June 2018 ocean pines progress by Ocean Pines Progress

Bailey makes June 1 deadlne for finishing Country Club RFP General Manager John Bailey said in late May that he expected to complete a new request for proposals for the Country Club’s second floor renovation shortly, presumably before a June 1 deadline contained in previous board direction to him. During the Board of Directors’ May 24 monthly meeting, Bailey said that the new “phase two” proposal to be bid out would not include an elevator or cleaning out or making use of the old kitchen equipment and re-purposing that space.

~ Page 8

GM still pressing for demolishing Sanctuary crab pier With the crabbing pier in Whitetail Sanctuary in poor condition and some nearby residents seeking its closure, the Ocean Pines Association is weighing options for its removal, relocation, or reconstruction. During a May 24 meeting, OPA General Manager John Bailey said the crabbing pier has been temporarily closed pending a decision as to how to proceed. Bailey received permission from the board to find an alternative site.

~ Page 15

Board approves $166,000 adjustment to fire/EMS budget

The expectation that the Ocean Pines Association would be adjusting its books for the fiscal year that ended this past April 30 to reflect an old agreement with the Ocean Pines Volunteer Fire Department was realized May 24, when the OPA Board of Directors voted unanimously to award the OPVFD a previously unbudgeted $165,620.

June 2018

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THE OCEAN PINES JOURNAL OF NEWS & COMMENTARY COVER STORY

OPA ELECTION

Hill sues board, OPA secretary Horn for inclusion on ballot; slate down to seven after two drop out Seeks temporary injunction to halt election process pending resolution of eligibility dispute By TOM STAUSS Publisher wo of the nine original candidates for the Board of Directors in this summer’ Ocean Pines Association election have withdrawn from the race, leaving seven candidates that have been certified as eligible by OPA secretary Colette Horn and one other who hasn’t been. Brett Hill, the former acting general manager and elected director who resigned from the board last August, has gone to court seeking to overturn Horn’s decision to exclude him from the certified ballot because, according to her, Hill had failed to pay the assessment on his primary residence by a May 15 deadline.

Collette Horn

Brett Hill

Hill in recent correspondence with Horn said that the May 15 deadline is not supported by language in the OPA bylaws, Sections 5.02(a) and (d) and 3.01(c), which he said should be interpreted to read that he should be certified as a candidate if his assessments are paid within 35 days of the vote count in August. Horn, who under the OPA organizational documents is the sole corporate officer given the task for certi-

fying candidates, cites 5.02(d) of the bylaws and board resolution M-09 as setting a hard deadline of May 15 for candidate eligibility. Section 5.02(d) says that the secretary “shall verify that the Association’s records as of May 15th support each candidate’s eligibility and shall submit a list of eligible candidates to the Elections Committee no later than June 1st.” Hill argues that this language gives the secretary flexibility to certify candidates after May 15. [See article on page 9 for a detailed look at the competing interpretations of the OPA bylaws by Hill and Horn.] Hill has said that even if Horn’s interpretation of the bylaws has some degree of plausibility, which he disputes, the bylaws also can reasonably be interpreted to support To Page 45

Trendic highly critical of Supik for $400,000 budget deficit miss, OPVFD funding issue ~ Page 24

~ Page 19

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OPA announces schedule for mosquito spraying

The Ocean Pines Association is a June 6 press release announced this summer’s mosquito spraying program in Ocean Pines, a service provided by Worcester County but funded by the OPA in an annual appropriation. The county will be spraying in Section 10 on Mondays, in Sections 9,12 and 13 on Tuesdays, Sections 1, 2, 3 and 7 on Wednesdays, Sections 5, 6 and 8 on Thursdays, and Sections 11, 14A, 14B, 14C, 14D, 18, 19 and 4 on Fridays. There was no information given in the press release or the county’s spraying schedule document that indicated what time during the day that the spraying will occur, but in previous summers it normally occurred during nighttime hours when outside activity by residents is at a minimum.

Trendic suggests T-bill investments

Unhappy with some of the returns on C-DAR investments outlined by Treasurer Pat Supik during her financial recap delivered during the May 24 Board of Directors meeting, Director Slobodan Trendic suggested diverting some of these longer-term CDARs into United States Treasury investments, T-bills for short. Trendic said that the current annual return on a four-week T-bill was 1.7 percent, higher than the yields on the Ocean Pines Association’s CDAR investments. Supik seemed to agree that the idea was worth looking into.

Tuttle: OPA should issue financial management RFP

Board of Directors candidate and former Elections Committee chair Steve Tuttle has sided with the Budget and Finance Advisory Committee and two sitting directors in opposing the award of a six-year contract to NorthStar Technologies for new management software. During the Public Comments segment of the May 24 board meeting, Tuttle said he supports the issuance of a request for proposals from management companies to assume control over OPA financial operations. Such an RFP would include possible software solutions. The issuance of such an RFP would not commit the OPA to the outsourcing option, but would gather additional information that policy-makers could evaluate

June 2018 Ocean Pines PROGRESS

OCEAN PINES BRIEFS before opting to lease or purchase the NorthStar software. But it is generally understood that issuing an outsourcing RFP would push the software/management decision to the new board in August. The Technology Working Group and Ocean Pines President Doug Parks, the working group’s board liaison, had been pressing for a board decision on NorthStar at the board’s May 24 meeting. But Parks pulled his motion to approve the NorthStar proposal from the meeting agenda, after the Budget and Finance committee voted unanimously to oppose it earlier in the week.

Board, B&F committee to discuss reserve study

A joint meeting between the Board of Directors and the Budget and Finance Advisory Committee has been scheduled for Friday, June 22, at 9 a.m. in the Community Center’s Assateague Room to allow both groups to discuss the status of the latest reserve study, completion of which has been slow even by the Ocean Pines Association’s usual leisurely pace. “We’re going to have an open discussion” about the reserve study, because it “totally feeds everything,” General Manager John Bailey said in a B&F committee meeting June 30. By “everything” he meant the completion of a capital improvement plan, a decision on an acceptable level of funding for the replacement reserve, and the annual contribution from assessments needed to fund whatever level of the replacement reserve that is deemed acceptable. Committee chair John Viola asked why the process to update the reserve study is taking so long. Bailey said the “scrubbing” of the asset list of fully depreciated items or items under the new $5000 capitalization threshold took a year and that scheduling difficulties with the company that completed the study didn’t help matters. Bailey seemed to attach a great deal of importance to reserve and funding questions because he believes specific proposals to address road improvements, bulkhead replacement, and drainage issues will emerge relatively soon and “all will be dealt with in next year’s budget ... I see it all coming together,” he told the committee.

Not everyone is so optimistic. Former OPA Director and STOP (Stop Taxing Ocean Pines) founder Marty Clarke indicated skepticism about the process and some of the numbers used to justify assessment increases in a 2012 version of a capital improvement plan “were so falsified it was almost criminal.”

Bailey pushes for creation of new capital reserve fund

It may be more difficult than he thinks because it probably will require a change in the Ocean Pines Association bylaws. But during a May 30 meeting of the Budget and Finance Advisory Committee, General Manager John Bailey, as he has previously, promoted the idea of creating a new capital reserve fund that would make it easier for boards of directors to fund new capital expenditures or projects without raising the assessment in the year in which a new capital item is funded. Under long-standing practice, the OPA funds new capital item out of current year assessments, treating them essentially as operating expenses. Replacement items, in contrast, are funded out of the replacement reserve, whose funding source is funded depreciation over the course of many years. With a typical balance of $4 million or more, the replacement reserve as a funding source normally doesn’t require an assessment increase to fund a replacement item. Bailey’s advocacy of creating a new capital reserve comes with an awareness that to some in Ocean Pines, including members of the B&F committee, such a reserve would be regarded as a slush fund whose use could be abused by some free-spending boards of directors. Bailey’s solution to that is to create a process in which new capital expenditures are fully vetted by multiple committees before they included on an approved list of new capital items. He has also suggested that a new capital reserve could be initially funded by the sale of OPA land assets, starting with building lots that have been in the OPA inventory for years. A valuable piece of property owned by the OPA is the two-acre parcel on Route 589 in front of the post office and library. Bailey didn’t address a practical

challenge in creating a new capital reserve, the fact that it isn’t authorized in OPA bylaws or other organizational documents. Authorized reserves are for replacement, roads, bulkheads and future projects, with the latter broad enough that it could include new capital items. But Bailey told the Progress after the meeting that he prefers the term new capital, in which case he’d best brush up on the ways and means of amending organizational documents to facilitate what he wants to accomplish.

Viola defends Aquatics Department surplus

The Aquatics Department racked up a $149,000 surplus in the fiscal year just ended, 2017-18, and Budget and Finance Advisory Committee chairman John Viola seems very impressed with Colby Phillips, the department’s director, and her team of managers and staff. Less impressed is former OPA director and STOP founder Marty Clarke, who attended the committee’s May 30 meeting and poked at the perception of some that the department is doing so well. To Clarke, the department’s success is mostly the result of shared Beach Club parking revenue, which he said is a practice that at least deserves some sort of asterisk on OPA financials. He has never been a fan of the revenue split from the sale of bundled beach parking/Beach Club pool passes, done for the past three fiscal years under various cost-sharing formulas, but he doesn’t seem to be objecting as much to that as he once did. Viola, who served as a temporary director of finance last year prior to the arrival of current director Steve Phillips, was and is a supporter of the revenue split. It’s more difficult to criticize in the new fiscal year because, this summer, those who don’t want to purchase pool passes with their beach parking permits don’t have to. That implies that those who purchase the bundled passes do so knowingly. Revenue-sharing from the sale of the bundled passe is consistent with that. Clarke during the May 30 meeting aimed his fire at the fact that the Aquatics Department’s has increased 21 percent in two years. Indeed, in that time period the department has added a full-time second in command aquatics supervisor in q

OCEAN PINES

June 2018

From Page 3

support of Colby Phillips, whose duties have been expanded to include oversight of Parks and Recreation, marinas, and beach parking. Viola suggested that Phillips’s payroll costs needed to further split among the departments she oversees. Viola said there had been “promotional raises” given out to key personnel over the two years singled out by Clarke and that Viola believes the payroll cost increase could be fully explained.

OPA records a $50,000 revenue day over holiday

The Saturday of Memorial Day weekend produced a record $50,000 revenue day for the Ocean Pines Association, General Manager John Bailey informed members of the Budget and Finance Advisory Committee in a May 30 meeting. The record day was the result of $14,000 in sales at the Ocean Pines Beach Club in Ocean City and $31,000 in sales at the Ocean Pines

Yacht Club, with the rest made up in golf, Bailey said. There was a one- to three-hour wait at the Yacht Club for seating over the holiday weekend, Bailey reported, with customers pleased with the quality of food and service. He said OPA members and their guests are impressed with interior redesign of the downstairs restaurant and bar. While Bailey said there was behind-the-scenes “chaos” with the onslaught of customers, that chaos wasn’t evident to them, which he attributed to the level of training provided to the kitchen and wait staff by the Matt Ortt Companies. He said he believes the Yacht Club in particular has achieved the “wow factor” that he and the Ortt company wanted to achieve.

Drainage work group preps recommendations

A drainage workgroup is wrapping up its initial evaluation of stormwater issues in the community and plans to submit its recommendations to the Ocean Pines Associa-

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tion Board of Directors next month. General Manager John Bailey during a May 24 meeting said the workgroup is in the process of developing its final report and anticipates presenting the document, along with recommendations, to the board in July. Bailey said those recommendations fall under five categories. The first focus area is emergency response to flooding when the community receives a significant amount of rain during a short period of time. Chronic areas of flooding were broken into two categories, those that require more effort to assess but do not need engineering design and pipe replacement, and those that require engineering and funding. Preventative maintenance “is going to require some money, equipment, and manpower” and is aimed at keeping stormwater problems from occurring within the community, Bailey said. The final focus area will inform property owners about Ocean Pines’ drainage, “what its support to do, what it’s designed to do, what it’s

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Bailey takes blame for mowing delay

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not designed to do, and how we can get at some of our bigger problems,” Bailey said. The drainage workgroup initially held two meetings, one with Worcester County staff to discuss strategies for addressing stormwater issues in Ocean Pines and a second meeting with residents and staff to brainstorm. “We came up with over 40 different areas that we’ve identified that we want to address and report on drainage in Ocean Pines,” Bailey said.

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opening of amenities put the OPA behind on grass cutting along ditches in the community, according to General Manager John Bailey. He addressed the issue during his report at a May 24 Board of Directors meeting, saying he takes the blame for getting behind on grass cutting throughout Ocean Pines. Bailey said crews were busy “doing various things to prepare for the opening if amenities in time for Memorial Day weekend and got behind. In addition, the landscape crew “is currently down two physical bodies, the supervisor and her number two” he said, adding “They left for other positions. This obviously was at a most inopportune time.” The mowing problem was compounded when the OPA didn’t new lawn mowers in time. They weren’t ordered quickly after the capital purchase was approved, and when they were finally ordered, they were place on backorder. Meanwhile, the maintenance department’s old lawnmowers were sold. “The old equipment used for this task was prematurely sold prior to the arrival of the new equipment

and for that I take the blame for the miscommunication that took place with the staff on when to actually sell the equipment,” Bailey said. “At the time of the directive to sell the two mowers I did not realize they were the two mowers essential to getting ditch work done prior to new mowers arrival.” He said had I understood that he would not have authorized their sale until after arrival of the new equipment. In the meantime, the OPA is using a mower from the golf course to cut grass along the sides of ditches, and should be caught up by time new mowers arrive. Bailey said the two mowers for maintenance were not purchased at the same time as a recently acquired mower for the golf course because they were coming from a different company. “Usually we do try to purchase from same vendor to achieve cost savings,” he said, but that wasn’t possible this time. The company from which the OPA is purchasing the maintenance mowers does not sell to golf courses due to industry constraints. The golf course superintendent was able to get another company to commit to delivery of the golf course mower early, with q

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that equipment arriving on May 2. “In the end we have no excuses for the existing situation and are working hard to correct it. In the short term as well as for the long term so the current conditions are not seen again,” Bailey said.

Board votes to approve committee appointments

Anna Foultz (right) waving to her substantial fan base during the June 1 parade celebrating Ocean Pines 50th anniversary. Joe Reynolds photo

With the concurrence of her fellow directors, Cheryl Jacobs, Ocean Pines Association vice president, made four appointments to standing advisory committees during a May 24 Board of Directors meeting. Lisa Schwartz was appointed for a third term on the Architectural Review Committee. Frank Daly was appointed to a second term on the Strategic Planning Advisory Committee. He’s a candidate for the OPA board of directors this summer. For the Budget and Finance Committee Leonard Hall was appointed for a first term. John O’Connor was granted a one-year extension for a fourth term. Director Pat Supick, OPA trea-

surer and liaison to the committee, said O’Connor has served on the committee for 13 years. Director Colette Horn asked if anyone else was waiting to serve on the Budget and Finance Advisory Committee and would be precluded from doing so by giving O’Connor an extension. Supik said no, that the only other person expressing interested in serving on the committee was Hall.

Board addresses property violation

Based on the recommendation of the Architectural Review Committee, the Board of Directors on May 24 voted unanimously to take action against the owners of 38 Canal Road. The board found the property in continuing violation of the restrictive covenants and voted to send it to OPA legal counsel for resolution. OPA General Manager John Bailey said the violation on the property consists of maintenance issues. A mattress and box spring were located outside of the house. Inspectors with the Compliance, Permits, and Inspections office initially inspected the site on Feb. 28.

June 2018 Ocean Pines PROGRESS

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Bailey makes June 1 deadline for completing Country Club request for proposal draft Elevator not included in second phase plans By TOM STAUSS Publisher eneral Manager John Bailey said in late May that he expected to complete a new request for proposals for the Country Club’s second floor renovation shortly, presumably before a June 1 deadline contained in previous board direction to him. During the Board of Directors’ May 24 monthly meeting, Bailey said that the new “phase two” proposal to be bid out would not include an elevator or cleaning out or making use of the old kitchen equipment and re-purposing that space.

Bailey said the elevator and kitchen proposals were anticipated as part of a phase three. He said when he presents the results of the new RFP for board action in July, he will have cost estimates for a phase three components, including the elevator, on hand, so the directors in voting to award a phase two bid will have an idea on what the entire project inclusive of phases two and three will cost. The general manager did not suggest the combination of the two phases into a single project, but that would seem to be at least possible if he and his staff gather cost esti-

mates for phase three components, including the elevator, on hand, so the directors in voting to award a phase two bid will have an idea on what the entire project inclusive of phases two and three will cost. The general manager did not suggest the combination of the two phases into a single project, but that would seem to be at least possible if he and his staff gather cost estimates for an elevator and clearing out or making use of the existing kitchen equipment. A local contractor, Marvin Steen, has said that he has obtained an esti mate for an elevator from a regional supplier at roughly $100,000. Steen last month told the Progress that he intended to submit a proposal in response to the new RFP that would

include the elevator and cleaning out the old kitchen equipment. Steen also said his proposal would be much less expensive than the two bids recently rejected by the OPA because they were deemed too costly at roughly $800,000 and $1 million, respectively. Bailey made no reference to the Steen proposal in his brief remarks about the Country Club project during the May 24 meeting. Steen said his proposal, which could come in at roughly half of the rejected $800,000 bid, would forgo the usual mark-up charged by a general contractor over the cost of services provided by sub-contractors who do most of the work done in a large-scale renovation. “I won’t be doing this to make money,” Steen said. “I will be doing this to help the association and its members.” His bid will be based on collecting prices for various components of a renovation from sub-contractors that he uses in building houses. Top priorities including redoing the bathrooms, adding new walls for meeting rooms, removing the old kitchen equipment and creating a

Trendic, Herrick succeed in call for special meeting on Country Club Directors to review RFP for second floor renovation June 14

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cean Pines Association Director Slobodan Trendic with the backing of Director Tom Herrick were successful in their effort to call a special meeting of the Board of Directors to review and discuss the request for proposals to renovate the second floor of the Country Club, with work to begin in the fall and completion anticipated by March of next year. At least one director, Cheryl Jacobs, did not support the call for the special meeting, but it takes just two directors to make one happen. This one is set for June 14 at 8 p.m. in the Community Center’s Assateague Room. Trendic told the Progress that he was unhappy that OPA General Manager John Bailey submitted copies of a proposed RFP on May 31, just one day prior to a previous deadline set by the board for its dissemination. Trendic said that Bailey should have sent copies of the RFP to the board much sooner than he did because he was aware or should have been aware that the motion setting a deadline for sending out the RFP also said the directors wanted an opportunity to review it. The statement of purpose for the special meeting is the final review of second floor renovation plan and consideration of funds funds already spent on the renovation, additional cost estimates based on the bids received this spring, the scope of any additional renovation work deemed necessary, parts of additional renovation that are desirable but not mandatory, the historical performance of the golf amenity, golf membership and other golf-related industry trends for the area, and other priority projects that will place funding demand on the OPA reserves. A board-approved motion on April 28 called for a board review and approval of the RFP prior to being published.

8 Ocean Pines PROGRESS

OCEAN PINES

June 2018 Ocean Pines PROGRESS

Horn continues to block Hill’s bid for OPA Board Says by-laws mandate May 15 candidate verification; Hill seeks court order requiring his inclusion on the ballot and in election materials mailed to property owners By TOM STAUSS Publisher eclared Board of Directors candidate Brett Hill and Ocean Pines Association secretary Colette Horn are locked in a battle over whether Hill should be certified as a candidate in this summer’s OPA election. The battle is going to court, with Hill filing for a writ of mandamus

in Worcester County Circuit Court June 4 asking the court to order the OPA to include his name on the ballot and all of the materials he submits for inclusion in OPA election mail-outs. Horn says he shouldn’t be allowed on the ballot because he failed to pay his lot assessment by May 15. She cites section 5.02(d) of the OPA bylaws that say “the Secretary shall

verify that the Association’s records as of May 15th support each candidate’s eligibility and shall submit a list of eligible candidates to the Elections Committee not later than June 1st.” In a June 1 email to the Progress, Horn said that she continues “to stand by the fact that the controlling language for the candidate verification process is the May 15th

Country Club RFP

might be an option, Steen said, depending on the desires of the board. He said he has reviewed the latest set of engineering specifications completed by Davis, Bowen and Fridel of Salisbury several months ago in anticipation of the RFP sent out to contractors earlier this year. He said his base proposal might deviate from these plans in certain

areas to save money. Certain options would be listed that could boost the final cost over the base, depending on what options the board decides it wants in a final design. Steen insisted that his base price would include the cost of an elevator, which he estimated at a cost of $100,000 that he obtained from a

From Page 8

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date, and that this process forms the basis for creating the candidate list. “Section 3.01 (c). Payment of the annual charge levied by the Board of Directors is a prerequisite to the right to vote ... 5.02 (a) Eligibility. All candidates must be one of the owners of record of real property in the Subdivision. ... (d) The Secretary shall verify that the Association’s records as of May 15th support each candidate’s eligibility,” she wrote. Hill says that Horn is misinterpreting and misapplying the eligibility provisions in the bylaws by concluding that 5.02(d) contains controlling language. His position is that the bylaws must be considered in their totality, and that sections 5.02(a) and 3.01(c) establish eligibility requirements that are not superseded or controlled by language in 5.02(d), as Horn maintains. According to 5.02(a), “Eligibility. All candidates must be one of the owners of record of real property in the Subdivision on the first day of January of the year in which the q

HILL VS. HORN

leading supplier of elevators on the Delmarva Peninsula. “The membership shouldn’t have to wait until a phase two for an elevator,” Steen said, adding that any re-leveling of the front entrance with an associated lowering of the landscaped area between the building and driving range is a non-starter, because of cost. “We shouldn’t be wasting time and money even looking at that,” Steen said. “Engineering studies cost money better spent on an elevator.” OPA General Manager John Bailey has suggested that a lowering of the front entrance should be looked at by an engineering firm, but the idea hasn’t gained a lot of traction on the board because of cost. Bailey also said that renovation of the front entrance area should be delayed until a second phase, but Steen says that’s a bad idea. “You really shouldn’t do one without the other,” he said. “And if you do a renovation, you want to make a good first impression. So the front entrance area has to be done along with the second floor, and, of course, the elevator.” The board, during its April 28 monthly meeting, voted unanimously to direct Bailey to reissue a request for proposals for the renovation no later than June 1, with a board review before then.

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Hill vs. Horn From Page 9

election is to be held and eligible to vote under Section 3.01(c).” According to Section 3.01(c), “Payment of the annual charge levied by the Board of Directors is a prerequisite to the right to vote. “No member may vote if, thirty-five (35) days prior to the voting deadline, the member has failed to pay the annual charge, including any assessed interest levied by the Association. “The voting rights of a member may also be suspended during any period the member is in continuing violation of the Declarations of Restrictions after the existence of the violation has been declared by the Board of Directors.” Hill also said Horn has no basis for concluding that 5.02(d) is controlling over the other relevant provisions, adding that when she cites it she omits key language that suggests flexibility in certifying candidacies after May 15. According to 5.02(d), “The Secretary shall verify that the Association’s records as of May 15th support each candidate’s eligibility and shall submit a list of eligible candidates to the Elections Committee not later than June 1st.”

“Clearly, she has until June 1 to submit a candidate slate,” Hill said. Hill and those who agree with him contend that the bylaws make no distinction between the right to vote and the right to run for the board. Horn essentially is saying that even if an OPA member meets the criteria for voting eligibility, he or she must have done so by the May 15 verification date under 5.02(d). Hill disagrees, contending that the secretary is obligated to verify candidacies by May 15 but is not precluded from verifying additional candidates after that date, especially since 5.02(d) gives the secretary until June 1 to submit a list of eligible candidates to the Elections Committee. In an email exchange with Horn, Hill also contended that he is eligible to be a candidate under 5.02(d) because his calendar year 2017 assessments were not delinquent and his calendar year 2018 assessments were not delinquent, either. The OPA levies interest charges on assessments beginning June 1, and Hill says his assessments were paid before June 1, avoiding the late fee and delinquency, and therefore he was a member in good standing who should have beeb certified as a candidate.

So far, Horn’s colleagues on the board are trying to steer clear of the Price: 98.500 (00.00) * controversy. Coupon: (00/00/00) 3.25 Their position appears to be that Horn is the corporate officer 07/15/2036 Maturity Date: (00/00/00) Prince Georges Md (Name of MuniCnty Bond) charged with verifying candidacies and that the board should stay out Callable Date: (00/00/00 or N/A) 98.500 Price:07/15/2028 (00.00) of election controversies and issues. Coupon: 3.25 (00/00/00) CallMaturity Price:Date:100 (000) The Progress sent inquiries to 07/15/2036 (00/00/00) Horn’s colleagues asking whether 07/15/2028 Callable (00/00/00 / AAAor N/A) Rating:Date:Aaa (XXX/XXX) they believe there is language in Call Price: 100 (000) the bylaws that needs to be cleaned Other: Aaa / AAA Rating:(Obligor) (XXX/XXX) up, as suggested by Gail KretschOther: (Obligor) mar, a former Ocean Pines property 3.25 % TAX-FREE* * owner, who, with the late Al Bridgman, was involved in reviewing and Prince Georges Md (Name of MuniCnty Bond) Carrie Dupuie, AAMS Carrie Dupuie, AAMS (Financial Advisor Financial Advisor Name) rewriting the bylaws in its last sig98.500 Price:(Approved (00.00) Title) (Financial Advisor Name) Financial Advisor 215 North Main Street Coupon: (00/00/00) 3.25 nificant revision. Berlin, MD 21811 (Approved (Address) Title) 07/15/2036 Maturity Date: (00/00/00) “I read and reread both sections 410-208-1704 North STMain 00000) 07/15/2028 Callable215 Date:(City, (00/00/00 orStreet N/A) Carrie.Dupuie@RaymondJames.com regarding eligibility to be a can(000-000-0000) I (Toll-Free: 800-000-0000) 100 Call Price: (000) Berlin, MD 21811 Fax:(Address) (000-000-0000) Aaa / AAA didate and eligibility to vote,” she Rating: (XXX/XXX) 410-208-1704 (E-mail Address) Other: (Obligor) (City, ST 00000) wrote recently on oceanpinesforum. (Website) Carrie.Dupuie@RaymondJames.com com. (000-000-0000) I (Toll-Free: 800-000-0000) Carrie Dupuie, AAMS “Neither section indicates any (Financial Advisor Name) Fax: (000-000-0000) (Approved Title) other date for voting eligibility oth(E-mail Address) (Address) er than 35 days prior to the election.*As of 06/07/2018 (City, ST 00000) * As of 00/00/00. (Website) I (Toll-Free: 800-000-0000) If a person is eligible to vote in theSubject to availability and price change. Minimum(000-000-0000) purchases may apply.(000-000-0000) The yield is the lesser of yield to maturity or yield to call. Interest is generally exem Fax: from federal taxation and may also be free of state and local taxes for investors residing in the state and/or locality where the bonds were issued. Howev (E-mail Address) bonds may be subject to federal alternative minimum tax (AMT), and profits and losses on tax-exempt bonds may be subject to capital gains tax treatme election, it would seem he or sheRatings by Moody’s/Standard & Poor’s. A credit rating of a security is not(Website) a recommendation to buy, sell or hold the security and may be subject to revie revision, suspension, reduction or withdrawal at any time by the assigning Rating Agency. Insurance pertains only to the timely payment of principal and int should be eligible to be a candidate.est. No representation is made as to any insurer’s ability to meet its financial commitments. Ratings and insurance do not remove market risk since they not guarantee the market value of the bond. But the By-laws need revision toSecurities offered through Raymond James Financial Services, Inc. member FINRA/SIPC. state the difference between voting in the election and being a candidate.” 06/07/2018 **As As ofof00/00/00. She said the issue and apparSubject to availability and price change. Minimum purchases may apply. The yield is the lesser of yield to maturity or yield to call. ent conflicts in interpretation from federal“may taxation and may also be free of state and local taxes for investors residing in the state and/or locality where the bo bonds may be subject to federal alternative minimum tax (AMT), and profits and losses on tax-exempt bonds may be subject to need to be challenged in court.”

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©2015 RaymondSubject James Financial Services, Inc., member FINRA/SIPC 15-MFI-0113 ICD BS 8/15 to availability and price change. Minimum purchases may apply. The yield is the lesser of yield to maturity or yield to call. Interest is generally exempt

from federal taxation and may also be free of state and local taxes for investors residing in the state and/or locality where the bonds were issued. However, bonds may be subject to federal alternative minimum tax (AMT), and profits and losses on tax-exempt bonds may be subject to capital gains tax treatment. Ratings by Moody’s/Standard & Poor’s. A credit rating of a security is not a recommendation to buy, sell or hold the security and may be subject to review, revision, suspension, reduction or withdrawal at any time by the assigning Rating Agency. Insurance pertains only to the timely payment of principal and interest. No representation is made as to any insurer’s ability to meet its financial commitments. Ratings and insurance do not remove market risk since they do not guarantee the market value of the bond. Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC.

Ratings by Moody’s/Standard & Poor’s. A credit rating of a security is not a recommendation to buy, sell or hold the security and revision, suspension, reduction or withdrawal at any time by the assigning Rating Agency. Insurance pertains only to the timely pay est. No representation is made as to any insurer’s ability to meet its financial commitments. Ratings and insurance do not remov not guarantee the market value of the bond.

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12 Ocean Pines PROGRESS

OCEAN PINES

June 2018

Bailey says election newsletter will be mailed to every address Property owners can ‘subscribe’ to quarterly publication at location of their choice

However, concern about the ability of property owners to access election information prompted reconsideration of the new distribution process for that edition only. In the past, the newsletter was produced and distributed to property owners monthly and the activity guides were sent out quarterly. For the last several years, however, the OPA produced just four quarterly Ocean Pines Reports and three activity guides. “All seven publications were being mailed to all addresses, those within the physical boundaries of the association and all off-site secondary addresses of owners,” Bailey said.

By ROTA L. KNOTT Contributing Writer ecause it contains important information about the Ocean Pines Association’s annual Board of Directors election, the summer edition of the Ocean Pines Report will be mailed to all addresses on file for property owners. General Manager John Bailey said the OPA wants to ensure that property owners receive the election issue of the newsletter so it will be sent to addresses both within Ocean Pines and outside the community. Bailey said the OPA trimmed funding for printing and mailing of the quarterly newsletters and seasonal activities guides as part of the fiscal year 2018-19 budget process.

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OCEAN PINES From Page 12 In order to save money in the FY19 budget, the OPA cut about $34,000 from the marketing and public relations department budget, including $17,000 for printing and $17,000 for postage related to production and mailing of it newsletters. The association also opted to produce just six publications, four quarterly newsletters and two activity guides. Bailey said the one publication was eliminated in order to save money. The plan for FY19 also included the OPA mailing only one hard copy of the publications to property owners who subscribe to them at the address of their choosing, in or outside of Ocean Pines. “The subscription doesn’t cost you anything. We just would rather send you one copy where you want it delivered versus sending two and wasting the printing and the postage for that. We just need the membership to indicate whether you want to receive a hard copy and if so which address do you want it sent

to,” Bailey said. However, given the heightened importance of the summer newsletter because of its coverage related to the board election, Bailey said that edition of the Ocean Pines Report will be mailed to all property owner addresses on filed with the OPA. He said the association will be reallocating $15,000 within the marketing and public relations department budget to cover mailing of the summer quarterly newsletter to all property owners at all addresses both within and without the physical boundaries Additionally, hard copies of all of the publications will continue to be available for pick-up at locations throughout Ocean Pines, such as the Community Center and Yacht Club. The newsletters and activities guides are also posted online and available to anyone who wants to view them. A link to subscribe to the publication is also available on the OPA’s website, oceanpines.org, under the News tab. Property owners can subscribe for all of the newsletters and activities guide or select individual issues they want to receive.

Bailey defends signature on resale docs, says OPA well within statutory guidelines By ROTA L. KNOTT Contributing Writer espite a change in its procedure for processing of disclosure packets necessary for the resale of properties within the community, General Manager John Bailey says the Ocean Pines Association is still fulfilling requests for those documents well ahead of state-mandated deadlines. Responding to concerns about how waiting for his signature on the disclosure documents may affect the timeline for processing requests for discloser packets from real estate agents and homeowners seeking to sell their properties, Bailey said it has no impact. During his general manager’s report at a May 24 OPA Board of Directors’ meeting, Bailey acknowledged that the disclosure packet re-

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quest procedure has changed, and he is now signing all of the documents as the final step in their processing. Under the new process, the Compliance, Permits, and Inspections office in the Public Works Department receives requests for disclosure documents and performs the necessary property inspections. Then, CPI takes the paperwork to the administration building for financial review, including status of annual assessments and any liens placed on the property by the OPA. Inputting financial information should not be done by CPI as CPI staff should not have full access to those records, Bailey said. He said the documents should be signed off on by a department head representative of the OPA, not CPI inspectors. CPI inspectors do not q

Newsletter

June 2018 Ocean Pines PROGRESS

OCEAN PINES

June 2018

Resale documents From Page 13

have the responsibility or authority for signing the disclosure statement, he said. Since the packet is already at the administration building, where his office is located and the general manager has ultimate oversight of the process, Bailey said he has decided to sign them. If he happens to be out of the office, the finance director is authorized to sign disclosure

packets. Bailey said one to five of the packets are processed each day. Since the final steps of the process are now being completed at the administration building, the physical location for the pickup of disclosure packets has changed to that site, instead of CPI, as well. Bailey cited legal implications for the association and a need to ensure accuracy of information as the reasons for the changes to the disclosure packet process. He said the additional level of oversight will

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reduce the opportunity for potential errors and reduce the OPA’s liability exposure. During the May 24 board meeting, he summarized the requirements of the Maryland Homeowners Association Act, which provides specific language regarding disclosures and notices for resale of lots. “Every real estate agent and broker should be aware of these requirements and limits,” Bailey said. The property owner or their real estate agent can acquire the application for a disclosure packet either online or in person from the OPA. Once filled out, the form has to be returned to the CPI, along with payment of a $250 processing fee. The OPA has 20 days from the receipt of the request and payment of the $250 fee to provide the disclosure packet. Those seeking to sell their property can request expedited processing within 14 days for an extra $50 more or within seven days for an additional $100 fee. Bailey said the OPA’s disclosure process, including receipt of the application and fee, property inspec-

tion, financial review, sign off and issuance, is much quicker than the standard set by law. “That process takes approximately seven days from receipt of the request, sometimes less,” he said, adding the association seeks to complete the disclose packets within five days of a request. “Historically OPA has not needed to charge any extra fee for the short turn around because we were getting the requests done in the expedited time frame without a request by the seller to do so,” Bailey said, adding “We do not anticipate this changing any time soon.” Bailey did not address a concern expressed by Director Slobodan Trendic that, since Bailey is not an officer of the OPA corporation, he is not authorized under the OPA Declaration of Restrictions to sign resale documents. He cited Section 12D(c) of the DRs that says that the OPA “shall upon demand at any furnish a certificate in writing signed by an officer of the Association certifying that the q

14 Ocean Pines PROGRESS

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Bailey still pressing for demolishing crab pier, wants to find new location for it RFP for replacement on hold pending search for alternative site By ROTA L. KNOTT Contributing Writer ith the crabbing pier in Whitetail Sanctuary in poor condition and some nearby residents seeking its closure, the Ocean Pines Association is weighing options for its removal, relocation, or reconstruction. During a May 24 meeting, OPA General Manager John Bailey said the crabbing pier has been temporarily closed

Resale documents From Page 14

charges on a specific lot have been paid or that certain charges against said lot remain unpaid, as the case may be.” That is the provision in the OPA’s organizational documents that provide a basis for resale documentation, including a report on the status of lot assessments, to be provided to a prospective owner by a seller at or before settlement. Trendic said that under the restrictive covenants, it appears that neither CPI nor Bailey should be responsible for signing off on resale documents because no one within the department is an officers of the OPA. Nor is Bailey. For many years, the OPA general manager has been an assistant treasurer of the corporation, but that is not the case with Bailey. The two assistant treasurers currently are Director of Finance Steve Phillips and Gene Ringsdorf, a long-time member of the Budget and Finance Advisory Committee. As officers of the corporation, both could sign off on resale documents. So could Administrative Assistant Michelle Bennett, who is an appointed assistant secretary and thereby an officer of the corporation. Others eligible to sign the resale documents are President Doug Parks, Vice-President Cheryl Jacobs, Treasurer Pat Supik, and Secretary Colette Horn, all members of the OPA’s board of directors. “If the DR section I read pertains to these resale docs, then the Association needs to review if the right people are signing these resale certificates. According to the DRs, the Association’s officers are the only ones that can sign,” Trendic said.

pending a decision as to how to proceed. The crabbing pier was originally envisioned by Balfour Holdings, Inc., developer of the Village at Ocean Pines, as a community amenity embedded within Whitetail Sanctuary. The developer was required by Worcester County code to include both active and passive community recreational areas and open space as part of its design for the section. The crabbing pier fulfilled part of that requirement for the residential planned community. Now, two decades later, the OPA is trying to decide whether to keep a crabbing pier as an amenity in Ocean Pines and, if so, where it should be located. Bailey said OPA staff is ready to go forward with a request for proposals for replacement of the pier and has been in contact with the county regarding permitting requirements. However, a group of four or five property owners in the area recently recommended that it be closed and removed, Bailey said. He asked for board input regarding whether to maintain a crabbing pier in the existing location or another site. He recommended having staff review alternative locations and provide associated project cost estimates.

Director Ted Moroney concurred there are three options for the crabbing pier – keep it where it is, relocate it if possible, or eliminate it completely. “I think really what general manager is asking for is direction for possibly looking at relocating,” he said. He suggested Bailey investigate those options and report back to the board with more informaiton on alternative locations. He later acknowledged that four or five individuals who favor removal of the pier hardly represents an accurate sampling of the neighborhood. Bailey said the existing structure has been closed. “The crabbing pier itself is sealed off from direct easy access until further notice for safety considerations,” he said. However, Bailey added, a separate wetland pier in Whitetail Sanctuary is open for use. He said appropriate signage is in place and includes the hours of use, which are dawn to dusk. Additionally, the OPA will add a layer of mulch to cover protruding tree roots along the access path to the pier. Director Slobodan Trendic called the issue of the crabbing pier a “delicate situation.” He said a handful of property owners are asking the board to approve eliminating an amenity, which is recognized in

a number of different association documents, including the turnover agreement for Whitetail Sanctuary. When the transfer of that section occurred between the developer and the association, all of the common assets were transferred to the OPA, including the crabbing pier, with an understanding that it would be taken over by the association and maintained appropriately, Trendic said. “I’m uncomfortable with voting to eliminate an amenity. It doesn’t matter whether the amenity is $20,000 or $2 million. It’s like voting to eliminate our golf course. I don’t know the membership wants the board to have that kind of absolute power or authority,” Trendic said. Bailey said that’s part of the reason he has suggested looking for another site to which the crabbing pier could be relocated. “There were certainly a lot of folks that wanted to keep a crabbing pier that don’t live in that area.” He said they are driving to Whitetail Sanctuary to access the crabbing pier but have nowhere to park other than along the roadside. “That is an unsolveable problem with the parking issue there at the Sanctuary,” he added. Relocating the crabbing pier would give the OPA the opportunity to provide parking for the amenity as well, Bailey said. Trendic suggested asking the OPA’s Bylaws and Resolutions Advisory Committee to give some guidance to the board on the issue, including whether it has the authority

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16 Ocean Pines PROGRESS

OCEAN PINES

June 2018

Bailey relents on leaf disposal, Public Works accepting yard debris Saturday-only drop off allowed from June through mid-November, when the schedule shifts to Monday through Saturday through Dec. 22 By ROTA L. KNOTT Contributing Writer roperty owners will be able to dispose of leaves, branches, and other yard debris at the Ocean Pines Association’s Public Works yard on Saturdays beginning this month. Seeking to save some money in its fiscal year 2018-19 budget, the Ocean Pines Association had eliminated its annual spring yard debris collection during May. Complaints from residents and concern from some members of the Board of Directors compelled General Manager John Bailey to reconsider and offer an alternative to the month-long spring clean-up. Bailey presented his new plan, a once-aweek collection at the public works yard, during a May 24 Board of Directors meeting. While residents didn’t have to pay for the annual spring yard waste collection held in May, it was costing the OPA about $30,000 per year to open the public works yard to receive debris, Bailey said. That expense, coupled with about $100,000 to assist residents with fall leaf disposal at the public works yard in November and December of each year, prompted the OPA’s decision to cut costs. Bailey said it was determined to be more important to maintain the fall leaf disposal process so the OPA didn’t cut that funding, opting into eliminate the spring collection. After receiving complaints about elimination of the spring service, however, Bailey said he took a look at “how do something different to serve the residents’ need as well as be mindful of the financial aspect of it.” His new plan is to open the public works yard from June through mid-November on Saturdays only, excluding holiday weekends, for residents to dispose of yard debris. It kicks into a Monday through Saturday collection from mid-November to late December. Director Ted Moroney wasn’t convinced the OPA should be collecting yard waste from residents when they can put a few bags per week out with their trash during regular pick-up times. “Should we really be providing this service at all?” he wondered.

Moroney is a candidate for the board in this summer’s OPA election. He reminded the board that the $130,000 per year cost to operate the program comes out of the pockets of property owners through the annual assessments, “and given everybody’s bitching about assessments going up there’s a problem right there.” Moroney said to remember “whether it’s this or drainage or anything else -- you want, you want, you want, it costs. And so, to be frank with you, I’m just not sure that we should be providing that service to the residents. I’m not sure that’s our responsibility to do that as a community.” Director Slobodan Trendic broached the issue saying he learned about the change from property owners, who felt they were not given an opportunity to provide input before the popular convenience was eliminated. Trendic said Moroney made a good point and his intent in bringing up the topic was to have an open discussion because the change took many property owners by surprise. He said it was a service to which a lot of members got accustomed. He said the board will have to weigh the advantages and disadvantages and determine whether or not this is a service the association should continue to provide in the future. “Those are the questions we always ask. How much do you want us to do for the community and what are you willing to pay for it?” agreed Cheryl Jacobs, who chaired the board’s May 24 meeting in the absence of OPA President Doug Parks. Under Bailey’s new plan, the public works yard will be open on Saturdays through Nov 17 from 8 a.m. to 4 p.m. From Nov. 19 through Dec. 22, the yard will be open Monday through Friday 8 a.m. to 3 p.m. and Saturdays from 8 a.m. to 4 p.m. Debris placed in paper bags will be accepted but any materials placed in plastic bags will need to be dumped out on site. No trash or construction debris will be accepted. Bailey was concerned about ensuring that only property owners or residents are using the service.

So Public Works staff will be checking identification of everyone dropping of yard waste. “This has been an issue in the past evidently with contractors bringing debris to our yard instead of taking it to the proper disposal sites in the county. Thus residents will be required to show their ID so that we can make sure they are residents and not contractors,” he said. Bailey added that contractors who are residents of Ocean Pines will be allowed to bring their personal yard waste to the public works yard. “That will be fine,” he said. Moroney begged to differ. He suggested that all contractors should be banned from the Public Works yard, but no other director agreed, at least not publicly. The general manger said the cost of operating the proposed schedule is unknown because there is no way to gauge the volume of yard waste that will be brought to the public works yard for disposal. However, he is anticipating the cost of labor to open the yard on Saturdays from June through November at between $4,000 and $8,000, depending whether one or two employees are needed. “And that depends on the cooperation we get from everybody that’s using it,” Bailey said.

Crabbing pier From Page 15 to eliminate an existing amenity. He also suggested the general manager hold a public hearing to receive public comment on alternatives for the crabbing pier. Before the board takes any action, it needs to find out from the State of Maryland whether it can even get a permit for a new pier at a different location, Trendic said. The regulations and restrictions are much tougher now than they were when the pier was constructed more than 20 years ago. “I would not be in favor of moving something and eliminating something without knowing for sure that we can actually have another pier,” Trendic said. Bailey concurred there are a lot of questions that need to be answered

The $4,000 and $8,000 expense was not budgeted for FY 2018-19, but Bailey said he believes he can find the funds to provide the Saturday-only service. “We will certainly monitor the costs and if we need to stop the Saturday operations before November we may have to do that” he added. Moroney said he is fine with Bailey’s proposal if he can provide the service through November within FY19 budget constraints. “But what I’m really worried about is $130,000 a year,” he said. “Is that a necessity?” Bailey added that some cost savings may be recognized by stockpiling the collected yard waste on site throughout summer and then disposing of it in the fall. Additionally, the OPA can recycle some of the materials, such as tree branches, as mulch for use on its trails and in the dog park. “We’ll see if it’s possible to do more of that recycling,” he said. He also posed a “longer term an idea for consideration” of operating a continuous yard waste collection site. “We may want to consider the possibility of a yard waste area that is open year round.” He said the site could be operated as a compost mulch facility where residents can drop off yard waste that gets recycled and then offered back to them as mulch at no cost. Bailey noted that such an effort will require a lot of research, some funding appropriation, and working with county and state regulatory agencies on limitations and permitting. “It may or not be feasible. However, it may be a possible solution to ... our residents’ needs,” Bailey said. before any action can be taken by the association. In the meantime, the OPA already has an RFP ready for replacement of the crabbing pier and has talked with the county about permits required doing so at the existing location, he said. Bailey has tried previously to persuade the board to simply remove the crabbing pier, without offering an alternative. His agenda doesn’t appear to have changed, but his tactics have. Now he’s suggesting the possibility of an alternative site, which he has yet to identify. Meanwhile, the board hasn’t authorized him to issue the RFP for replacement, which means the neighborhood and the larger community is without an amenity that the OPA is obligated to maintain.

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OCEAN PINES

June 2018

Ocean Pines to celebrate 50 years with anniversary golf tournament Event sold out, to feature golf pros from Ocean Pines’s early days

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Ocean Pines Golf Club, originally known as Seabright and later as Ocean Pines Golf & Country Club. Construction on the golf course began in 1970. It officially opened on June 5, 1972, making it one of the earliest courses in the Ocean City area. The inaugural foursome that day included PGA Tour and Masters champion Billy Casper as well as Bob Haley, Ocean Pines’ first golf club professional. Haley, now retired, went on to build and own The Bay Club in Berlin and found golf apparel company Sport Haley. He credits his time at Ocean Pines with much of his later success. “Given the opportunity to start something as big as Ocean Pines at age 26 was a wonderful, incredible thing,” he said. “A lot happened because of Ocean Pines. They were the first people to take a chance on me.” Haley will revisit Ocean Pines at the anniversary tournament, where he will play with other former Ocean Pines golf pros Buddy Sass, Bob Beckelman and Hunt Crosby, all of whom work at area courses. This year’s event is not the first anniversary tournament for Beckelman, who was the head golf professional at Ocean Pines when the community celebrated its 35th. Although Beckelman is now the head golf professional at River Run Golf Club in Berlin, (where Crosby is also employed as the director of golf) Ocean Pines is still a special place for him. “It’s interesting to me to think that I still consider Ocean Pines Golf Club as my home no matter how long I’ve been gone or how many other positions I have held,” he said. Sass, who is the head golf professional at Ocean City Golf Club, has a similar fondness for Ocean Pines, where he worked in addition to being a member. “Ocean Pines was a great place to grow up,” he said. “My family was a member from the beginning. My dad joined in 1970 and continued through 1999. I played thousands of rounds on the course and it never got old.”

 q

he literal and figurative heart of Ocean Pines – Ocean Pines Golf Club – will help the community continue its year-long 50th anniversary celebration with a golf tournament later this month. Although just a few years shy of 50 (the course opened its first nine holes in 1972), Ocean Pines Golf Club has long been a social center of the community. The sold-out event, which will be held on Saturday, June 30, at 9 a.m., is a testament to that legacy. According to Ocean Pines Director of Golf John Malinowski, the tournament sold out within a couple of weeks of opening registration. He said that those lucky enough to snag a spot will be in for a treat. “The golf course is in fantastic condition,” Malinowski said. “I think tournament participants will be pleased by the job our superintendent, Andre Jordan, and his staff have done.” While the anniversary was the impetus for the tournament, the highlight of the event will be the course layout, created by legendary architect Robert Trent Jones, Sr. Jones, who has designed over 400 courses around the world, was commissioned to create the layout for

BOARD OF DIRECTORS Golf tournament

June 2018 Ocean Pines PROGRESS

Board approves $166,000 adjustment to fire department budget for 2017-18

From Page 18

Moroney motion passes unanimously; Hill calls ambulance funding mechanism ‘complete bull’ By TOM STAUSS Publisher he expectation that the Ocean Pines Association would be adjusting its books for the fiscal year that ended this past April 30 to reflect an old agreement with the Ocean Pines Volunteer Fire Department was realized May 24, when the OPA Board of Directors voted unanimously to award the OPVFD a previously unbudgeted $165,620. The award, to cover the OPA’s share of costs for ambulances purchased on a purported accelerated schedule, was reflected on the OPA’s fire/emergency medical service expense line for 2017-18, contributing to the OPA’s reported $1.2 million deficit for that fiscal year. A motion offered by Director Ted Moroney during the board’s May 24 meeting said the $166,000 adjustment would bring the OPA into compliance with a memo of understand-

ing (MoU) between the OPA and the OPVFD that dates back to 2011. It was amended in July of 2013. The motion said board action was necessary “in order to properly close the FY 2017-18 financial books.” The expected additional contribution to the OPVFD by the OPA has been controversial of late, with former Acting General Manager and OPA Director Brett Hill, a declared candidate for the board whose bid has been in limbo over a dispute ver eligibility, arguing that any payment to the OPVFD over the originally budgeted $476,429 for 2017-18 was unnecessary. He has said OPVFD official Billy Bounds was satisfied with that number when the OPVFD budget for 2017-18 was approved in February of last year. In a prepared background commentary, Moroney began by alluding to a transfer last year of $216,777

from an OPVFD capital reserve fund controlled by the OPA to the OPVFD, for the purpose of paying off an OPVFD loan note earlier than required. According to Moroney, the fund was a “custodial account (held) by the OPA to pay off OPVFD notes for which the OPA was responsible” under the MoU. Hill has said that the existence of the fund was a surprise to him when it was discovered under his tenure as acting general manager, and that it was so old and unmonitored that signature cards associated with it were of individuals no longer associated with the OPA. “The intent (in paying off the loan early) was a good one because the action (allowed) a reduction in interest payments due from the OPA over the remaining life of the loan,” Moroney wrote, but he also noted q

Although firmly rooted in tradition, Ocean Pines Golf Club has not been shy about embracing the future. With an eye on developing future players, the course has a thriving junior program and will welcome over 100 young golfers at its camps this summer. Ocean Pines Golf Club also offers a free golf app, available for download on Apple and android devices, that features live scoring and GPS and can be customized for tournaments and outings. “Golf as an industry and pastime is always evolving. Ocean Pines tries to stay ahead of the curve by keeping an eye on trends and making golf fun for and accessible to as many people as possible,” Malinowski said. Open to the public year-round, Ocean Pines Golf Club is the only Robert Trent Jones championship course on Maryland’s Eastern Shore. Said to be a fair but demanding course, its 18 holes are nestled amid natural wetlands and trees.

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BOARD OF DIRECTORS

June 2018

Fire department From Page 19

that “there was no approval of this action by the OPA board, nor was any change to the MoU formally documented” by the individuals who were involved. Hill has said that the OPVFD’s Billy Bounds, Hill, OPA Treasurer Pat Supik, represenatives of the OPA’s finance department and even former OPA attorney Joe Moore had trouble understanding the MoU and had effectively agreed to abandon it, albeit informally, in 2017. Hill has been criticized by Moroney and others for failing to memorialize the informal understanding in writing. Hill has also written on oceanpinesforum.com that Supik has been afflicted with “amnesia” in failing to acknowledge publicly her attendance at three separate meetings last year about this issue. As part of the process that led to the transfer of $216,777 to the OPVFD, Hill said the OPVFD signed off on a fire/Emergency Medical Services (EMS) budget of $476,429 for 2017-18, comprised of OPA contri-

butions for both OPVFD operations and capital expenditures. According to Moroney, the OPVFD later concluded that the original budget of $476,429 did not cover all of the OPVFD’s capital expenditures for 2017-18. “During the review of the of the 2018-19 budget (in January and February of this year) by the Budget and Finance Committee, the OPA became aware that, in the opinion of the OPVFD, as part of a previous verbal understanding between the two parties regarding the loan payoff, the purchase of some equipment had been accellerated and that OPVFD understood that the OPA would fund 50 percent of said purchases,” Moroney wrote. He added that “this understanding of this verbal agreement was confirmed in a February 2018 working meeting between senior members of the OPVFD and the OPA.” A request for a “portion” of the requested funding was contained in a follow-up letter to the OPA, Moroney said. Last month, an “OPA team” met to review the history of the MoU with several goals, Moroney said,

including agreement on “proper book entries before closing 2017-18 books.” The team, he said, also agreed to ask the budget and finance advisory committee to recommend changes “in oversight of OPVFD budget requests, the reserve component (which Moroney didn’t explain in his commentary), the housing and protection of reserve funds and the general reporting of OPVFD operating results.” Neither Moroney’s motion nor his background information contained any information on how the team calculated the $166,000 adjustment to the OPVFD’s bottom line, or whether it added that amount to the originally approved OPVFD budget for 2017-18 of $476,429. The April financial report for the OPA indicated it was added to the original budget. Through the end of March, the OPA had contributed $357,322 to OPVFD coffers, with no budgeted payments made to the OPVFD in February or March. The Progress emailed Moroney on May 30 asking for clarification of whether the $165,620 adjustment

was added to the cumulative contribution through March or to the originally budgeted $476,429. His return email confirmed that it had been. It was further confirmed by the April 2018 financials released in late May by OPA Director of Finance Steve Phillips Moroney provided additional detail on how the $165,620 adjustment was determined. Starting with the approved budget number of $476,429, Moroney’s summary subtracted the $357,322 that had been contributed to the OPVFD by the OPA as of April 30, unchanged from March. The summary also subtracted an additional $31,283 reportedly owed to the OPVFD under the MoU and another $31,283 held by the ssociation in the custodial reserve account at PNC Bank for the OPA’s share of OPVFD capital purchases. Finally, the summary subtracted the $216,777 that the OPA paid the OPVFD from that custodial reserve account, indicating that this reserve account had been restored. “Restore Reserve by Funding

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BOARD OF DIRECTORS Fire department From Page 20

Debt Payment” was the cryptic line item in Moroney’s summary The Progress emailed Moroney asking for an explanation for why this reserve had been restored. The Progress also asked Moroney to explain why a payment from a custodial reserve account had been treated as an OPA operating expense that contributed to the OPA’s reported $1.2 million deficit last year. Both actions had the effect of inflating the OPA’s operating deficit for 2017-18. “The $216,777 was OPVFD funds used to pay off the note for which OPA had P&I (principle and interest) responsibility. By doing this everything is square, we have met our obligations, the OPVFD is in agreement, two Advanced Life Support vehicles are funded, and there will

June 2018 Ocean Pines PROGRESS not need to be any change to the FY 2019 budget. “Just as important both parties are committed to revising the budgeting review process, updating the Reserve calculation and recommending changes to the MoU,” Moroney said in his earlier email. Hill slammed the way the purchase of the two advanced life support vehicles, otherwise known as ambulances, was handled. “Ted used the guise of the PNC account to pay for a FY19 purchase under the FY18 blame-it-on Brett budget,” Hill said. “This is the key sentence: ‘the two Advanced Life Support vehicles are funded’. These (purchases) cross OPA fiscal years, but are in the same OPVFD year. OPVFD is Jan - Dec, OPA is May - April. One unit was purchased in February, the second today (June). OPA dumped them both into last year, so “not need to be any change to the FY 2019 bud-

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get,” he said, calling the methodology used “complete bull.” In an explanation of the purpose and effect of his motion, Moroney opined that it would restore “the proper value of the OPVFD capital reserve fund pre-note retirement, met (OPA) capital replacement reserve contribution per the approved budget provided the proper basis for funding through the MoU for the

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equipment already purchased by the OPVFD, continued any future benefit from the note retirement, and ensured that the OPA has followed the legally agreed upon terms that govern the relationship between the parties.” Moroney and Hill sparred over the issue in late May on oceanpinesforum.com, with neither individual giving the other much credit.

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June 2018 Ocean Pines PROGRESS

BOARD OF DIRECTORS

June 2018

Trendic highly critical of Supik for inaccurate deficit forecast, handling of OPVFD funding Parks defends OPA treasurer’s handling of issue involving funding of two ambulances By TOM STAUSS Publisher cean Pines Association Director Slobodan Trendic has expressed sharp criticism of OPA Treasurer Pat Supik’s performance as the OPA’s chief financial officer, citing her inaccurate deficit projections in the 2017-18 fiscal year that just ended and also for failing to address the months-long imbroglio over funding for the Ocean Pines Volunteer Fire Department. Within a week of Supik repeating $1.6 million deficit projection for 2017-18, in comments made during a treasurer’s report at a May 24 Board of Directors meeting, Director of Finance Steve Phillips released a delayed financial recap for April

that showed the deficit was $1.2 million. That still substantial but it represented a $400,000 miss in Supik’s last projection prior to the release of official, but still unaudited numbers, for 2017-18. In a response to a Progress email asking for comment from each of the directors, Tredic said that, speaking as as an individual director “frankly speaking I find OPA’s handling of the fiscal affairs for the past year and a half absolutely terrifying and an irresponsible experience. If I held the role of the Treasure and CFO of the Association during this financial fiasco I would have resigned long ago out of pure embarrassment. “For the past two yearly during our budget sessions I voted against

Slobodan Trendic

Pat Supik

the proposed budget. On the other hand our Treasurer voted in favor of the budget even thought our BudgetToand Finance Committee found Page 26 the revenue projections ridiculous. “As a result of those ridiculous revenue projections, among other things, the community is now looking at a $1.2 million operating defi-

cit” in 2017-18,” he said. When it became clear last summer that revenue projections for the Yacht Club and Beach Club were falling well short of projects, Supik failed to act, Trendic said. “Last summer we witnessed money-losing fiasco. Beach and Yacht Club were losing thousands of dollars on weekly basis and our Treasurer as the chief financial officer of the Association did absolutely nothing to reverse / control the situation. Even when I attempted to take action I got no support from her or the board,” Trendic said. “Instead we witnessed Pat’s deficit forecast go from $1 million to $2 million, then to 1.6 million. That was an alarming display of the Treasurer being clueless to the OPA’s real financial conditions,” he charged. Trendic said last year he was the “lonely controversial vote against Pat Supik’s re-appointment as the treasurer. Today my vote proved to be correct. Truth be told I wanted to nominate John Viola but I was talked out doing this by some directors; I take the responsibility for that. Rest

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24 Ocean Pines PROGRESS

BOARD OF DIRECTORS Trendic vs. Supik

June 2018 Ocean Pines PROGRESS OPA President Doug Park defended her role in the OPVFD funding matter but offered no defense of the $400,000 miss in the deficit projection, suggesting that perhaps he’s aware that such a huge miss is difficult to explain or defend. “He (Trendic) is correct in his praise for the work done by Director Moroney (on the OPVFD funding issue,” Parks wrote. “However, he is somewhat off point regarding references to Director Supik. Suggesting that the OPA Treasurer dropped the ball and had no involvement in the proceedings is misleading at best.”

From Page 25 assured I will never let that happen again.” Viola served in a temporary role as director of finance last year following the early departure of Mary Bosack and before the arrival of Phillips. He’s currently the chairman of the Budget and Finance Advisory Committee. In another response to a Progress email, Trendic faulted Supik for failing to get on top of a funding challenge involving the OPVFD, an issue that seems to have been resolved with Director Ted Moroney in the lead, rather than Supik. The issue involved a request for accellerated funding of two ambulances, of which the current leadership in the OPA became aware this past January. “Director Moroney did an excellent work on what I recently learned has been now a year-old unresolved issue and him spearheading the effort to clean-up our records with OPVFD,” Trendic said. “This is the kind of leadership I expected to see from our treasurer as a chief financial officer of the Association. Instead this leadership came from Director Moroney.” Trendic said Supik was involved in three meetings in the winter of 2017 with former Acting General Brett Hill and members of the OPVFD in which funding issues were discussed. He said she was “fully aware” of details of those discussions and what kinds of understandings were reached between the OPA and OPVFD at the time, including a budgeted number for OPA’s financial support of the OPVFD in 201718. “What is troubling is that these issues continued to linger for another year unresolved. Only recently, with proactive work by Director Moroney, our relationship with the OPVFD representatives (has) started to improve and the necessary financial adjustments were finally made,” Trendic said. “For that I wish to extend my personal thanks to Director Moroney.” Only one OPA director responded to Trendic’s emails and criticismLike of us on Supik’s performance as treasurer, at least not in a response copied to the Progress. What might have been said in private emails among directors is unknown.

According to Parks, Director Supik “attended every meeting from the time the board was made aware of the accelerated purchase of two ambulance units in January 2018. She also coordinated the information sharing between Steve Phillips, Director Moroney and others that were involved.” Parks said that after the meetings and several discussions between Supik and Moroney, Moroney volunteered to do a good portion of the detail work on the OPVFD adjustments and to coordinate with Supik as needed. “The approach is better catego-

rized as both a collaborative effort and effective succession planning. After the effort and summary report, several board members and other individuals are now much more knowledgeable regarding the details of the MOU (memo of understanding) and the arrangements with the OPVFD. This information can be passed along to subsequent boards going forward,” Parks said. That didn’t satisfy Trendic, who told the Progress that the satisfactory conclusion to the ambulance purchase matter resulted from Moroney’s intervention, not Supik showing up to the meetings.

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BOARD OF DIRECTORS

June 2018

Kylan Barn Ribbon-Cutting and Open House

Moroney proposes joint meeting with committees on C-resolutions, M-09 By ROTA L. KNOTT Contributing Writer

R Kylan Barn and The Greater Ocean City Chamber of Commerce are hosting a Ribbon Cutting Ceremony and Open House on Monday, June 11, 2018 at 4 PM. The ceremony will start promptly at 5 PM and will take place at 30603 Dusty Lane in Delmar, MD. Kylan Barn, owned by local photographer Kyle Hughes and developer Doug Marshall, is a barn-style wedding and event venue. It is a 3,200 square foot all-wood barn, nestled on 32 acres, bringing charm and rustic elegance to any event. Kylan Barn officially opened its doors this year. Members of the community who are interested in learning more about Kylan Barn are invited. There will be a DJ and light refreshments. For more information, contact Kylan Barn at (410) 251-5914 or visit www.kylanbarn.com

ather than continuing to make piecemeal modifications to a series of Ocean Pines Association resolutions, the Board of Directors is hoping to have a joint meeting with the Budget and Finance Advisory Committee and other committees as well to discuss comprehensive revisions to the documents. Director Ted Moroney presented for first reading series of proposed minor changes to the several of the â&#x20AC;&#x153;Câ&#x20AC;? resolutions that govern advisory committees during a May 24 meeting, but said a better approach would be to address revisions comprehensively. He suggested the board meet with the advisory committee as a first step in that process. Moroney said the purpose of the

joint work session would be to review and discuss several of the C resolutions and resolution M-09 regarding the candidate search process for OPA board elections. He said the B&F committee first submitted recommended changes to the C resolutions to the board more than a year ago, but directors are just getting around to considering some of the minor changes that have been proposed. In some cases, no action was taken for over a year. In other cases, further changes to other governing language has warranted additional changes to the resolutions, he said. â&#x20AC;&#x153;Given the greatest institutional knowledge of the governing documents lies with this committee and in an effort to fully discuss the operation of board committees that are both administrative and, in some

BOARD OF DIRECTORS cases, more operational oriented, a joint meeting will allow frank and open discussion and hopefully resolution,” Moroney argued for hold the work session with the advisory committee. He said the proposed joint work session would facilitate discussion and allow for adopting resolutions that do not need constant minor amending and can instead be reviewed on a regular basis. He said the advisory committee gets different directions each time board members change. “What’s happened here is almost every board gives different direction…” to the Bylaws and Resolutions Advisory Committee, he said. Similarly, changes in the committee membership have altering its recommended modifications to the resolutions. There are disagreements as to the intent of some of the recommendations. “We’ve never really sat down and discussed the reasons” for some of the proposed changes to resolutions, he added. An open meeting with the board and committee to discuss each of these C resolutions in particular is necessary, he said. Moroney said the board needs to “see if we can’t fix these once and for all” and then implement a cycle for future modifications. He said board liaisons to the advisory committees for which the governing C resolutions are being amended could represent those committees at the joint meeting. Director Collette Horn suggested inviting to the joint meeting the chairpersons of the advisory committees that would be affected.

June 2018 Ocean Pines PROGRESS

Trendic urges colleagues to include more info when offering motions Directors agree that following recommended format will keep OPA members, and themselves, better informed By TOM STAUSS Publisher cean Pines Association members who scan the official “board packets” available on the OPA Web site prior to monthly meetings of the Board of Directors sometimes are confused by the dearth of supporting information included with action items and motions offered by individual directors. A board resolution, B-04, is supposed to be followed when motions are presented. During the board’s May 24 monthly meeting, Director Slobodan Trendic urged his colleagues to follow B-04 more closely when offering their motions and using the recommended form that includes a box for the topic under consideration and another section labeled “background.” Trendic, who offered his comments as informational and a request to colleagues rather than as a motion, commended Director Ted Moroney for following that format in motions he offered for consideration during the May 24 meeting. “I’m glad to see” that, Trendic said, adding that including the background information in some detail will “inform our membership better” in advance of meetings about topics to be addressed by the board. Director Tom Herrick said he was in “total agreement” with Trendic, with Moroney and Herrick both saying that more background information also helps directors in preparing for meetings. Director Cheryl Jacobs said that if the directors offer more detailed information about their pending motions, OPA members who can’t make a meeting or are limited by the five-minute rule during Public Comments will have more opportunity to make informed viewpoints known to the directors via email prior to a board vote.

BOARD OF DIRECTORS

June 2018

Horn, Trendic at odds over proposed board ethics/conduct proposal Trendic opposed to establishment of independent ethics committee

that would hear complaints against board members By ROTA L. KNOTT Contributing Writer alling the document duplicative, self-serving, and an inherent conflict of interest, one member of the Board of Directors openly opposed a proposed resolution that would establish an ethics and conflicts of interest policy for the Board of Directors. Following a first reading of resolution B-08, Director Ethics and Conflicts, which provides policy regarding ethics and conduct for board members, Director Slobodan Trendic said he wouldn’t be sitting on the Ocean Pines Association’s governing body if the resolution had been in place a year ago. “I am concerned with the negative things this resolution can create if enacted, said Trendic, the former target of a group of board members who wanted him ousted for alleged ethical violations last year. Director Collette Horn introduced the resolution on behalf of a working group she chaired. She said it will “give better guidance to the board particularly in matters in which removal from the board might be under consideration.” Trendic said he understands and appreciates the intent of the resolu-

tion, adding there a lot of elements to it that duplicate what already exists in some resolutions and the OPA bylaws, and there are a number of flaws in it. If the resolution had existed last year, “I would probably not be sitting at this table today, he said, adding “I’m going to let the membership figure out what that actually means by what I said.” He took particular issue with the resolution’s directive for the board to create and appoint the members of an ethics committee. That alone can cause problems if a majority of OPA directors “might have a certain opinion on an issue,” he said. Horn said the resolution simply provides for the development of a standing ethics committee that would provide independent review and recommendation back to the board regarding the handling of complaints about directors. Within that committee there would be the authority to access a pre-selected law firm with expertise in this area based on a letter of engagement that would be written if this is all approved. Horn took issue with Trendic’s

comment that he would have been removed from the board if the resolution was already on the OPA’s books, but she didn’t elaborate as to how his removal would have been prevented under the proposed document. Trendic took care not to send a message that he is opposed a board ethics policy, only that he objects to the current draft and is both duplicative on language already in the bylaws and too broad and cumbersome. Trendic said he would prefer “putting together what exists in many places, which is a code of ethics document that each director should be asked to sign and acknowledge, just like we ask employees to sign and acknowledge that they have received the employee handbook.” After attending a late May meeting of the work group that drafted the proposed resolution, he said the become more convinced “this is really not something we should do.” If ultimately approved by the board, the resolution would make all directors, whether elected or appointed, subject to the new ethics and conflicts of interest policy. Complaints could be filed by directors

against each other or by OPA members against directors The resolution proposes an Ethics Committee that would process, investigate and make determinations as to complaints of ethical or conduct violations lodged against board members by either other directors or association members. It will also provide guidance for directors in interpreting the requirements of resolution. The committee is proposed to be comprised of five OPA members appointed by the board. Members would have substantial human resource, ethics, or legal credentials. Meetings of the Ethics Committee would be held in closed session if permitted to be closed under the Maryland Homeowners Association Act. Complaints are to be processed within 14 days of receipt. The resolution provides for retaining a law firm independent of the OPA to conduct investigations and issue opinions on matters referred by the Ethics Committee. The legal counsel would deliver the results of its investigation and recommendations to the Ethics Committee and the board for their consideration. The Ethics Committee would forward its findings, opinion, and recommendations to the board, which will still make the final determination on the disposition of the complaint. Any recommendation by the board for removal of a director would be determined by a super-majority of directors comprising the quorum for the meeting. The board may consider remedies including removal of the director, counseling, public reprimand, or education. Removal for cause may only be considered for violations of the policies on director conduct. Director recommended for removal would have an opportunity for a hearing but before the same board that is trying to have them removed. The ethical standards listed in the resolution include that directors will attend board meetings in person, by phone or by other approved means unless sufficient justification causes the absence, and to participate in all meetings and communications in accordance with the bylaws; maintain a business-like climate in meetings by respecting parliamentary procedure; abide by the board’s decisions, even if they disagree; promote the goals and interests of the q

28 Ocean Pines PROGRESS

BOARD OF DIRECTORS Ethics proposal From Page 28 association in a constructive manner and attempt to avoid promotion of unnecessary conflict among association members. Additionally, it states directors should promote responsible management of the association’s finances when conducting association business; promote uniform enforcement of the Declarations of Restrictions and other governing documents; when conducting Association business, to place the interests of the association above those of individual members; and always act within the authority given to them by association members and the State of Maryland. Directors are advised to act with proper decorum. When conducting association business either in meetings or in email or other forms of communication, they should focus on issues, and conduct themselves with courtesy and respect toward each other, association employees, managing agents, suppliers, and association members. “Directors are required to act in accordance with board decisions and shall not act unilaterally or contrary to the board,” the policy says. Under the heading of director conduct, the resolution calls for directors to be responsible for protecting the confidentiality of the association’s confidential information except when its releases duly authorized or legally mandated. No director may disclose confidential information including private information of fellow directors, personal information of employees, results of disciplinary actions involving employees, information or

June 2018 Ocean Pines PROGRESS opinions concerning legal disputes in which the association is or may be involved without the prior written approval of legal counsel, or any information which is identified as confidential. The resolution also addresses director interactions with OPA employees, saying they may give advice to the general manager, but directions and assignments will come from the board through the OPA president. In most cases directions and assignments to the general manager will be based on decisions made by board vote or consensus and the president is advised not to provide contrary directions. Directors are prohibited from giving direction to management, employees, or suppliers unless authorized or delegated by the board or it is part of their role as an officer of the association. They should not directly address employee complaints but refer them to the general Manager or the OPA’s human resources officer, and should not threaten or retaliate against an employee who brings information to the board regarding alleged improper actions of a director. In the area of conflict of interests, the resolution states directors shall not recommend a course of action, or make a decision on behalf of the association that materially benefits themselves or certain related parties, including a spouse, domestic partner, child, mother, father, brother, sister. It also covers any corporation or organization in which a director participates in management, serves as a board member, an officer, or a partner, is employed or directly or indirectly a debt holder. Conflicts can also occur is a director is the

beneficial owner of any class of equity securities; has a substantial beneficial interest, or in which they serve as a trustee or in a similar capacity in a trust. It cites as a conflict of interest “any relationship where there could be a quid pro quo that could reasonably impact the director’s influence

on an issue, input to discussion and/ or their vote.” Directors must disclose the existence of any conflict of interest of their own or of affiliated persons to the entire board. The new ethics/conduct policy could be presented for approval at the board’s June meeting.

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BOARD OF DIRECTORS

June 2018

Moroney, Herrick in support of ethics/conduct resolution Trendic holds fast to streamlined ethics-code-only approach By TOM STAUSS Publisher hile Ocean Pines Association Director Slobodan Trendic has staked out a position in opposition to a draft ethics/conduct policy presented for first reading by Director Colette Horn at the May 24 Board of Directors meeting, the sole sitting director seeking election to the board this summer, Ted Moroney, is much more supportive. Only Trendic and Horn commented on the proposed resolution during the meeting. The Progress reached out to the other five directors for comment. Moroney and Tom Herrick responded. OPA President Doug Parks, Vice-president Cheryl Jacobs, and Pat Supik did not. Trendic has indicated that he favors adoption of a simple code of ethics instead of a more detailed ethics/

conduct code preferred by Horn and a working group appointed to draft it. It would establish a new ethics committee to consider complaints against directors. Complaints would be heard in closed meetings, with decisions announced afterward, according to the draft board resolution. “My feeling is that if the board already had a Code of Ethics in place we may not be having this conversation now,” Trendic wrote in a recent email to the Progress. “Our by-laws (Section 5.12) provide the mechanism for director removal in an open Board meeting, not a closed session, and Resolution B-05 addresses conflicts of interest.” Trendic said he was relying on materials available online by the Educational Community for Homeowners (ECHO), a California non-profit, and CSS Industries for what he regards as a less intrusive

and cumbersome process for dealing with complaints against directors. One link he provided is to ECHO’s on-line journal, https://www.echo-ca. org/article/ethics-code-hoa-boardmembers. The CSS Industries link is http:// www.cssindustries.com/directorscode-of-business-conduct-and-ethics. He said these two examples of ethics policies “illustrate how and why I decided to take a different position from my board colleagues. Let’s hope we all keep an open mind and focus on getting a good and simple Code of Ethics in place. Then see what impact that ‘code’ has on directors’ behavior and, if determined insufficient, take it to the next level,” Trendic said. Horn in an email to the Progress said her working group had looked at both the ECHO site and CCS In-

dustries ites sduring its deliberations. In a reply to the Progress, Moroney said that “overall” he favors the proposed ethics and conduct resolution, but he said an issue that remains for him is “the potential use of the policy by a sitting board to ramrod a dissenting voice off the board.” Trendic said during discussion at the May 24 board meeting that had the proposed new policy been in place last year, he believes he would have been tossed off the board by a board majority. There were three votes to do so, one short of what was needed to accomplish Trendic’s removal. “I support placing such checks and balances in place with an Ethics and Conduct Resolution,” Moroney said, but said “stacking” the proposed ethics committee could be a concern. “My opinion is that in staggering the terms of the appointees and given the turnover in the Board, it will be difficult to stack the committee. Further, this adds five additional sets of eyes and perspectives that

30 Ocean Pines PROGRESS

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may be less emotional regarding the issue at hand. Last, it allows for a third party, unaffiliated legal opinion, to be part of the process which means counsel is not a board tool but independent,” Moroney said. He added that with these safeguards in place, “this resolution will actually cause boards to be less inclined to want to remove a sitting director without definable cause. The fact that the reasons for such actions must be communicated to the committee and subject, if an investigation is warranted, to verification, questioning and both sides of the story will inevitably raise the bar.” Moroney said the proposed resolution defines four basic areas, including ethical standards, director conduct, interaction with association employees, and conflicts of interest. “As such, during board orientation, a review can be helpful in setting a course of conduct throughout the year,” Moroney said. “Therefore, unless I see reasons raised that re-

June 2018 Ocean Pines PROGRESS fute these key points, I support the resolution” as presented on first reading. Herrick, who is not running for reelection to the board this summer, said he believes the board should adopt a resolution to provide a policy regarding ethics and conduct for members of the board and officers of the OPA as authorized by Section 5.12 of the bylaws. “The Ad-Hoc work group has done a commendable job in articulating expected standards to follow as a basis for a board to evaluate allegations of misconduct and I am in favor of their recommendation for these standards to be adopted,” he wrote. But he hedged his support by saying that “any suggested remedy provided by an advisory ethics committee to the board for action can be debated by the board to consider if necessary or useful to the process. Personally, I am not sure it is necessary, but I will be fine with whatever the majority decides. The bottom line is that any final decision (to remove a director) is left up to the board of directors to decide,” he said.

Herrick took issue with the draft resolution’s provision that says an accused director won’t be allowed to cast a vote on the issue of his or her removal. He also agrees with Trendic on the need for an open process. “I personally believe, as the Bylaws state, final determination should be made by a two-thirds vote of the entire board and if the accused wishes the process to be in open session, they should be afforded the right for it to be conducted in that manner,” Herrick said. The Progress asked the directors whether they thought the new conduct policy would constitute an “engraved invitation” for heightened board divisiveness. Herrick said in his view it would not. After reading Herrick and Moroney’s responses to the Progress inquiry, Horn sent her own comments, contending that the proposed process involving an ethics committee and independent legal counsel “is to ensure greater independence and objectivity in the process of evaluating and responding to complaints or allegations.” She said the structure was intro-

duced by the Work Group in order to address concerns about “witch hunts” by the board on one of its directors. The Ethics Committee members would be appointed for staggered terms, would meet fairly narrow qualifications, and would comprise a “standing committee” that would meet as needed, she said. “These features are meant to address concerns about “cronyism” entering the process and thereby injecting an avenue for ‘witch hunt by proxy.’ We included the independent counsel both for greater objectivity and to ensure that any investigation needed in the process of evaluating a complaint would be done by professionals with the skills needed to conduct investigations. I believe the process provides a greater measure of protection for directors and would likely set a higher bar for removal of a director,” she said. She added that she agrees with both Herrick and Trendic that language should be added to the resolution explaining the need for it and also to apply its provisions to officers of the OPA.

32 Ocean Pines PROGRESS

BOARD OF DIRECTORS

June 2018

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By ROTA L. KNOTT Contributing Writer espite objections from one member who wanted to repurpose another vehicle instead of buying new, the Board of Directors on May 24 approved the purchase of two fully outfitted Ford Explorers for the Ocean Pines Police Department. Director Slobodan Trendic balked at the proposed capital purchase, saying the Aquatics Department has a little-used Explorer that could be given to the OPPD and have a police package installed for less than buying a new one. John Bailey, Ocean Pines Association general manager, presented the request for a capital expenditure to replace two existing high mileage police vehicles with 2018 Ford Explorers with the police package at a total cost of $33,864 each. The low bid for the vehicles, from Hertrich Ford of Milford, Del., came in under the budgeted amount of $35,000 each. The base vehicle cost is $27,000 with the addition of the emergency package and taxes, bringing the total per vehicle to $33,864. Bailey said the OPPD is the only local police agency that does not

have a take-home vehicle program for its officers, but that allows the department to keep its fleet small. The OPPD has six marked vehicles on the road during peak hours. By comparison, he said the Berlin Police Department has 15 vehicles and Pocomoke Police Department has 17. The OPPD is replacing a 2013 Explorer with more than 132,000 miles and a 2014 Explorer with 152,000 miles. Bailey said the request for replacement is based on more than just miles. “It’s the hours these vehicles operate,” he said, adding the engines of police vehicles are at idle a lot, which puts significantly more hours on the engines than mileage indicates. However, Trendic asked about repurposing for the OPPD the Explorer already owned by the OPA and stationed within the Aquatics Department. He said he doesn’t know how often it is used by that department and noted that the association is still reimbursing an employee for mileage for use of a personal vehicle. Bailey said the Aquatics Department’s Explorer only has 10,000 miles on it and it is used by various employees. He said the directive from a previous general manager when that vehicle was purchased was to keep it clean and not use it for transporting tools, materials, and equipment. That’s why the employee is still using a personal vehicle for those tasks and is reimbursed for the cost of mileage. He said it is possible to repurpose that vehicle but a lot of things would have to be changed because it doesn’t have the police equipment package, police engine, roll bar, separator between driver and rear seats, or police computer system. “There are a lot of things that would have to be done to it, not that that’s $35,000 worth,” he said. Bailey suggested a different approach to repurposing of vehicles once the two old OPPD cars are replaced. Instead of giving the OPPD the Aquatics Department’s Explorer, he suggested giving Aquatics one of the vehicles being replaced by the police department for hauling of q

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June 2018 Ocean Pines PROGRESS

Parks pulls motion to approve NorthStar management software from May 24 agenda Budget and Finance committee votes in opposition to proposal pushed by Technology Working group By TOM STAUSS Publisher motion to approve the purchase and implementation of community association management software licensed by NorthStar Technologies was removed from the agenda of the May 24 Board of Directors meeting by Ocean Pines Association President Doug Parks because it encountered major pushback by the Budget and Finance Advisory Committee earlier in the week. The B&F committee voted unanimously to oppose the purchase, instead adopting the position of two OPA directors, Slobodon Trendic and Tom Herrick, that the OPA should fully explore financial management outsourcing options before commiting to a six-year relationship with NorthStar for its software solutions. Outsourcing could include the hiring of a management company such as Legum and Norman or one of its many competitors to manage OPA financial operations. A proposal submitted by Legum and Norman last summer narrowly failed after only three directors favored it. As generally understood, the outsourcing option would include the issuance of a request for proposals (RFP) from management firms, or perhaps a request for information (RFI), for financial management services. Generally such companies have their own proprietory software to help them in their management

functions or recommend packages licensed by leading software manufacturers, or employ some combination of both. Since last year, the Technology Working Group, initially chaired by Parks but currently headed by former OPA President and Director Tom Terry, has been vetting four or five community association management software packages. At the April regular meeting of the board, Terry and paid OPA software consultant Les Smith made a public presentation in support of NorthStar software without actually disclosing the name of the working group’s recommended vendor. After the Progress outed NorthStar as the recommended vendor in its May edition, OPA General Manager John Bailey confirmed it days later, urging the board to approve the NorthStar solution at its June regular meeting. Parks instead decided to push up an approval vote to the May 24 board meeting, perhaps sensing he had the votes to make it happen. After the vote by the B&F committee, Parks reversed course, and no other director was willing to push for NorthStar approval. In remarks read into the record at the May 24 meeting -- Parks was absent -- the OPA president said that the motion for approval was withdrawn pending “additional review” by the B&F committee. Parks didn’t define the nature

Police vehicles

all of the required police equipment is more expensive than ordering it with the equipment installed. “That was in the material that was provided to us. So I don’t agree that that would be a better utilization of that vehicle,” she said. Director Ted Moroney liked Bailey’s suggestion, saying it addresses personal use of vehicles by employees for association tasks and uses the heavy-mileage vehicles to do the hauling around and within the community. Moroney offered the motion to approve the capital purchase of the two new Ford Explorers for the OPPD. The motion carried 5-1 with Trendic opposed and Parks absent.

From Page 32

supplies and materials. That would eliminate the need for employees to use personal vehicles. Additionally, he said the Recreation and Parks Department no longer has a vehicle for running errands around the community either and could use the other outgoing police vehicle. “That way we would take care of three birds with that stone,” he said. Cheryl Jacobs, chairing the meeting in the absence of OPA President Doug Parks, said information provided by staff as part of the capital purchase request package made it clear that retrofitting a vehicle with

of that additional review or when it would take place. Nor did he say whether a decision on new management software would be pushed off to the new board that organizes itself in August. Doug Parks “The process will continue,” he said. The additional review occurred in a meeting of the TWG and the B&F committee on June 5, during which it became clear that the B&F committee members seemed disinclined to support the NorthStar solution without the OPA fully exploring management outsourcing options. The objective is to make sure the OPA obtains the best price and the best solution. During the board’s April meeting, Terry and Smith said that NorthStar solution would save the OPA roughly $150,000 over a six-year period in software expenses that would otherwise cost the OPA roughly $1 million. During the June 5 joint committee meeting, it became evident that in fact there will be no net savings to the OPA if the NorthStar software is acquired. The original motion offered by Parks and then rescinded by him said that the TWG was established in October of 2016 “to address the current state of the technology landscape supporting OPA operations.” While Parks didn’t say so, that state is generally thought be abysmally behind the times, with both hardware and software used by the OPA dating back to the last millenia. Parks’ in supporting commentary to his rescinded motion said the TWG developed a list of requirements “after discovery sessions with OPA staff, management and business process owners.” These requirements “were the basis for an RFP that was created and published in December, 2017,” with Smith the committee’s software consultant integrally involved in drafting it. Five vendors submitted proposals in response to the RFP, with four vendors participating in product demonstrations and submitting to

an evaluation process. “Based on the extensive evaluation that included a consideration of outsourcing for some operations, the TWG recommended NorthStar as the solution that best fits the OPA,” Parks said. In remarks during the April board meeting, Terry made it clear that the TWG was not favorably inclined toward the outsourcing model, contending that it wouldn’t really save the OPA money. OPA Director and Treasurer Pat Supik weighed in as well, contending that outsourcing financial management had been rejected by a board majority in the summer of 2017 and that, since then, the board went ahead and hired a new director of finance, Steve Phillips. But that argument did not sit well with members of the B&F committee. And one candidate for the OPA board this summer, Steve Tuttle, took to the microphone during the May 24 meeting’s Public Comments segment to urge the board to consider outsourcing options before voting to approve the NorthStar proposal. Parks had already removed his motion from the meeting agenda when Tuttle made those remarks. The discussion continued at the joint meeting of the B&F committee and the Technology Working Group June 5. B&F committee chair John Viola indicated that he would be drafting an e-mail to the board summarizing the committee’s findings, which will include the conclusion that, despite any earlier claim by the TWG that the NorthStar package would save the Ocean Pines Association roughly $150,000 over six years, those savings have shrunk to zero. With some additional costs likely, the latest estimate over six years for the NorthStar package is $893,000. With an additional 5 percent contingency for unanticipated costs, including the need to integrate NorthStar software with other software that the OPA uses, Viola concluded that the OPA will realize no cost savings if the OPA buys the NorthStar suite. OPA General Manager John Bailey and TWG members contended that even with no costs savings over the six-year term of a licensing agreement, there will be significant efficiencies in operations if the OPA acquires the software. No one in the room disputed the prospect of management efficiencies, but there was less agreement q

BOARD OF DIRECTORS

June 2018

NorthStar proposal From Page 33

over the extent to which those efficiencies could be quantified. Viola at one point even said he’s aware of situations in which software conversions have ended up costing two or three times the estimated costs, but he didn’t predict that in the case of NorthStar. The meeting began on a discordant note, with TWG chair Tom Terry vehemently denying recent allegations circulating in Ocean Pines that he and perhaps some of his working group colleagues stand to gain financially if the board votes to accept the group’s recommended vendor for new management software. Terry, a former OPA director and president, said he and all of his committee members are volunteers and have spent countless hours vetting four software vendors on instructions from the board. He said he was outraged that his motives could be questioned in such a way. With that issue disposed of quickly -- Terry’s comments prompted no response -- most of the meeting was spent pouring over costs related to purchase a license to the NorthStar suite, which TWG members and Les Smith, the OPA’s paid technology consultant, acknowledged would not handle all off the OPA’s management software needs. The take-away from that part of the discussion is that there would need to be some customization to integrate NorthStar’s software with the OPA’s existing software. Smith at times seemed to hedge on the upside on those kinds of costs, but the consensus seemed to be that a 5 percent contingency or roughly $50,000 would be sufficient to handle integration issues that might arise. The elephant in the room seemed to be the issue of outsourcing OPA financial management, which Viola said at various times during the meeting needed to be addressed at the board level before a decision is made on whether to purchase the NorthStar software. He said the issue has begun to resonate throughout Ocean Pines, even as he acknowledged that the issue has to be defined better for the community to be comfortable with a board decision to purchase $1 million in software and support services over six month. As sometimes understood, outsourcing is the hiring of a management company with its own propri-

etary software, or even companies that use off-the-shelf software suites from the likes of Microsoft and Oracle, that would assume control over OPA back office financial operations currently performed by OPA Director of Finance Steve Phillips and his small support staff. But outsourcing could have other definitions that don’t involve hiring a management company to take over the OPA finance department. It could involve a more modest objective of retaining the OPA’s current finance department personnel while shopping for software from more vendors than the four or five that the TWG has been vetting for the past nine months or so after issuing an RFP (request for proposals). OPA Director Slobodan Trendic for one made it very clear early in the meeting that he was very reluctant to approve the NorthStar proposal because he didn’t think the TWG had fully explored well-known management suite alternatives by such companies as Microsoft and Oracle. While he commended the TWG for the work it had done vetting the four companies that had submitted software proposals as a result of the RFP, he wondered whether the TWG had contacted large homeowner associations that have the NorthStar suite installed to gauge how well these HOAs like the package That question went unanswered. Trendic early in the meeting said the board never addressed the issue of outsourcing in a coherent fashion last year. He said before the board votes on NorthStar, it needs to decide how it wants to handle back-office and software integration, and it needs to consider options available from large such as Microsoft and Oracle before rushing into a decision to buy the NorthStar package. Viola seemed to agree with that, volunteering to help lead a discussion about outsourcing. Another director, Cheryl Jacobs, pushed back against outsourcing, telling Trendic that the board, in rejecting a management proposal from Legum and Norman last summer, had disposed of the outsourcing model. But Trendic said that Jacobs essentially misconstrued what the board did after the Legum and Norman proposal mustered three votes, one short of what was needed. “It hasn’t been decided at the board level,” or even discussed in any detail, Trendic said. The two directors engaged in a two-way whispered exchange on the issue during

Moroney proposes wording changes in board ‘C’ resolutions Working with GM would no longer be in committee mission statements, reversing board preference in Thompson era By ROTA L. KNOTT Contributing Writer inor amendments proposed to nine of the “C” resolutions, those governing the advisory committees, will bring them into compliance with the Ocean Pines Association’s governing documents. At the board’s request, the Bylaws and Resolutions Advisory Committee originally reviewed and recommended a number of changes to the “C” resolutions in April 2017. More than a year later, and after some minor tweaking, the board is finally considering their approval. Director Ted Moroney presented a first reading of amendments to resolutions C-01, C-03,C-04, C-05, C-06, C-08, C-11, C-13, and C-15 during a May 24 Board of Directors meeting. He said “primary what has happened is that the change of the governing documents required that we change the authority in a number of our C resolutions going forward.” For resolutions C-03, Budget and Finance Advisory Committee, C-05, Clubs Advisory Committee, and C-06, Communication Advisory Committee the proposed amendments remove language from the purpose section of the document referencing the general manager. The existing language states that the committees can advise the board and general manager. No longer. That was a change in the resolutions placed there by previous boards in the Bob Thompson era. Director Cheryl Jacobs’s first year as a director -- she is retiring in August after her first and only three-year term -- was part of a board majority that was very supportive of Thompson

34 Ocean Pines PROGRESS

a break in the meeting, after which an irritated Jacbobs left in a huff, well before the meeting had concluded. She didn’t say whether she had a prior engagement. The Legum and Norman proposal from last summer, which was not a fully development bid but somewhat conceptual, came in for some discussion during the June 5 meeting. Bailey said he had been in contact with the company to determine whether it would be willing to sell or lease its proprietary software to the OPA without a management contract, which he described as another variation of outsourcing. After the meeting, Director Tom Herrick, one of three directors who supported the Legum and Norman proposal from last summer, scoffed at the very idea that Legum and Norman would be willing to make its software available without maintaining control over it with its own personnel. He said the purpose of throwing that option out there would be to make a case that outsourcing had been explored, when nothing of the

kind had been done. He essentially said Bailey’s approach to Legum and Norman was lip service, that the only way to gather information about outsourcing possibilities would be to issue an RFP, something the board earlier this year voted not to do. There has been majority support for the issuance of an request for information, or RFI, which could yield information similar to what an RFP might depending on how vendors decide to respond. Herrick said he fears that OPA President Doug Parks with the support of a board majority is preparing to ram the NorthStar proposal “down our throats,” which he said he hopes will lead the STOP organization, Stop Taxing Ocean Pines, a group headed by board candidate Esther Diller, to file for an emergency injunction. Herrick said the purpose of an injunction would be to prevent the NorthStar software purchase from taking place before a new board with two or three new directors assumes control over OPA affairs in August.

June 2018 Ocean Pines PROGRESS

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BOARD OF DIRECTORS

June 2018

and his preference for using advisory committees to assist in promoting and even helping to implement some of his programs. One election later that support for Thompson had evaporated, too, and Jacobs’s elevation to the OPA presidency had evaporated with it. During the May 24 board meeting, Jacobs asked why providing support for the general manager is being removed from the resolution. Moroney responded that the proposed change dates back more than a year and was in the original recommendations presented to the board in 2017. “The thinking at that time was that these are board advisory committees and that they should basically be reporting to the board and not really involving the general manager,” he said. The proposed amendment to resolution C-11, Golf Advisory Committee, removes language stating the part of its purpose is “assisting the OPA marketing department in promoting golf in the broader community.” Jacobs also questioned that recommended change. Moroney responded the Bylaws and Resolutions Committee’s feeling was that task is an operational issue and not an advisory committee issue “But we don’t want the advisory committee out there spreading the word about our golf?” Jacobs asked. Moroney said the problem is in the language included in the existing resolution. He said there is a difference between assisting with marketing and just spreading the news about the golf course. In resolution C-01, Committee General Policy, the amendment makes a minor change to clarify the authority to the board to create advisory committees. The new language reads “The charter of Ocean Pines Association Inc. and the bylaws of the association direct the Board of Directors to establish and appoint the members of such committees and other advisory bodies as may be necessary to, or convenient in, the association’s discharging duties entrusted to it.” That same change is made to the authority section all of the “C” resolutions. An additional amendment to C-01, paragraph 3b removes language allowing the committees to request “routine administrative assistance and necessary office supplies.”

Another change to resolution C-05 regarding the Clubs Advisory Committee simply alters a reference to the Golf and Country Club to make it just the Golf Club. The building known in Ocean Pines as the Country Club would not be renamed as part of this change, however. A change to resolution C-08, Elections Committee, will eliminate language stating “the chairperson shall consult with the general manager regarding the association staff assistance necessary to carry out the election process and a timeline for required actions. The general man-

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June 2018 Ocean Pines PROGRESS

From the desk of: Ed Tinus

Age: 59 years Occupation: Master Upholsterer, Universal mechanical technician

Why I am seeking office:

For God, Country, And Community. To serve with transparent, interactive, representation. We have the technology for all voters to securely be engaged with the political process. We will have an App for your smart devises. A vehicle that will drive you to the open doors of legislation in Annapolis, from the comfort of your own home. Down load Bills and take an active roll with digesting the verbiage. Citizens and government working together interacting on your Rights, Laws, Tax’s. Returning more power to the people of our community. Regardless of your party affiliation. To protect the services for our DD 214 Veterans as well our first responders they are my real hero’s. To serve with honesty, integrity, and morals to lead us into a Better Maryland. Praying that my Trust in God as a Forth Degree Knight of Columbus, guides me to represent you well. Amen.

Where I stand:

1: Voting integrity, every election cycle some of our votes are mishandled, lost, or simply not counted. The archaic method of voting has outgrown itself. The State Board of Election does ts very best trying to upload paper ballots to intergrade with our technology. A few basic measures can make your votes more secure with little cost. That all forms of photo I.D. from MVA will have U.S. citizen displayed. That your voting registration is swipe stripe coded on the bottom back. This way when you move your voting registration is automatically transferred. Even in the event of death as your license expires so does your voting status. The merchant processing equipment can be adapted to this I.D. process, minimizing the cost and time. 2: Our Constitutional Rights are undermined and disregarded. Example: Our new law for gun control HB 1302 violates several laws. Our representatives have overstepped the boundaries of what The Maryland Constitution allows them to enact law of this Constitutional nature. We the People through a popular vote must first amend the Maryland Constitution granting our General Assembly the right to do so. The Republic and society has no checks and balances in place to hold our elected officials accountable. With the Ed App a new level of communication will allow the voters to have a voice of repeal. We must not make laws that break laws. 3: Protecting Social Security, restoring the Chesapeake Bay, funding our first responders, and education needs. To reduce taxes through wiser spending. We stand at the edge of a great divide on one side is our traditional method of representation. Where Wayne H offers his O.C. councilmen experience of regulations, fines, and tax’s that gives him the ability to vote for you in Annapolis. Remember the tax payers of Worcester county are paying for 50% of the inlet dredging? Joe S stands on this traditional side also. Working as a Hogan appointed DNR agent to follow the leadership of Mr. Hogan. Mr. Hogan signed HB 1302 into law. The unconstitutional gun regulations. Joe states that he will protect your gun rights? Ed Tinus offers the leadership into real effective change. Standing steadfast calling for the evolution of representation through technology. Where citizens and government work together for a Better Maryland. Both parties do not want the loss of power to the voters for intervention. I never ask for donations therefore I am not beholding to any special interest. The voters will hold me accountable.

Vote Ed Tinus for Delegate 38C, Republican Primary, Tuesday, June 26, 2018 Early Voting June 14-June 21, 10 a.m. to 8 p.m.

www.united-us.org

38 Ocean Pines PROGRESS

OPA FINANCES

June 2018

OPA claims it lost $1.2 million in 2017-18, $400,000 less than Supik’s May 24 estimate Payment made to OPVFD in new fiscal year is charged against fire/EMS department in April, inflating final numbers By TOM STAUSS Publisher lthough its accuracy has been questioned because of the way the finance department recorded a $285,000 payment to the Ocean Pines Volunteer Fire Department in May, the first month of the new 2018-19 fiscal year, a financial report issued by the Ocean Pines Association in late May is claiming that the OPA lost $1,189,631 in 2017-18. That was still substantially less -- about $400,000 in fact -- from an $1.6 million loss that OPA Treasurer Pat Supik had declared was imminent literally a few days before Director of Finance Steve Phillips unveiled the unaudited April numbers and the cumulative totals for the year. The actual departmental loss excluding new capital expenditures is shown as $1,040,323, a huge jump from the $34,000 surplus recorded

at the end of March. By any measure, April was an extremely poor month financially for the OPA, with an actual loss of $1,074,426. In contrast, in April of 2017, under the stewardship of Acting General Manager Brett Hill, the loss for the month was roughly $550,000. In a somewhat surreal presentation at a June 30 meeting of the Budget and Finance Advisory Committee, Phillips said the fact that the OPA only lost $1.2 million for last year, in contrast to what Supik has consistently said in recent months would be a $1.6 million loss, was the result of austerity measures put in place by General Manager John Bailey since the beginning of the year. Neither Supik nor Phillips offered any explanation for why, literally less than a week before at the Board of Directors May 24 meeting, Supik had continued to insist that a $1.6 million loss for the year was imminent, and this was more than three

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weeks after the close of the 2017-18 fiscal year. Phillips tried to pass off the $1.6 million loss projection as a conservative one, but there is significant doubt given the actual results that the estimate ever had any real basis. It was used as a justification for a $30 assessment increase approved by the Board of Directors in February. At the time, a $2 million deficit was declared almost as fact for two consecutive years, including a $360,000 operating loss in 2016-17. Actually, the operating fund actually improved year-over-year in 201617 because a reserve fund known as the deficit recovery fund was closed out and its assets transferred to the general fund. Perhaps the most startling anomolous number in the April 2018 financials was a $284,727 loss in the fire/EMS (emergency medical services) department, reflecting a pay-

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Ocean Pines PROGRESS June 2018

$1.2 million loss

Unaudited OPA financial summary, April 2018

From Page 38

fiscal year because that’s when the payment was made. If that happens, the actual loss for the year would be less than $800,000, excluding new capital expenditures, and under $1 million with new capital. Even if the auditors accept the backdating, critics of OPA financial management will say that the deficit was overstated as a way of trying to salvage what little credibility may remain after months of $1.6 million or more deficit projections. The Board of Directors at the May 24 meeting attempted to pave the way for the backdating by passing an amendment to the 2017-18 budget more than three weeks after that fiscal year concluded. The motion introduced by Director Ted Moroney may not have been fully comprehended by his colleagues, who voted for it unanimously. The financial report for April indicates that the budgeted $39,707 for the month was paid in April, but in fact it was not. It was bundled in the $284,727 remitted to the OPVFD in May as a result of the demand letter. In addition, the OPVFD demanded that the OPA pay its share of ambulance costs that the OPVFD contended was owed. One of the ambulances was delivered to the OPVFD before the end of the fiscal year while the other reportedly was delivered after the new fiscal year began. Another notable number from the April financials was the $90,001 loss at the Yacht Club, which contributed to a $673,211 loss for the year at OPA’s premier restaurant amenity. A large portion of the loss appears to be almost $54,000 in inventory write-offs, which the new Yacht Club managers, the Matt Ortt Companies, had said was coming. Hill has questioned the legitimacy of some of those write-offs, contending that at least some of it should be offset by returning product to the sellers. In addition, during a month when the amenity was not open, the Yacht Club recorded $7,653 in wages and benefits, $11,427 in services and supplies, $6,466 in utility expense and $1,558 in “other” costs. Phillips said some of the loss for the month stemmed from improvements at the Yacht Club prior to its reopening in late May, but most of those were probably capital im-

Excluding new capital expenditures, which are treated as operating expenses in the audited financial statements, unaudited results for 2017-18 show a $1.04 million deficit for 2017-18, the fiscal year ending this past April 30. Including new capital, the deficit is said to be $1.2 million. Both the Progress and oceanpinesforum.com have questioned the fire/EMS expense line of $284,727 for April, as the Ocean Pines Association reportedly wrote a check to the Ocean Pines Volunteer Fire Department after a May 24 OPA Board of Directors’ vote adjusting the fire/EMS budget for 2017-18, after the fiscal year had closed.

provements that would not show up as operating expenses. One department that peformed better than budgeted was golf, which produced a $5,313 surplus for the year and exceed budget by $86,935. But the Tern Grille, the restaurant and bar operation that supports the golf course, lost $36,504 for the year, missing its budget by $86,935. Aquatics, although missing its budget for the year, nontheless experienced a dramatic turn-around year over year, generating a $149,063 surplus for the year. It missed its

budget by $26,527. The three racquet sports in combination more or less broke even for the year, slightly behind budget but in the case of platform tennis and pickleball less than $500. Recreation and Parks, under the supervision of Aquatics and Recreation and Parks Director Colby Phillips, had a $424,981 deficit for the year but exceeded its budget forecast by $83,379. Reserve summary -- The OPA concluded the 2017-18 fiscal year with $7,893,933 in reserves, consist-

ing of $4,587,906 in replacement reserves, $2,493,722 in bulkheads and waterways reserve, and $812,405 in the roads reserve. Balance sheet -- The OPA concluded the 2017-18 fiscal year with a balance sheet indicating $40,423,954 in assets, compared to $39,929,150 in April of last year. Operating cash on hand was listed at $3,419,546, compared to $3,118,669 in April of last year. Short-term investments totaled $9,728,288, a jump from $8,567,898 from the same time last year.

Phillips says sharp increase in April expenses a result of timing, OPVFD ‘true-up’ Austerity measures imposed by general manager reduced deficit, finance director says By TOM STAUSS Publisher hen pressed by Budget and Finance Advisory Committee chair John Viola pressed him for reasons why a $34,000 departmental surplus at the end of March had ballooned to a $1.2 million deficit at the end of April, the final month of the 2017-18 fiscal year, Director of Finance Steve

Phillips came prepared with an answer. The committee met with Phillips and General Manager John Bailey June 30 for a review of the unaudited April financials. A year ago, under the administration of former acting general manager Brett Hill, April produced a $550,000 operating deficit, while this year, under Bailey, the deficit

was $1,074,436, roughly twice that of a year ago. Phillips gamely tried to explain the year-over-year increase in April expenses to a revenue timing issue, but the same sort of timing issues would also have pertained to April of 2017. April historically has been a poor month for revenue at OPA amenities, and assessment revenues q

OPA FINANCES

June 2018 Ocean Pines PROGRESS

Phillips explains deficit From Page 40

collected in April for 2018-18 don’t show up in April books but in May, the first month of the fiscal year. Phillips also blamed the yearover-year ballooning of expenses on what he called true-ups, an obscure term that in this case probably refers to adjustments in the fire/EMS (emergency medical services) expense line that exceeded the recorded budget for April by $245,000. He further blamed the March to April $1 million increase on Yacht Club fix-ups, without providing any detail. But the Yacht Club lost $90,001 in April, and some of that probably was repair costs in anticipation of the reopening of the amenity in May under the management of the Matt Ortt Companies. What he could have said but didn’t is that the $1.2 million deficit recorded at the end of April includes $176,139 in new capital expenses. The $34,000 surplus at the end of March did not. The departmental surplus at the end of April excluding new capital was $1,040,323. It’s this number that correlates with the

$34,000 surplus in March. Phillips attributed some of the Yacht Club’s $90,001 loss and the Beach Club’s $30,530 loss on inventory write-offs of roughly $74,000, of which $21,000 occurred at the Beach Club. While Viola had pressed Phillips to explain the sharp jump in expenses in April when compared to March, the finance director at times tried to emphasize some positive aspects to the 2017-18 results. He pointed out that the Recreation Department under Aquatics and Parks and Recreation Director Colby Phillips produced a deficit of $424,981, $87,379 better than budget. Aquatics generated a $149,063 surplus for the year. Similarly, Steve Phillips said, golf operations (excluding the Tern Grille) did much better than budgeted with a $5,313 surplus for the year, $86,935 ahead of budget. He attributed that to savings in fertilizer and chemical usage implemented by golf course superintendent Andre Jordon. The discussion then shifted to factors that caused the OPA to lose $1.2 milion for 2017-18. Director Slobodan Trendic attributed the loss to three primary

County keeps property, local income tax rates unchanged

n approving their fiscal year 2018-19 operating budget of more than $190 million on June 5, the Worcester County Commissioners maintained the current rate of 83.5 cents per $100 of assessed value for real property taxes and 1.75 percent for the local income tax rate. The overall spending plan reflects a decrease of $8.9 million from the FY18 budget. Based on the current tax rate of 83.5 cents, property tax revenues are expected to increase by $2,880,921 or 2 percent. The homestead credit cap remains unchanged at 3 percent and is estimated to result in a reduction in taxes of $1.3 million for the county’s qualified principal resident homeowners effective July 1, 2018. The county also retained the same local income tax rate at 1.75 percent with revenues anticipated to increase by $500,000 over the current year.

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factors, $107,000 in unbudgeted new capital for new platform tennis courts, the OPVFD adjustment that resulted in fire/EMS over budget by $165,619, and unrealized income at the Yacht Club and Beach Club. That unrealized income resulted in a Yacht Club deficit for the year of $673,213 and a loss at the Beach Club of $102,781. “Put your own objective analysis on it,” Trendic said, calling the results at these two amenities terrible, with the blame in part on the

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with losses as they mounted up last summer. Viola pointed out that other areas were significantly over budget, citing legal expense and contract services. Bailey confirmed that legal expenses exceeded budget by $100,000 and that the OPA incurred about $250,000 in contract services. How much contract services exceeded budget he didn’t say.

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CAPTAIN’S COVE

Ocean Pines PROGRESS June 2018

Cove president charged with illegal posting of ‘confidential tax documents’ on Web site Scheduled June 7 board meeting canceled; other directors fear they’re next on opponents’ hit list By TOM STAUSS Publisher bout 45 minutes after the scheduled 2:30 p.m. start of the June 7 Board of Directors meeting, Facilities Manager Rob Girard took to the podium to announce that Cove property owners association President Tim Hearn had been arrested on charges of violating section 58.1-3F of the Criminal Code of Virginia and that the meeting was canceled, no replacement date disclosed. Girard’s announcement stunned the assembled Cove association members, who, like Girard, had no idea what sort of crime 58.1-3F involves. It turns out it’s a Class 1 misdemeanor involving unauthorized disclosure of confidential tax information. The relevant section says it “shall be unlawful for any person to disseminate, publish or cause to be published any confidential tax document which he knows or has to

reason to know is a confidential tax document.” The code defines confidential tax document as any correspondence, document, or tax return that is prohibited from being divulged ... and includes any document containing information on the transactions, property, income, or business of any person, firm, or corporation that is required to be filed with any state official ...” The penalty for a Class 1 dismeanor is confinement in jail for not more than 12 months and a fine of not more than $2,500, either or both. Although some Cove residents and board members speculated after the meeting that Hearn’s arrest involved the board’s and Hearn’s handling of a dispute involving two adjoining neighbors, it turns out that seven separate arrest warrants were issued on behalf of seven Cove residents, most if not at all former Cove board members, who were up-

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set because, late last year, Hearn authorized the posting of federal 1099 forms containing Social Security numbers of former board members on the members-only section of the Cove association’s Web site. Girard disclosed that two of the Cove property owners and former board members who had filed the criminal complaint against Hearn were John Ward and George Dattore. Hearn told the Progress that all seven of the complainants, filed beginning in March with the last one apparently filed last month, seem to be former board members who served before Hearn and business allies took effective control of the Cove association in 2012. Hearn said he first learned of the outstanding arrest warrants signed by a Accomack County court commissioner when he was met by a sheriff’s deputy at the entrance to the Cove’s Marina Club. The deputy

happened to be a former employee of the Cove association that he recognized, Hearn said. The Cove president said the deputy informed him that the citizen complainants had wanted him to present the arrest warrants to him when he was presiding over the scheduled June 7 board meeting, “maybe to take me out in handcuffs,” Hearn said. Instead, the deputy gave him a choice, sign the warrants on the spot or decline and accompany him down to the county sheriff’s office where he would be booked in ways not unfamiliar to those who watch television crime shows. Hearn said he elected to sign on the spot. He then asked the deputy whether Hearn could follow he depity down to the sheriff’s office in Hearn’s own vehicle so he could obtain copies of the arrest warrants for his lawyers. The deputy agreed. Hearn said he returned to Captain’s Cove after obtaining the requested copies around 4 p.m., too late to start the meeting. “It would not have happened anyway,” Hearn said, because his board colleagues are “upset and concerned that they could be the next

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CAPTAIN’S COVE targets” of those who don’t like the way Hearn and other directors have been running Captain’s Cove. “I understand their concerns,” Hearn said. “They feel intimidated. Had an arrest gone down the way the complainants wanted, it definitely would have sent a message to some directors.” Contrary to the impression some Cove association members had at the aborted June 7 meeting, Hearn was never taken into custody or in danger of being jailed. “I was not hand-cuffed, fingerprinted or perp walked,” Hearn said. His encounter with the deputy seems not unlike being stopped by a police officer for a driving infraction and being asked to sign a citation, except in this case he was asked to sign seven separate documents. Hearn said the deputy told him that the sheriff’s department had had some difficulty in serving the warrants to him because he was seldom in Captain’s Cove when deputies were present. “So the complainants suggested that the sheriff show up during the board meeting,” Hearn said. “Make a scene.” His first appearance on the charges in Accomack County District Court is set for June 13. Hearn said he expects his lawyers will ask for a continuance, because of so little time to prepare a defense, or instead will ask for a dismissal of charges because of “irregularities in the warrant documents” filed by the complainants. “They contain misrepresentations or lies in order to persuade the commissioner to sign the warrants,” Hearn said, declining to give examples. “I will leave that up to my lawyers to make that case. I don’t mean to be cryptic,” he added, “but that’s what courtrooms are for.” Hearn said that his arrest is just the latest in a saga that began last May when Hearn, in comments during a board meeting, criticized boards on which Ward and Dattore, perhaps his two most determined critics, served. “From 2009 to 2012 George Dattore and fellow board members paid themselves over $200,000 for travel costs associated with coming to meetings,” Hearn told the Progress, citing the existence of 1099s issued to directors that prove it. Those 1099s were subsequently posted on the members only section of the Cove’s Web site, triggering a dispute that has now been criminalized. To be continued.

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OPINION

Ocean Pines PROGRESS June 2018

COMMENTARY

The OPA’s fake $1.6 million deficit

mazing how in just a few days a $1.6 million deficit turned into a $1.2 million deficit. Ocean Pines Association Treasurer Pat Supik declared during her treasurer’s report at the May 24 Board of Directors meeting that last year’s deficit would hit $1.6 million, the same number she guesstimated in March and April. Just a few days later, when the OPA finance department issued the April end-of-year financials, the new deficit was $1.2 million, comprised of an “actual” -- that term should be used with extreme caution -- departmental deficit of $1,040,323 million and another $178,139 in new capital expenditures. The latter are always considered operating expenses in Ocean Pines LaLa Land and are paid for out of the operating fund. That $400,000 miss is startling even by Ocean Pines’ financial standards. Supik needs to take a good hard look over whether she has the expertise and credibility to continue to serve as the OPA’s chief financial officer. That same fanciful number or an even higher one -- remember projections of $2 million or more? -- were cited as a rationale for the assessment increase approved by this board of directors in February, with only Slobodan Trendic not swallowing the Kool-Aid. The OPA board needs a few more like him come August. Said another way, the potential deficit was used cynically to manipulate the membership into accepting the need for an assessment increase. As for Supik, she should give a lot of consideration to submitting her resignation, if not from the board than at least as treasurer. If she is so out of touch with the actual numbers the finance department is about to release a month after the close of the 2017-18 fiscal year, she clearly doesn’t have a good read on the OPA’s financial affairs. She was one of the board’s chief cheerleaders for a higher assessment and the $1.6 million (or higher) deficit projection for 2017-18. Come to think of it, so was Ted Moroney, an appointed director who is running for the board this summer. The treasurer doesn’t have to be an OPA director, thankfully. Someone like John Viola, current chair of the Budget and Finance Advisory Committee, would be a credible replacement for Supik. As for the $1.2 million deficit, that, too, should be taken with a grain of salt. This number reflects a reported $166,000 “adjustment” to the fire/EMS (emergency medical services) bottom line that shouldn’t be charged to the 2017-18 books. For one thing, part of the adjustment (before it was readjusted again, for reasons too arcane for explanation) included a $212,000 payment to the OPVFD -- actually, it seems to have been made out to Farmer’s Bank, a note-holder on the Northside firestation -- from a “secret” custodial

reserve account with PNC Bank set up in 2011 or 2013 and controlled by the OPA ever since, for some of that time with one signatory who wasn’t even an OPA employee. It’s an off-the-books account that never should have been set up to begin with. Certainly it was not well monitored if no one seemed to know about it when it was “rediscovered” last year by Acting General Manager Brett Hill. Expenditures made out of a custodial or any other kind of reserve account for purposes for capital expenditures should not be treated as an operating expense, even in OPA LaLa land. Moreover, the OPA sometime in May, the first month of the 2018-19 fiscal year, cut a check to the OPVFD for a reported $285,000 or so, because the OPA had for some abstruse (if not obtuse) reason failed to make budgeted payments of $39,707 to the OPVFD in February, March and April. In addition, the OPA owed the OPVFD for its share of two ambulances, supposedly purchased on an “accelerated” schedule. This was the state of affairs that OPA mismanagement fostered, apparently as an OPA financial “team” tried to figure out and implement an unfathomable memo of understanding (MoU) drafted back in 2011 and reportedly amended two years later. This whole MoU miasma is a smokescreen designed to disguise the fact that the OPA essentially was issued a polite demand letter dated May 10 to pay up. It doesn’t really matter when the ambulances were delivered or became serviceable. For accurate accounting purposes, the OPA’s share of any OPVFD capital expenditures should be charged against the books in the fiscal year when the associated OPA payments were made. Back-dating the books to reflect what should have been done but wasn’t is unacceptable. It serves to inflate the operating fund deficit for 2017-18, which perhaps makes some folks feel better, because it means they only missed the deficit projection by $400,000. This also applies to the $39,707 times three ($119,121) that the OPA should have paid the OPVFD but didn’t in 2017-18. This number, too, should show up in the fiscal year when it was paid. The April financials inaccurately show a payment was made to the OPVFD in April; it wasn’t. More back-dating, which in other contexts is illegal. In this case, probably not, but that doesn’t make it any more acceptable. It’s just a shell game played across two fiscal years, to make one fiscal year look worse than it should. More evidence of the abuses possible under accrual accounting, designed to make things more complicated than they need to be. Bottom line is that roughly $285,000 should be backed out the fire/EMS department last year and moved into 2018-19. To get there is simple math. According to the

departmental breakdown in April’s financial (page 5), the OPVFD had a negative variance to budget of $245,020 in April, but that didn’t include the $39,703 that the summary inaccurately shows as an April disbursement. Adding the two categories together comes to $284,727, very close (if not identical) to the check the OPA reportedly wrote the OPVFD in May. The OPA under the oversight of Moroney (probably because the OPA treasurer was not up to the job) tried to explain the $166,000 (or so) adjustment to the original fire/EMS budget of $476,429, negotiated by Hill, Supik, members of the OPA finance department, and the OPVFD’s Billy Bounds last year. According to Hill, it was known at that time that a couple of new ambulances would need funding. Some of it was provided in 2017-18, as part of the $476,429 budget allocation, and some of it was anticipated for 2018-19. The MoU was more or less discarded as a funding guide because no one involved, the OPA’s treasurer included, could understand it, according to Hill. As it happens, the $166,000 “adjustment” that Moroney’s “team” calculated is precisely the dollar amount that, when added to the $476,429 fire/EMS budget, comes out to about $640,000, what the April financials show the OPA paid the OPVFD in 2017-18. Of course, while the math works, this $166,000 “adjustment” should show up in 2018-19. When added to the three months of backdated payments the OPA should have made in February, March and April, but didn’t, the total is a little more than $285,000, more or less what the OPA paid the OPVFD in May. Of 2018. Funny how all of this math works out. If this $285,000 is subtracted from the $1,040,323 departmental loss (excluding new capital) that shows up in the April financials, the more accurate departmental loss for last year is actually $735,596 or thereabouts. Add $178,139 in new capital, if you must. While the OPA and OPVFD work to replace the discredited MoU in coming months, consideration needs to be given for an alternative to the OPA paying its share of OPVFD capital expenditures from the OPA operating fund. The operating fund is for operations, not capital expenditures, and what’s true for the OPA internally should also be true for the OPA’s contribution to OPVFD’s capital expenditures. Moroney in his attempts to explain the $166,000 “adjustment” seemed to suggest that the OPA had “restored” the mysterious, secret custodial account, but other sources say this didn’t happen. Hill says to the best of his knowledge that secret reserve was zeroed out last year, but he’s not certain. In Ocean Pines LaLa land, anything is possible. -- Tom Stauss

OPINION

June 2018 Ocean Pines PROGRESS

Proposed ethics/conduct policy a solution in search of a problem

Horn sincerely seems to believe that her working group’s solution will deter future boards from trying to remove members for frivolous or even superficially justifiable reasons, but it’s just as likely that it will invite the very thing it’s designed to An excursion through the curious cul-de-sacs An excursion through theby-ways curious and by-ways and cul-de-sacs deter. of Worcester County’s County’s most densely community. of Worcester mostpopulated densely populated community. The proposed resolution sets up By TOM STAUSS/ By TOM Publisher STAUSS/Publisher a supposedly independent ethics committee to consider ethics/conduct complaints from directors, with legal counsel to be made available, dic’s trauma, not hers, as she was at some point in time. A formal process is precisely but it’s not that difficult to imagine not a director at the time. He thinks what she’s come up with is rife with what Horn’s ethics/conduct policy complaints coming from rank and file members of the OPA as well. overkill and would have resulted in establishes. These in fact might gain traction, Trendic today thinks that a simhis removal had it been in place a proving the adage that one needs ple ethics policy, not an attempt to year ago. to be careful what one wishes for We’ll never know, but it’s certain- micromanage conduct as though dibecause the law of unintended conly possible. Last year, Trendic sur- rectors are a bunch of unruly third sequences often rules over what’s vived a determined effort to remove graders, will suffice, with the bylaws printed on paper. him by three directors, saved only governing those situations which Horn herself might be the subbecause Doug Parks, currently the rise to the level that a board memject of a complaint and suffer the OPA president but then an appoint- ber’s fitness for office is at issue. indignity of being hauled through a ed, unelected board member, didn’t Whatever perceived defects are process that, even if she survives it, show up for the meeting in which a embedded in current procedures, will be a distraction and the source removal vote was scheduled. efforts to remove Trendic and Hill of annoyance. Not exactly a profile in courage failed to gain a support of a board

LIFE IN THE LIFE INPINES THE PINES

Hill law suit From Page 1 his candidacy if his assessments were paid prior to June 1. Hill said that Horn has ignored the fact that he paid his assessment before June 1, the date assessments are considered past due and subject to interest charges. “If there is conflict or ambiguity in the bylaws, then I would argue that the bylaws should be applied in favor of inclusiveness,” said Hill, who is acting as his own attorney in the case. “We’ll find out if the court agrees.” In his suit against Horn and the directors, Hill argues that Horn applied went beyond a strict application of the bylaws by allowing the candidacies of Greg Turner and Mark Mitchell. He told the Progress that what he regards as a “double standard” in his treatment by Horn, in contrast to Turner and Mitchell, is proof of a “personal animus” towards Hill. Horn has denied that she has anything against Hill personally but simply didn’t follow the rules. In the case of Turner, Hill submitted documentation that seemed

on Parks’s part, but his absence was, indirectly, a vote to retain Trendic. Had a more formal process been in place, it’s difficult to see Parks being able to dodge a very public decision

majority last year, just as they did several years prior when a former general manager and certain directors conspired to have Marty Clarke removed from the board.

Let’s posit for a moment the possibility that Brett Hill wins his case against the OPA and the OPA is forced to include him on the ballot,

to suggest that Turner might not be eligible to run because the deed for life for the home he lives in is, according to a document on file in the courthouse in Snow Hill, is in the name of his late parents. However, the Progress has learned that, whatever may or may not be on file in Snow Hill, ownership of Turner’s home passed to him when his parents died more than ten years ago. Hill also told the Progress that the application submitted by Mitchell, one of the candidates who subsequently withdrew, shows evidence that it was improperly filled out and then completed past the May 10 filing deadline by someone Hill said thinks probably was Horn. Hill has filed a writ of mandamus asking the Worcester County Circuit Court to order his inclusion on the ballot and to issue a preliminary injunction ordering a stop to the current election proceedings. His suit for breach of fiduciary duty by Horn calls for $50,000 in punitive damages, to be paid into the OPA’s operating fund. Hill told the Progress if Horn and the board members as defendants decide to battle it out in court, rath-

er than to capitulate and certify him as a candidate, his next step will be to file for a permanent injunction to stop the election until the latter is resolved in court. Trendic, the Elections Committee secretary, has been trying to arrange a special meeting of the board to discuss the situation with the association’s attorney. Triggering his desire for a special meeting is the fact that the board itself is a named defendant in the case, in addition to Horn individually. Prior to being named a defendant, Trendic said his position was to advocate for a strict “hands-off” policy by the board with respect to the eligibility issue raised by Hill. Initially concluding that this was a matter for the board secretary, Horn, to deal with exclusively, Trendic said his thinking has changed given the new circumstances. As of June 8, however, Trendic said none of his colleagues had indicated interest in calling for a special meeting. Two directors are needed for that to happen. The Progress has learned that the OPA’s insurance carrier has been notified of the lawsuit and that Hill sent a copy of his 60-plus page filing

to Jeremy Tucker, the OPA’s attorney from the Lerch Early law firm. It remains to be seen whether Tucker will be handling the litigation for the OPA or whether in-house attorneys or attorneys hired by the insurance company will take the lead. In related election matters, the Ocean Pines Elections Committee in a meeting June 8 announced the seven candidates as of that date, certifying that Mitchell and Scott Wagner had withdrawn their candidacies, leaving seven on the ballot. Those seven, who drew for position on the ballot June 8, are Steve Tuttle, Frank Daly, Turner, Paula Gray, Esther Diller, Ted Moroney and Arie Klapholz. The committee also voted to change the date of the first candidates’ forum from June 20 to June 27, from 7 to 9 p.m. at the Yacht Club’s second floor ballroom, because one of the candidates, Diller, is out of the country and is unavailable to attend or to submit a video clip for inclusion if the date remained June 20. She will be able to submit a video clip for the June 27 meeting, according to committee chair Steve Habeger, but will be unable to attend the forum in person.

irector Colette Horn and her intrepid group of working group volunteers have toiled many, many hours in trying to come up with a new Board of Directors ethics/conduct policy, and in so doing have come up with a solution in search of a problem. The proposed solution might very well cause problems its architects don’t foresee. Somehow Ocean Pines survived without such a policy for its first 50 years, with the Ocean Pines Association by-laws governing the process by which the directors can vote to remove one of their colleagues. There are also rules on the books governing conflicts of interest. It’s hard to know precisely what drove Horn early in the term to propose such a policy; perhaps it was residual trauma over the various attempts last year to remove Slobodan Trendic and, to a lesser extent, Brett Hill from the board. If that’s what it was, it was Tren-

46 Ocean Pines PROGRESS

OPINION

June 2018

Life in the Pines From Page 45 costing the OPA five figures in legal fees in the process. Let’s posit further for the sake of argument that he decides that Horn, as the OPA secretary in charge of candidate certification, acted with personal animus and political calculation in deciding that Hill had not met eligibility requirements to run for the board, even after Hill paid his lot assessments prior to June 1, the date that the secretary must submit a candidate slate to the Elections Committee. Then let’s posit that Hill decides that Horn’s handling of the situation was abysmal, that she handled the issue in the worst way possible, that it resulted in unnecessary legal expense, especially given the degree of discretion inherent in the bylaws. And then just to add more spice to the mix, let’s assume that Hill defies the odds and actually wins punitve damages from the court in the amount of $50,000, causing a sharp uptick in insurance premiums. From all that, would it a leap of logic to posit that he would then decide to file a complaint against Horn with the Ethics Committee for these alleged misdeeds? It would not. Indeed, it would be surprising if Hill listened to his better angels, turned the other cheek, and just let the whole thing fade away.

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Of course Horn will be able to defend herself, and it’s not too difficult to see her making a case that she relied in good faith on legal advice (if in fact she did), and that her’s was a defensible interpretation of the bylaws, even if proven incorrect by a court ruling. Fair enough. But by setting up an ethics/conduct process, without which Hill wouldn’t have much opportunity for a redress of grievances other than a lawsuit, the board may very be creating a situation which comes back to bite with a vengeance. Another example: Let’s posit that an irate property owner, incensed by the over-hyped projected $1.6 million deficit for 2017-18 used to justify an assessment increase in 201819, decides that OPA Treasurer/ director Pat Supik has done a really horrible job in the job of chief financial officer of the OPA. After all, she only missed the projection by $400,000, and that assumes that a $285,000 adjustment to the fire/EMS budget backdated to last year (though a check for that amount apparently was written in May, in 2018-19), is warranted. Let’s posit for argument’s sake that an OPA member believes with all his moral fiber that backdating the books was done simply to inflate the deficit for last year, making it possible for one faction of Ocean Pines property owners to more credibly blame Hill for last year’s inflated red ink. Let’s posit this OPA member believes the OPA treasurer was fully complicit in the way this issue was

settled, even though she seems not to have been directly involved in the heavy behind-the-scenes lifting because the details were more than she could handle. Let’s further posit that this same OPA member, in high dungeon, believes that current director Ted Moroney, as much a cheerleader for $1.6 million deficits or higher during the 2018-19 budget process as Supik, and the director most intimately involved in the backdating of OPVFD expenses to 2017-18, also has performed abysmally in his role, no matter how well-intentioned he was in trying to solve a thorny issue. Of course someone of Moroney’s mental acuity is going to be able to defend himself against such a complaint, and in the end may very well prevail. But the point here is that if the board sets up an ethics committee to handle complaints against directors, it can’t very well decide that it’s a process reserved for directors only. How elitist would that be? If complaints from OPA members are allowed, and they should be, then it’s not at all difficult to imagine in factionalized Ocean Pines that complaints, some tinged with political motives, will be forwarded to the ethics committee for consideration. Directors, already burdened by unpaid hours of volunteer work, often painfully boring, could be forced to defend themselves in a process that they themselves created, hoisted on their own petards. Some possibly talented people who might be willing to serve as

directors will flea like scalded dogs from the prospect, knowing they might have to defend themselves on dubious ethics complaints. Horn’s proposed ethics/conduct committee would only be able to recommend remedial action, with final decisions reserved for the board of directors, but with the director or directors subject to the complaint excluded from participating in the vote. This provision conflicts with the bylaws, incidentally, which appear to allow the full seven-member board to render a judgment whenever a director’s removal is at issue. At the very least, this conflict needs to be resolved before Horn’s enabling resolution is passed on second reading. Moreover, it would not be too difficult to imagine a scenario in which multiple directors are targeted for an ethics/conduct complaint, with those directors unable to cast a vote on their continued presence on the board. Let’s posit that Supik and Moroney are targeted together, since some of their behaviors overlap. This ethics committee proposal invites even further political divisiveness in Ocean Pines, in a year when the current board, despite occasional differences among directors, has managed its affairs with civility. The directors should think twice, and then again, before passing this proposal on second reading. Sometimes less is more. Trendic’s less intrusive, less bureaucratic solution is the better one.

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