Budget meeting January 24, 2018 6 pm – 9 pm
BOD President Ann Simpson began the 1/24/18 Budget Meeting at 6 pm with the Pledge of Allegiance, and an announcement that Fred Whiting would not be continuing as BOD Secretary and asked for a volunteer to serve as BOD Secretary in his stead.
County Commissioner Tom Mark spoke to property owners about the state response to the effects of the recent winter storms upon local roads, and the promise from the governor that trucks will be sent from surrounding, unaffected areas to assist with future storms. We were one of many dealing with icy roads. He also stressed that the county was in excellent financial shape, and discussed some road expansions planned for the near future.
Ann then announced that, in the interest of transparency, the BOD had voted to make one BOD meeting per month open to property owners who wanted to observe a board meeting. Notice to this effect will be posted.
Treasurer Rich Miller gave an overview of the 2018 budget announcing that by November 2017 the POA was debt free on its line of credit. He told us the BOD was “leaning toward” removing the old clubhouse (at a cost of $60k), but later, Ann confirmed, in response to a question, that the status of the clubhouse would be determined only after a land use study was completed.
Rich Miller also confirmed that the non-dues monies derived from the HP golf course and the three marinas are presently sufficient to pay down the debt to Harbour Partners, and are projected to be more than sufficient in future years. He continued by saying that bad debt was down from previous years, that the 120 lots sold this year garnered additional dues. In general, he said, income was higher than expenses.
Director Dan Engelhaupt announced the formation of a DOR Enforcement Committee, and asked for volunteers to serve. Members would familiarize themselves with the various sets of DORs, encourage compliance from property owners throughout the community, and set fines for those who resist compliance.
Director Bill Beery announced that he had volunteered to search for a land use planner, and that he had discovered that these professionals fell into two categories: a governmental-type planner who dictated, and the developer, neither of which he believed suited our unique needs. He has yet to receive bids, and doesn’t know, at this point, what services or advice our budgeted amount will buy. He is searching for someone who has the skills and is willing to do what we want for what we are willing to pay. He expects to hire in 2018, and to report to the community in late spring.
Director Beery announced the formation of a Multifunctional Clubhouse Work Group and is seeking volunteers for this committee.
Director Wayne Strausbaugh showed before and after slides of bulkheads previously in need of repair, and after repair. He was happy to announce that, overall, the wood involved was in excellent condition, and that the tie rods were the problem, having reacted to the chemicals in the treated wood. The new tie rods are protected, and stainless steel bolts have replaced the galvanized nails used previously. He stated that repairs and replacement has cost significantly less than expected. Replacing the tie rods will take from two to three years. The Birdland Marina cost $23k to repair, and has a 20 year life expectancy with no maintenance necessary.
Director Jim Cline explained that the new, electronic version of the Beacon was created with the Billy Casper software, and that the decision to go digital was not the BOD’s. The Sun Journal ceased printing the hard copy and offered the present arrangement, instead. Every 4th Wednesday, the Sun Journal will contain a printed version of the part of the Beacon suitable for non-property owners, and will be delivered, at no cost, to property owners. This section of the Beacon is also excellent publicity for Fairfield Harbour. The private, property owner version will be accessible in the online, searchable version at fh-poa.com. He reminded us that the screen can be enlarged by clicking on the broken square icon at the page bottom. Dan Argentieri, Club Professional, told us that the online Beacon readership was 1900, more than half of the community, and that if one wanted a hard copy of the online pages, a property owner could get that section printed, for approximately $5.
Dan told the attendees that HP had been renting a shredder/chipper for $8k per year. The shredder/chipper purchased this year, would pay for itself in five years, and had a life span of much longer than the 12 year expectancy of one used constantly by the company who removes trees, professionally.
He also explained that the proposed expansion of the present pro shop and replacement kitchen would provide the “gathering place” property owners had wanted, as well as a dining facility for local affairs and local and outside golf tournaments, which would bring added revenue. The area to the right of the building would be expanded and accommodate seating for 100 people. The kitchen would be extended on to the rear porch, within the present roof line, and the present desk would be moved to the left of the door. He expected the work to begin in March or by 1 April, and to be finished by 1 June. He praised the talents of Michele Kolb, who has reduced the expenses and increased the profits of the facility.
Following the presentations, Ann opened the floor to questions from the property owners in attendance.
A question was posed about a significant financial offer from a property owner towards the renovation of the present clubhouse, with matching funds from the community. There was some disagreement between the questioner and BOD President Ann Simpson about the amount proffered, and the conditions stipulated. Ann Simpson stated that though the BOD deeply appreciated the property owner’s generous offer, ultimately, the BOD turned the offer down because it did not appear to them to be in the best interest of the community.
A property owner then asked that the BOD use the regularly posted FH Property Owner’s Update to keep the community more closely informed of projects and accomplishments. Ann responded that the property manager, Jennifer Gudaitis, will be issuing a regular Manager’s Update to answer this need.
The next questioner asked what key items/task items were in the RFP (as in Request For Proposal) seeking the land use planner. Director Beery explained that we did not want detailed engineering studies, which would cost too much money. He was seeking a planner to offer some priorities, some budgeting advice, and advice about the highest, best use of the land.
A question was raised about the proposed playground and its impact upon our insurance rates. President Simpson explained that they didn’t know that, that they hadn’t gotten to that point, but that there was “a ton of regulations.”
Another property owner suggested the playground monies be directed, instead, towards a soccer field or a baseball field, for broader use than a playground which had minimum age-related use. She was encouraged to pursue that idea with the BOD.
A playground questioner asked when the date for a land use study could be expected, and stated that their proposal included facilities for all ages and community activities. Was a playground committee going to be set up? Had the BOD received a copy of the notes taken at the recent meeting the playground proponents had? President Simpson replied, no, but invited the speaker to bring a copy of the notes to the BOD.
A property owner asked what did people want in a Multi-Use facility? (Flexible space for meetings and gatherings, and possible physical fitness facilities) What else did property owners want? (open trails, fitness center, boat ramp)
A questioner asked why no quarterly financials had been published. Treasurer Miller explained that the BOD was now doing semi-annual financials, to save money.
The next questioner expressed some concern that, to her, the numbers presented in the proposed budget didn’t support the amount of dues being charged because the budget includes non-cash expenses, like “loss on sale” and “depreciation” but don’t include the cash outlay for principal payments on debt. Mr. Miller’s response was that Billy Casper Golf “has all the numbers they need to put into BCG’s budget system, that their system is different from the one we have used until now.” The questioner had some concern that we were “underfunding the reserves,” that we haven’t been updating the reserve study. Ann Simpson responded that a study had been done in 2015. Apparently, this was not available on the POA website. A search for the document will be made.
Essentially, the exchange that ensued was a difference of opinion about whether or not existing reserve funds could be expended on the various projects planned, and whether we needed to increase reserves to maintain the HOA required percentage because we now have acquired the 385 acres, and the amenities.
Should we increase the reserve fund, or do we have much more in reserve than required, and, if so, why not spend some on the much needed improvements?
A property owner suggested that, while the clubhouse is still standing .. as an eyesore … as a question mark … as a black mark … the BOD should erect an EIGHT by FOUR (plywood panel size) to announce “site of future FH Activity/Community Building” ….to promote a more positive image and improve community morale.
A property owner suggested that a running list of projects planned, in process, and completed be maintained so that nothing is lost with the change of personnel on the BOD. He was under the impression that a lighting project had been abandoned when, in fact, it had proved to be more complicated than expected and is still in the process of being resolved.
Another property owner praised the proposal for a monthly “open” board meeting as “a good step in the right direction,” but stressed that the community also needed general communication from someone to ALL the community to avoid rumor and miscommunication, citing the problems that occur when information is passed from one person to another.
A property owner rose to announce that the 2016 audit had been erroneously filed in the 2017 folder. He also questioned why the reserve fund donations weren’t level from year to year.
A property owner wanted to know whether the playground and basketball courts at the rec center were accessible to residents of the community. They are, upon payment of a modest annual dues. So, a playground, etc. within the Harbour proper wouldn’t be redundant, she was told.
Another property owner asked what the duties/responsibilities of Security
personnel were in matters of medical emergency. They are listed in our brochure as “First Responders” but, actually are limited in the assistance they can legally provide. They are familiar with AED (defibrillator), and are trained in first aid, but are permitted to do little else. They are not EMTs and may not respond to a 911 call.
A property owner rose to, again, stress that more transparency and communication with the community was needed.
Another person was in full support of the pro shop expansion and upgrade, but was concerned about our utilizing the reserves to replace things we currently have. Reserve studies done in 2013 and 2015 could not possibly have been intended for property acquired in 2017.
Finally, a rather new property owner who has had experience in land use planning was of the opinion that the budgeted $17.5k wasn’t enough. Director Beery repeated that he hadn’t gotten bids yet, but when he did the BOD would consider every aspect. The property owner told us that the reserve study should come after the land use planner had completed a plan.
President Ann Simpson adjourned the meeting at 9 pm. Your FACTS Reporter
Please note the following links for more information about HOA Reserve Funds
http://blog.hignell.com/hoa-management/bid/326736/How-an-HOA-Board-
Should-Use-the-Reserve-Fund-vs-Operating-Fund
http://blog.hignell.com/hoa-management/bid/397830/6-Questions-HOA-Board-
Members-Ask-About-Operating-Reserve-Budgets
http://blog.hignell.com/hoa-management/what-is-a-reserve-study-and-why- should-an-hoa-board-care