. “That is a significant cost,” Collins said. “Well, it might behoove us to know that.” He said if there is little night use of the facility, then lighting could be eliminated from the project in an effort to reduce the cost.

14 Ocean Pines PROGRESS

OCEAN PINES

February - Early March 2015 Ocean Pines PROGRESS 15

OPA FINANCES

OPA’s financial performance dips again in December, remains positive for the year Yacht Club records $34,049 loss for the month, misses budget by $45,211

OPA net operating results by department as of Dec. 31 Description

Month Actual

Month Budget

Variance to Budget

YTD Actual

YTD Budget

Variance To Budget

Fiscal Yr Budget

By TOM STAUSS Publisher he Ocean Pines Association’s financial performance for December stayed in deficit territory, with a negative operating variance to budget of $38,979, roughly $10,000 better than November. For the fiscal year so far, the OPA is $42,169 ahead of budget, but the trend is not positive. The positive variance on Nov. 30 was $80,853. While most all amenity departments lost money in December, those losses were expected and budgeted for. With one exception, all amenity departments hovered close to their budgeted losses. The Yacht Club stood out as the one major amenity that fell short of budget by a significant margin, missing its budget target by a whopping $45,211. The actual loss was $34,049, compared to a budgeted surplus of $11,162. “(Yacht Club) revenues met budget numbers for the month,” OPA General Manager Bob Thompson wrote in his January report to the Board of Directors. “However, utility, wages, supplies and utility costs exceeded budget. Expenses are currently being reviewed to

Racquet sports From Page 14 Director Pat Renaud said having no lighting could open the OPA to liability issues if someone is injured there after dark. “Everybody’s going right to cutting out the lighting,” Director Bill Cordwell said. However, he said if lighting is provided the members will play into the night. Collins agreed and said “that’s good thinking.” But he added “where I’m coming from is maybe even during the summer time there’s not a great deal of nighttime play. I don’t know.” Director Sharyn O’Hare asked Stevens to suspend the meeting rules to allow pickleball and paddle ball members in the audience to have input on the topic. Stevens initially declined saying “I pretty much know what they’re going to say. They’re going to say it’s important.” O’Hare made a motion, supported by a majority of board members, to suspend the rules. Stevens went along with it. Representatives from both groups then told the directors that they already play into the night hours on the existing lighted courts. They said any new courts

should be constructed with lighting as well. The board dropped talk about lighting after being informed that the existing courts in Manklin Meadows are lit and that both pickle and paddle ball members play after dark year round if the weather permits. Director Tom Terry pointed out that the $32,000 allocated for the playground should be removed from the project cost since that work will be completed even if the remainder of the project doesn’t move forward. “That really is under the general fund,” he said. “It’s got to be replaced anyway because they’re rotting,” O’Hare said. Terry concurred and said “If you don’t build the pickleball courts and the paddle ball courts the request for $32,000 doesn’t go away.” Thompson said he included the playground expenditure as part of the package “so you can see the entire cost for everything we were going to do.” Terry said budgeted funding for the project is about $100,000 short of the cost estimate. Director Marty Clarke quickly responded that “there is no budget for next year” because the board has not

yet voted to finalize the FY 2016 spending plan. Terry said he understands that the budget hasn’t been passed yet but added that the general manager has included some funding in his proposed budget for construction of the Manklin Meadows master plan. That funding may need to be increased based on the estimate, he said. Clarke queried Thompson regarding construction of the new courts and whether the project would be paid for by from the general fund or the replacement reserves fund. Clarke argued that “it’s not replacement reserves” (that should be used to pay for new courts) because they will be additional courts, not replacements for other existing amenities. Thompson said the “OPA’s accountant” will advise them on how to address that issue. Clarke also asked about the timing for the work. “What we’ll do if the board approves this overall plan, we’ll then take steps to get started,” Thompson said. He added that work would likely not begin until warmer weather arrives. Clarke said he would not support approving action on the master plan because the cost of the project exceeds the

amount allocated for it, in both this year and next year’s budget. “No matter how you divvy up the nuts, its $43,950 over all the budgets,” he said. Stevens differed, at least as it pertains to spending in the 2016 fiscal year. “Why or how can we be over budget on a budget we haven’t even approved yet?” Stevens asked. Terry said that by approving moving forward with the master plan, the board would essentially be telling Thompson to include the necessary funding for the work in the upcoming fiscal year’s budget. “We would have to increase that portion of the budget,” Terry added. As an alternative solution to building the entire master plan now, Thompson also submitted a proposal to only construct four of the pickleball courts at this time. “Our goal is to get the project started,” he said, even if that means building it in phases. “So we gave you an alternative solution for consideration.” Thompson said he believes it would be better to move forward with the entire project at one time. “We believe option one is the correct way to do it. But we also felt giving an alternative was appropriate,” he said.

16 Ocean Pines PROGRESS

OCEAN PINES

February - Early March 2015

OPA reserves drop to $4.5 million in December By TOM STAUSS Publisher he reserve summary released as part of the December financial report shows that the Ocean Pines Association’s allocated reserve balance dropped to $4,483,293 as of Dec. 31 last year, a drop of $216,101 from the previous month. The balance stood at $4,699,394 in November, $4,871,868 in October, $5,128,136 in September, $5,178,302 in August, $5,519,149 in July, $5,786,683 in June, and $6,003,165 in May. The erosion is typical as the OPA makes expenditures from the reserves through the year. The May reserve summary reflects the annual contribution from assessments that traditionally is recorded in the first month of the fiscal year. Usually, most of the month-to-month reduction in the overall reserve balance is attributable to activity in the Major Maintenance and Replacement Reserve, which as of May 31 had a balance of $4,754,531, reflecting the full annual transfer from lot assessments into this fund. That didn’t happen in December, however, following a pattern in recent

months. In fact, the December balance was virtually unchanged from November. The maintenance and replacement reserve balance as of Dec. 31 was $3,914,927, just a very slight decrease from November’s $3,916,546 balance. For the year through Dec. 30, total capital spending from this reserve was $1,158,116, comprised of $937,383 in spending from the funded depreciation component of this reserve and $220,733 from the five-year capital plan funding stream, most of which would be related to Yacht Club construction costs. Most of the other OPA reserve funds To Page 18

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Financial report

From Page 15 identify area improvements should be made.” Thompson’s report made no mention of why the Yacht Club had been budgeted to make money in December. There is no indication that Thompson is moving toward a change in the current Thursday through Sunday open for business schedule, despite the fact that the Yacht Club lost $15,641 in October, $46,651 in November and $34,049 in December, wiping out an operating surplus that had accumulated during the warmer months, through September. There is no particular reason to believe that January’s results will be much of an improvement over December’s, absent any change in schedule. Through December, the Yacht Club’s cumulative deficit is $24,888 for the year. If operating deficits reach $40,000 or more per month in the January through April period, a final deficit of around $200,000 for the year is not unrealistic. Golf operations lost more than any other major amenity for the month, but it only missed its budget by $2,186. Year to date, golf remains in surplus by $27,282 but, because of a poor start to the fiscal year in May, is $37,431 behind budget for year. That’s a negative variance to budget that probably can’t be made up in the colder months of the year. Thompson, as is his custom, emphasized the positive about golf in his January report to the board. “Another good showing for golf,” he said, citing the modest negative variance to budget. “Year to date we have realized a $146,107 improvement in golf in the same timeframe from our previous year.” These results are contained in Controller Art Carmine’s financial report for December, posted on the OPA Web site in mid-January. According to the report, December’s negative operating fund balance of $38,979 resulted from revenues that were under budget by $3,191 and expenses that were over budget by $111,852. The other major amenity depart-

ment, aquatics, missed its budgeted loss for the month by a modest $4,712, recording a $36,066 loss for the month against a budgeted $31,354 loss. In his report to the board, Thompson attributed most of that negative variance to utility costs, which he said should be less of an issue going forward because of the installation of new propane tanks at the Sports Core pool by Sharp Energy. That company’s propane costs less than propane delivered via pipeline by the previous supplier, Sandpiper Energy. Thompson pointed out that aquatics revenues were close to budget in December and “are $72,310 ahead of the same period last year.” For the year through December, aquatics has a $48,824 operating deficit, behind budget by $32,603. Status of reserves – The reserve summary released as part of the December financial report shows that the OPA’s allocated reserve balance dropped during the month to $4,483,293, compared to $4,699,394 in November, 4,871,868 in October, $5,128,136 in September, $5,178,302 in August, $5,519,149 in July, $5,786,683 in June and $6,003,165 in May. The annual contribution from assessments traditionally is recorded in May, the first month of the fiscal year. The reserve balance tends to drop throughout the fiscal year reflecting transfers out of reserves to pay for capital expenditures [See separate story for details] Status of the balance sheet – According to the Dec. 31 balance sheet, the OPA has assets valued at $30.4 million, against liabilities of $1.7 million and owner equity of $28.7 million. The balance sheet indicates a decline in operating cash to $1,384,425, from the $2,133,033 on hand at the end of November. This compares to operating cash of $1,402,913 in October, $1,719,99 in September and August’s $2,281,367 balance. These kinds of fluctuations are considered normal. The December balance sheet indicates that the OPA had $4,020,819 in short-term investments as of Dec. 31, compared to $4,018,768 in November, $5,315,829 in October and $5,612,201 on hand at the end of September.

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Golf management From Page 1 executed more than three years ago. OPA Director Jack Collins, who is serving as the informal head of the golf working group, with OPA President Dave Stevens, a recent addition, and Director Tom Terry, as members, disclosed during the board’s Jan. 29 monthly meeting that the leasing option for managing the golf course seems to be fading as a viable option during the board’s Jan. 29 monthly meeting. He stopped short of saying it was completely off the table, but as a practical matter it probably is. The working group was waiting for confirmation of that in a questionnaire sent out to all three remaining bidders in late January, due back in early February. The Progress has learned from another source that Haley-Marshall indeed was working on a revision to its leasing proposal, enabling the board to evaluate all three proposals on a more or less level playing field. Collins also announced that on Saturday, Feb. 14, from 9 a.m. until 1 p.m. at the Ocean Pines Country Club, the working group will be hosting representatives from all three finalists in 45-minute presentations, followed by questions from the golf membership that could take up to 30 minutes each. After an introduction and explanation of procedures by Collins, Billy Casper Golf representatives will begin their presentation at 9:15 a.m., followed

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by Landscapes Unlimited at 10:45 a.m. and Haley-Marshall at 12:15 p.m. Collins in comments after the Jan. 29 lauded the care and methodical way the working group has gone about its mission, including the decision to allow golf members and others interested in the golf course to ask questions of the finalists. He said that openness and willingness to listen to members will help the board make an informed decision on which of the three finalists it wants to operate the course, probably under a three-year management contract. The questionnaire sent to the finalists include five general questions. The first asks about strategies used over the years to combat declines in the golf business over the years, including specific examples of ones that have proved effective. The second question asks the applicants to detail strategies to lower maintenance costs without sacrificing course conditions. The third question asks, given the “unique nature” of the Ocean Pines community, what is “right combination” of membership play, resident (non-member) play, package play and outside (retail) in Ocean Pines, and reasons why. The fourth question asks the finalists to identify its top three priorities in managing the course and specific steps to attain those objectives. Finally, the questionnaire asks “what level of accountability” the applicant would accept for not achieving budget objectives, which seems to be a convoluted way of coaxing the finalists to accept some sort of formula in which any oper-

18 Ocean Pines PROGRESS

Reserves drop From Page 16 – bulkheads, future projects, golf drainage, and operating recovery -- were unchanged or only insignificantly changed from earlier months. The roads reserve was the exception, dropping from $222,331 in November to $83,641 in December. The bulkhead and waterways reserve had a balance of $1,051,674, down slightly from the $1,127,177 balance in November. This compares to the balance of $1,224,917 in October and $1,478,081 balance in September. The future projects reserve had a deficit of $60,336, the golf drainage reserve had a deficit of $642,262 and the operating recovery reserve had a surplus of $135,649. The operating recovery reserve had been zeroed out last year, on the theory that previous year deficits had been sufficiently offset by subsequent surpluses, but the OPA Board of Directors last year authorized $135,152 from the current year’s assessment to be allocated to this previously zeroed out reserve. The purpose of resurrecting this fund and adding money to it purportedly involves the possibility that funds will be needed to address certain tax liability issues in future years.

From Page 18 ating losses will be shared by the OPA and the management firm. Under the current contract with BCG, the OPA absorbs any losses in golf operations at the same time it pays a management fee of roughly $70,000 annually. There have been reports that BCG’s initial proposal to the OPA was simply to continue the existing contract, with no changes in the terms, but the questionnaire seems to be designed to encourage BCG to modify them if it hopes to continue its relationship with the OPA. In a brief interview following the Jan. 29 meeting, Stevens disclosed that in a special meeting in January, the board voted 4-3 to notify BCG in writing that in the view of the majority bloc of directors, the company was unlikely to meet its budget for the fiscal year ending April 30. By making that determination and giving notice to BCG, Stevens said the OPA, under terms of the existing contract, will not be under an obligation to pay a termination fee should the directors decide to contract with another management entity. Stevens said the board vote – with Stevens and Directors Marty Clarke, Pat Renaud and Collins all in favor – was not a decision to “get rid” of BCG. But

February - Early March 2015 Ocean Pines PROGRESS he said it was a necessary procedural step in the event that the board decides to cancel the BCG contract and to hire either the Haley-Marshall partnership or Landscapes Unlimited to manage the golf course. During the Jan. 29 meeting, the board also went to great lengths to assure local package play promoters and others that despite the ongoing effort that may result in a management change at the course, all bookings, tee times and tournaments will be honored. In a unanimous vote, the directors passed a motion that “stipulates that the Ocean Pines golf course will continue to function as a golf course … and that any all commitments made by the OPA and/or golf management company” will be honored. Even though he voted for the motion, OPA Director Bill Cordwell wondered out loud whether bookings will suffer merely because the OPA has been investigating alternatives to BCG. Collins, in offering the motion, said that there has been “much speculation” about the future of the golf course, including its possible closure or conversion to some other use, and he said his motion was intended to put an end to that kind of speculation. He said the effect of the motion makes it clear that the golf course will not be closing, that it won’t be repurposed for any other type of amenity, reaffirms commitments made for golf packages, tee times and tourna-

ments, and “focuses efforts on assuring a long-term success of the golf course.” Stevens told the Progress in a Feb. 3 telephone interview that he is absolutely convinced the board acted properly to search out possible alternatives to BCG given the losses piled up by the company over the past three years. Acknowledging that three directors seem more or less committed to retaining BCG, he said the board majority is committed to

seeing the process to the end, and that means deciding from among the three finalists, including BCG. “I really don’t know who’s going to get the contract,” Stevens said. The three directors apparently supporting Casper’s retention – Cordwell, Terry and Director Sharyn O’Hare – agree with OPA General Manager Bob Thompson that changing management

OCEAN PINES Golf management

20 Ocean Pines PROGRESS

OCEAN PINES

February - Early March 2015

Thompson tees up blame game if spring golf bookings suffer General manager says uncertainty over management contract will ‘almost certainly’ lead to package play promoters giving their business to competing golf courses By TOM STAUSS Publisher arly in the process that will conclude with adoption of the Fiscal 2015-16 budget for the Ocean Pines Association later in February, General Manager Bob Thompson touted and defended what some considered its most unrealistic forecast: that golf operations would lose a mere $14,000 next year. The $14,000 projected deficit was contained in Thompson’s initial budget draft unveiled in early January. Technically, it was actually the handiwork of Billy Casper Golf, currently in its fourth year as the course’s fee-based management company, which has been in a competition with other firms to retain or obtain the Ocean Pines golf course management contract. But by including it in his budget draft, Thompson effectively was endorsing it. He defended it in meetings of the Budget and Finance Advisory Committee

in mid-January. Partly on the strength of the general manager’s endorsement, the committee chair embraced it as well, and most members of the committee, in an informal showing of hands, endorsed it as well. Committee chair Pat Stupik even went so far as to say that because she found this year’s staff-projected loss of $90,000 plausible, it was no stretch to conclude that a $14,000 loss for next year was just as reasonable. Thompson defended the staff projection for the current fiscal year, offering the single caveat that it was based on a solid April of package play, which he conceded is very weather-dependent. That was then, but now Thompson seems to be singing a different tune about how well golf will do in the current fiscal year. It could even be said he’s teeing up a scenario by which the Board of Directors

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could be blamed for a poor finish to the fiscal year in golf this year. OPA President Dave Stevens, in recent remarks to the Progress, said a fair reading of Thompson’s general manager’s report for February, available for viewing on the OPA Web site, invites that kind of interpretation. “Notice that we don’t allow him to read those reports at public meetings anymore,” Stevens quipped. Thompson said uncertainty over who will be managing the golf course

Golf management From Page 19 companies at this point in the process risks gains made by BCG this past year in managing the course. Thompson has said that as of December, BCG has brought about a $146,107 improvement year-over-year in the bottom line. He said a recently projected yearend loss of roughly $100,000 means the company would be coming in very close to budget, but he admitted in recent discussions with the Budget and Finance Committee that such an optimistic projection assumes an April with good weather. Clarke, the OPA director who is most associated with the idea of leasing out the golf course – an idea that seems to be fading – said that as of December the company is about $37,000 behind budget and that he doubted that situation could improve over the remainder of the fiscal year.

this year could affect spring business. The OPA currently is embarked on a process that could lead to a decision by the board of director to jettison Billy Casper Golf as the golf course management firm in favor of one of two competitors, a local partnership of former Bay Club owner and Ocean Pines golf pro Bob Haley and Marshall Enterprises, or Landscapes Unlimited of Lincoln, Neb., and Annapolis. At one point in a recent budget review meeting, Thompson told members of the budget and finance committee that the board had decided to go in a “new direction” with respect to the golf course, which some understood to mean that a decision has already been made to part company with BCG. Thompson later clarified that he did not intend to imply that. “Casper is still in the running to manage the course,” Thompson said. But that Casper is not assured of continuing in that role and may lose its Ocean Pines contract has put Thompson at odds with a board majority. Thompson has favored BCG’s retention for many months. In his February general manager’s report, Thompson said “there is a strong potential for reduced spring bookings/ outside business, as a decision as to who will run our golf operations this season remains undecided. The spring booking season occurs in advance of spring. “Whether we will honor the bookings or not isn’t the only consideration. The decision to place customers on a course is dependent on course conditions, along with the expected guest experience the customer will have at that facility. The anticipated guest experience is based on previous experiences, strong relationships with the packagers and consistent offerings. Bookings depend on repeat business and satisfied customers,” he wrote. In a very pessimistic conclusion, Thompson opined that in a “high competitive marketplace with plenty of golf choices, the lack of knowing what to expect when booking will most certainly lead to booking elsewhere where the products and service are consistent and predictable.”

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February - Early March 2015 Ocean Pines PROGRESS

OPA weighs options for repair or replacement of Mumford’s pool Engineers determine numerous voids in soil and decking around swimming pool

why the east side of the pool is sinking. In exploring those issues, engineers found a much more extensive problem that needs to be addressed before the repairs can be made -- numerous voids or air pockets in the soil and decking around the pool. Original core drillings at the Mumford’s Landing pool revealed varying levels of fill from four to eight inches deep and revealed some issues with the fill and voids under and around the pool. Due to those findings, the OPA asked the engineers to explore the issue further and to perform more core drilling. Additionally a void was found in the ground below an area where the pool is leaking and sagging on the bayside. John D. Hynes and Associates Inc. of Salisbury performed the supplemental exploration study to further evaluate the subsurface conditions regarding

Volunteer spirit

The Kiwanis Club of Greater Ocean Pines - Ocean City recently hosted Kelly Brinkley, Volunteer Services Manager of the Worcester County Department of Human Resources. She’s been visiting volunteer organizations like Kiwanis to make them aware of her department and services. Pictured are (L-R) J. Graham Caldwell who arranges for the speakers, Brinkley and Immediate Past President Dick Clagett, who presided over the meeting. She recognized the local Kiwanis Club for being so involved in support of the community and cited the next fundraiser on February 14th, Valentine’s Day, when the Annual Kiwanis Winter Pancake Breakfast will take place in the Ocean Pines Community Center from 8 to 11 a.m. settlement of the pool and information for remedial work to repair it. The engineers analyzed 19 soil borings and found voids between the bottom of the pool deck slab and the underlying soil in

all but four of the borings. The engineers’ recommendation is for grouting the stone base layer located around the pool basin with a flowable

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By ROTA L. KNOTT Contributing Writer epairs to the Mumford’s Landing swimming pool may need to be much more extensive than originally anticipated when the Ocean Pines Association first began seeking a resolution to problems with cracks in the structure and leaking water. The problems with the pool are so severe that they could necessitate replacement of the structure, according to OPA General Manager Bob Thompson. In his Jan. 29 general manager’s report, Thompson told the Board of Directors that the OPA is “currently exploring potential solutions from repair to complete pool replacement” to address the ongoing issues at the Mumford’s Landing pool. The project started out as an effort to repair cracks, stop a leak and determine

22 Ocean Pines PROGRESS

OCEAN PINES

February - Early March 2015

New school board member

Eric Cropper, the new school board member from District 6, which includes a portion of Ocean Pines, was recently sworn into office. He was elected this past November. He is pictured with wife Bess and their three kids, Eric Jr, Grace, and Sara.

Mumford’s pool From Page 21 fill material that consists of concrete and water grout mixture containing fine sand. They also suggested cutting

openings in the pool decking in order to provide access to grout the stone layer below the pool and around the perimeter of the pool. Finally after the voids are filled, the engineers recommended grouting the voids below the pool slab.

Nowhere in the engineering report is a recommendation for complete replacement of the pool. As a practical matter, Thompson will have a difficult time persuading the OPA Board of Directors to fund pool replacement without a supporting recommendation from professional engineers, according to board sources. Thompson said the final report from Hynes and Associates has been “passed on” to the original bidders on the Mumford’s Landing pool project along with a request for proposals to fix the voids and pool deck. That work would be in addition to the original RFP for repairing the cracks, leaks and resurfacing the pool. Meanwhile, repairs at the Swim and Racquet Club swimming pool are proceeding on schedule. Demolition and removal of the plaster surface was nearing completion and pool resurfacing will take place once the weather warms. At the Swim and Racquet Club, the project includes repairs to the family pool and deck including removing tiles, lane markers and plaster finish. The project calls for changing the ladders by installing wall treads and top railings, reinstalling swim blocks so they line up evenly and repairing the expansion joint in the first phase of the work. The second phase involves replacing the handicapped entry chair for a pole that

swings either way, replacing all tiles and applying the bond coating and a new coat of Diamond Brite. The original projects are both pools called for removing the existing pool tiles, lane markers and the entire plaster finish down to the gunite pool surface. That work was supposed to be finished this winter at both sites, but will now only occur at the Swim and Racquet Club. The second phase of work scheduled for the spring includes retiling, repairs to the pools and decking, bond coating of the gunite surface and applying new plaster. Now, it appears, as though only the Swim and Racquet Club project will be completed at this time. This leaves open the question of whether repair or replacement of the Mumford’s pool will be completed by Memorial Day weekend, its scheduled reopening date. At its most recent meeting, the Aquatics Advisory Committee discussed a recommendation from its chair, Virginia Reister, that the OPA should consider dealing with existing conditions at the Mumford’s pool as they are for another season, doing the minimum repairs necessary to reopen the pool, while postponing repair or replacement until the fall, after the pool closes for the season.

OCEAN PINES

February - Early March 2015 Ocean Pines PROGRESS

2015-16 OPA BUDGET

Directors debate whether to increase assessments and if so, by how much

OPA Director Marty Clarke

By TOM STAUSS Publisher his much is clear following a Feb. 7 meeting on the 2015-16 Ocean Pines Association budget: There is still no clarity on how much the assessment will increase next year or even if it will. If OPA President Dave Stevens’ view prevails, there will be no increase in the assessment from the current year’s $909. If General Manager Bob Thompson’s draft budget is adopted with no change -- and that is a virtual impossibility at this stage in the process -- then the assessment will increase $25 to $934. If the final budget reflects increased spending approved by the board during the Feb. 7 meeting, then the assessment could easily end up around somewhere $940 or $950. OPA Director Marty Clarke would roll back the current assessment by a little more than $40, made possible in part by eliminating $130 in the current assessment related to the so-called fiveyear funding plan. Clarke’s proposal was effectively voted down during the Feb. 7 meeting, prompting him, in an elaborate display of disgust, to declare his intention not to seek reelection to the board this summer when his term expires. Some of his colleagues later speculated that Clarke will revisit that decision once he cools down from the budget battles. Stevens’ proposal for no increase in

assessments was based in part on reallocating or repurposing a portion of fiveyear plan revenues. He is no more a fan of the five-year plan funding stream than Clarke is. The difference is that while Clarke urged the complete defunding of the plan, Stevens said he wanted to continue to collect it until such time as it will have raised suffiicnet funds to pay for construction of the new Yacht Club, or to zero out the current $1.5 million deficit in the fiveyear plan reserve. “The original purpose of this plan was to fund renovation or replacement of major assets whose current replacement costs far exceeds the amount (if any) collected against inflation years ago,” Stevens said. “As it stands, it has become a effective method of collecting money, without any corresponding plan for how it is to be spent... “Right now this collection has no defined conclusion. It will go on forever. There are also no associated criteria for how it should be spent or even whether it can be spent before we collect it,” he said. Stevens said that even after this year’s $1.1 million contribution from assessments, the so-called five-year plan reserve will still have a negative balance of roughly $1.5 million at the end of the current fiscal year. “That is partly because we keep spending on additional projects even when we are already in the hole,” he said.

Stevens said he thought the term “five-year plan” should be “buried forever.” But he said that he did not agree with Clarke that the plan should be defunded in next year’s budget as a way of reducing lot assessments. As an alternative, Stevens proposed creating a new reserve to be called the Legacy Assets Improvement reserve. For the fiscal year 2016 and 2017 budgets, Stevens proposed allocating dollars sufficient to close out the fiveyear plan reserve. That timetable could be extended if necessary, he said. Stevens also suggested that a portion of the so-called historic reserve, which

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is replenished each year in the amount of roughly $1.6 million in funded depreciation, could be reallocated to certain allocated reserve funds that are now in deficit. Stevens said that the golf drainage and future projects reserves could be zeroed out and eliminated this way. He then said the new Legacy Assets Improvement reserve could be funded as needed, once a new capital improvement plan is established and approved, presumably sometime this year. “Next year’s budget should be the last for the ‘five-year plan’ and depending on what we find out during the CIP process,” Stevens said a gradual reduction in assessments could result. “I believe our target this year should be to maintain the current assessment of $909.”

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OPA budget From Page 23 In a brief interview after the meeting, Stevens acknowledged that the only way to achieve that goal appears to be the reallocation or repurposing of funding that now shows up in the five-year plan reserve. He also said it would also be possible to reallocate funds in the historic, or funded depreciation reserve, to the fiveyear plan reserve, in much the way he is suggesting using some historic reserve funds to zero out the future projects and golf drainage reserves.

The reaction among the other directors to Stevens’ proposal was noncommittal. No one opposed it outright. Clarke had left the meeting before Stevens could fully explain it. Director Tom Terry said he needed more time to think about it. He said he was opposed to defunding the five-year plan as a way of “artificially” lowering the assessment. In the end he might conclude the same thing with respect to keeping the assessment the same. Director Pat Renaud told the Progress he was open to Stevens’ proposal, but that Director Jack Collins, who did not attend the meeting, would be a key

OCEAN PINES

vote. Renaud suggested that Collins would probably be a no vote in raising the assessment. The only way to accomplish a no-assessment-increase budget would be for a board majority to vote for Stevens’ proposal or some variation of it. A 4-3 outcome seems possible if not likely. Not only did the board not make any signicant cuts in the draft budget proposed by Thompson, with its proposed $25 assessment increase. The directors also added some items with an impact on the assessment, such as a $50,000 for a reserve study, a change in the projected golf operational loss from $14,000 to $50,000, about $10,000 or so in swimming pool covers, and $40,000 for an electronic sign proposed for one of the main entrances into Ocean Pines. In addition, the directors approved about $20,000 not included in Thompson’s budget draft for Yacht Club items including another fire pit, deck fans and a big screen television. In another key decision that was a partial setback for Clarke, the directors appeared to accept a proposal from Terry to avoid funding roads depreciation in the amountof $314,000. Terry said he would work with Thompson and Controller Art Carmine to come up with a more acceptable number. The Feb.7 budget meeting was clearly a frustrating session for Clarke, who

seemed to be waging a lonely battle to reduce the lot assessment and to end a supplemental funding stream originally designed to finance major capital improvements more than six years ago. The five-year funding plan generates about $1.1 million in revenue for the OPA, if fully funded by the board in next year’s budget. Clarke is not proposing to eliminate or reduce funded depreciation, the MM&R reserve’s other major revenue stream, which is scheduled to generate roughly $1.6 million next year. Clarke says the OPA is collecting too much revenue in its reserves, and that having substantial funds on hand that could be spent without a detailed capital improvement plan invites promiscuous spending, such as a proposal to buy the former Pine Shore golf course north of Ocean Pines a couple of years ago. Clarke, who has met resistance from some of his colleagues to his proposal to end the five-year-plan, is not calling for a net $130 decrease in the lot assessment next year. At the same time he wants to defund the five-year funding plan, that would be in is seventh year if fully or partially funded by the board next year, Clarke wants to fully fund road depreciation and add money to the golf drainage reserve. Funding road depreciation in the amount of $214,068 would add $37.16

24 Ocean Pines PROGRESS

OPA General Manager Bob Thompson’s proposed 2015-16 budget, still under review by Board of Directors and subject to change before expected final approval Feb. 19.

OPA budget From Page 24 back into the assessment while funding golf drainage in the amount of $350,000 would add $41.41. After a number of other adjustments to the draft budget proposed by Thompson in early January, Clarke’s proposal would reduce the lot assessment next year to $866.09, down from the current $909. That’s a $42.91 reduction. Thompson’s draft budget, in contrast, would increase the assessment by $25 to $934. Clarke said the April 2016 ending balance in the OPA’s reserves would be roughly $400,000 less under his proposal than in the draft budget proposed by Thompson – about $4.2 million compared to $4.6 million. Even at $4.2 million the OPA’s reserves would be higher than at almost any time in its history, Clarke said. Some directors have pushed back against Clarke’s proposal to defund the five-year funding plan. OPA Treasurer Jack Collins said in one budget review meeting in the latter part of January that the five-year funding plan has been earmarked by previous boards as the funding source for the new Yacht Club. The five-year plan reserve is currently about $1.5 million in deficit, and Thompson has said it won’t be until 2018 that sufficient funds will have been raised to pay for the new $5 million amenity. Collins called that funding mechanism a social contract between the OPA and its membership, but Clarke produced language in the 2012 referendum materials that seemed to contradict the idea that any such “social contract” ex-

February - Early March 2015 Ocean Pines PROGRESS isted in 2012, when the Yacht Club referendum was passed by a two to one margin. In an answer to a question about whether the OPA had already raised sufficient funds to pay for the new Yacht Club, the election materials said the OPA already had sufficient funds collected for that purpose. In fact, the five-year plan reserve had only about $1.4 million allocated to it in July of 2012, according to a reserve summary published in the Progress in August of that year. Clarke said the 2018 alleged “pay-off” year only emerged sometime after the referendum passed. He also said that even if such a social contract existed, it wouldn’t bother most property owners if the contract was broken by a reduction in the lot assessment. In budget review sessions, Clarke seemed to have somewhat more support in his contention that payroll expense increases in a number of OPA departments were excessive. In his budget proposal to his colleagues, he suggested cutting proposed payroll increases in the Parks and Recreation Department by $30,000, in aquatics by $20,000, at the Yacht Club marina by $10,000, and, most notably, at the Ocean Pines Yacht Club by $225,000. Clarke and other directors also were skeptical at Thompson’s budget drafted showing that golf operational losses would be reduced to about $14,000 next year. Clarke’s budget alternative added another $100,000 in losses to the golf bottom line. Subject to change by the directors before final approval, the draft balanced budget proposed by Thompson called for $10,920,376 in revenue and spending, with the expense side comprised

of $10,742,894 in non-capital spending, $110,818 in new capital additions, and $66,664 in Sports Core loan principal payments. On the capital expenditure side of the ledger, the draft budget’s $1.99 million in proposed spending includes $1 million in spending from funded depreciation and $675,000 from the so-called five-year funding plan, which would be in its seventh year if funded by the board. The rest of the capital spending is attributable to new capital additions. The current year’s approved budget is for $10,229,558 in departmental non-capital spending, with another $3.1 million in capital spending, much of which won’t be spent despite its inclusion in the budget. This means that Thompson is proposing a decline in capital spending of roughly $1.1 million over this year’s approved budget, but an increase in spending for operations of roughly $690,000 year-over-year. Actual spending this year no doubt will differ from the budget approved in February of last year. He attributed some of the increase

in the budget to the federal Obamacare law – otherwise known as the Affordable Care Act – and an increase in the minimum wage, along with a roughly $200,000 projected increase in the cost of emergency medical services provided for by the Ocean Pines Volunteer Fire Department but funded by the OPA. While much of the OPVFD EMS budget is funded by county and insurance company reimbursements, shortfalls are, as a matter of policy, paid for by the OPA under a formula negotiated in recent years by the OPA and OPVFD. The draft budget for amenity departments suggests that the general manager foresees good times ahead, with operating deficits in the big three – the Yacht club, golf and aquatics – at very modest levels. Aquatics would lead the pack with a $113,000 deficit, followed by the Yacht Club with $87,868 in projected red ink. Golf and related food and beverage operations would only lose $14,124. The golf budget was for the most part prepared by Billy Casper Golf, the q

OCEAN PINES

The proposed capital spending list in the draft OPA budget for 2015-16. The OPA board of directors will be adding and subtracting from the list prior to final budget approval.

February - Early March 2015

OPVFD sets record straight on proposed budget increase EMS deputy chief says more more funding needed to keep two ambulance crews on hand 24 hours a day By TOM STAUSS Publisher cean Pines fire/emergency medical deputy chief Billy Bounds in a meeting with the Ocean Pines Association’s Board of Directors Feb. 4 set the record straight about the reason why the Ocean Pines Volunteer Fire Department’s funding request for emergency service in fiscal 2015-16 has increased by roughly $200,000. When he initially presented his 2015-

OPA budget From Page 25 management company that currently operates the golf course for the OPA. The board is reviewing options for golf course management this month from proposals submitted in response to an OPA request. Of four proposals still in

16 draft budget to the board of directors, OPA General Manager Thompson attributed some of the increase in the budget to the federal Obamacare law – otherwise known as the Affordable Care Act – and an increase in the minimum wage, along with a roughly $200,000 projected increase in the cost of emergency medical services provided for by the Ocean Pines Volunteer Fire Department but funded by the OPA. While much of the OPVFD EMS bud-

the running, one is for a lease, one is a status quo proposal from BCG, and the other two are for management contracts similar to the current fee-based BCG arrangement. The aquatics’ budget deficit would drop considerably from this year’s projected loss because of a proposed reallocation of about $48,000 in Beach Club parking revenue to aquatics.

get is funded by county and insurance company reimbursements, shortfalls are, as a matter of policy, paid for by the OPA under a formula negotiated in recent years by the OPA and OPVFD. Thompson initially attributed $24 of the $25 increase in base lots assessments that he is proposing as part of his draft budget to the Ocean Pines Volunteer Fire Department’s funding request, citing declining reimbursements from emergency medical calls as the primary reason for the increase and the proposed increase in assessments. While the number of calls continue to increase, requiring more staffing and cost, more calls and responses don’t always result in transport to area hospitals via ambulance, causing a revenue that has to be made from somewhere, Thompson said. Bounds’ explanation for the $200,000 increase in the EMS budget

OCEAN PINES differed from Thompson’s explanation in January, but the EMS chief, perhaps wanting to avoid stepping into a political minefield, did not tell the directors he was in any way contradicting Thompson. Fire/EMS Deputy The OPA genChief Billy Bounds eral manager for the most part sat quietly during the meeting. Bounds said that about of $135,000 of the requested increase was related to salary and benefit increases, in part brought about a decision to ensure that there are always two ambulance crews ready to respond to emergency calls at all times. The OPVFD wants to ensure that service and response time for a second call is the same if one crew is already responding to a first call, Bounds said. To accomplish the staffing to make that happen, Bounds said that the OPVFD is requesting a 1.2-person equivalent increase in personnel, along with the accompanying benefits. In total, the department is asking for total EMS staffing of 13.3 full-time equivalent employees, or three individuals per shift, along with Bounds

26 Ocean Pines PROGRESS

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OCEAN PINES

February - Early March 2015 Ocean Pines PROGRESS

Panel touches lightly on hot button topics like golf course management and increases in payroll expense By TOM STAUSS Publisher he Budget and Finance Advisory Committee, in times past a ferocious critic of budget drafts submitted by General Manager Bob Thompson and his predecessors, this year is taking a kinder, gentler approach. That was evident in the very first observation by the committee in a Jan. 26 letter to the board commenting on Thompsonâ&#x20AC;&#x2122;s proposed $12.8 million budget. â&#x20AC;&#x153;Committee members found this yearâ&#x20AC;&#x2122;s budget process to be inclusive, effective and very beneficial to the development of a sound budget and appreciate managementâ&#x20AC;&#x2122;s efforts in this regard,â&#x20AC;? wrote Pat Stupik, the committee chair, in her letter to the board. In past years, the committee has been

known to harp on the lack of amenity business plans in budget submissions, but this year the criticism was muted at best. It might even be said it was non-existent on this point. â&#x20AC;&#x153;During the budget process feebased and revenue-generating amenities in general provided information that supports revenue and expense forecasts,â&#x20AC;? Stupik wrote. â&#x20AC;&#x153;When possible and appropriate, industry best practice standards were identified for Ocean Pines amenities and included in each business plan. â&#x20AC;&#x153;Because committee members believe strongly in the need for well-developed business plans, not simply marketing plans, we also suggest that budget review and approval for departments not providing this information should be postponed until the required

OPVFD funding

service among all area EMS services, and he said the $200,000 requested increase in support can help insure that Ocean Pinesâ&#x20AC;&#x2122; EMS services remain top flight. Bounds said that even with the requested increase in funding training money has been cut in the budget request, down from roughly $15,000 this year to about $5000 next year. He said the OPVFD probably would make a request to increase training funding in 2016-17 to more traditional levels. But in the 2015-16 he said the OPVFD budget had been scrutinized line by line and cut to the bone. He acknowledged that there has been some reduction in insurance reimbursements for ambulance calls resulting from residents not needing to

From Page 22 when heâ&#x20AC;&#x2122;s on duty. Bounds said that roughly 25 percent of calls requesting emergency service come in when an EMS crews is already on the road. If there are insufficient number of paid staff or volunteers available to make the run from Ocean Pines, Bounds said the second call is outsourced to a neighboring fire department, in most cases the one in nearby Showell. That outsourcing or wait until a volunteer with EMS skills responds to a request can affect crucial minutes in response time, Bounds said. He said he believes the OPVFD offers the best response time and quality of

documentation is presented,â&#x20AC;? she wrote Stupik did not identify any departments that in her or the committeeâ&#x20AC;&#x2122;s estimation had failed to submit well-developed business plans. In previous years, the committee specified departments by name that in, the panelâ&#x20AC;&#x2122;s opinion, had come up short. The letter said the committee strongly recommends the creation of a document which â&#x20AC;&#x153;presents and contrasts the current and prior yearâ&#x20AC;&#x2122;s assessment by component (capital reserve, public works, amenities, etc.), as this breakdown is critical for an understanding of the ultimate impact of budget requests on each memberâ&#x20AC;&#x2122;s fee.â&#x20AC;? Stupik said such a detailed breakdown should be made available as part of the budget presentation to the community, which this year has been postponed to Saturday, Feb. 21. In previous years, such a document has been prepared and presented to the membership at the annual budget town hall meeting.

The letter said that payroll and payroll expense accounts for more than 60 percent of Ocean Pinesâ&#x20AC;&#x2122; operating budget and would increase by $425,609 over current year spending, â&#x20AC;&#x153;the largest increase of any budget component.â&#x20AC;? Rather than criticize the proposed increase or suggest ways it could be trimmed, Stupik noted the â&#x20AC;&#x153;significanceâ&#x20AC;? of those numbers and said that OPA management should present â&#x20AC;&#x153;the components of the increase in terms of rates, FTEs (full-time equivalence) and benefits. Justification should be included for all components,â&#x20AC;? she wrote. There was no indication that the committee, or at least the committee chair, felt that the proposed increase in payroll and payroll expense was unjustified. The committee took a somewhat stronger stand on the need for an information technology officer, a position funded in this and last yearâ&#x20AC;&#x2122;s budget but not filled by Thompson, who has delayed the hiring until elements of a new IT system is in place. The position is again included in the proposed 2015-16 budget with no guarantee that it will be filled. Not filling a budgeted position means that management can show a better result relative to budget than would otherwise be the case. â&#x20AC;&#x153;During the 2015-16 budget year, technology system objectives should be q

Budget and Finance Committee gently critiques Thompson budget

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From Page 27 set, the necessary technology identified and a system that is flexible enough to serve the Association’s current and future needs should be chosen,” Stupik wrote. She went on to say that the committee supports the funding and urges the hiring of an IT director or consultant. “We also support the dollars allotted for recreation and parks software, various computers and the carry-forward of unexpended technology dollars from 2015 to 2016,” she wrote. The committee letter briefly touched on the $200,000 proposed increase in the fire and emergency medical services budget, expressing “concern” over what it characterized as a “significant” proposed increase. But rather than take a position on it, the committee simply punted the matter to the board of directors, recommending the board obtain supporting documentation to help it “determine if such an increase is warranted and/or if other options are available for this level of funding.” The board met with representatives of the Ocean Pines Volunteer Fire Department in early February. Board members seemed to agree that in fact the increased level of support was justified. [See separate article in this edition of the Progress for details.] On the hot topic of golf course man-

agement, the committee for the most part seemed simply to accept optimistic budget forecast forecasts submitted by Billy Casper Golf for the remainder of the current fiscal year, as well as the $14,000 loss projected for next year. “Based on that information, we have no budget recommendation” with respect to golf, Stupik wrote. Opting not to wade too far into the contentious issue of whether to replace BCG with another golf course management company, the committee nonetheless warned of consequences should the board decide to make a change “given the short timeline between budget approval and the beginning of the upcoming golf season.” Stupik wrote that changing companies at this time “will ultimately impact any financial results projected and budgeted” for golf this year and next. In other observations and recommendation, the committee: l supported budgeted dollars in the marketing and public relations department l recommended the “inclusion of plans and rationale” for all capital requests, the carry-forward of unexpended capital items from the prior year, and review of the OPA’s capitalization policy “for dollar amounts and content” and its updating “if necessary.” l recommended combining the Future Projects reserve with the five-yearplan component of the Major Maintenance and Replacement Reserve.

Venit rejected by budget committee Board declines to appoint former director to advisory panel; Clarke alone in supporting nomination By ROTA L. KNOTT Contributing Writer history of service to the community as a member of the Board of Directors is not necessarily a guarantee that you will be welcomed back by the Ocean Pines Association should you wish to serve in another capacity. Former director Mark Venit found that out last month when his application to serve on the OPA’s Budget and Finance Advisory Committee was summarily rejected by the sitting board. Advisory committee appointments

are generally made by the OPA president, currently Dave Stevens, and endorsed by the full board. But in Venit’s case, Stevens declined to make the appointment. “I am not proposing Mark’s name,” he said. When asked why by fellow Director Marty Clarke during the Jan. 29 board meeting, Stevens said he would not allow Venit to serve on the Budget and Finance Committee “because there was a fairly strong objection” to his appointment from the current committee members.

l recommended the proposed contribution of $135,216 into the Deficit Recovery reserve. l recommended continued work on developing a new short-term, mid-term and long-term investment policy for the OPA and urged the board to “keep in sight” future funding for the development of a ten-year comprehensive plan. l urged the board to continue efforts

to pressure the county to provide more funding support for OPA police, fire, EMS, parks and recreation, roads and public works. l suggested that the board ask the county commissioners to provide OPA members with a “property tax differential” to help offset the cost of “funding services not provided by the county” as an alternative to direct funding support.

28 Ocean Pines PROGRESS B&F Committee

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Venit From Page 27 He said another director could nominate Venit for appointment and the full board could “vote it up or down.” Clarke, head in hands, muttered “Get outta here.” Also previously rejected when seeking appointment to the same advisory committee prior to becoming a board member, Clarke said, “You know what happens when the group starts picking the group, don’t you?” Director Tom Terry added that this is not the first time something like this has happened. When he was OPA president there was “disruption” to the Aquatics Advisory Committee when a member sought reappointment but was not approved, Terry said. OPA procedure is to provide applicants’ information to the advisory committee on which they are seeking a seat and to solicit an endorsement of the appointment from both the committee and the board liaison to that committee. Stevens said the committee was notified that Venit’s application was received and reviewed it. On the application form dated Nov. 20, 2014, committee chairman Patricia Supik wrote that “The BFAC does not endorse membership on the committee for Mr. Venit.” There was no explanation for what in effect amounted to a committee blackball of someone who was willing to serve and had the credentials. Under the board liaison’s endorsement area, Director Jack Collins simply wrote “I defer to the committee’s unanimous decision.” During the board meeting, Stevens said “if someone on the board wishes to

nominate Mr. Venit to the committee, against the committee’s objections….” Clarke interjected and made such a motion, saying “so nominated.” His motion died for lack of a second by another board member. On his application for the Budget and Finance Advisory Committee, Venit said he is a 23-year resident of Ocean Pines, served as a board member from 20032006 and previously as a member of the Clubs Advisory Committee. “My intent is simply to share my knowledge, career experience and prior service lessons with members of this committee,” he said on his application. As for knowledge or input that he had to offer to the committee, he listed extensive academic training in finance and budgeting, 40 years of professional experience in owning and running businesses, serving as a management and marketing consultant to more than 600 companies and organizations, and experience as a committee chairman and OPA director. None of that experience was enough to sway the board and, before that, committee members. With the unanimous endorsement of fellow directors, Stevens did make several other advisory committee appointments at the same meeting. He appointed chairmen for three committees: Rick Jackson for the Communications Advisory Committee, former OPA President Glenn Duffy for the Architectural Review Committee and Steve Cohen for the Comprehensive Plan Committee. Stevens also appointed Tres Denk for a second term and Jim Walh for a first term, both on the Recreation and Parks Advisory Committee and appointed Don Pellicano for a first term on the Racquet Sports Advisory Committee.

Mathias, Carozza active in early days of new Assembly session By ROTA L. KNOTT Contributing Writer seasoned legislator and a novice representative are both hard at work in the General Assembly this session representing the residents of Worcester County. Senator Jim Mathias and Mary Beth Carozza, newcomer to the House of Delegates, have cumulatively sponsored and co-sponsored more than two dozen pieces of pro- Senator Delegate posed legislation already this session. Jim Mary Beth Mathias Carozza Mathias, whose District 38 including portions of Worcester, Wicomico and Somerset counties, is the primary spon- $5 in dues annually and operate solely sor of three bills and a co-sponsor on for the use of its own members and their nearly two dozen more. guests. The only bill introduced so far that is Mathias has already received a fair specific to Worcester County is Mathias’ amount of publicity for a bill, favored SB0038. The legislation would simply by hospitality businesses in Ocean alter the annual fee for a seven-day vet- City and elsewhere, that would require erans’ license in Worcester County. Cur- school systems in the state to open afrently the annual license fee for a six- ter Labor Day. The later opening would day license is $500; and for a seven-day allow younger summer workers to stay license is $750. The bill will reduce the on the job longer in the critical month seven-day fee to $500 for a veteran’s li- of August. cense for any local unit of a nationwide He is the sponsor of SB 0381 which bona fide nonprofit organization or club will require the POW/MIA flag to be composed solely of members who served flown on the grounds of State buildings in the armed forces of the United States under the control of the Secretary of in any war. General Services and the Secretary of The organization must have held a Transportation whenever the flag of the charter from a national veterans’ orga- United States is flown. That bill defines nization for a period of not less than five the “POW/MIA flag” as the POW/MIA years prior to the time of making appli- flag of the National League of Families cation for the license, have a member- of American Prisoners and Missing in ship of at least 15 people, charge at least Southeast Asia Mathias also sponsored SB0380 Requiring the Motor Vehicle Administration, when it registers a Class L (historic) vehicle or Class N (street rod) vehicle, to issue a single registration plate for the vehicle. As a co-sponsor Mathias has his name on SB0044 which would increase from 65 miles an hour to 70 miles an hour the maximum speed limit that may be established on specified highways in the State and SB0082 which increase from 30 years to 40 years, the maximum term of imprisonment that may be imposed for the offense of second-degree murder. His name is also on SB0181, a bill that seeks to increase the portion of highway user revenues that is distributed to local governments, altering the allocation of the local share of highway user revenues among Baltimore City, counties, and municipalities. Carozza, who represents the new District 38C that includes parts of Worcester and Wicomico counties, is the primary sponsor of just one piece of legislation of far, HB0243 related to state government procurement from veteran-owned small business enterprises. The bill has a goal of increasing the participation To Page 31

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is asking the U.S. Census Bureau Farm system. blocks aligned with the boundaries of objectives. to amend the boundaries census blocks the Ocean Pines subdivision. He said the potential benefits include Organization types eligible to apply that include the Ocean Pines subdivifor grant funds include those involved availability of a higher quality water sion. in health, human services, arts and cul- supply that could be used to help reduce Nonprofits required Ed Tudor, director of development operating costs inwith the Riddle Farm systure,share community environmentalExperience® S SAIL FREE Crystal Cruisestomakes it easier than ever to theaffairs, All Inclusive your complete application review and permitting, presented the affairs or historic preservation. Applica- tem. For your years stateroom Worcester County has tions request for approval during a traveling Jan. 20 It could also help stabilize water serdue no later than Feb. 25. Apdren or the 3rd person in cruises for are free! doled out funds to local non-profits plications received after this date will vice rates and could provide additional meeting of the Worcester County Comseemingly at random, based on who not be considered. missioners. He said that a better alignwater resources to help meet the future showed up at a meeting to beg for monment would allow the county to comneeds of planned commercial developplete more precise population analyses ey and which elected officials thought County approves study ment on the south side of Route 50. for election purposes following the next their cause was valid. However, Ross said it is important to But no more; Worcester County Gov- for water system expansion census as well as for other statistical determine the long-term capacity of the John Ross, deputy director of public water supply to provide additional serernment has instituted an updated apanalysis. Tudor said he does not see any down- plication to be used by non-profit orga- works, met with the commissions on vice beyond the Ocean Downs site. side to starting this conversation with nizations that plan to apply for grant Jan. 20 to review a proposal from John In response to a question from Comfunds from the county for fiscal year Salm of J.W. Salm Engineering to inves- missioner Joe Mitrecic, Ross said that the U.S. Census Bureau at this time. tigate the possibility of providing public the benefit to Ocean Downs would be In response to a question by Ocean 2016. The new non-profit grant applica- water service to Ocean Downs from the that it can relinquish its responsibility Pines Commissioner Chip Bertino, tion, which is available as a portable Riddle Farm sanitary service area. Tudor said that the bureau routinely for maintaining its own water system. Salm would provide engineering and document format file, can be accessed amends the boundaries surrounding Mitrecic offered a motion, approved on the homepage of the county website hydrogeologic studies of the system at a unanimously by the commissioners, to each of the towns based on annexations. He also advised that until now the coun- at www.co.worcester.md.us under the cost of $14,475. approve the proposal from Salm EngiRoss said that a significant part of neering to perform the engineering and Top Links section. ty has never asked the bureau to amend .....info@travelwithoasis.com would include hydrogeologic study for the public water The application requires non-prof- any potential agreement the boundaries for Ocean Pines. its to provide greater detail regarding having the Ocean Downs Casino turn system expansion in the Ocean Downs Commissioner Merrill Lockfaw made strategies for achieving their program over its water supply system to the a motion, which was approved unani-

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General Assembly

Health accreditation

The Worcester County commissioners and health officials display a plaque announcing that the Worcester County Health Department (WCHD) has achieved national accreditation through the Public Health Accreditation Board (PHAB). Those pictured include Health officials QIS Director Jennifer LaMade (front row, from left), Administration Director Heather Barton, Health Officer Debbie Goeller, Prevention Director Marty Pusey and Commissioners Diana Purnell, Bud Church and Chip Bertino; and Environmental Health Director Ed Potetz (second row, from left), Consultant Becky Shockley, Community Health Director Debra Stevens, Deputy Health Officer Dr. Andrea Mathias and Commissioners Joe Mitrecic, Jim Bunting and Ted Elder. The WCHD is one of the first two health departments in Maryland to earn accreditation. Another bill, HB 174, repeals a requirement that motor fuel tax rates be adjusted in future years based on growth in the Consumer Price Index for all urban consumers. If approved, HB0251 would reduce the state corporate income tax rate from 8.25 percent to 6 percent beginning in

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From Page 29 goal from 0.5 percent to 5 percent for veteran-owned business enterprises for specified state procurement contracts. She has also tacked her name onto half a dozen other bills as a co-sponsor. Three of the bills have been assigned to the House Ways and Means Committee on which she sits as a member. The first bill, HB180, addresses purse distributions from the Ocean Downs Race Course. It will extend through calendar year 2019 the authorization to use specified Purse Dedication Account funds generated from video lottery proceeds for operating assistance by the Ocean Downs Race Course and Rosecroft Raceway to support a minimum of 40 live racing days at each race course. It also addresses the general use of Purse Dedication Account funds by the Ocean Downs Race Course and Rosecroft Raceway for operating assistance. Of the amount provided from the Purse Dedication Account for Ocean Downs Race Course, the bill states that up to $1.2 million may be used to provide operating assistance to support a minimum of 40 annual live racing days for calendar years unless the racing licensee is prevented by weather, acts of God, or other circumstances beyond the racing licensee’s control.

32 Ocean Pines PROGRESS

February - Early March 2015

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Commissioners endorse $105 million capital spending plan By ROTA L. KNOTT Contributing Writer espite some misgivings about the timetable for completing proposed projects and even the necessity of some of them, the Worcester County Commissioners on Feb. 3 endorsed a new five-year capital improvement plan. The plan covers fiscal years 2016 through 2020 and includes more than $105 million worth of projects, including new schools, government buildings, roads and wastewater improvements. Projects totaling $105,636,416 are requested during the five-year period. Of those projects, about 11.61 percent or $12,265,000 worth of the expenditures, are requested to come from the countyâ&#x20AC;&#x2122;s general fund and 53.26 percent or $56,260,374 are proposed to come from bond funds. The remainder of the funding for the projects would come from user fees, grant funds, state match funds, state loans, designated funds, enterprise bond funds or a local bank loan. The plan is a document that the county will use in preparing future operating budgets, anticipating future financial needs and to identify possible funding resources. Inclusion of a project is the CIP does not constitute a guarantee of funding from the county. Some capital projects will be added, deleted and amended as necessary through the life of the plan. As with the countyâ&#x20AC;&#x2122;s operating budget, the projects for each fund have to be balanced with the resources available in that fund. The FY16 general fund request is $4.45 million or 18 percent of the CIP and general and enterprise bonds total $6.63 million or 26.8 percent of the capital outlays. The bond rating agencies look closely at the CIP as a financial planning tool for the county when establishing rates for future funding. Public schools projects that are part of the CIP for the county total more than $53 million. The projects included are the Showell Elementary School replacement and an addition to Stephen Decatur Middle School. In the area of other school related projects, the county has designated more than $2.5 million in its capital improvement plan for projects at Wor-Wic Community College in Salisbury. The funding is proposed as a contribution for a new building renovations anda new academic building. Capital improvement projects scheduled in the area of general government facilities total more than $10.47 million. The proposed projects include tax software update for the treasurerâ&#x20AC;&#x2122;s office, an 800MHz radio system enhancement, and a new Berlin branch library. In the area of public safety, the capital improvement plan includes $10 million for improvements to the county jail. The capital improvement plan for

New schools, government buildings, roads and wastewater improvements top list of possible projects over next ten years, even as elected officials seem skeptical that all the projects on the approved list are needed and will be funded public works contains projects totaling more than $27.24 million. The public works plan includes cap and closure of the Berlin rubblefill, asphalt overlay and pavement preserva-

tion for county roads and construction of a new county storage building in Snow Hill. Water and wastewater improvement included in the CIP are water system interconnections and effluent dis-

posal at Mystic Harbour, Newark spray irrigation and a belt filter press replacement in Ocean Pines. Solid waste division projects are a gas remediation project in Snow Hill, cell 5 construction at the central landfill, a landfill administration scale building renovation and addition. For recreation and parks, the capital improvement plan contains proposed projects totaling more than $2.33 million. It includes funding for land acquisition and development at Showell Park near Ocean Pines.

34 Ocean Pines PROGRESS

February - Early March 2015

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February - Early March 2015 Ocean Pines PROGRESS

Hearn’s status as a Cove property owner or developer-affiliated member at issue Cove association’s message board ‘lights up’ with exchanges between Cove president and skeptics

Previously, a majority of the Cove board decided not to act on a Kieffer motion directing the Cove’s law firm, Inman and Strickler, to research whether, in light of anticiated board election results last year, the balance on the board had been upset. With three directors, including one newly elected, indisputably declarant-affiliated, Hearn’s status then becomes relevant to a question of whether four declarant-affiliated members effectively control the board in contravention of the settlement agreement. Hearn has said on numerous occasions that his ownership of the lot on Captain’s Corridor is what gives him the status of a non-affiliated member of the board. His status as the managing partner of the Captain’s Cove Utility Company is not relevant to that calculation, he has said. He and his wife previously owned a house in the Cove, but it was sold last year, prompting him to purchase an unimproved lot as a way of reestablishing a claim as a Class A property owner. He renewed that assertion in a Feb. 5 message board post. “My Class A membership in CCGYC is a function of my ownership of Section 3, Lot 1713, which is on Captain’s Corridor,” he wrote, “and is not owned as a part of CCUC operations, or with the Declarant. The taxes and (Cove association) dues are paid from personal funds…” To Hearn, his ownership of the lot makes it an open and shut case in his favor, but it’s not so clear to some of his critics. One skeptical Cove resident,

Vickie Williams, even went so far in a Feb. 5 post to question Hearn’s ownership of the Section 3 lot. She asked Hearn to supply the date of purchase. “Accomack County online property records currently has someone else listed as the lot owner,” she advised Hearn. “Now that is not to say the County site is up to date, but without some type of verification such as a HUD 1 (settlement sheet), I have no idea whether it is your property.” Hearn had not directly responded to Williams’ request for verification by Feb. 6. In addition, recent postings on the Cove message board have raised the

question of whether, back in 2011, Hearn’s status as manager partner of the CCUC somehow defined him as a declarant-affiliated member of the Cove board. “I believe CCGYC has previously invested a significant amount of legal money back in 2010 and 2011,” Hearn wrote in response to those concerns, “and was provided with the information from at least one, and maybe two different attorneys.” He said lawyers agreed at the time that an affiliated entity, as defined by the regulations of the SCC (state corporation commission) when it comes to a utility corporation, calls for a different definition than what the 2011 Settlement Agreement described.” In essence, Hearn said that for purposes of the settlement agreement, his ownership and role as managing partner of CCUC did not confer upon him a status as a declarant-affiliated member of the Cove board. At the time, he owned

By TOM STAUSS Publisher he status of Captain’s Cove property owner association president Tim Hearn as someone who may or may be not be affiliated with one of the so-called declarant or developer-affiliated entities that have had control or near control of the Cove’s board of directors since 2011 has roiled the association in recent weeks. The issue has been the topic of numerous posts on the message board on the Cove Website of late, with quite a few appearing since Feb. 1. There is also word that the Concerned Citizens of Captain’s Cove, CCCC for short, has consulted with an attorney and may decide to ask the courts to determine the issue of Hearn’s status. If it’s determined that Hearn is a declarant-affiliated member of the board of directors, and only that, then that would appear to conflict with the terms of a 2011 agreement between the Cove association and developer interests specifying that declarant or developer-affiliated individuals would not constitute a majority of the Cove association’s board. If it’s determined that Hearn is not a declarant-affiliated board member, but rather has the right to serve on the board by virtue of his ownership of Section 3, Lot 1713 on Captain’s Corridor, then it would appear there would be no conflict with the 2011 agreement. “An affiliate or not affiliate, that is the question,” Cove director David Kieffer said in a Feb. 5 post. “I was not an active member in CCGYC politics at the time of the settlement between 2009 and 2011. But as a current Board member now, I truly wish we could solve this controversy fairly and amicably and without extensive legal fees. Is there a way?” CCGYC, or Captain’s Cove Golf and Yacht Club Club, is the official corporate name of the Cove property owners association. Whether an amicable, non-litigated solution to the dispute is possible remains to be seen. Emotions have been running hot among some segments of the Cove year-round residential population over the perceived control of the board by non-resident owners. But as of the first week of February, CCCC had filed no legal action to shed light on Hearn’s status or any other related matter. Absent an actual court filing raising an issue that can be adjudicated, or board action asking the Cove’s law firm to offer an opinion on the issue, it could be that the recent flurry of postings will simply fade away in intensity and frequency. That, too, remains to be seen.

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LIFESTYLES

February - Early March 2015

Wednesday, Feb. 11 Ocean Pines Boat Club, indoor mini-golf event, 4:30 p.m., Old Pro Golf, 68th St., Ocean City, $9 per person for golf only / $18 per person for golf and dinner. Boat Club members and non-members invited. A round of miniature golf will be followed by dinner at Taylor’s Neighborhood Restaurant in Ocean Pines. Happy hour 4:30 p.m. BYOB and bring a small snack to share. Walt or Barb at 410-600-0021 to sign up. Thursday, Feb. 12 Ocean Pines Garden Club Meeting, 10 a.m., Ocean Pines Community Center. Featuring Kim Reed, who will lead a demonstration on “Tai Chi for Health.” Open to the public. Democratic Club of Worcester County, monthly meeting, 6:30 p.m., Ocean Pines Community Center. Featuring Erin Swanson, a a registered nurse with Amedisys, who will discuss the organization’s patient care transitions from hospital to home. Democrats and interested Independents welcome. Saturday, Feb. 14 Annual Kiwanis winter pancake breakfast, 8 a.m. to 11 a.m., Ocean Pines Community Center. $5 adults, $3 children under 12, free to children under

HAPPENINGS 5. Pancakes, sausages, fruit cup, orange juice and coffee or tea. Tickets are available in advance from any Kiwanis member or by calling 410-208-6719 or at the door. Carry-out breakfasts available. Golf course management presentations, 9 a.m., Ocean Pines Country Club. Three competing proposals for management of the Ocean Pines golf course. Thursday, Feb. 19 Regular monthly meeting, Ocean Pines Association, Board of Directors, 1 p.m., Ocean Pines Community Center, and streamed online at oceanpines.org. Approval of 2015-16 OPA budget expected. Regular monthly meeting, Pine’eer Craft Club, Ocean Pines Community Center, 9:45 a.m. refreshments followed by craft and planning meeting. Guests welcome. 410-208-3032. Friday, Feb. 20 Murder mystery and dinner, For the Love of Money, sponsored by the Ocean Pines Chamber of Commerce, 6-9 p.m., the Woodlands of Ocean Pines. Get a Clue Productions. $40 per person, in-

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cludes dinner and show. Cash bar, prizes and raffles. Tickets online at www. OceanPinesChamber.org or the Ocean Pines Chamber of Commerce office or call 410-641-5306. Saturday, Feb. 21 Ocean Pines Association 2015-16 budget presentation, 9 a.m., Ocean Pines Community Center. OPA General Manager Bob Thompson summarizes main features of 2015-16 OPA budget. Tuesday, Feb. 24 Four-session boating course begins, Ocean City Power Squadron, 7-9 p.m., Ocean Pines library. Additional sessions March 3, March 17, and March 23. Test, March 30. $15 per person, free for middle and high school students. Ccharting, navigation and basic boating skills. Paddle, sail, inboard and outboard power boating. NASBLA-approved, meets all state requirements. Registration 6:30 p.m. first night of class. Free 6-month Ocean City Power Squadron membership upon successful completion of the course and exam. Contact Wally Stevenson at 410-726-1509 or Mort Brown at 410-6418040 for more information. Ongoing Free platform tennis clinics, Saturdays at noon, Manklin Meadows tennis complex. Bring sneakers, the rest is provided. Annual memberships start at $150 . Pine Tappers free adult tap dance classes, Tuesdays, 2-3:30 p.m., Ocean Pines Community Center. Exercise and have fun with choreographed tap dancing routines. From 2-2:30 p.m., brush up on basic techniques and a review of the routines, then join the regular class from 2:30-3:30 p.m. Every week or dropin as convenient. Lori at 410-251-2162 or tntandcompany@gmail.com. Ocean Pines Ping Pong Club, Ocean Pines Community Center, Monday noon to 2 p.m, Wednesday and Friday noon to 3 p.m. All levels of players welcome. Neil Gottesman, 732-773-1516. Suicide Grievers Support Group, 3rd Wednesday every month, 6 p.m., Worcester County Health Department, Healthway Drive, Berlin, adjacent to Atlantic General Hospital. Open to anyone who has lost a friend or loved one to suicide. Free of charge. Quiet listening, caring people, no judgment. 410-629-0164. The Kiwanis Club of Greater Ocean Pines – Ocean City every Wednesday at 7:45 a.m. in the Ocean Pines Community Center. 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, 410-2081272; 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.

Captain’s Cove To Page 38 a home on Starboard Court, which he sold last year. Hearn’s description of what lawyers back in 2011 agreed to relative to his non-declarant status triggered skeptical reactions from Williams and former Cove General Manager Lance Stitcher, a Cove property owner who was removed as GM in a reorganization of the Cove POA after Hearn assumed the presidency. Williams said that if there are legal opinions from attorney that verify Hearn’s recollection, he should produce them. Stitcher was even more direct, telling Hearn that as someone who attended a meeting in Cambridge where the issue was discussed, he (Stitcher) believes it was understood that Hearn was among those in attendance who were “most certainly” declarant-affiliated. “I’m sure that I can get a few others that would agree with that statement who sat in the room that night,” he wrote. “At the very least you representing (Michael) Glick in this transaction gives you a certain fiduciary responsibility to your client. I’m unclear on how you could break that affiliation for your convenience …” Hearn said his opinion on the matter stems from meeting notes taken in the 2011 settlement conference in Cambridge, “where the definition of a Declarant affiliate was agreed upon to be very limiting in nature, as the then Board did not want it be expansive, for the reason that it would negatively impact dues collections. Given the level of importance that dues collection was given at the meeting, I imagine the notes or recall from the CCGYC board members who were there will be consistent with mine on that topic,” he wrote. Declarant-affiliated lots are not subject to the annual lot assessment levy in Captain’s Cove. Hearn suggested that former Cove board members or Stitcher could produce notes from the Cambridge meeting, or, in lieu of that, the current board could ask the law firms present at the meeting to produce relevant correspondence on the matter. “However, it is unclear what level of support there would be from the current board or members in investing new, unbudgeted money in asking the firms to complete such a task, given that the request is being made by a sole member (Williams) for such a speculative reason,” he said. The Cove board is scheduled to meet Saturday, Feb. 21, in the Marina Club banquet room beginning at 9:30 a.m. Hearn’s status may come up for discussion at the meeting.

OPINION

February - Early March 2015 Ocean Pines PROGRESS

COMMENTARY11

FREQUENTLY ASKED revisited: QUESTIONS Yacht Club referendum ‘Frequently Asked Questions’ damage and design deficiencies which must be addressed if the building is to remain safe to use over the next 30 to 40 years. Independent Professional Engineers have stated that repair or renovations are unsatisfactory alternatives due to the significant cost and inadequate design of the current structure. Furthermore the current facility lacks the flexibility of use or the capacity needed to meet current and/or future needs of our community. (See AWB Report and Special Board Meeting presentation dated December 6, 2011 on OPA website for more info)

Q. What doessummer the $4.3 million cost include? t was of 2012 that Ocean Pines Associa-

tion members voted, byinclusive a two for to the oneproject. margin, A. The $4.3 million dollars is all In for

additionatonew all the construction for the new afacility price $4.3 millioncosts Yacht Club, cost this that shortincludes demolitiongrew and removal of the existing buildings, site ly thereafter to $5 million. An initial judgment planning, new kitchen equipment,from furniture architectural that kitchen equipment theadditions, old Yacht Club could designs and prints, a 5% project It also includes the catbe saved andand installed incontingency. the new facility proved relocation of existingincorrect, equipment, phones, Ancel System, fuel storagehunastrophically costing property owners tanks, signage, as well as a brick paver deckthey and additional dreds of thousands more that had not parking. voted on as part of the referendum. Q. Why not build a one-story smaller structure at Even now, in 2015, the cost of the new Yacht Club less cost? continues to grow, as the Board of Directors considers A smaller structure would notthe allow2015-16 the Yachtfiscal Club toyear offer that A.capital expenditures for restaurant while other groups utilize catering/banquet Q. What happens if I say “no” to this referendum in partservices are intended to remedy design flaws and omisservices for special occasions and functions such as weddings, question? sions in the new facility, including a draught beer sysanniversary and birthday celebrations, holiday parties, bereavement tem to service the tiki bar, tiki bar hurricane shutters, A. A “no” vote will leave the community with its current facility. functions, and more. A smaller building would limit the space that andof Adirondack fororganizations the patio use area. All Such are perThe existing Yacht Club building is expected to last no more than many our community chairs groups and as well. fectly justifiable additions to the facility. 12-18 months in its current condition. use is extensive and building a smaller facility would force our Theand proposed Club capital Members others toYacht go elsewhere to meetexpenditure their needs. list for 2015-16 also andnot equipCatering/banquets is anincludes important banquet element in furniture our community, Q. How will a new building impact my annual ment, even more kitchen equipment, an outside seronly as an amenity for our owners but as an important financial assessment? vice bar –ourand more. Theoperation. list totalsInroughly $150,000 element in food service addition, the A. The entire $4.3 million cost will be met without any special in Yacht Club spending, and there is little indication assessment or external borrowings. Once completed, there will be recommended new building is designed to have one floor closed thus far in thus the reducing 20156 budget process underregular way that down if needed, cost while still providing an annual depreciation expense on the new building, which will the Board of Directors is going to deny funding for increase assessments by approximately $6 per year. (The current restaurant and entertainment services. This flexibility simply does existof in ait.smaller, one-story structure.quite properly is adding Indeed, the board depreciation on the existing facility is $7 per year with the new notany to the list: some outdoor fans that could help deter the building being $13 per a year) This, however, is expected to be at Q.legions If I sayof“YES”, will construction begin, how flies when that congregate at the club when the least partially offset by lower utility costs and increased operational longblows will it the takewrong and what happens to the existing wind way. Inexplicably omitted from efficiencies gained by the new design of the building. I enjoy at are the Yacht in thethat meantime? theservices new spending roomClub dividers would make A.it Construction 12cavernous months beginning this floor fall, subject possible to will usetake the second banquet Q. I’ve heard we have already paid for a new Yacht to room obtaining permits. The existingSooner facility will remainthese operational more intelligently. or later, dividers Club. Is that true? If so, how will that happen? through the summer of 2013 while the new building is being will need to be funded. A. Yes. In short: A financing strategy “The 5-Year Funding Plan” constructed. The pool pool proposed bar will notYacht be affected by The source for and all this Club capital was adopted 4 years ago to address the anticipated major facility construction. They will remain open during construction. spending, of course, must be the five-year-plan reserve costs of our community. Therefore, you have been paying into a – a component of the OPA’s Major Maintenance and What happens in the winter when demand goes reserve account via the plan for 4 years. This plan will be used as Q.Replacement Reserve – because that was the sacred the long-term funding solution for this and other projects. down? made to property owners in the referendum promise This new facility is uniquely designed to takeprior advantage A.materials sent out to the membership to theof2012 Excerpts from the “Frequently Questions” space. Service can be that scaledturns appropriately demand. We Q. If catered/banquet events are the Asked main reason for vote. But wait, out nottotomeet be true, according section the size, Yacht Club referendum theof larger do we really need to havematerials them? sent have the option to open both floors during the busiest seasonal months and scaling back to one floor operations when demand toA.property owners in 2012. The number and size of these events over the past few years slows. Long-term, the design provides maximum flexibility for indicated that they are important to our membership and the Ocean Pines. Seasonal, year-round, restaurant only, catering/ community. Moreover, while future tastes in food, beverages and banquets only can all be accommodated, allowing the best use of entertainment will change, banquet affairs will continue to the facility over the next four decades. Note that a larger facility can be important as long as people get married, have birthdays, become smaller if needed, but a small one cannot become larger! anniversaries, club meetings, and bereavements. It can also be shown from a profit and loss standpoint that catering is an important Q. Why is this such a pivotal decision? adjunct to regular dining. A. The commonly held property—that which we all own—in Ocean Pines is reaching the end of its useful life. If we do not act Q. Who uses our banquet facilities today? to keep our assets in attractive, functional and effective condition, A. 95% of all non-wedding events are OPA Member related and the community will begin to show age and decay that will affect 80% of all functions are OPA Member related. In the past 3 years our individual property values. Just as we invest in upkeep of our there have been over 400 functions with over 30,000 attendees own property, we must do so with our commonly owned property. at our banquet facilities. This does not include the regular The Yacht Club built by Boise Cascade has reached the end of its restaurant business. So who uses our banquet facilities today? — useful life. It is time for us to act together to correct this WE DO! problem.

Proposed Yacht Club capital expenditures in the general manager’s draft 2015-16 budget. Note that none of these proposed capital expenditures are being funded from the five-year plan, contrary to assertions by some OPA officials that the new facility would be paid for by the five-year plan.

to the fine print on the proposed capital spending list published elsewhere on this page. The funding sources for these proposed expenditures is this year’s lot assessment – the general fund – and funded depreciation, deceptively called the “historic” reserve because it is replenished with fresh new assessment dollars collected each and every year from OPA members. So much for promises made to property owners about how the new Yacht Club would be funded by the five-year plan. It was true, up to a point, until it no longer was. This is not mere budgetary minutiae. It’s relevant to a debate now occurring among OPA directors on the proper level of funding for the OPA reserves, particularly whether the five-year-plan revenue stream – costing OPA members $130 per year in their lot assessments – ought to be defunded in the 2015-16 budget. Leading the charge on this is OPA Director Marty Clarke, who points out that that this funding stream would be in its seventh year in FY 2016 if he is unable to persuade his colleagues to end it. The referendum materials can still be found on the OPA Web site for those who want to compare what was promised in 2012 to the reality three years later. The section titled “Frequently Asked Questions” makes for fascinating reading. Given the disparity between promises made then and the reality today, an update on this section of the referendum materials is warranted, employing the convenient question-answer format used in 2012. Parts of the 2012 Q&A is reproduced elsewhere on this page for convenient reference. Not everyone has the patience and stamina to wade through the navigational tabs on the OPA’s new and improved Web site. Q. How will the new building impact my annual assessment? A. Any operational losses budgeted and actual have to be subsidized by annual property assessments, a fact conveniently omitted in the 2012 Q&A. Funded depreciation on the new building is costing property owners roughly $13 in the current lot assessment, an increase of $6 from depreciation expense collected from property owners each year in relation to the old building. Contrary to a 2012 claim that increased depreciation expense would be offset by lower utility costs and increased operational efficiencies gained by the new design, year-to-date financial results for the Yacht Club do not bode well for the remainder of the current fiscal year. Actual results are eviscerating the 2012 claims. The Yacht Club lost $34,049 in December, and the cumulative deficit through the end of December was $24,888, with the dog months of January, February, March and April likely to add significantly to that deficit. It would not be surprising if the deficit at the end of the fiscal year approaches or exceeds $200,000 if current trends continue and the Thursday-through-Sunday schedule remains in place. Utility expense in December was $15,575, missing its budget by $6,007. So much for lower utility cost and operational efficiencies promised in 2012. Claims made in 2012 were misleading and delusional at best: at worst, intentional falsehoods designed to curry favor with voters. Q. I’ve heard we had ALREADY paid for a new Yacht Club when we voted in 2012. Is that true? A. No, not even close. This assertion answered as a “Yes” in the 2012 Q&A was spin at best, designed to mislead and obfuscate, or, at worst, a deliberate lie – take your pick – and this conclusion is not based on 20-20 hindsight. The referendum Q&A says that the

Q. Why must we rebuild the Yacht Club? A. The existing 40 year old building has serious structural

February - Early March 2015

five-year funding plan reserve had “already” raised sufficient funds to pay for the new Yacht Club, but that is contradicted by the published OPA reserve summary for July 30, 2012. The five-year-plan reserve had accumulated a mere $1.35 million as of that date, about the time OPA members were casting their referendum ballots. The five-year plan funding stream was well short of the advertised (but later increased to $5 million) $4.3 million cost of the building. Indeed, it had not raised sufficient funds for that purpose even by 2015. According to the OPA’s reserve summary for this past December, the shortfall is roughly $1.5 million. Some say it would take until 2018 for the five-year plan to raise sufficient funds to fully “pay” for the new Yacht Club, but that’s based on assumptions that may prove unreliable. For instance, if the OPA uses the five-year plan funding for projects other than the Yacht Club, then the 2018 phony “pay-off ” date would be pushed back even further. Q. Other than some reported remaining unpaid invoices, the Yacht Club has been fully paid for. If not by the five-year plan reserve, then how? A. To be sure, the primary funding source appears to have been the five-year funding plan reserve, as the balance in this reserve steadily dropped during the construction period as the contractor received draws as the work proceeded. As for the $1.5 million shortfall to date, it’s hard to say for certain, but it would appear that invoices have been paid by unallocated reserves and/or operating cash not reflected in the monthly reserve summaries. The OPA’s monthly balance sheets consistently show that OPA cash on hand and shortterm investments exceeds the bottom line balance in allocated reserves by significant amounts. As the OPA can’t manufacture dollars out of thin air, and no line of credit was established with a bank or savings and loan or other similar entity, the funding source must necessarily be unallocated reserves and/or operating cash. Q. But the five-year plan eventually will “pay” for the new Yacht Club, perhaps by 2018, as some are now saying? A. Some might make that claim, to be sure, but a combination of the five-year plan and “other” funds have already done it in real-time, less some modest remaining invoices yet to be paid. Q. So perhaps some sort of internal borrowing – robbing Peter to pay Paul, so to speak – has facilitated the actual pay-off in lieu of the five-year plan funding shortfall? A. OPA Director Tom Terry recently suggested that the five-year funding plan funding stream has effectively borrowed from OPA funds for the purpose of paying for the new Yacht Club, but, upon reflection, he later told the Progress that no internal borrowing mechanism was put in place relative to the new Yacht Club. His walk-back of the earlier assertion is correct. Such a mechanism was approved for golf drainage projects a number of years ago, and the same is true for the Sports Core pool enclosure project. No such internal borrowing mechanism is in place relative to the new Yacht Club. Q. Didn’t OPA General Manager Bob Thompson disclose the five-year-plan funding shortfall in town meetings prior to the referendum in 2012 and that it might take until 2018 to fully “pay” for the new Yacht Club from the five-year-plan reserve? A. That’s what he says now, and perhaps he did. Progress reporting at the time does not verify this. Another media source – Joe Reynolds of oceanpinesforum.com – says he believes that admission and “clarification” came sometime after the referendum was approved by OPA members. But whatever Thompson said or didn’t say during his public outreach in 2012 is not

COMMENTARY particularly relevant today, as it was the election materials – particularly the misleading if not false answers to questions in the “Frequently Asked Questions” – that constituted the more or less official narrative from the OPA at the time. That’s the information that was made available to the vast majority of OPA members, especially those who didn’t bother to attend town meetings or who aren’t members of civic groups that heard Thompson’s sales pitch. The referendum materials fed the perception that the OPA had money in the bank for the new Yacht Club – that it was “already” paid for, thus making a “yes” vote almost a no-brainer. Q. But one answer in the “Frequently Asked Questions” section of the referendum materials indicated that the five-year funding plan is a long-term solution for the new Yacht Club and other long-term projects. Doesn’t this statement exonerate the OPA from claims that it had deliberately misled or lied to property owners in the referendum materials? A. No. Remember, the answer to the question about whether the new Yacht Club was “already” paid for was an unqualified Yes. At best, the verbal jujitsu that followed served to confuse the issue. There was no definitive statement that it would take until well after the new Yacht Club was open for business for the fiveyear-plan reserve to generate sufficient funds to “pay” for the new building. A candid admission of that would have been inconsistent with the false claim that the new building had “already” been paid for. Q. OPA Director Marty Clarke wants to eliminate the five-year-plan funding stream from the OPA 2015-16 budget. Wouldn’t this violate a “promise” made to OPA members in 2012 in the referendum materials that this funding stream was earmarked to pay for the new Yacht Club? A. Though Thompson and some OPA directors make that argument, no such promise appears in the referendum materials. It can be more accurately described as a non-promise, conveniently invoked now for the political objective of keeping the five-year-plan alive and funded. To the extent that this funding stream has been the primary source for paying for the new Yacht Club, it could be argued that to some extent this “non-promise” has already been fulfilled. To the extent that funding other than the five-year-plan has been used to pay Yacht Club invoices, this “non-promise” has already been violated. In addition, roughly $150,000 in Yacht Club capital expenditures is proposed in the 2015-16 budget by Thompson. The funding source for these capital expenditures is either next year’s assessment or the so-called historic reserve – funded depreciation. OPA management is already violating the “non-promise” by using reserves other than the five-year-plan for Yacht Club-related capital expenditures. Q. Isn’t the OPA paying depreciation on the new building, in effect paying for a new building that might be needed 40 years from now? A. Yes, that’s a perverse irony of the OPA’s funding practices. If you accept at face value Thompson’s assertion that the five-year funding plan won’t fully pay for the new Yacht Club until 2018 -- and you shouldn’t -- then current property owners are effectively paying twice for the new building, once through the $130 five-year-funding plan and then again through funded depreciation, costing another $13 or $14 in the lot assessment, both at the same time. Put another way: We are paying for a new building 40 years from now even before we have “paid for” the building we just built – that is, if you buy into the false narrative that the five-year-plan is and must be the new building’s sole funding source.

OPINION Q. What would be the net impact of eliminating the five-year-plan on the OPA’s reserve balance? A. A modest one. Clarke is proposing to allocate $314,068 in assessment dollars to the roads and drainage reserve, which would cost property owners $37.16 in the lot assessment. He would also add $350,000 from the assessment to the golf drainage reserve, with a $41.41 impact on the assessment. He would add another $45,000 in capital spending related to racquet sports, equivalent to $5.32 in the lot assessment. But all these increases would be offset by a $1,089,630 decrease in contributions to the five-year-plan reserve, equivalent to a $129.98 decrease in the assessment. The net result is $389,562 less flowing into reserves than would otherwise be the case. That’s the same as a $46.09 decrease in the lot assessment. Instead of a projected reserve balance of $4,682397 on April 30, 2016, as called for in Thompson’s draft budget, the reserve balance would be $4,292,835, still quite high by historical measures. It’s a difference that hardly anyone would notice or care about. Q. But Clarke’s proposal would result in an assessment decrease, would it not? A. Yes. Thompson’s draft budget with full funding of the five-year-plan would result in an increase in the assessment from $909 this year to $934 next year. In contrast, Clarke’s defunding proposal results in a decrease in the assessment to $866.09, most of it attributable to the defunding of the five-year plan. That is subject to change based on other adjustments to the budget that Clarke is proposing. It could be adjusted again depending on the outcome of discussions with the Ocean Pines Volunteer Fire Department on its proposed budget for next year. Q. What are the chances that Clarke will persuade at least three of his colleagues on the board to accept his proposal to defund the fiveyear-plan reserve? A. Hard to say, but he at least has a shot at it. He might get a partial loaf, but that would be better than no loaf at all. His companion proposal to fund road depreciation, proceeds of which can be used for both road and drainage projects, would fit nicely with the agenda of OPA Treasurer Jack Collins, who got elected in 2013 advocating for community-wide drainage improvements. Clarke also is proposing to fund the golf course drainage reserve, something that OPA President Dave Stevens is on record as supporting. During private conversations recently, Collins seemed less inclined to accept the false narrative – as he called it, the social contract – that he initially said called for the OPA to continue collecting the $130 per year tied to the five-year-plan at least until 2018. If Collins decides he no longer wants to drink the five-year-plan Kool-Aid – not a social contract as he initially thought but a false narrative refuted by hard evidence from the OPA’s referendum materials – then perhaps he will join Clarke in supporting an end to the five-year-plan funding. That would leave Pat Renaud as the fourth director most likely to join in a majority that could defund the five-year-plan, if not totally then at least partially. If Clarke can’t get the full defunding of the five-year plan, then perhaps the funding of roads depreciation and golf drainage could be postponed for one year. That might be an acceptable compromise, though complete defunding of the five-year plan would be best. Q. Wouldn’t defunding the five-year plan jeopardize the OPA’s long-term plan for funding major capital improvements? A. Not at all, although you’ll hear fear-mongering and hand-wringing by one or two directors about that. They will continue to drink the five-year-plan Kool-Aid even without a demonstrated need for the revenue in the form of a detailed, up-to-date capital improvement

38 Ocean Pines PROGRESS

OPINION

February - Early March 2015 Ocean Pines PROGRESS

Golf course lease option no longer seems viable

ot for lack of trying, it now appears that the Ocean Pines Association won’t be leasing out its 18-hole Robert Trent Jones golf course anytime soon. Word is that the one lease proposal that made it into the final three under consideration by the Board of Directors as a way to manage the golf course was not a pure lease proposal, one that would have removed the possibility of an operating loss for the OPA. This lease proposal contained a request for subsidies in the event the lessee was unable to turn a profit at the golf course. As a result the board working group investigating the possibility of alternatives to Billy Casper Golf decided there was little substantive difference in concept between what might be called a hybrid lease proposal and a more traditional fee-based management contract in which the contractor is given a lot of autonomy to run the course. It now appears that the single lease proposal that survived the vetting process will be converted into a more traditional fee-based management proposal. Nor is BCG out of the running, despite a 4-3 board vote last month that seemed to indicagte that a majority of directors isn’t necessarily convinced the company is the best bet for continuing to manage the golf course. The board majority is skeptical that budget projections for the current fiscal year offered by BCG are realistic, and this skepticism was reflected in a letter drafted by the OPA president and sent to BCG executives giving notice that the company might lose the contract as a result of the current selection process. The letter was required under the current contract as a way of avoiding an early termination penalty, should that termination actually occur. That is not done deal, by any means. BCG has its advocates, of course, led by OPA General Manager Bob Thompson and joined by three directors – Bill

a failure of management, pure and simple. The Ocean Pines tradition of tolerating poor maintenance, and using the An excursion through the curious cul-de-sacs An excursion through theby-ways curious and by-ways and cul-de-sacs resulting shabbiness as an excuse to jusof Worcester County’s County’s most densely community. of Worcester mostpopulated densely populated community. tify a replacement building, should not be indulged in this instance. By TOM STAUSS/ By TOM Publisher STAUSS/Publisher If any of the three finalists come in with specific proposals for a make-over, Cordwell, Sharyn O’Hare and Tom Ter- fluence the final board decision, but just at least of the bottom floor where the pro ry. They’ve cited improvements in the how much is hard to say. shop and snack bar is located, the direcgolf course’s bottom line this year and As for the three directors firmly in tors ought to seriously consider funding seem to believe that management conti- BCG’s corner, judging by the 4-3 out- them. The OPA’s historic reserve, flush nuity is the best way forward. come of the earlier vote, it seems unlikewith cash from funded depreciation, can Thompson mentioned in a recent ly that their minds can be change at this be tapped to pay to make the place a budget session that it seems the board stage inthe process. more hospitable place. The historic remajority is heading in a “new direction” The likely fade-out of leasing as a serve is a component of what is grandwith respect to golf course management, viable option for managing the Ocean ly called the Major Maintenance and later saying he didn’t mean anything by Pines golf course perhaps was inevita- Replacement Reserve, and maintaining it, but the caveat didn’t come across as ble, given the less than stellar financial assets is precisely why that reserve was all that convincing. performance of the course in recent established all those years ago. Thompson without saying so explic- years and an aging, declining memberIt’s amazing what new carpeting and itly seems worried that BCG won’t be ship base of roughly 150. a fresh coat or two of paint can do to around much longer in Ocean Pines. A new management company, or freshen a place up – both inside and out. But this is Ocean Pines, so anything Casper, if its contract is renewed, will But in addition to that, some serious atcan happen. As of the first week of Feb- be tasked with trying to figure out how tention needs to be given to that rather ruary, BCG was still very much in the to boost membership at the same time sad seating area tacked on years ago to running to continue to manage the it cultivates the outside play absolute- the snack bar. Ocean Pines golf course. ly necessary to sustain the golf course’s Here’s a news flash to anyone payAt the board’s regular meeting in finances. ing attention: That place is depressing late February, the directors also took Given the poor financial results in and it blocks the views of the ponds and pains to assure the golfing public and recent years, in the end it was probably ninth and 18th greens from the Tern local promoters that whichever of the too much to expect a prospective leasing Grille. Razing it and just leaving it as three finalists that the directors choose company to assume all the risk of manopen space would be better than what’s to manage the course in the future, aging the golf course. The effort by the there now. there will be continuity. board and its working group headed up That means outside play bookings, by Director Jack Collins in pursuit of a tournaments and other tee-times pre- leasing option was made in good faith. arranged for next season will be guarIt seems to have fallen short, disapanteed regardless of who is running the pointing to be sure, but not the end of show. the world. All three finalists, including BCG, Here’s another helpful hint to the The Ocean Pines Progress, a journal will be meeting with the local golf com- board if it truly wants to improve the of news and commentary, is pubmunity – and anyone else interested odds for a successful year of operation lished monthly throughout the year. enough to attend – in a day-long meet- at the golf course: It really is time to It is circulated in Ocean Pines, Berlin, ing at the Country Club on Feb. 14. do some significant sprucing up of the Ocean City, and Captain’s Cove, Va. Probably not too long after that, the Country Club, sufficient to make it a Letters and other editorial submisboard will be making a final selection of more welcoming place for members and sions: Please submit via email only. which management proposal is the best non-members alike. For starters, the Letters should be original and exclufit for Ocean Pines. odor of mildew, and its underlying caussive to the Progress. Include phone It’s likely the presentations by the es, needs to be eradicated once and for number for verification. three candidates will to some extent in- all. Why it’s been tolerated for so long is

LIFE IN THE LIFE INPINES THE PINES

127 Nottingham Lane Ocean Pines, MD 21811

COMMENTARY

processes are complete.

From Page 38 plan. Even with the demise of the five-year plan, funded depreciation will continue to extract more than $1.6 million from property owners next year, and that pile of cash – projected to total $5.8 million on April 30 of next year – is available for repair or replacement of existing assets. It should be more than adequate to handle repairs and refurbishment of both the Beach Club and Country Club, for instance, neither of which are scheduled to be addressed in the 2016 fiscal year. In the coming months, a reserve study – a detailed assessment of OPA assets and their remaining life-cycle – will occur. In addition, Stevens is heading up a well-thought-out process that, in the coming months, will produce a new capital improvement plan for the OPA. As part of the CIP process, some thought will be given to trying to match funding needs with resources, at which time the need for a five-year-plan or similar capital supplemental funding program will come into sharper focus. There may or may not be a need for a supplemental source of funding for major projects once the reserve study and CIP

Q. But there is a capital improvement plan in place – wasn’t one voted on by the board in June of 2012? A. Apparently so, but today it’s practically useless; one of its major components, the new Yacht Club, is already completed. So are other projects. Bridge replacement was listed at $800,000-plus as if the OPA was responsible for the entire cost; 80 percent of the cost is actually a county responsibility. Country Club replacement is listed at $3 million; Clarke has informally proposed that Country Club remodeling and refurbishment could be done at a fraction of that, well under $1 million, in fact. The same is true for the Beach Club. Clarke makes the argument that having too much money in reserves encourages over-spending, replacement of existing facilities rather than intelligent renovation. Q. Didn’t Thompson present a draft CIP – he called it a rack and stack – in November of 2013? A. Yes, but it was never approved or even discussed to any significant degree by the board at the time.

PUBLISHER/EDITOR Tom Stauss tstauss1@mchsi.com 410-641-6029

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