ocean pines progress march 2015

March - Early April 2015 Vol. 10, No. 12

THE OCEAN PINES JOURNAL OF NEWS & COMMENTARY

410-641-6029www.issuu.com/oceanpinesprogress

COVER STORY

To Page 2

Thompson projects modest loss for year

County faces budgetwoes, freezes hiring

www.OceanPinesToday.com

Facing another challenging bud-get year resulting from a continued decline in projected property tax revenues, the Worcester County Commissioners have enacted an im-mediate hiring freeze for non-public safety personnel.

OPA General Manager Bob T“County revenues are anticipat-ed to dip from $178 million in the current fiscal year to $167 million in FY16 unless significant budget sta-bilization funds are utilized,” Com-missioner President Jim Bunting said.

~ Page 28

Ocean Pines Association General Manager Bob Thompson is project-ing a relatively modest $24,493 loss for 2014-15, in a quarterly forecast delivered nine months into the fis-cal year. Issued as part of his Feb. 24 general manager’s report, the re-vised projection contrasts with the $157,748 loss in the half-year fore-cast issued last Nov. 22.

Even with the relatively modest loss for the year, however, Thompson predicts that the OPA will miss its budgeted $198,301 surplus for the year by a substantial $222,793.

~ Page 21

General Manager Bob Thompson recently said the board of directors had failed to do its due diligence and to properly vet Landscapes Unlimited before agreeing to ne-gotiate a management contract for the Ocean Pines Association’s golf course with the company.

Several directors were not pleased with Thompson’s challenge to the way they handled the golf course management issue.

The topic apparently was raised in a closed session of the board March 12, with no reported out-come as it was a personnel matter.

~ Page 7

Thompson questions board golf action

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OPA Board increases lot assessment by $12Base levy raised to $921 from current $909; Renaud

splits off from erstwhile allies to support Terry’s Plan BBy TOM STAUSSPublisher

Ocean Pines Association property owners will be paying $12 more per lot in annual assessment in the fiscal year beginning May 1 as a result of a board vote approving a

2015-16 budget in a special meeting March 12.The base lot assessment will be $221, an increase from the

$909 levy in the current fiscal year. Amenity fees for the most part are remaining the same this summer.

The budget and lot assessment increase were approved in a 4-3 vote, with Director Pat Renaud joining Tom Terry, Sharyn O’Hare and Bill Cordwell in the majority. OPA Treasurer Jack Collins floated an alternative that would have left the assessment at $909, with the apparent backing of OPA President Dave Stevens and possibly Marty Clarke, who had offered an alternative in late January that would have reduced the assessment to $866.09.

The $12 increase is roughly half of the $25 increase proposed by OPA General Manager Bob Thompson in January.

Renaud’s support of an assessment increase and partnership with Terry in forging what they called a budget compromise represented a fraying of the majority bloc that seemed to have emerged following the board election last August. The Stevens-Collins-Clarke-Renaud bloc stayed together in the recent 4-3 vote selecting a new management company to run the Ocean Pines golf course.

In that instance, efforts by Terry and others to peel Renaud off in support of keeping Billy Casper Golf as the golf course management company failed to dislodge him.

But on next year’s budget, Renaud felt comfortable in working with Terry to the exclusion of his erstwhile allies. At one point during discussion, Renaud joked that Collins was resorting to his Tea Party origins in supporting a budget with no increase in assessments. An irritated Collins said he

resented the remark, but later he suggested that it hadn’t bothered him all that much.

The issue that seemed to divide the board as they grappled with a final vote on the budget involved the status of the five-year-plan revenue stream that had not been addressed to any great extent in previous board discussions. This funding stream represents $130 of the annual assessment, or $1.1 million in revenue to the OPA, originally conceived as a supplemental source of funds for major capital projects. It’s been earmarked as the primary funding source for the new Yacht Club that opened in May of last year.

Through the current fiscal year, the sixth year this funding plan has been in place, it has raised $4.3 million from OPA property owners, precisely the amount approved by property owners for the new building in the summer of 2012. It apparently has been used for capital projects other than the new Yacht Club, however.

Under the approved budget, only $923,760 has been earmarked of this $1.1 million for the capital assets replacement reserve, which is called the Major Maintenance and Replacement Reserve in monthly summaries prepared by OPA controller Art Carmine. The remaining $175,000 of the $1.1 million will be used to pay for a like amount in new capital expenditures not included in the general manager’s draft budget released in January.

Even so, when added to the $4.3 million already collected in five-year-plan funds, next year’s $923,760 allocation will raise the total collected in new Yacht Club funds to more than $5.2 million. That’s more than enough to pay for the new Yacht Club had the five-year-plan funding stream been used over its life strictly for the new Yacht Club.

Because the five-year-plan funding stream will be in its

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seventh year in 2015-16, an awkward if not impossible-to-explain situation, the new budget calls it something else – the legacy reserve. Its partner in the capital assets replacement reserve is called the historical fi nding reserve, which is where funded depreciation of all association assets, big and smaller, is parked.

None of the seven directors supported eliminating all of this funding stream, whatever it’s called, and the “legacy” reserve name in the end may not stick. Clarke came the closest to putting a stake in the fi ve-year funding stream. His alternative plan would have reallocated most of it for other purposes, such as funding roads depreciation in the amount of $314,068 and adding $350,000 to the golf drainage reserve.

Stevens would have kept more of the fi ve-year-plan funding than Clarke would have, trimming it back by the amount needed to keep the assessment at $909, the level that Collins also advocated. But the OPA president in the end didn’t have the votes for that, with Renaud fi rmly in favor of what was called Plan B, which he and Terry had worked out in private but which its critics said was mostly the handiwork of Terry.

The $12 increase in the assessment actually began as a $6 increase at the start of the meeting, but the directors decided that a previously accepted projected for losses in golf operations -- $50,000 – was not realistic. So they informally agreed to up that projected loss to $100,000 instead, action that added another $6 to the lot assessment.

The Plan B approved by the 4-3 vote, on a motion by Terry, suggests that the former OPA president who was succeeded by Stevens last August remains a director who can forge board majorities if he can bring Renaud or Stevens on board with what he’s advocating.

Directors Sharyn O’Hare and Bill Cordwell were dead set against any erosion in the fi ve-year-plan funding stream, so Terry had two fi rm votes in his corner for whatever version of the budget he advocated.

That’s a dynamic that has been readily apparent on the board in recent months.

Terry, too, was adamant that the fi ve-year-plan funding stream should remain, more or less in its existing form, and he managed to persuade Renaud to that point of view, even though Renaud, in a subsequent conversation with the Progress, said in his view much of that funding stream has been reallocated.

It really hasn’t. It’s simply been

renamed. Under Terry’s Plan B, the $923,760 in fi ve-year-plan funding will be used to pay down what he alleges is the Yacht Club funding defi cit, which, he said, technically had been paid for out of historic reserves, or funded depreciation.

That might actually not be the case. The historical reserve, or funded depreciation, will have a projected balance of $5.2 million as of April 30, and as far as the Progress has been able to determine, never has been used as the funding source for the Yacht Club, despite Terry’s assertion. Even Terry has acknowledged that there was no formal board action to borrow the funds from the historic reserve to pay for the new Yacht Club.

The actual funding source to pay Yacht Club invoices to date probably is unallocated operating funds that don’t appear in the reserve accounting. No association offi cial has ever been able to explain the matter with any coherence.

Whatever the source of Yacht Club funding, there is no doubt that the capital assets replacement reserve accounts for it by showing the “legacy” portion of the reserve as a defi cit, projected to be a bit more than $2 million at the end of the current fi scal year.

By allocating $923,760 in new “fi ve-year-plan” or legacy funding to this reserve, the balance in this column will drop to $1.1 million at end of 2015-16 under the Terry-Renaud Plan B.

The remaining $175,000 of the fi ve-year-plan funding revenue will be used for fi ve new capital projects that General Manager Bob Thompson did not include in his original draft budget. These projects were added as the result of subsequent board discussion.

The added projects are $50,000 for a reserve study, which is supposed to shed light on how much the OPA should have parked in its various reserves; $45,000 in new money for the Manklin Meadows racquet complex; $20,000 for new pool covers; $40,000 for a new electronic signage; and $20,000 in a new big screen tv, fi re pit and outdoor fans for the Yacht Club.

Also in the Terry plan, the board effectively lowered Thompson’s proposed payroll number by $150,000, without actually identifying how it was to be done. Thompson and his staff are supposed to be conducting a review on how it might be accomplished.

Three reserve accounts that have been carrying negative balances for some time will be zeroed out under the approved Plan B budget by using “historic” dollars (funded depreciation) – future projects, roads, and golf drainage – in the amount of roughly $780,000.

The future projects reserve will remain in place to help fund future major projects to be determined by a new capital improvement plan under development.

The approved Plan B anticipated that the legacy or fi ve-year-funding column will remain until such time as the Yacht Club is zeroed out.

To date, Terry has not acknowledged that the fi ve-year-plan has collected $4.3 million through the current fi scal year and will have collected more than $5 million by the end of next year.

Also as part of Terry’s Plan B, the board reallocated $675,000 in fi ve-year-plan revenues to the historical reserve, for reasons that were not immediately clear.

“I can’t explain,” Stevens told the Progress in a late night phone call. “I don’t think it’s correct.”

Terry returned a call and explained what he intended to accomplish.

He was simply changing the funding source for two items in the approved capital budget for next year -- $500,000 for a police headquaters addition and $175,000 in bridge funding.

In the draft budget, the funding source was the so-called fi ve-year funding plan.

In the approved budget, the funding was changed to the historic reserve (funded depreciation).

With the 4-3 vote in favor of Plan B, Thompson and OPA Controller were scrambling to put together a fi nal budget document refl ecting all of the changes as the Progress was going to press.

Assessment increaseFrom Page One

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Collins says OPA boardwon’t manage relations

with new golf contractorThompson will have lead role in handling relations with

Landscapes Unlimited, but directors will expect more frequent reports than occurred under Billy Casper Golf

By TOM STAUSSPublisher

Contrary to some reporting and opinion expressed in the local media, the Ocean Pines Association’s general manager will continue to have an important role in day-to-day oversight and relations with Landscapes Unlimited, the company

that will be taking over management of the course May 1.OPA Director Jack Collins, who is the informal head of the board team that is

working out details of a new contract with the Lincoln, Neb., and Annapolis-based management firm, said there appears to be some misunderstanding in the local media about the board and General Manager Bob Thompson’s role in managing the relationship with LU once the take-over takes place.

One opinion piece even suggested that Thompson’s role has been eliminated in favor of the board.

“That is incorrect,” Collins told the Progress in an March 11 telephone interview. “Bob will still be the OPA contact person responsible for interacting with Landscapes.” He said he wondered where that misinformation came from but said he wanted to dispell it before too many people accepted it as true.

Collins also said the notion that a board majority had a predispotion to terminate Billy Casper Golf ’s contract well before a decision was made to negotiate with LU also was untrue.

To Page 5

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“We (the four directors who voted to select LU) had an open mind throughout the process,” Collins said.

What drove the majority to select LU was the company’s business plan, he said, particularly its emphasis on the need to increase the number of annual memberships from among Ocean Pines property owners.

Collins said that even an increase from the current 150 memberships to 200 would mean that the “core revenue” needed to help pay for golf course operating expenses would increase

From Page 6

Thompson roleaccordingly.

Collins said most of the directors concluded that BCG in its business plan was emphasizing the need to increase outside play revenues over rebulding membership revenues

“What struck us about the LU plan was how they saw the need to do both, in roughly equal percentages,” Collins said.

Another noteworthy feature of the LU proposal is that the company lowered its original monthly management fee by $2500, to come in at $6500.

That made its proposal competitive financially with that of BCG, Collins said.

Contract negotiations with LU were progressing in mid-March.

Landscapes Unlimited vows effort to recapture members

lost to other area golf coursesPlans to rebuild membership base sways board majority, who hope

Nebraska-based company can deliver to make Ocean Pines golf course a welcoming place for new members and non-members alike


With some of the golf member-ship expressing a preference for retaining Billy Casper Golf

as the Ocean Pines Association’s golf course manager and General Manager Bob Thompson making no secret of his support for Casper, the OPA Board of Directors nonetheless are embarking on a new direction for Ocean Pines with a decision to change golf course manage-ment companies.

Billy Casper Golf is under contract to continue to manage the course through the end of the current fiscal year, April 30.

In a closed session Feb. 20, the board voted to enter into contract negotiations with Landscapes Unlimited, of Lincoln, Neb., and Annapolis, for a three-year

contract to manage the Ocean Pines golf course beginning May 1.

The annual management fee is ex-pected to be in the neighborhood of $70,000, about the same as the OPA has been paying Casper.

The vote was 4-3, with OPA Presi-dent Dave Stevens and directors Marty Clarke, Jack Collins and Pat Renaud all voting for LU.

In favor of retaining Casper were Tom Terry, Sharyn O’Hare and Bill Cordwell. Clarke, who had supported a competing proposal by a local partnership, com-prised of Bob Haley and Mike Marshall, a former golf course owner and hotel/restaurant operator, respectively, in the end voted for LU.

Clarke had a strong desire to try a different approach to managing the golf

course.Clarke has been a skeptic of BCG and

Thompson’s predictions of a dramatical-ly reduced operating deficit in golf in the current fiscal year and BCG’s projected $14,000 loss in 2015-16.

Clarke and his three colleagues in the majority determined that BCG was not likely to make its $73,300 budget for the year or even a revised target of about $89,000.

An earlier 4-3 vote to advise Casper of that determination by a board majori-ty presaged the outcome to change man-agement companies.

It also was a step, under the current three-year BCG contract, that allows the OPA to effectively terminate it, with-out financial penalty.

The election of Stevens and Renaud to the board last summer clearly made

a difference in the outcome. It changed the political make-up of the board in ways that haven’t always been as ap-parent as it was with this vote. It left Thompson reeling, telling a local media representative several days after that he expected to be fired for his strong ad-vocacy of Casper in recent months. No firing occurred in the immediate after-math of the vote, after which Stevens, Collins and Terry were named as the board’s representatives in negotiating a contract with LU. The agreement will be submitted to the entire board for ap-proval.

O’Hare and Cordwell were report-ed to be the directors most upset with the decision. Thompson also registered his dismay in subsequent remarks to the board in which he asserted that the board had not done “due diligence” be-fore selecting LU as the golf course man-ager.

Collins, the director who has been the informal head of a three-member team that led a protracted process of seeking out alternatives to BCG, said it was LU’s emphasis on rebuilding mem-bership that helped persuade a board majority to support its bid to manage the course. He also cited the company’s strong record in building and managing golf courses all over the country, includ-ing one called Renditions near Annapo-lis.

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Collins said it was the perception of most directors that BCG’s proposal for managing the course going forward emphasized the need for relying on non-member play as a way of reducing operating deficits at the course.

In contrast, LU regional vice-presi-dent Mark Mattingly, in a presentation to the golf membership in mid-Febru-ary, made it clear that while non-mem-ber play will continue to be important, his business plan for success clearly called for rebuilding the declining golf membership base. It currently stands at about 150 memberships in various categories, representing about 250 indi-viduals.

Mattingly, an engaging personality clearly comfortable on his feet, told the 30 or so golf members who attended pre-sentations by the three finalists for the golf management contract that a Robert Trent Jones golf course in a community with more than 8400 properties should have a much stronger membership base than it has.

He said that cultivating ties with the Ocean Pines community will be his com-pany’s highest priority and will be an easier path to success than attempting to compete on price with the 16 public

courses in the area.“I don’t think competing with 16

courses is sustainable or workable,” he said, nonetheless adding that LU will not be “turning away” outside play as a way of bringing in needed revenue.

Mattingly cited the advantages of managing a golf course in the middle of a community the size of Ocean Pines.

“The HOA won’t let the golf course fail, and the greens are in great shape, the best in the area,” he said. He cited the cachet of a Robert Trent Jones de-signed golf course, the presence of a new Yacht Club nearby, and other in-house investments in the course in recent years.

He said he wanted the Ocean Pines golf course to sponsor activities and pro-gramming across the generations – for youth and middle-agers as well as the older members who constitute the cur-rent membership base.

He pledged a “concerted effort” to connect with Ocean Pines residents who aren’t members to persuade them to join as members, or at least to play the course more often.

He said that members and residents can expect LU to continue efforts to keep the course in top condition. He said his company will strive to show appre-ciation for those who support the golf course and to offer the best service pos-

sible to them. He also said LU is committed to

working with the OPA. “You’re in charge,” he said. “We work

for you.”One objective will be to restore what

he called the right combination of resi-dent and non-resident play on the golf course.

From 2002 through 2009, he said that the two thirds of course revenue was de-rived from members and one third from non-members. But he said that percent-age has completely reversed in the cur-rent year, with 67 percent of the revenue attributable to daily greens fees paid by non-members.

“That makes the course a commodity” rather than an amenity based on mem-ber relationships, and one that “begins to compete on price and against 16 other courses,” he said.

If the course is “relationship-based,” Mattingly said that price will become a secondary consideration. He said the goal will be to balance member revenue and non-member revenue “50-50” – a formula that suggests he is well aware that returning to the former two-thirds, one-third percentage isn’t realistic.

Mattingly, in answer to a question, acknowledged a need for more revenue at the course but said that roughly 80 percent of what’s needed can be ob-

tained by “building relationships” with new members with the remainder com-ing from incremental increases in rates “keeping up with inflation.”

Later he said that if LU is unable to rebuild the membership basis, including recapturing former members who left for other courses in the area, then he wouldn’t expect to continue to manage the course.

But he expressed confidence in his company’s ability to connect with resi-dents, telling the members that in other communities where LU has been hired to manage golf courses, these efforts have paid off in membership increases. Direct marketing and what he called “proprietary” methods would be em-ployed, he said.

In response to another member ques-tion, he said LU would consider retain-ing current Ocean Pines golf pro John Malinowksi and golf course superinten-dent Rusty McLendon, who are both Casper employees, if either would be interested in staying on in Ocean Pines after the transfer of golf course manage-ment.

Mattingly acknowledged that there would be a “learning curve” as LU tran-sitions to management of the golf course. Keeping some continuity from former management would make the transition easier to accomplish, he said.

From Page 5Landscapes Unlimited

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Thompson questions board’s ‘due diligence’ on golf course decisionStevens, Clarke, Collins

push back against general manager

By ROTA L. KNOTTContributing Writer

General Manager Bob Thompson recently suggested that the board of directors had failed to do its

due diligence and to properly vet Land-

scapes Unlimited before agreeing to ne-gotiate a management contract for the Ocean Pines Association’s golf course with the company.

Thompson waited patiently for the duration of the board’s Feb. 28 meeting for his turn to speak.

When he finally got the chance to do so, he seized upon the opportunity to criticize directors for failing to complete an adequate review and background

check on the company. The board se-lected Landscapes Unlimited to replace Billy Casper Golf as the OPA’s course management team.

Thompson told directors at the start of the meeting that he had an issue re-lated to the golf management contract that he wanted to address.

After waiting through about an hour and a half of the meeting, he finally got his chance.

“I have a concern that I’ve sat on since last week and I just hope to pres-ent it because I think it’s appropriate to do, and I know… I’m not trying to be adversarial in any way at all, okay, but I do think I have a responsibility to ask the questions because I’m being asked the questions, and I don’t have the an-swers,” Thompson told directors.

The board met on Feb. 20 to review

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proposals to assume the golf manage-ment role of the Ocean Pines course. During that meeting it selected Land-scapes Unlimited and agreed to move forward with negotiating a contract.

Thompson argued that when the OPA selected Casper it took a different approach. He said that time the OPA in-terviewed a number of companies before selecting Casper.

“I bring that up to point out that once the board made the final decision and that was the direction we moved down, I got solidly behind it. Okay. I share that with the understanding of why I’m ask-ing these questions now,” he said. “I’m concerned that we’ve made some deci-sions to go in a different direction, and I think I have a responsibility to at least ask the board as a whole to clarify some

things for me.”He said he does not believe that any

background checks were performed on Landscapes Unlimited, and no one vis-ited any of the golf courses that the com-pany manages. While he acknowledged that’s the board’s decision, Thompson said failing to complete such checks means the new contractor has not un-dergone the same level of scrutiny that Casper did when that firm was hired by the OPA.

“I just need to understand how to an-swer that to our membership,” he said, adding, “and I’m struggling a little bit. We’re happy now with the performance, so much of the folks in place now, that we want to make sure Landscapes hires them, but we’re terminating the con-tract. I just don’t know how to answer those folks, and I need some input, some insight, some understanding…”

Thompson alleged that the board vot-ed on the new golf contract based on a lack of information. He said he doesn’t believe it was intentional on the board’s part but that if a mistake was made by failing to do a background check on the company, then it should be acknowl-edged.

“Because if we make a mistake now and we recognize it’s a mistake, it’s not making the mistake that matters, it’s what we actually do in light of making it,” he said.

He said he is concerned about the is-sue and is not sure how to respond when OPA members query him on the issue.

Further, he said the board opted to terminate the Casper contract because it didn’t like the company’s performance but wants to ensure that the new com-pany hires as many of the existing golf employees as possible.

“I don’t understand that. I don’t know how to answer that. When mem-bers are asking me, I just don’t know how to answer that,” he said.

Director Marty Clarke was the first to respond to Thompson, telling him that “I don’t think there has been any change in direction.”

Rather, he said every board member wants to see the golf bottom line perfor-mance and experience improve.

“That hasn’t changed. That’s the same.”

As far as hiring existing Casper em-ployees by Landscapes Unlimited, he said the board hasn’t encouraged that at all.

“It has not?” a surprised Director Sharyn O’Hare asked.

“I haven’t,” Clarke responded, say-ing, “We don’t work for Landscapes Un-limited.”

OPA President Dave Stevens said the new company has indicated that it is in-terested in retaining certain employees but not necessarily all of them.

In response to Thompson’s com-ments, Stevens said that he, along with Directors Tom Terry and Jack Collins, will be working with Landscapes Un-limited to craft a proposed contract for board approval.

Part of that discussion will relate to

From Page 7

Due diligence


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employees, he said.“We need to remember that when

Casper came here the first thing they did was sever the industrial – he meant to say institutional -- memory of the old golf course,” Clarke said.

That meant getting rid of all existing golf course employees.

Still, he said he “doesn’t have a prob-lem” if Landscapes Unlimited wants to retain some of the existing Casper em-ployees.

Stevens said the board did investi-gate Casper before signing a contract with the company, and he acknowledged that it received mixed reviews. The board was also mixed about hiring the company but at the time Casper was the “most reasonable given our circum-stances.”

This time, he said, it was not an over-sight that association representatives didn’t visit any Landscaping Unlimited managed golf courses.

“There are issues. No denying that,” he said. “But we’re not reopening the evaluation.”

Stevens said the board did talk about visiting some courses managed by Land-scapes Unlimited but not because the directors are continuing the evaluation phase. Rather, he said, “we wanted to know what their experiences were in the transition phase.”

Director Tom Terry, who participated in the meeting via conference call, said the new golf management company has the right to hire anybody it wants, in-cluding current Casper employees.

At the same time, the board has a right to suggest that the company keep on certain key employees who have done a good job, he said.

He also said that Ocean Pines isn’t in a position to say that Casper did a terri-ble job or that it wouldn’t hire them back in the future.

After listening to the director’s com-ments, Thompson piped up again saying that his concern isn’t related to the con-tractual matter.

He said his concern is the lack of re-search that went into the board decision to hire the new company.

“That’s a concern for me. And I’m not making light of it. I’m not hoping it was wrong. But I’m trying to go back and get my arms around it, reading every-thing because I’ve been asked to support the new team coming in. And as I read through it, it does not appear we did our due diligence in the same way that we did when we brought a different compa-ny in,” Thompson said.

He said he believes that it is import-ant to note that and ask about it. “And I’m not out of line asking it because I think it’s appropriate to understand that.”

Several directors made it clear that they believed he had crossed a line that should not have been crossed.

Stevens said Thompson was simply “challenging, questioning” a decision that’s already been made by the board.

From Page 8

Due diligence “And questioning my due diligence which I don’t take lightly,” Clarke add-ed.

Thompson said that’s not what he was doing.

“It’s my job if I find something … if I see something that’s a concern to me, who do I bring it up to? The board.”

He said he had spoken to two sepa-rate board members about his concerns, and they thought it was appropriate to bring it up to the entire board. He didn’t name the two directors he discussed the matter with.

“Bob, you’re not bringing it up to the board. You’re bringing it up publicly. You’re bringing it up in a public meeting in which the board has already made a

decision,” Stevens said.Director Jack Collins agreed, saying,

“That’s correct.”“That was not my intent,” Thompson

replied.Collins said, “Well, that’s what you

accomplished, whether it was your in-tent or not.”

Stevens said Thompson should have brought up his concerns about the new contract when the board was evaluating potential golf management companies at the meeting in which Landscapes Un-limited was selected.

While there has been some specu-lation circulating in Ocean Pines that Thompson might lose his job because of his public challenge, it would seem his job is safe. In a March 8 interview,

Stevens said Thompson’s comments were a “personnel matter” that would be addressed by the board with the gen-eral manager in closed session. That oc-curred March 12.

Stevens declined comment after the meeting, as expected.

In answer to a reporter’s question, he said the matter under discusson was a personnel matter.

For a transcript of Thompson’s discussion with the board alleging a failure to do due

diligence, see page 11.


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Transcript of Thompson remarksBob Thompson:I have a concern that I’ve sat on since

last week and I just hope to present it because I think it’s appropriate to do and I know… I’m not trying to be adver-sarial in any way at all, okay, but I do think I have a responsibility to ask the questions because I’m being asked the questions and I don’t have the answers.

Last Friday the board made a deci-sion to move in a different direction with golf. It’s important to note that last time they did it we interviewed a number of companies and one of the ones… the two finalists were Kemper and Casper. And my support was for Kemper at the time.

I bring that up to point out that once the board made the final decision and that was the direction we moved down, I got solidly behind it. Okay. I share that with the understanding of why I’m ask-ing these questions now.

I’m concerned that we’ve made some decisions to go in a different direction and I think I have a responsibility to at least ask the board as a whole to clarify some things for me.

First, my concern is decisions were made and I don’t believe we did any background checks with the final com-pany that we chose. And again that’s certainly the board’s decision but I think we need to know we didn’t do the same level of scrutiny that we did when we made the last selection of our golf folks. My big concern there is making these decisions without actually doing enough homework we’re not only impacting the longevity of our course but also our members who are paying the rates for those, and those who are currently working here and their families when we’re terminating an existing contract. A lot of big decisions with what hap-pened Friday.

So my question is as we’re going through it, and I’m trying to wrap my arms around it and be supportive of it… some things such as we terminated the Casper contract because we didn’t like their performance but the new contract we need to make sure that they hire… make every effort to hire the Casper team that’s in place, the employees. I don’t understand that. I don’t know how to answer that. When members are ask-ing me, I just don’t know how to answer that.

When the question came up of who we did a background check on. I’m get-ting the answer we didn’t do background or visit any of the Landscape Unlimited courses. Very different than what we’ve done in the past. I just need to under-stand how to answer that to our mem-bership.

And I’m struggling at little bit. We’re happy now with the performance so much of the folks in place now that we want to make sure Landscapes hires them but we’re terminating the con-tract. I just don’t know how to answer those folks and I need some input, some insight, some understanding cause…

Again the board obviously has a right to do whatever they want to and I’m gonna get behind it. Without clarity on that it’s a concern for me.

And I just think… and again I’m not trying to create an issue here but if a mistake was made, a vote was made with lack of information I don’t think there was anyone intentionally doing it. I think there was just an oversight. I think it’s important we make sure we understand that. Because if we make a mistake now and we recognize it’s a mis-take, it’s not making the mistake that matters, it’s what we actually do in light of making it.

Now that’s where I am with it. I’m not saying I’m above making mistakes. I do all the time. But it’s when I’m made aware of them, I try to correct them. And I think that’s kind of the measure of where we are and I’m a little concerned

here and I’m just not sure how to an-swer my membership and, quite frankly, how to understand this myself and I just need to ask because I need to represent the membership when I’m out talking to them and the board obviously when I’m trying to answer these questions.

And any clarity the board can give to me would be helpful.

Board discussion ensues.

Bob Thompson:And please understand Mr. Stevens

my question wasn’t contractual matters at all. The board… I understand the necessity to be cognizant of and how to negotiate a contract. I understand that.

And it’s not something you openly do. A hundred percent with you.

My bigger concern is we made a de-cision to move down a path … a differ-ent path with a different company. How much research went into that company before we made the decision? That’s a concern for me. And I’m not making light of it. I’m not hoping it was wrong. But I’m trying to go back and get my arms around it… reading everything be-cause I’ve been asked to support the new team coming in. And as I read through it, it does not appear we did our due dili-gence in the same way that we did when we brought a different company in. And I think it’s important to note that or ask about it. And I’m not out of line asking it because I think it’s appropriate to un-


q

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derstand that.

Dave Stevens: Basically you’re…there’s no other

way to break this down, Bob. You’re saying that, I mean, you’re challenging, questioning a decision that’s already been made by the board.

Marty Clarke:And questioning my due diligence

which I don’t take lightly.

Bob Thompson:Here’s what I’ll say. I’m not doing

that as I started . I knew it was going to feel adverse.

It’s my job if I find something … If I see something that’s a concern to me, who do I bring it up to? The board. I’ve spoken to two separate board members about this concern and they thought it was appropriate I bring it up to the en-tire board. So that’s what I’m doing.

Dave Stevens:Bob, you’re not bringing it up to the

board. You’re bringing it up publicly. You’re bringing it up in a public meeting in which the board has already made a decision.

Jack Collins:That’s correct.

Bob Thompson:That was not my intent.

Jack Collins:Well, that’s what you accomplished.

Whether it was you’re intent or not.

Dave Stevens:You were at the last meeting. And the

board voted … that was the first thing we did.. that was to continue with our team, Tom, myself and Jack, and to pursue this issue, okay, and to pursue an agreement with Landscapes. If you wanted to bring it up with anybody, you could have brought it up to us.

Stevens shuts down Thompson and moves on.

From Page 11

Transcript

Landscapes could hireCasper employees

When Landscapes Unlimited takes over management of the Ocean Pines golf course

on or about May 1, the break with Billy Casper Golf ’s four-year tenure in Ocean Pines might not be quite as “clean” as could be expected. That’s because key Casper personnel in Ocean Pines – golf pro John Malinowski and course super-intendent Rusty McLendon – may be asked to stay on.

It may come down to whether they want to or not. There’s been some specu-lation that both have put down roots in the area and may not want to relocate.

LU regional vice-president Mark Mattingly confirmed the possibility of hiring Malinowski and McLendon during a presentation to Ocean Pines golf members in mid-February. He said hiring them would be good for maintain-

ing continuity in golf course manage-ment.

OPA Director Marty Clarke recently observed that, when BCG came in four years ago to manage the course, person-nel with institutional knowledge were let go.

The possibility that there might be some carry-over personnel staying on seemed to be well received by most of the golf members who attended the pre-sentation. That group tended to support retaining BCG as the golf course man-agement company, crediting McLendon for having the course in excellent play-ing condition this past summer.

Doing something to keep existing members happy could be seen as a good public relations move, if nothing else.

So far, the Ocean Pines Association

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Racquet sports project still in budgetary purgatoryBy TOM STAUSSPublisher

Back in January, at the Board of Di-rectors Jan. 29 regular meeting, plans for redevelopment of the

Manklin Meadows Recreation Complex with additional racquet sports courts were again put on hold. The board opted to delay approval of the master plan un-til it could discuss funding for the proj-ect as part of the Ocean Pines Associa-tion’s fiscal year 2015-16 budget process.

That process has been ongoing throughout February and has pushed into March, with the board scheduled to vote on the 2015-16 budget at a special meeting March 12. OPA President Dave Stevens said earlier in the week that he doubted that the racquet sport complex would come up for discussion during that meeting. The earliest it could be discussed again would be at the board’s regular meeting in March, Stevens said. The date of that meeting is Saturday, March 28.

OPA General Manager Bob Thomp-son has been a strong advocate of the racquet sport complex at Manklin Mead-ows, but the board decision putting the issue on hold at the Jan. 29 meeting may have spooked him into not bringing it up again in February. His written gen-eral manager’s report at the board’s Feb. 22 regular monthly meeting was glaring in its omission of any mention at all of plans to revamp the Manklin Meadows complex. One of the plans most deter-mined advocates, Director Tom Terry, was not at the Feb. 22 meeting, although he was listening in via Thompson’s cell phone. It perhaps would not have been the most fortuitous time to urge board action given Terry’s absence.

At the Jan. 29 board meeting, Thomp-son had cost estimates for both build-out of the full master plan and a scaled back version that is essentially the first phase of the overall plan. Thompson es-timated construction of all of the ame-nities included in the full master plan at $339,550, while the alternative plan was about half of that cost.

Thompson developed the cost esti-mate based on the master plan design approved by the board last year to guide additions and changes to the recreation facilities at the Manklin Meadows Rec-reation Complex. The project includes the addition of two paddle ball courts now and two more in the future, relo-cation of the playground, realignment of the parking lots and the addition of eight pickle ball courts.

The overall master plan cost estimate includes $161,927 for building all eight proposed pickle ball courts, with site preparation and asphalt paving, fenc-ing, lighting, painting, nets and poles. That pricing also incorporates $32,000 for the playground relocation, which will actually be completed regardless of whether or not the rest of the Manklin Meadows project moves forward.

Portions of the playground struc-ture are deteriorating and need to be

replaced. The platform tennis portion of the master plan is estimated to cost $95,123, including site preparation, as-phalt and lighted courts. General proj-ect costs account for another $82,500 and cover site preparation, engineering and a five percent contingency.

With the cost estimates in hand, Thompson said he now needs board guidance as to whether or not to move forward with actually constructing the amenities included in that master plan.

Funding currently designated for or proposed to be set aside for the project totals $229,272 across two fiscal years.

The approved fiscal year 2014-15 budget includes $135,000 for four pickle ball courts and two platform tennis courts and $150,000 for ballfield lighting in Manklin Meadows.

The lighting project was completed at just $122,403 for a savings of $27,587 that could be put toward additional work, for a total available funding this year of $162,597. The proposed FY 16 budget includes $35,000 for four pick-leball courts and $31,675 for the play-ground equipment repairs for a total of $66,675.

Directors immediately started seek-

ing savings in the project and juggling numbers. They discussed whether light-ing at the courts is needed, and it’s still an open question. Directors said that the existing courts in Manklin Meadows are lit and that both pickle and paddle ball members play after dark year round if the weather permits.

Director Tom Terry pointed out that the $32,000 allocated for the playground should be removed from the project cost since that work will be completed even if the remainder of the project doesn’t move forward.

“That really is under the general


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has taken no official position requesting that LU hire on any specific BCG per-sonnel, but sources say it is unlikely that the OPA directors would oppose action by LU to maintain “institutional mem-ory” during the change in management. Hiring of BCG personnel is not prohibit-ed under non-compete provisions of the expiring BCG contract.

Because of prior notice of the possi-ble change in management company was provided to BCG in a timely fash-ion, the OPA should be exempt from any financial penalties resulted from early termination of the existing three-year contract.

From Page 12

Casper employees

Still no resolution to Mumford’s pool defects

Thompson might have proposal ready for

board consideration sometime in March


Structural problems with the Mum-ford’s Landing swimming pool may be so bad that the entire amenity

needs to be replaced, according to Gen-eral Manager Bob Thompson. He told the Ocean Pines Association Board of Directors during a Feb. 28 meeting that

he is still sifting through the plethora of recommendations he has received for re-pairing the cracked, leaking and slowly sinking pool.

Because the summer season is not that far away, it’s difficult to see how major repairs could be completed or a new pool built before then. No one wants to see the pool not open for the season. It’s possible that the OPA could decide to limp through another summer at the pool basically as is, with a solution to current conditions implemented this fall.

“We’re exploring every potential op-tion to redo that pool,” Thompson said in his general manager’s report. The options include everything from total replacement of the pool to installing a liner inside the pool to simply plastering the surface.

However, the decision on how to pro-ceed with repairing the pool structure itself depends largely on what approach the OPA takes to filling voids or air pock-ets in the ground under and around the amenity. The project started out as an effort to repair cracks, stop a leak and determine why the east side of the pool is sinking. In exploring those issues, en-gineers found a much more extensive problem that need to be addressed be-fore the repairs can be made.

Original core drillings at Mumford’s Landing pool revealed varying levels of fill from four to eight inches deep and revealed some issues with the fill and voids under the pool. Due to those findings, the OPA asked engineers to explore the issue further and to perform more core drilling. Additionally a void was found in the ground below an area where the pool is leaking and sagging pn the bayside. The supplemental explora-tion found voids between the bottom of the pool deck slab and the underlying soil.

Engineers have recommended fill-ing the stone base layer located around


From Page 14

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the pool basin with a flowable material that consists of concrete and water grout mixture containing fine aggregate. They also suggested cutting openings in the pool decking in order to provide access to grout the stone layer below the pool and around the perimeter of the pool. Fi-nally after the voids are filled, the engi-neers recommended grouting the voids below the pool slab.

“Is there a possibility that the reso-lution may be replacing the entire pool?” Director Jack Collins asked.

Thompson responded that may be the best option and staff is currently researching the cost to replace the pool. “That’s the last possibility we’re now ex-ploring.”

He said the OPA “started down one path” anticipating that less extensive repairs were necessary to fix cracks in the pool surface.

But the project became much more involved when engineers found voids or open spaces under the pool where water has been leaking for an extended period of time.

“If you recall that was one of our telltale signs when we first started the process,” Thompson said referring to the

leaking and pool’s settlement.He said staff is trying to “come up

with the best possible solution,” and is talking with a number of different vendors about the options for repair-ing the pool. Among the proposals are mud jacking, which involves pumping a concrete slurry under the pool to fill the voids, caulking and digging down sides of pool and pushing a dirt and sand mix into fill the voids from the sides.

“We’re looking at a number of solu-tions to get that repair under the pool addressed,” Thompson said.

With the summer season fast ap-proaching, OPA President Dave Ste-vens wanted to know when Thompson would have a recommendation to sub-mit to the board.

“I don’t get a sense of is how these are converging on a solution,” he said.

Thompson declined to give a time-frame in which the board could expect a recommendation, “I’ll bring it when I’m ready to bring it as a final solution,” he told Stevens. But he added that it is staff ’s intent to have a solution identi-fied in March and to then reach out to the board for vote to proceed.

“Every time where get close to where we think the final solution is another question comes up,” he said.

Clarke wants to revisit selling undeveloped OPA lots

One member of the Board of Direc-tors wants the Ocean Pines Asso-ciation to considering selling its

inventory of undeveloped lots.Director Marty Clarke during a Feb.

28 meeting suggested that it may be time for the OPA to once again investi-gate the possibility of unloading the 19 or 20 lots scattered throughout the com-munity that the association owns. He asked General Manager Bob Thompson if he had given any thought to the idea of selling them.

Thompson said he has looked at that possibility, as has the board pre-viously. He added that he was recently approached by parties inquiring about some of the OPA-owned lots and pricing for their purchase.

“It is something we should look at,” but he added the caveat that this is still not a strong real estate market. “Is now the time to do it while we’re still at the lower end of the market?” he asked, suggested that it may be a good idea to wait until the market comes back a little stronger.

Director Sharyn O’Hare, a real estate agent, agreed with Thompson. She said that unless there is a specific reason to sell the lots the OPA should wait until their sale can generate greater profits. “It may not be the best time,” she said.

However O’Hare added that there are currently very few lots available for sale in the Ocean Pines area. She said the board may want to consider selling one or two at a time.

“It’s certainly not the time to put 19 lots on the market,” she said.

OCEAN PINES BRIEFS“I didn’t say that,” Clarke respond-

ed. He said it may be worth investigat-ing the potential for their sale and the best approach to doing so.

One of the issues that would need to be addressed: Which real estate bro-kerage and real estate agent to hire to list the lots for sale?

OPA preps to list foreclosure property

The Ocean Pines Association will be soliciting proposals from local real estate agencies that are interested in adding to their listings a property that the OPA bought at foreclosure and ren-ovated.

Director Bob Thompson during a Feb. 28 meeting said that the home lo-cated at 37 Tail of the Fox is now ready for sale.

“It is all cleaned up, broken items have been repaired or replaced and it looks great,” Thompson said.

He said the association will be send-ing out a letter to the managers of each of the local Ocean Pines area real es-tate brokerages about having them list the property. “We will ask questions such as estimated sale price, days on the market, what fees they will charge to list it and what marketing efforts they will deploy to get the property sold. We will review all information we receive back and place it on the market with the office that provides the best

feedback to us,” he said.Thompson said the OPA paid approxi-

mately $95,000 for the property and has invested about $15,000 in fixing it up.

The OPA renovated the 1,300-square-foot home to make it more marketable to prospective buyers. It installed new floor-ing, drywall, painting, heating-ventila-tion-air conditioning, electrical work and

appliances.Last year the board voted to purchase

the property at a foreclosure sale in an effort to collect money that is owed to it by the former owner.

OPA president makes committee appointments

President Dave Stevens appointed two additional members to an Ocean

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Pines Association committee during a Feb. 28 meeting. He appointed Dennis Faber and Herb Roe to the Search Com-mittee.

The Search Committee is charged with soliciting and reporting on poten-tial candidates for two open Board of Di-rector positions this year.

Other committee members are com-prised of Martin Baer as chairman and members Grant Helvey, Bill Lee, Mickey Lobb, Dianne McGraw, Gary Miller and Les Purcell.

The Search Committee replaced the OPA’s old Nominating Committee sev-eral years ago. While the Nominating Committee was charged with actually vetting candidates and recommending a slate, the Search Committee does not have that responsibility. Any property owner can file for election; the Search Committee’s job is to encourage proper-ty owners to do so.

To be eligible a candidate must be the owner of record of property in Ocean Pines as of Jan. 1, 2015, eligible to vote as of May 15 and complete and submit an application to the Search Committee.

Work under way on new boat ramp

Construction of a new Ocean Pines Association boat ramp in White Horse Park is under way by contractors Fisher

OCEAN PINES BRIEFSFrom Page 15

Marine.OPA General Manager Bob Thomp-

son in his Feb. 28 written report to the board reported that the cofferdam is up and the entire old ramp has been re-moved. The new pilings are in for the sides of the ramp and the sheathing has been installed. The bottom whaler has been secured on both sides and the top whalers should be done by the end of the day.

He said the contractor will be work-ing on the finger pier and pouring the ramps in the next few weeks. Proj-ect completion is estimated for spring weather permitting.

Fisher Marine was awarded a $255,000 contract for construction of the boat ramp off Beauchamp Road. The project includes the replacement of the two existing boat ramps, replacement of three existing piers with one new pier and a temporary berthing dock for boats waiting to use the ramps, installation of a new vinyl bulkhead and the construc-tion of a concrete pier with a gangway and floating dock.

Marina fuel pumpproject finally begins

Replacement of the fuel pumps at the Yacht Club Marina is finally under way.

General Manager Bob Thompson during the Feb. 28 meeting of the Board of Directors reported that all of the ap-propriate permits are acquired and ma-terials ordered. He said the decking ma-

terials were to be delivered that week. The barge should be available begin-

ning the following week to move marina shed off the platform and make room for construction of new deck. Completion of deck, electrical work, gas lines and pumps will take about one week.

Because pipes running from the dis-penser along the dock are not properly angled for flow and are not in compli-ance with code, the OPA had to have them replaced and construct an elevat-ed deck about the current dock to cover them. The problem was discovered by the contractor hired to replace the ma-rine grade electrical wiring required for the fuel dispensers.

The original fuel dispenser project budget was $75,000. The additional work puts the total project cost more than $10,000 over budget.

Board considersCPI violations

The Board of Directors considered vi-olations of the Ocean Pines Association’s governing documents at two properties during its Feb. 28 monthly meeting, referring one to the OPA attorney but holding off on action on the other.

For the second month in a row, the board reviewed debris and trailer vio-lations at 42 Bramblewood Drive that were referred by the Compliance, Per-mits, and Inspections Department.

General Manager Bob Thompson said the property owner has removed the de-

bris from the trailer, which was listed as the trailer violation, but there is still debris scattered around the property. He said that debris consisted largely of cut yard waste like stumps, wood clippings and branches.

The board agreed to find the proper-ty owner in continuing violations of the restrictive covenants and to forward the issue to the OPA attorney for action.

At 1 Burr Hill Drive CPI found a violation because the property owner failed to secure a permit from the OPA to convert a screened porch converted to a sunroom.

Directors asked if the owner had ac-quired a county building permit. Thomp-son said he didn’t know.

“Typically we give permits before the county,” Thompson said but added, “Sometimes people just ignore Ocean Pines and go do it.”

The board voted to have OPA staff determine whether or not the county is-sued a building permit. If so, then the OPA will issue a permit and charge the property owner a $150 filing fee. If no county permit was issued, then the is-sue will be sent to the OPA attorney for resolution.

OPPD stats showcrime reduction

Ocean Pines Police have released preliminary crime statistics for 2014. Serious crime declined nearly 40 per-

To Page 18


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cent in 2014 compared to 2013. A review of serious crime, known as Part 1 Of-fenses, showed that there were 106 Part 1 offenses in 2014 compared to 178 the prior year.

Police answered 12,402 service calls for 2014, which is a new record. Police also made 193 arrests and conducted 2,654 traffi c stops, resulting in the is-suance of 460 traffi c citations. Traffi c accidents saw a 23 percent reduction, which could be a result of increased en-forcement.

“The statistics are very encourag-


ing for crime reduction, and the efforts of our police department contribute to keeping Ocean Pines one of the safest, per capita, communities in the State of Maryland,” Chief David Massey said in a press release.

OPA seeks TRC approvalof Public Works addition

Ocean Pines Association Public Works staff were scheduled to appear before the county’s Technical Review Committee on Thursday, March 11, at 1 p.m. to review plans for an addition to the Ocean Pines Public Works Mainte-nance Building in South Ocean Pines.

The proposal is for construction of a

4,633 square foot addition to the exist-ing building east of Ocean Parkway.

The addition was included in the cur-rent year’s capital budget.

Search panel hostingopen meeting March 25

Ocean Pines Association’s 2015 Search Committee will host a public meeting on Wednesday, March 25, at 6 p.m. at Ocean Pines Community Center. The meeting will be open to Association nembers and anyone interested in a po-sition on the board is encouraged to at-tend.

The purpose of the meeting is to outline the function of the Search Com-mittee, to describe the qualifi cations of the candidates, to outline the responsi-bilities of OPA Board members, and to receive input about fi nding interested candidates.

The Committee’s function will be to seek at least four candidates to run for the Board of Directors in the next elec-tion to fi ll two openings. To be eligible a candidate must be the owner of record of property in Ocean Pines as of January 1st of this year, eligible to vote as of May 15th and have completed and submitted an application to the Search Committee or Administration Offi ce no later than 5 p.m. on May 10.

An application form may be print-ed from the Association’s web site www.oceanpines.org or obtained from a Search Committee member or from the Administration Offi ce at 239 Ocean

Parkway. Offi ce hours are 8 a.m. to 5 p.m. Mondays through Fridays and 8 a.m. to 2 p.m. on Saturdays after April 25.

Sports Core pool hostingfamily fun swim event

The After-School Family Fun Swim will run every Tuesday and Thursday from March 17 to May 14 from 4-5:30 p.m. at the Sports Core Pool.

The cost for children ages 5-15 is $2 for Ocean Pines residents and $3 for non-residents. The adult rate is $3 for residents and $4 for non-residents. Ad-mission is free for children ages 4 and under and for non-swimming adults.

for kids who are interested in keep-ing other swimmers safe, Ocean Pines Aquatics will offer two lifeguarding training opportunities at the Sports Core Pool.

A four-session Red Cross lifeguarding class will be offered March 27-29 and April 3. This course will provide the training for individuals to become Amer-ican Red Cross-certifi ed lifeguards.

The fee is $275 for residents and $325 for non-residents. Class graduates may qualify for a full tuition waiver if employed by Ocean Pines Aquatics. To register, call the Sports Core at 410-641-5255.

Ocean Pines Aquatics will also host a one-day junior lifeguard program on Saturday, April 11, from 10 a.m.-4 p.m. Participants ages 8 and up will learn lifeguarding skills, play games, visit the local fi re department and more.

The cost of the program is $75 per person, which includes a t-shirt, whis-tle, fi rst aid kit and lunch. Space is lim-ited and pre-registration is required. To register, call the Ocean Pines Recreation and Parks Department at 410-641-7052 or the Sports Core at 410-641-5255.

For more information about any of these programs, contact the Ocean Pines Aquatics Department at 410-641-5255. Information regarding additional Ocean Pines aquatics programs, includ-ing an online version of the Ocean Pines Winter 2015 Activity Guide, is available at www.OceanPines.org.

Dazzle gift shopto host arts night

Dazzle gift shop in Manklin Station (near DeNovos) at the Ocean Pines South Gate will host an art night from 4-7 p.m. on Tuesday April 7. Refresh-ments will be served.

The event will showcase local artists creating their artwork, featuring artists Jim Adcock, Bev Wisch, Dot Park and Marcia Cupschaulk.

Owner Joyce Landsman says the arts night will be an “opportunity for area residents to meet and greet local talent.”

Women’s club to hostgame and card party

The Women’s Club of Ocean Pines will host a card and game party on Thursday, April 2, from 10 a.m. to 2 p.m. at the Restaurant at Lighthouse Sound


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Like a stuck record, still no Sandpiper, OPA agreement on natural gas

Stevens expresses frustration at Sandpiper’s

‘refusal to respond’ to OPA proposals


It’s turned into a stuck record with no end in sight: There is nothing new on the status of negotiations between the

Ocean Pines Association and Sandpiper Energy over a new franchise agreement that could usher in the roll-out of natu-ral gas conversion in Ocean Pines.

The state of play between the OPA and Sandpiper is no different in early March than it was in early February, and in the many months before that.

“Sandpiper refuses to respond to anything reasonable,” said a frustrated Dave Stevens during a brief discussion of the impasse at an OPA Board of Direc-tors meeting on Feb. 22.

While Sandpiper executives might very well disagree with Stevens’ charac-terization, OPA Director Marty Clarke agrees, and he goes even further. To Clarke, Sandpiper hasn’t responded in a meaningful way to OPA’s negotiating demands because the company’s agenda

is different from that of the OPA.“They want to start pumping natu-

ral gas through the pipeline (as soon as possible) so they can become a public

utility” regulated by the Public Service Commission, Clarke said.

That status would mean that the OPA loses whatever leverage it has over the Ocean Pines pipeline that currently carries propane to Sandpiper’s customer base, Clarke has said.

Loss of leverage means the OPA would be in no position to insist that Sandpiper pay a franchise fee for the


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right to deliver natural gas and propane via the pipeline, making use of a right-of-way granted to a predecessor by the

OPA back in the 1990s.Clarke recently confi rmed that any

agreement between the OPA and Sand-piper on a franchise agreement – one of the areas of contention between them – would most likely have to receive the ap-

proval of the Maryland Public Service Commission because it involves rates.

“Probably, but that’s not a prob-lem,” Clarke said. “If Sandpiper asks the PSC for approval, they’ll get it. I would imagine in any (new franchise) agreement with the OPA, the fee would be included contingent on PSC approval.”

Reports are that the fee if approved by the PSC would be passed on to Sandpiper customers in $3 per month increments.

A $3 per month add-on charge is said to be equivalent to a $150,000 an-nual franchise fee.

Some early proponents of natural gas in Ocean Pines would be perfect-ly happy for the OPA to drop its insis-tence that any new agreement with Sandpiper include a franchise fee. Budd Shea, an Ocean Pines property owner who has been advocating for natural gas for several years, writes in a letter published in this edition of the Progress that it’s time to abandon the franchise fee idea.

To Shea, it’s clear that Sandpiper doesn’t want to impose a fee on its cus-tomers in Ocean Pines.

But beyond that, he thinks it’s unfair to ask a minority of property owners to pay a fee for a pipeline that hasn’t cost the OPA anything over the years to maintain or operate.

To Shea, a franchise is a hidden tax on Sandpiper customers. To Shea, Sandpiper already operates as a public utility, similar to Verizon or Choptank Electric, and the OPA shouldn’t be try-ing to force into the role of franchisee similar to that of Mediacom, a cable television, Internet and phone provid-er.

“Do we get a franchise fee from ei-ther Verizon or Choptank? No! They have their cables in the ground on Ocean Pines property. What is the dif-ference between cables in the ground

or a pipe in the ground? I see none,” Shea writes.

To Clarke, it’s obvious that Sandpiper is a franchisee because it or its predeces-sor company, Eastern Shore Gas Co., has been operating under a franchise agree-ment since the 1990s.

He has said the pipeline right-of-way is a valuable community asset from which all property owners in Ocean Pines should benefi t fi nancially. Clarke would go fur-ther than other directors to press his po-sition:

He wants the board to write a letter to Sandpiper demanding it cease and desist from using the pipeline on a date certain, giving existing customers plenty of time to fi nd a new propane supplier if Sandpiper still declines to execute a new franchise agreement.

While it is diffi cult to see how this im-passe will end short of an OPA capitula-tion on a franchise fee, in the meantime the association is continuing to take steps to sever its business relationship with Sandpiper, at least as a propane customer. of the company

Propane tanks provided by another area supplier, Sharp Energy, have been installed at the Sports Core pool, the Community Center and the Public Works building, with the possibility of adding tanks at the Country Club and Yacht Club.

Thompson told the board that there is a space issue at the Yacht Club that is yet to be resolved.

The impasse and continued frustration over a natural gas agreement pretty much dashes hopes that emerged in December that there had been a conceptual break-through in talks between the Ocean Pines Association and Sandpiper Energy over a new franchise agreement.

In an email received by the OPA in ear-ly December, Sandpiper indicated it was willing to negotiate a franchise fee with the OPA to allow it to continue to use its pipeline to bring propane and natural gas to its Ocean Pines customer base.

Clarke also said the email indicated willingness by Sandpiper to consider pay-ment of the OPA’s legal fees of roughly $70,000 that were incurred during pro-tracted contract negotiations and to ne-gotiate a turn-over agreement covering pipeline assets at the expiration of a new franchise pact.

Because Sandpiper had not previously indicated willingness to negotiate these issues, at least not as forthrightly, the Progress characterized the early Decem-ber email as a breakthrough in a head-line and article published in its Decem-ber-Early January edition.

OPA President Dave Stevens later characterized the email as less of a break-through and more of a “promising” devel-opment that he subsequently called a de-laying tactic.

Stevens also has resisted Clarke’s idea for a letter to Sandpiper giving the compa-ny a specifi c date to either execute a new contract or stop pumping propane through its Ocean Pines pipeline.

The OPA president prefers to allow the status quo of delivery of propane through the pipeline to continue pending comple-tion of a new franchise agreement.


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Thompson forecasts $24,493 loss for current fiscal yearDirectors criticize report format, imply that general manager

is hiding a substantial food and beverage deficit at the Yacht ClubBy TOM STAUSSPublisher

Ocean Pines Association Gener-al Manager Bob Thompson is projecting a relatively modest

$24,493 loss for 2014-15, in a quarterly forecast delivered nine months into the fiscal year. Issued as part of his Feb. 24 general manager’s report, the revised projection contrasts with the $157,748 loss in the half-year forecast issued last Nov. 22.

Even with the relatively modest loss for the year, however, Thompson pre-dicts that the OPA will miss its budgeted $198,301 surplus for the year by a sub-stantial $222,793.

Thompson offered no explanation for the projected bottom line improvement in his forecast, which he developed with the assistance of OPA Controller Art Carmine.

Rather than ask the general manager about the rosier year-end outlook, direc-tors instead focused almost entirely on the forecast’s format. During discussion at the board’s Feb. 24 monthly meet-ing, OPA President Dave Stevens and Vice-president Marty Clarke suggested

that Thompson’s forecast hid projected losses in food and beverage operations at the Yacht Club.

The format combined both food and beverage operations and highly lucra-tive marina boat slip net revenues in a single Yacht Club+ line item, which made it impossible to know precisely what Thompson expects food and bever-age operations at the amenity to net at year’s end April 30.

In the face of persistent criticism by Clarke and Stevens over the report’s format, Thompson promised to send to the directors, in the week following the board meeting, a revised forecast for year’s end that separates out the two Yacht Club components.

A comparison of the Feb. 24 and Nov. 22 summaries does show an erosion in expectations at the Yacht Club. At the half-year mark, Thompson forecast a $40,005 loss for the Yacht Club at year’s end, but that has grown to $76,513 at the three-quarter mark.

Food and beverage losses would have to be much larger than that, because through the end of January, actual ma-rina operations for the year have netted

a $139,421 surplus for the OPA.That would suggest a likely loss in food

and beverage operations at the Yacht Club this year in excess of $200,000. Through January, actual losses at the amenity are roughly $71,000, including an actu-

al $45,876 loss in January. If February, March and April losses are close to that, a $200,000 loss for the year is achiev-able.

Thompson, in his Feb. 24 GM Report, indicated that there have been some personnel cuts at the Yacht Club to ad-dress concerns about wage and benefit costs.


From Page 21

Forecast

The Feb. 24 forecast indicates that Thompson, at least when he drafted it, thought that golf and related food and beverage operations (Terns Grill) would produce a relatively modest loss for the year -- $89,270. But that’s a sharp ad-justment upward in red ink from the half-year projection, when Thompson saw only a $14,813 loss in golf.

Golf is budgeted to lose only $73,300 this year, which means the Feb. 22 pre-diction envisions only a modest $15,970 negative variance to budget in golf on April. 30.

But elsewhere in his report, Thomp-son makes it clear he no longer believes – if he ever did – that the $89,270 pre-dicted loss is realistic.

“The final decision to change the di-rection of our Golf Operations … by the Board of Directors could have a signif-icant impact on year-end numbers,” Thompson said, in effect blaming the board’s decision to replace Billy Casper Golf with Landscapes Unlimited as the golf course management company for a possible poor finish for the year.

But Thompson’s earlier rosy scenar-io was based on a profitable April that might not have been likely even had the board made no decision to replace BCG. Through January, golf is $43,313 in defi-

q General Manager Bob Thompson’s forecast of OPA financial performance in the 2014-15 fiscal year ending April 30.

q


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cit, and BCG’s internal budgeting would add another $110,000 or so to that deficit in February and March. With the deficit at more than $150,000 going into the fi-nal month of the fiscal year, Thompson and BCG would have needed to pull out a $60,000 surplus in April to meet the $89,270 targeted loss.

Last April, golf operations lost $15,756 for the OPA, contributing to a $326,048 loss for the year. This year, should golf lose $15,000 or $16,000 again in April, the loss for the year could end up close to $160,000, easily a 50 per-cent improvement over last year.

But it would still be quite a distance from the forecast contained in the Feb. 22 report. Should April perform even worse than last year’s $15,767 – a sce-nario that Thompson appears to believe is possible because of the change in golf course management – then the loss could easily be closer to $200,000 than it would be to $150,000.

Another amenity department that shows improvement over the mid-year forecast is aquatics, which Thomp-son now is forecasting with a loss of $173,783, compared to a $198,414 deficit predicted previously.

While the general manager offered no explanation of the better forecast, some of it could be related to lower util-ity costs at the Sports Core indoor pool, where the OPA has obtained a new pro-

From Page 22

Forecast pane supplier, Sharp Energy, and un-derground propane storage tanks, to replace higher-priced propane delivered via pipeline by Sandpiper Energy.

Another OPA department, recreation, along with the three racquet sports, is projected to lose $488,374 in the current year, with a $30,488 negative variance to budget. This is an erosion from the mid-year projection, in which the negative variance to budget was only $20,462.

Three departments, administration, Public Works (including compliance, permits and inspections) and the Beach Club, including parking, are projected with positive variances to budget for the year. The positive variances are $24,877, $31,351 and $22,811, respectively.

At mid-year, these projected positive variances were $61,133, $12,789 and $22,274, respectively.

This year’s board criticism of the forecast during the Feb. 22 meeting fol-lows a familiar pattern.

In November, Clarke was critical of Thompson’s forecast for golf, citing golf ’s negative variance to budget of roughly $50,000 to $60,000 in the May through July quarter. Thompson at the time agreed that the first month of the fiscal year was slow, but he said that golf op-erations have gotten better since then, with the performance relative to budget “accelerating” more recently.

Clarke seemed unconvinced that the golf numbers would come in anywhere close to the latest forecast, later telling the Progress that last year’s three-quar-

ter-year forecast was relatively rosy for golf only to be wiped out by a very poor April.

The outspoken director also found fault with the brevity of the report and the absence of Carmine to explain it, rather than Thompson.

“Before Bob, the reports were ten to 12 pages long,” Clarke said, adding that the first quarter’s averages were about $64,000 off the average for the past five years.

Thompson responded that he is not concerned with five-year averages, but instead focuses on year-over-year differ-ences.

OPA’s finances in the red for January Surplus disappears as Yacht Club, golf drive OPA into small deficit after three quarters of the fiscal year

OPA FINANCES


The Ocean Pines Association in January recorded a negative op-erating variance to budget of

$46,147, a modest deterioration from December’s $38,979 negative variance. For the fiscal year through nine months, the OPA has slipped into a small nega-

tive variance to budget of $3,722, after positive variances had been recorded in earlier months.

The OPA remains in the black for the year, however, in the amount of $1,742,677. For the month, the loss was $569,491. In a recent year-end forecast, OPA General Manager Bob Thompson predicted a modest actual deficit for the

year of $24,492, compared to the budget-ed surplus of $198,301. But that forecast seems already to be in danger of slipping [see separate article in this edition of the Progress for details].

According to Controller Art Car-mine’s January financial report, the $46,147 negative variance to budget for the month was produced by reve-

nues that exceeded budget by $15,087 and expenses that were over budget by $61,235.

For the year so far, revenues have exceeded budget by $169,365, total ex-penses are over budget by $173,087, and new capital expenditures are over budget by $257, resulting in a total oper-ating fund variance of $3,979 (including new capital).

While most amenity departments lost money in January, those losses were expected and budgeted for. The Yacht Club stood out as the one major amenity that fell short of budget by a significant margin, missing its budget target by $30,172. The Yacht Club’s actual loss for the month was $45,876.

The good news: Yacht Club gross revenues exceeded budget by $14,764, on revenues of $53,604. Similarly, net revenues, reflecting food and beverage costs, also were positive relative to bud-get. Net revenues were $32,383 for the month, better than budget by $7,042.


From Page 23

January financials

Expenses, however, hurt the bottom line, notably in wages and benefits and utility costs. Budgeted at $19,886, actu-al wages and benefit costs were $49,580 in January, a $29,694 negative variance. Utility costs were $16,474, against the budgeted $10,218, off by $6,256.

“Personnel reductions were made mid-January that should help show some improvement in wages moving forward,” OPA General Manager Bob Thompson wrote in his Feb. 24 report to the board of directors. He also said that “utility costs are still a challenge,” advis-ing the board of difficulty in installing new tanks to provide a lower cost option for propane supplies. He blamed the dif-ficulty in space limitations around the facility.

“We are also looking into more effi-cient operations of the second floor heat-ing when not in use,” he told the board.

There is no indication that Thomp-son or a majority of directors are moving toward a change in the current Thurs-day through Sunday “open for business” schedule, despite the fact that the Yacht Club lost $15,641 in October, $46,651 in November, $34,049 in December and now $45,876 in January, wiping out an operating surplus that had accumulat-ed during the warmer months, through September.

Through January, the Yacht Club’s cumulative deficit for the year was $70,764, compared to the budgeted $10,465 surplus. That’s an $81,229 neg-ative variance for the year. For those looking for the silver lining, last year’s cumulative deficit through January was $107,354, so that means that, despite continuing winter deficits, the Yacht Club has improved its bottom line per-formance by more than $36,500 year over year.

But the Yacht Club is budgeted to break even this year, a goal that would appear to be unachievable with only February, March and April remaining to affect year-end results. In his recent year-end forecast, Thompson is predict-ing a $76,513 loss for the year, which seems to suggest that in the final three months of the fiscal year, the general manager optimistically thinks the Yacht Club will lose only another $6,000 or so.

Golf operations in January lost $70,596, a not unexpected result, but the results continued a pattern of most of the year in which this amenity beat its budget for the month. The $6,819 positive variance for the month is not matched by year-to-date numbers, how-ever.

Because of the substantial loss for the month, golf operations have slipped into deficit for the year. The cumulative loss for the year is $43,313, compared to the budgeted $12,701 deficit. The neg-ative variance to budget for the year is $30,612. The good news is that, in Jan-uary of last year, golf operations had al-ready accumulated an operating deficit of $181,851.

That means golf, despite all of the

challenges, has realized a $138,538 turn-around year-over-year.

As is typical, Thompson in his month-ly report to the board emphasized the positive in golf results.

“Another good showing for golf oper-ations,” he wrote, citing the $6,810 posi-tive variance to budget and the $138,538 turn-around year-over-year. He did not mention the $70,596 actual loss for the month.

Thompson cited the recent year-end forecast with golf losing only $89,270 for the year, but he then more or less renounced that projection when he said that the board’s decision to hire a new company to manage the golf course for the OPA “could have a significant impact on year-end numbers.”

Even before the change in manage-ment, however, Thompson’s projection of an $89,270 loss was based on a pos-itive April that assumed good weather and results that have not been achieved in recent years. Last April, for instance, the loss for the month was $15,756, missing its budget by $51,112.

This year, according to information obtained by the Progress, the Billy Casper Golf budget for February and March calls for about $110,000 in ad-ditional losses, which would leave the cumulative deficit at about $153,000 en-tering April, the last month of the year.

To achieve Thompson’s forecast of an $89,270 loss, golf would have had to achieve a $63,730 surplus this April, which his critics on the board and else-where have said was never realistic even before the decision to change man-agement companies.

If this April’s results are close to what was achieved last April, the golf deficit for the current fiscal year would come in at roughly $169,000. If the management

change does adversely affect revenues for April, the deficit could easily be clos-er to $200,000.

Billy Casper Golf is under contract to manage the course through the end of April.

In other budget results for January, aquatics lost $33,495 for the month against a budgeted loss of $22,047, for an $11,448 negative variance to budget. Year-to-date, aquatics has lost $82,319, with a $44,051 negative variance to bud-get.

But as noted by Thompson, the de-partment under new Director Colby Phillips is doing substantially better than it was a year ago, when its cu-mulative deficit through January was $118,909. That’s a $36,590 year-over-year improvement, driven mostly by higher revenues.

In January, revenues of $19,544 ex-ceeded budget by $1,092, and for the year the positive variance is $1,854. Year-to-date revenues of $565,614 com-pare favorably to $490,065 in revenues through January of last year, which amounts to a remarkable increase of $75,549.

In his report to the board, Thompson acknowledged that aquatics expenses for January were over budget, blaming most of it on utility costs. Indeed, $7,669 in excess utility costs made up most of the $12,540 overage, with wages and benefits exceeding budget by $2,539.

“Our Sandpiper billing runs from mid-December to mid-January,” Thomp-son wrote, suggesting that savings from replacing Sandpiper propane supplies by lower-cost Sharp Energy supplies had not been fully realized.

“We had the billing for filling the new (Sharp Energy) propane tanks that added to utility costs for the month,” he

wrote.Thompson is now projecting a

$173,783 loss in aquatics for the year, according to the year-end forecast he made public in late February.

Status of reserves – The reserve summary released as part of the January financial report shows that the OPA’s al-located reserve balance dropped during the month to $4,398,600, compared to $4,483,293 in December, $4,699,394 in November, 4,871,868 in October, $5,128,136 in September, $5,178,302 in August, $5,519,149 in July, $5,786,683 in June and $6,003,165 in May.

The annual contribution from assess-ments traditionally is recorded in May, the first month of the fiscal year. The re-serve balance tends to drop throughout the fiscal year reflecting transfers out of reserves to pay for capital expenditures.

[See separate story for details] Status of the balance sheet – Ac-

cording to the Jan. 31 balance sheet, the OPA has assets valued at $29.6 million, against liabilities of $1.64 million and owner equity of $27.95 million.

The balance sheet indicates an in-crease in operating cash to $1.74 mil-lion, up from the $1,384,425 on hand at the end of December. This compares to operating cash of $2,133,033 at the end of November, $1,402,913 in October, $1,719,990 in September and August’s $2,281,360.

These kinds of fluctuations are con-sidered normal.

The January balance sheet indicates that the OPA had $3,019,058 in short-term investments as of Jan. 31, com-pared to $4,020,819 in short-term in-vestments as of Dec. 31, $4,018,768 in November, $5,315,829 in October and $5,612,201 on hand at the end of Sep-tember.

OCEAN PINES March - Early April 2015 Ocean Pines PROGRESS 25

q

OPA reserves drop to

$4.4 millionin December


The reserve summary released as part of the January financial re-port shows that the Ocean Pines

Association’s allocated reserve balance dropped to $4,398,600 as of Jan. 31, a decline from the previous month’s $4,483,293 balance.

The balance stood at $4,699,394 in November, $4,871,868 in October, $5,128,136 in September, $5,178,302 in August, $5,519,149 in July, $5,786,683 in June, and $6,003,165 in May.

The erosion is typical as the OPA makes expenditures from the reserves through the year.

The May reserve summary reflects the annual contribution from PROP-ERTY assessments that traditionally is recorded in the first month of the fiscal year.

Usually, most of the month-to-month reduction in the overall reserve balance is attributable to activity in the Major Maintenance and Replacement Reserve, which as of May 31 had a balance of $4,754,531, reflecting the full annual

transfer from lot assessments into this fund.

This reserve had a small decline in its balance as of Jan. 31 when compared to the Dec. 31 total. The fund balance dropped to $3,865,232 from December’s $3,914,927 and November’s $3,916,546 balance.

For the year through Jan. 31, total capital spending from this reserve was $1,209,736, comprised of $989,003 in spending from the funded depreciation component of this reserve (labeled his-torical in the reserve summary) and $230,733 from the five-year capital plan funding stream, most of which would be

related to Yacht Club construction costs.The other OPA reserve funds – bulk-

heads, future projects, golf drainage, and operating recovery -- were un-changed or only insignificantly changed from earlier months.

The roads reserve had a balance of $83,683, a slight increase from Decem-ber’s $83,641 balance and November’s $222,231 balance.

The bulkhead/waterways reserve had a balance of $1,016,914, a decline from the $1,051,674 balance in December.

The future projects reserve had a deficit of $60,366, the golf drainage re-serve had a deficit of $642,578 and the

operating recovery reserve had a sur-plus of $135,716.

The operating recovery reserve had been zeroed out last year, on the theory that previous year deficits had been suf-ficiently offset by subsequent surpluses, but the OPA Board of Directors last year authorized $135,152 from the current year’s assessment to be allocated to this previously zeroed out reserve.

The purpose of resurrecting this fund and adding money to it purportedly in-volved the possibility that funds will be needed to address certain tax liability issues in future years.

OPA withholding $168,531in Yacht Club payments

pending final Harkins talksBy TOM STAUSSPublisher

Ocean Pines property owners won-dering about the final cost ac-counting of the Yacht Club proj-

ect and the status of negotiations with Harkins Construction, the new build-ing’s contractor, over final project invoic-es and other issues can rest assured: At some point everything will become clear.

When that will exactly happen isn’t clear, however. Ocean Pines Association General Manager Bob Thompson, in a memo to the Board of Directors dated Feb. 26, made no representations about when these issues will be satisfactorily resolved.

That’s probably because he doesn’t know. The good news is that the pro-tracted process of resolving contract issues, including completion of several punch list items the contractor has been in no apparent hurry to finish, does not appear to be unfriendly or heading inex-orably towards litigation.

The new Yacht Club opened for busi-ness in late May, a little more than ten months ago.

Assisted by Ocean Pines proper-ty owner Ted Moroney, a contractor,

Thompson has been steering a course designed to complete the project as ami-cably as possible under the circumstanc-es.

Thompson’s memo reveals that, pending a resolution of outstanding is-sues and “several items that Harkins must correct,” the OPA has been with-holding $168,531 in a final payment to the contractor.

“This has dragged on longer than we (had) projected,” Thompson wrote in his memo. Outstanding matters include “Harkins not installing the flagpole and cupolas until December/January, com-pletion of punch list items, correcting the (defective upstairs) deck and slow response to our requests for documen-tation.”

Thompson told the board that he, Mo-roney and Public Works Director Eddie Wells had met with Harkins executives twice in the last six weeks, “most recent-ly in excess of four hours to resolve sev-eral issues.”

Thompson reported progress in one particular area – “we have resolved to our satisfaction” is the way he phrased it – involving work done by Public Works staff, but where the contract called for

work to be done by Harkins, the OPA has been insisting that costs associated with doing that work be deducted from payments owed Harkins.

“In order to ‘prove’ our case, we had Public Works, through (Wells), break down every single item by labor, equip-ment and material,” Thompson wrote, telling the board that Moroney “took that information and prepared a de-tailed breakdown of each area in typical contractors format, and then Eddie pre-pared a sketch showing where the work was done.”

Thompson said during the recent meeting “each item was discussed and resolved to our satisfaction,” by which

he apparently means Harkins execu-tives agreed to deduct the itemized cost from the final payment it expects to re-ceive from the OPA.

The general manager reported less progress on the flip side of negotiations – items that Harkins has presented that would increase the cost to the OPA over the agreed upon contract cost of building the Yacht Club.

Thompson’s memo didn’t specify the nature of these change orders or their potential cost to the OPA.

He would only say that Harkins “has been slow to respond to requests for sup-porting information” and that, as a re-


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From Page 25

Yacht Club

sult, OPA has held up the final payment to the contractor.

Thompson told the board that he and his team should be able to meet with Harkins in coming weeks “and hopefully bring the project to resolution in terms of final negotiated costs. As you know well, the final negotiations often require tenacity, determination and attention to detail.”

In an odd turn of phrase, the general manager said his team is “close in our minds to resolution of all matters.” It was not clear why he didn’t simply say that he and his team believe they are close to reaching an agreement with Harkins.

In a subtle dig at OPA Director Marty Clarke for his public remarks relative to negotiations with Sandpiper Energy for a natural gas agreement, Thompson said “we have found it critical to our suc-cess to maintain a low key approach and follow standard contractor/owner proto-col in closing out the contract.”

He acknowledged that the process and slow pace “often frustrates every-one, but we are making progress in get-ting to closure.”

Thompson’s memo also included a “simplified financial dashboard” that appears to address concerns expressed by Clarke that previous versions of the dashboard seemed overly complicated

and opaque, making it difficult to know precisely how much the new Yacht Club has cost the OPA.

The revised dashboard indicates an initial referendum-approved cost of $4,314,297, with a board approved in-crease of $456,000 to cover the cost of new kitchen equipment.

As of Aug. 20 of last year, the dash-board shows the value of the Harkins contract, with approved change orders, of $4,034,474, along with direct OPA costs and estimated costs of $729,508, for a total estimated cost of $4,763,982.

The difference between the proj-

ect value and total estimated costs is $6,314, more or less where it was this past summer. Should the OPA in-cur additional costs in excess of that remaining $6,314, the Yacht Club project would be in over-run territo-ry, which Clarke has said has already happened with the approved $456,000 in new kitchen equipment.

They have been rumors circulating in the community suggesting that ad-ditional cost overruns could boost the final cost of the new Yacht Club well above the previously disclosed price. Thompson’s memo did not address any

of those rumors or put them to rest.Clarke also has said that additional

capital costs associated with equipping and furnishing the Yacht Club that are likely to be approved in the new 2015-16 OPA budget should be added to the final dashboard.

There are roughly $150,000 of upgrades to the new facility, including new kitchen equipment and furnishings as well as a new draught beer system and hurricane shutters for the outdoor tiki bar. If added to the dashboard, these additional capital expenses would push construction well into over-run territory.

Assessment abatement conflicts with governing docsBy Rota L. KnottContributing Writer

A resolution that allows property owners to request an abatement of the increase in the annual

Ocean Pines Association property as-sessment is on the chopping block.

OPA President Dave Stevens during the Board of Directors’ Feb. 28 month-ly meeting offered a motion to rescind board resolution F-05, which provides for a certain amount of assessment in-creases to be abated for qualified home-owners. Director Bill Cordwell seconded to the motion.

“The issue is not cost but rather hav-ing a resolution on the books that does

not belong there,” Stevens said.Since Stevens’ motion deals with

a resolution, the board is required to hold both a first reading, which was held at that meeting, and a second reading before voting on the motion. That allows time for public comment.

Stevens said the resolution was original created in 2006 and then reformatted in 2009. But at that time “We didn’t change the content,” he said.

The resolution allows for low in-come qualified homeowners to ask for an abatement of the assessment in-crease levied in any one year. It was intended to correspond to the Mary-

land Homeowners Tax Credit Program which offers similar relief for one-year increase in property taxes.

The governing documents, including the declaration of restrictions, charter and bylaws, gave the board the authority to pass that original resolution. Those doc-uments require the board to set and levy an annual charge against each association member.

The Declarations of Restrictions give the OPA the power to levy an annual charge against each member in an amount to be determined by the board for current maintenance needs, future needs, and purposes of the Association as set forth in


From Page 26

Assessment abatement

the Articles of Incorporation. Similarly, the charter gives the OPA power to levy an annual charge upon each member to support the purposes of the association. The by-laws makes it a duty of the board to determine the amount of the annual charge to be levied against each member.

But the State of Maryland has a pro-gram that allows a credit against a home-owner’s property tax bill if the property taxes exceed a fixed percentage of the owner’s gross income. The program is known as the Homeowners Tax Credit Program. The homeowner must apply for the tax credit. Information about the pro-gram can be obtained from the Maryland Department of Assessments and Taxa-tion.

Under the existing resolution the OPA will grant a one-year abatement of the in-crease, if any, in the association annual charge to any homeowner presenting a copy of the property tax bill reflecting the HTC or a copy of the HTC certificate for that year to the Association Finance De-

partment. The homeowner must apply for an abatement of the annual charge increase on an annual basis.

Stevens said what the resolution F-05 fails to mention is that the annual charge must be uniform for all owners of the same specified class of property, such as waterfront properties or back lots. There is no provision in the OPA governing documents to lower the rates for an individual homeowner for any other purpose. Therefore resolution F-05 is on direct violation of the OPA’s governing documents, Stevens said.

According to OPA Controller Art Carmine, the number of people tak-ing advantage of this opportunity for an assessment abatement in any giv-en year may be as many as seven or eight. However, that is only when the increase in the annual property assess-ment is significant.

“It is really a housekeeping item that will affect very few people,” Ste-vens said.

The board plans to hold a second reading of the proposal to rescind reso-lution F-05 at its March meeting.

Board tables vote on refund of fees paid by Star Charities By ROTA L. KNOTTContributing Writer

After being approached last month by a tearful resident seeking a re-fund, the Board of Directors is con-

sidering giving back the funds expended by the nonprofit Starr Charities for rent-al of the Ocean Pines Association’s Com-munity Center for a large fund-raiser.

Director Marty Clarke offered a mo-tion to refund all fees charged to Starr Charities in conjunction with its annual Beef and Beer event, which raises funds for veterans’ organizations. Director Jack Collins seconded it. However, the motion was ultimately tabled for future consider-ation in a 5-2 vote.

Star Charities is an all-volunteer group of Ocean Pines residents that works to support local residents, other organizations and particularly veterans groups, Foultz told the board in late Jan-uary. Foultz said the OPA charged $450 to use the gymnasium, kitchen and meet-ing room at the Community Center spac-es but couldn’t even get in to decorate until after 2 p.m. because another event was scheduled.

She said her group held its event at the Community Center because other venues charged too much and because she and her volunteers want to use and support the OPA’s facilities. But, she said, her charity can’t afford to pay even what the OPA charged this time.

Clarke didn’t argue that Starr Char-ities deserves special consideration. Rather, he said the OPA doesn’t have an approved fee structure for use of the ame-nities.

“There has been no fee structure given this board to approve or not approve since I’ve been sitting on this board the second time. Ever,” he said. According to board resolution M-02, the general manager is supposed to present a fee structure to the

board for approval on an annual basis as part of the budget process. He asked fellow board members if they have ever been presented with such a fee sched-ule and then added “Never!”

OPA General Manager Bob Thomp-son said that is not accurate.

“The Policy we’re using has been the policy in place since I’ve been here.”

Starr Charities was actually charged a little less that it should have been based on the existing policy and fee structure, according to Thompson. If the board decides to take action and issue the refund, he said that would change the direction for how the OPA charges for use of the Community Cen-ter.

OPA President Dave Stevens said is-suing the refund would not necessarily

be a revision to facility use policy. “We’re not changing the policy but we can make exceptions to the policy without chang-ing it.”

Thompson said that would put the association staff in a unique situation of determining “Do we enforce the pol-icy that we’re currently under place or do we enforce it until the bard overrides it?”

Director Bill Cordwell took issue with the motion, saying it would set precedent for similar requests from ev-ery non-profit organization in the com-munity to request free facility use.

“For the last couple of years we’ve sat here at budget time and we’ve agreed there are things that have to be paid for and we can’t give the place free to every-body,” he said. Opening any of the facili-ties requires a lot of work by employees who have to set up, tear down and clean-up for the group’s using the amenities, he said.

“Are you talking just this one chari-ty or are we going to giving all charities free because then I guess we would have to revisit the budget,” Cordwell said.

Clarke said that without a policy in place the board will have to deal with such requests as they are made. “This one is the one that I’m dealing with to-day,” he said.

Stevens agreed and, regarding OPA policy, said “I haven’t seen anything that I can say this is right this is wrong.” He added that the issue is not just one of fees but also of how the OPA wants to use its facilities.

Director Tom Terry, who participat-ed in the meeting via conference call, suggested, since there is no policy in place for who is eligible for refunds and based on what criteria, that the board set Clarke’s motion in abeyance until it can agree on what groups do and do not get to use the facility for free. He said the policy that the board is supposed to follow when making such decisions isn’t

in place.Clarke disagrees. He said the appli-

cable resolution makes clear that char-itable organizations with a majority of Ocean Pines residents as members are exempt from fees.

Terry said there are many types of nonprofit organizations in the Ocean Pines area and they are not all like Starr Charities. He said the board should not be in a position where it needs to re-view and make a motion every time a group wants a refund. He said the board should hold off on making a decision un-til it can review a policy that can be im-plemented by the general manager.

Since there is not policy currently in place the board would set precedent by issuing the refund to Starr Charities, Terry said. “We’re going to open the door for virtually everybody who’s pay-ing anything to come in and ask for a refund,” he said.

Terry said he isn’t necessarily op-posed to giving back the funds paid by Starr Charities but just don’t want to “open Pandora’s box.”

Stevens agreed that is the underlying issue. But he said the board is waiting for input from General Manager Bob Thompson and his group of advisors who are reviewing the issue.

In response to a question from Di-rector Sharyn O’Hare regarding when he will have a proposal to present to the board, Thompson said his advisory group is studying who is using the fa-cility, how they’re using the facility, and how many hours they’re using the facil-ity.

“We’re going all through that now as I’ve shared with you before. But we’re not ready to make any recommenda-tions to change or modify the existing policy that’s been in place.”

Terry ultimately made a motion to ta-ble Clarke’s proposal to refund the fees paid by Starr Charities for 60 days. The motion was approved in a 5-2 vote.

Star Charities donationStar Charities founder Anna Foultz and her volunteers presented a check for $4,500 Feb. 19 at the Ocean Pines Community Center to Maj. General Jim Adkins (retired), Maryland National Guard, to benefit Wounded Soldiers in Maryland. Accepting the check with Gen. Adkins was Col. Charles Kohler, also of the Maryland National Guard. The money was raised through Star Charities’ annual Beef and Beer event held January 9, 2015 at the OP Community Center. From left: Ocean Pines Association President Dave Stevens, Lee Tilghman, Col. Kohler, Anna Foultz, Mrs. Adkins, Gen. Adkins, Paul Mazzei, Sandy McAbee, and Peggy Rumberg.


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Worcester faces depletion of budget stabilization funds County institutes hiring freeze to

control expenditures


Facing another challenging budget year resulting from a continued decline in projected property tax

revenues, the Worcester County Com-missioners have enacted an immediate hiring freeze for non-public safety per-sonnel.

“County revenues are anticipated to dip from $178 million in the current fis-cal year to $167 million in FY16 unless significant budget stabilization funds are utilized,” Commissioner President Jim Bunting said.

“The county has lost over $40 million in property tax revenues since fiscal year 2009 due to declining assessments, and property tax revenues are project-ed to decline by another $4 million in FY16.”

While officials insist that the coun-ty’s overall financial health remains strong due to sound fiscal management, the commissioners instituted the hiring freeze to help buffer the effects of re-duced tax revenues in order to avoid hav-ing to utilize all of the remaining budget stabilization funds to balance the oper-

ating budget in fiscal year 2016.

In Feb-ruary, the commission-ers met with county Fi-nance Officer Phil Thomp-son and A s s i s t a n t Finance Offi-cer Jennifer Swanton to review the

get stabilization funds in FY 2015 and FY 2016. The general fund is expected to fall to $169.1 million in FY 2017 once the budget stabilization funds are ex-hausted.

Major revenues, including property tax, income tax and other taxes, com-prise $155.3 million of the anticipated general fund revenue. Property taxes were severely affected by the declining assessments.

The county’s revenue history, which includes a property tax increase in FY 2013 to stabilize revenues and a de-crease in the homestead tax credit from $10.2 million in FY 2009 to $2.4 million in FY 2014, shows consistent declines. The county also transferred budget sta-bilization funds in FY 2015 to produce a balanced budget.

Revenues projections include a de-crease in Ocean City property assess-ments effective July 1, 2015, resulting in a net property tax loss of $1.4 million for FY 2016 based on current state es-timates.

Thompson said the county has lost more than $40 million in property tax revenues due to declining assessment since the recession began during FY 2009.

However property assessments ap-pear to have stabilized and may begin to increase again in the future. He also

concluded that, based on current reve-nue projections, the county will need to fill an $8.7 million decline in total rev-enues in FY 2017, after exhausting the budget stabilization funds.

Thompson said that the bottom of the revenue trough, which was previously estimated to occur in FY15, is now pro-jected for FY 2016.

In response to a question by Com-missioner Bud Church, Thompson said that here may be opportunities for the commissioners to cut expenditures to avoid exhausting all budget stabiliza-tion funds.

Swanton said that the proposed state budget bill for FY 2016 would also di-vert a portion of the Local Impact Grant funds from the Casino at Ocean Downs from the county to the state’s Education Trust Fund.

She said that for Worcester County that would equate to a loss of roughly $300,000 annually and would affect the county’s ability to cover the debt payment on Worcester Technical High School.

Reassessment area 1 is northern Worcester County including Ocean Pines, which is due for revaluation in 2016. Area 2 is southern Worcester County and will be reassessed for 2018. Are 3 is Ocean City and was just reas-sessed for 2015.

revenue projections for the fiscal year 2016.

The news, which is based on state Department of Assessments and Tax-ation assessment cycles and effective dates, with Ocean City representing 60 percent of the county’s total assessable base, wasn’t good.

The county’s assessable base shows a $5.46 billion assessment decline from $20.25 billion in FY 2009 to an estimat-ed $14.79 billion in FY 2016, with an anticipated increase to $15.06 billion in FY 2017

The general revenue fund is expect-ed to dip from $178 million in FY 2015 to $177.9 million in FY 2016, including $6.4 million and $10.5 million in bud-

Jim Bunting


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Ocean Pines seeks more than $1.07 million in county grantsWORCESTER COUNTY

OPA asks for funds to support the police department, roads and bridges maintenance, tourism

and recreation and parks programs


Contending that the Ocean Pines Association supports the largest year-round population in the coun-

ty, the Board of Directors has asked the Worcester County Commissioners to provide more than $1.07 million to help cover the cost of its services and pro-grams.

OPA representatives on March 3 presented the association’s requests for funding for fiscal year 2015-16 budget to the commissioners. The request in-cludes $625,000 for public safety, $7,500 for tourism, $150,000 for recreation and parks, $250,000 for roads, another $54,386 in county street grant funding and $33,000 in a restricted fire depart-ment grant.

“Despite having the largest year-round population, we continue to receive the minimum level of funding compared to the amount of funding received by the other communities in Worcester Coun-ty. The minimum amount we receive is surprising when you compare the per capita dollars allocated,” OPA General Manager Thompson said.

Although Ocean Pines contains more than 7,700 homes and a year-round pop-ulation of 11,700 residents, or 23 per-cent of the county’s population, Thomp-son said the funding coming to the OPA is lacking.

“Our funding request involves four distinct needs, public safety, roads and bridges, tourism and recreation. To gain some perspective on the financial pic-ture between Ocean Pines and the rest of the county, we have captured sever-al of the critical elements directly from the county budget as they pertain to the

Ocean Pines community,” Thompson said in his funding request letter to the commissioners.

For several years the county has pro-vided the OPA with a grant that has been used to fund the police depart-ment. This year in the area of public safety the OPA is asking the county for funding of at least $650,000. The total budgeted cost to Ocean Pines to operate the police department during the fiscal year exceeds $1.6 million.

“We are appreciative of the financial support given to us by the commission-ers and trust that you will be able to continue this extremely valuable and much-needed support for our police services during the coming fiscal year,” Thompson said in his letter to the coun-ty.

Last year the OPPD handled more than 12,400 calls for service, directly assisted the allied police agencies with more than 400 calls for service in the areas surrounding Ocean Pines. Con-tinued growth in the Route 589 corri-dor places increased demands on the 15 sworn member police agency.

Thompson said the OPA has seen a dramatic increase in calls for service in the past 5 years and anticipates future growth in public safety demands to keep pace with development.

In an effort to reduce demands on the county and the state police, the OPA agreed to assume all public safety calls for service on Manklin Creek Road. In

addition, in response to recent tragic events, the police department is called upon to provide patrols and visits to the various schools in the area.

“While we do not mind being called upon to support the residents outside of Ocean Pines, it does put additional strain on our already stretched resourc-es,” Thompson said.

To ensure that the Ocean Pines bridges and roadways remain safe the association requested county funds of $250,000. In previous years the county provided funding in the average amount of $500,000 annually but that money was passed through from the state’s highway user funds, better known as the gas tax.

“We acknowledge the county’s loss of liquid fuel funding that has restrict-ed your ability to provide Ocean Pines needed road maintenance dollars for paving, drainage, bridges and similar projects,” Thompson acknowledged in his letter.

The OPA has budgeted this year to spend $175,000 on required repairs that were identified in the county’s recent in-spection of the bridges in Ocean Pines. It does not include any funding for roads work.

“Our roads and bridges are an im-portant part of our infrastructure. Safe passage of emergency vehicles, school buses and county wastewater vehicles are just a small part of daily activities on our roadways and bridges.

Funding for roadways and bridges are vitally important to the wellbeing of our community.”

The OPA is also seeking $7,500 in county funding for promotional purpos-es. Thompson said tourism is of vital im-portance in Worcester County and the OPA supports various activities that at-tract participants of all ages who reside in and out of Ocean Pines.

He argued that its efforts to provide amenities like boat ramps, marinas, the Yacht Club, Robert Trent Jones golf course, Worcester County Veterans Me-morial and the Beach Club in Ocean City all contribute and add value to the tourism industry that exists in Worces-ter County.

“We would appreciate your consider-ation of a small portion of tourism fund-ing to help us in our efforts to provide amenities and programs that highlight the benefits of visiting Worcester Coun-ty,” Thompson said.

He asked the county to assist the OPA with covering the costs associated with its Fourth of July celebration, which is budgeted this year at $15,000.

He said this event is one of the big-gest holiday activities of the year, swell-ing the community population to more than 25,000.

The OPA want funds to help cover the expense associated with providing the fireworks display that serves not only Ocean Pines residents but also guests and visitors from all across the north end of the county.

The vent is so well attended that it has to be held at the county’s Showell Park on Route 589.

For recreation and parks the OPA wants $150,000 to assist in providing various recreational programs and facil-ities. That represents just 6 percent of the OPA’s annual budget for recreation and parks, including the aquatics de-partment, exceeds $1.6 million.

“Our programs provide an essential service to many Worcester County res-idents yet the vast majority of those expenses are paid by our OPA mem-bership,” Thompson said. “Despite that fact, over 35 percent of our recreation and parks program participants are non-Ocean Pines residents.”

He said the recreation and parks de-partment is open seven days per week to meet the needs of residents, visitors and tourists in the county.

It offers many free amenities and ac-tivities including concerts, tennis, fire-works, marinas, boat ramps, basketball courts, soccer fields, playgrounds, walk-ing trails and more that are open to the public.

“We understand the very difficult task of selecting where and how to al-locate financial resources with so many competing elements,” Thompson said, adding that even if the county were to approve all of its funding request, Ocean Pines would still receive less than 50 percent of what the next comparable community receives.

30 Ocean Pines PROGRESS March - Early April 2015 WORCESTER COUNTY

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County proceeds with second phase of Pines water line project

Community members participate in training

Community Emergency Response Team members received training on how to provide traffic control at an incident scene from Corporal Dale Trotter, of the Worcester County Sheriff ’s Office. This exercise was part of ongoing training that’s offered to members and included Cpl. Trotter providing an overview of the Sheriff ’s Office’s K9 team, including his role as a K-9 handler and the ser-vices he and K-9 partner Edo provide.

CERT members are area residents who have completed prior CERT instruc-tion through Worcester County Emer-gency Services. This training equips them with the information needed to help themselves and their neighbors prepare and survive during the first 36 to 72 hours after a catastrophic event when local first responder resources are stretched to their limits. They also as-sist WCES at special events, such as the County Fair and Blessing of the Com-bines, where they provide first aid to those in need and distribute emergency preparedness information to the public.

The CERT program is an extremely

With phase 1 of the work wrapped up, the Worcester County Commissioners in

February approved moving ahead with the new phase of a water line replace-ment project in Ocean Pines. The com-missioners met with John Tustin, coun-ty director of public works, to review the status of the project.

Last year the commissioners autho-rized waiving the bids and accepted a negotiated price for 47 water service line replacements from the company of WM Water and Sewer LLC of Ocean View, Del. He said that since then WM has nearly completed the service lines iden-tified in that phase of the project and the company’s performance has been very satisfactory.

As a result, Tustin proposed assign-ing the company additional water lines for replacement. Based on Tustin’s rec-ommendation, the commissioners ap-proved accepting a proposal from WM Water and Sewer LLC to complete phase 2 of the project in Ocean Pines. The work includes installing an additional 35 short side service lines at a cost of $550 each and 36 long side service lines at a cost of $900 each for a total cost of $51,650.

Tustin said the work would begin im-mediately.

informative, hands-on, educational pro-gram packed with information to equip residents, who have no prior emergen-cy medical training, to gain the deci-sion-making and practical skills nec-essary to offer immediate assistance to those in need following an emergency until further help can arrive.

“CERT helps you prepare yourself, your family, your community to face a wide variety of emergencies,” Tom Kane, WCES emergency planner, said. “CERT just makes you safer.”

To find out how you can become in-volved in CERT, contact Kane at 410-632-3080 or [email protected].

Tourism officials call for Green nominations

Worcester County Tourism is accept-ing nominations through April 10 for the fourth annual Worcester Green Awards. celebrating excellence in promoting en-vironmentally friendly practices, strate-gies and products.

Awards will be presented to Worces-ter County businesses that demonstrate extraordinary performance related to sustainable environmental practices,

such as water conservation, wastewa-ter management, the promotion of al-ternative transportation and transit, recycling, energy conservation, on-site renewable energy production, use of lo-cal products and food sources and the purchase of renewable energy.

Nominations are being accepted in five categories: Community Leader such as a business person or organiza-tion, Business, Lodging, Restaurant or Teacher.

Applicants will be judged on their overall level of commitment, measur-able environmental benefits or progress, cost savings, and customer outreach and engagement. To qualify, applicants must reside or operate businesses in Worces-ter County. Awards will be announced during the Ocean City Hotel-Mo-tel-Restaurant Association dinner meet-ing on April 23 in Ocean City.

For more information about the Worcester Green Awards, visit www.vis-itworcester.org.

County offers STEM Internships and Camp

Worcester County Economic Devel-opment is now accepting applications for the 2015 STEP UP and Reach for


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the Stars summer programs. These pro-grams provide opportunities to Worces-ter County youth to explore unique career paths in the fields of science, technology, engineering, and mathemat-ics. Applications are available online at www.chooseworcester.org/STEM<http://www.chooseworcester.org/STEM> and are by Tuesday, March 31.

“Since 2013, WCED has offered the STEP UP and Reach for the Stars pro-grams to engage local students in the STEM disciplines. This county program connects local students, from middle schoolers through the university level, with businesses and agencies in Worces-ter County. These programs provide students with a platform to learn from

WORCESTER COUNTYAROUND THE COUNTY

From Page 30

professionals and entrepreneurs in their own communities while allowing em-ployers the opportunity to home grow their future workforce.

Reach for the Stars is an eight-day computer science and aerospace en-gineering summer camp taught by a team of qualified educators and IT and engineering professionals. Offered at The Red Doors Community Center on 3rd Street in Ocean City, it is open to Worcester residents enrolled in grades 6-9 in the 2014/2015 school year.

The STEP UP Summer Internship Program is designed to provide high school and college students with the opportunity to gain hands-on work ex-perience in a STEP career field, thus providing an opportunity for classroom studies to be applied to real life tasks. It also connects Worcester County STEM businesses with their future workforce.

Interns will be placed in medical set-tings, IT companies, engineering firms, environmental science agencies, and digital media production companies in Worcester County. They will also par-ticipate in professional development sessions while on the job that teach communication, time management and career skills.

For more information, call Fawn Mete at 410-289-5576.

Recreation and Parks offers prevention program

Worcester County Recreation and Parks in conjunction with Atlantic Gen-eral Hospital will hold Stepping On, a well-researched falls prevention pro-gram for elderly adults.

This seven-week program will take place at the Worcester County Recre-ation Center in Snow Hill on Tuesday afternoons at 12:30 p.m. and is free of charge to the public.

Stepping On aims to break the cycle of falling, engaging people in a range of relevant fall preventive strategies. The program content draws on current evi-dence for falls prevention and has been proven to reduce falls.

Local experts from the community will present topics on exercise, medica-tion management, vision and falls, and community safety.

Guest speakers may include physical therapists, pharmacists, optometrist, occupational therapists, police and oth-er community mobility experts. Pre-reg-istration is requested. Call Dawn at 410-641-9268.

E-cycling day setat Park and Ride

Worcester County will hold its next e-cycling day and household hazardous waste collection on Saturday, April 18 at the Park and Ride in West Ocean City from 10 a.m. to 2 p.m.

The county sponsors the program in in cooperation with the Maryland Department of the Environment and Maryland Environmental Service. The county incurred expense for the project is about $20,000 and is available in the fiscal year 2015 budget.

Pine’eer craft shop reopensThe quaint craft and gift

shop located opposite the Ocean Pines Community

Center will re-open for shoppers on Saturday,

March 14. The shop is run by members of the Pine’eer

Craft Club and has been closed for the winter. The opening will feature the

latest creations by mem-bers of the club. Pictured

are Jacki Kollar, Shop Man-ager, and Sharon Puser,

President of the Club. The shop is open Saturdays 9

a.m. to 3 p.m. and Sundays 11 a.m. to 3 p.m.


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March - Early April 2015 Ocean Pines PROGRESS 33GENERAL ASSEMBLY

County’s share of casino impact funds on chopping blockBill in the General Assembly aims to build up Education Trust Fund, and that could cost the OPA money allocated for road resurfacing


Legislation is pending in the Gen-eral Assembly that could sig-nificantly reduce the amount of

money coming to Worcester County, and by extension Ocean Pines Association, in the form of Local Impact Funds from the Ocean Downs Casino.

The Hogan administration’s proposed budget bill, the Budget Reconciliation and Financing Act of 2015, would divert local impact funds that would otherwise go to the county, which then divvies up some to the OPA, Ocean City and Berlin. The cross filed bills, House Bill 72 and Senate Bill 0057, provide for the trans-fer of certain funds currently allocated as local impact money.

During a February meeting with the Worcester County Commissioners, As-sistant Finance Officer Jennifer Swan-ton said that the proposed state budget bill would create a direct loss of revenue to the county of roughly $300,000 annu-ally. She said that would affect the coun-ty’s ability to cover the debt payment on Worcester Technical High School, where the funding was designated.

Local impact grant funds are desig-nated to be used for improvements in communities in immediate proximity to the video lottery facilities and may be used for infrastructure improvements, facilities, public safety, sanitation, eco-nomic and community development including housing and other public ser-vices and improvements.

In fiscal year 2015, $4,073,964 of the funds that would otherwise be allocated as video lottery terminal local impact grants statewide would be moved to the Education Trust Fund instead. In the following fiscal year, 2016, the state would transfer $3,887,697 the Educa-tion Trust Fund. The bills have an effec-tive date of June 1, 2015.

Therefore, county would lose the rev-enue almost immediately upon passage.

The current state law specifies that the distribution of proceeds from video lottery terminals includes a 5.5 percent designation for local impact grants.

Another two percent goes to the State Lottery and Gaming Control Agency, 33 percent to the video lottery operation licensee, seven percent to the Purse Dedication Account up to $1 million an-nually, until the issuance of a license in Baltimore City.

Another 1.75 percent goes to the Racetrack Facility Renewal Account, and 1.5 percent to the Small, Minority and Women-Owned Business account. It also specifies that six percent goes to the licensee if they own or leases their ter-minals except for Anne Arundel County licensee, which gets eight percent. After the issuance of a license for a facility in Prince George’s County, however, that changes to eight percent for the Anne Arundel licensee and seven percent to the Baltimore County licensee.

Finally, the current law says that “the remainder,” about 28 percent, goes to the Education Trust Fund, a special non-lapsing state fund that provides money for public elementary and sec-ondary education, through continuation of the funding and formulas established under the Bridge to Excellence in Public Schools Act. It includes funding for re-gional differences in the cost of educa-tion. It also provides funds to construct public school buildings and capital im-provements, fund capital projects at community colleges and public senior

higher education institutions.The fiscal year 2014 revenue distribu-

tions to Ocean Pines, Worcester County, the Town of Ocean City and the Town of Berlin topped $2.347 million. Although not a municipality, the Ocean Pines As-sociation was designated to receive a portion of the local impact grant funding because of the community’s proximity to the Casino at Ocean Downs.

The OPA was given a total of $234,715 in slots funding for fiscal year 2014, ac-cording to a Maryland Racing Commis-sion report, but did not yet spend any

of the money. Plans are to use the funds for road surfacing projects throughout the community. For FY 2015 the OPA is expecting to receive about $300,000.

A summary of revenue and expendi-tures for the Worcester Country portion of the fund for fiscal year 2014 shows that the county-received revenue for the period totals $1.408 million.

The county anticipates using the ca-sino funds to retire debt on the recently constructed Worcester Technical High School in accordance with its the multi-year plan.


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$4000 5/19 Wooded$4000 4/2092 Wooded$4000 9/38 Cleared, Septic Approved $4000 9/66 Cleared, Septic Approved$4000 1/471 Wooded$4000 4/1964 Wooded$4000 5/2473 Wooded, Septic Approved$4000 9/163 Cleared, Septic Approved$4000 5/2562 Wooded, Septic Approved$4000 11/97 Wooded, Septic Approved$4000 1/806 Wooded$4000 11/27 Wooded$4000 8/4 Cleared $4000 4/2338 Wooded, Septic Approved$4000 3/1657 Wooded, Septic Approved$4000 6/86 Wooded$4000 9/185 Cleared$4021 6/40 Wooded, Septic Approved$4200 6/45 Wooded, Septic Approved$4430 5/2482 Wooded, Septic Approved$4500 5/41 Wooded, Septic Approved$5000 6/17 Wooded, Septic Approved$5000 4/1962 Wooded, Septic Approved $5000 11/101 Wooded, Septic Approved

$5000 4/2039 Wooded$5000 8/48 Cleared$5000 4/ 2104 Wooded, Septic Approved$5000 4/2130 Wooded, Septic Approved$5250 1/1252 Wooded, W & S$5500 5/2403 Wooded, Septic Approved$6,000 1/1250 Wooded, W & S $6000 9/127 Wooded, Septic Approved$6500 7/276 Cleared, Septic Approved$7000 9/64 Cleared$7000 11/3 Wooded $7000 11/2 Wooded $7000 11/14 Wooded $7000 11/4 Wooded $7000 8/38 Cleared $7000 9/101 Wooded $7000 1/733 Wooded$7900 4/2177 Wooded, Septic Approved$8500 4/2358 Wooded, Septic Approved$8900 3/1723 Wooded, Septic Approved $8900 11/10 Wooded, Septic Approved$9000 9/126 Cleared, Septic Approved$10,000 9/168 Wooded, Septic Approved$10,000 11/32 Wooded, Septic Approved

UNDER CONTRACT

UNDER CONTRACT

March - Early April 2015 Ocean Pines PROGRESS 35CAPTAIN’S COVE

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Hearn says non-payment of property taxesattributable to protracted appeal process

Cove president to undergo heart surgery to repair aortic aneurysmBy TOM STAUSSPublisher

Captain’s Cove property owner as-sociation Tim Hearn, who has a major health issue of his own to

contend with, is also dealing with un-flattering press coverage about his com-munity that essentially portrays it and its primary developer as property tax scofflaws.

A recent article published in a local weekly and on its parent daily’s Web site says that the two developer-owned enti-ties in Captain’s Cove, together with the Cove POA, owe more than $600,000 in delinquent property taxes to the coun-ty, including interest and penalties. The county treasurer, Dana Bundick, is quot-ed in the article as contending that the delinquent taxpayers “didn’t keep up their end of it,” phrasing that seemed to imply that developer interests and the Cove association had agreed to a pay-ment plan and then reneged on it.

“That’s a hunk of money they owe the county and for you and me and the rest of us who pay our taxes, that’s not fair,” she’s reported as saying.

In a recent email exchange with the Progress, Hearn made it clear that the developer entities, CCG Land LLC and CCG Note, LLC, as well as the Cove POA, are still involved in appealing as-sessed valuations of lots at the heart of the dispute. The appeals were first dis-closed and reported on this past sum-mer, along with the decision not to pay property taxes levied on what the appel-lants regard as inflated values used for tax purposes.

In reaction to the unflattering pub-licity, Hearn recently directed the Cove POA’s financial management firm, L&H, to issue a check to Accomack County for $10,000 to cover a portion of the alleged delinquency, which reportedly is for about $17,000.

He made it clear, however, that the payment was made under protest and that the Cove POA will seek a refund of any overpayments made once the appeal process is completed.

There is no indication that CCG Land or CCG Note will be taking a cue on the payment of disputed tax bills from the Cove POA pending completion of the ap-peal process.

Hearn has not been pleased by the slow process in resolving the assess-ment appeals. As he said last summer when the issue arose, the county uses a default value of $4,000 for many Cove lots, including those that are unbuild-able because of the lack of roads and/or utility availability. The market for resale lots in the Cove has not bounced back from the real estate downturn of 2007-08. More recently, lot sales have slowed to a trickle, while home resales and new home construction is keeping pace with demand, according to industry profes-

sionals.With few recent comparables on

which to base values for assessment purposes, because of the lack of recent sales, Hearn and others have suggested that the value of undevelopable lots in Captain’s Cove should be $400 or even less.

“Previously, making a payment to Accomack County on a distorted assess-ment value has not provided any benefit to the taxpayer, CCGYC included, as the assessor continued to be unmotivated to consider the current sales compara-bles,” Hearn said in a recent email. “Giv-en that situation, L&H was instructed by (Hearn) to not make tax payments” by the December, 2014 deadline “and to hold that cash on the … balance sheet until the appeals were resolved.

Hearn said that while the decision was made to cut a check to the county for $10,000, Cove POA counsel will be asked to request a rebate “for any over-age paid … for the past three years once the appeal is completed.”

The tax dispute is not the only chal-lenge facing Hearn. He was recently diagnosed with an aortic aneurysm, a congenital condition that requires open heart surgery to rectify. He underwent surgery the week of March 9, with recov-ery time likely to last several months. With Hearn unavailable to preside over Cove affairs during his recuperation from surgery, Cove POA vice-president Dave Kieffer will be stepping into the board’s leadership role until Hearn is able to return, expected sometime this summer.

Hearn’s recent email provided addi-tional background and context for the

tax dispute that he feels was omitted from the front page newspaper article that triggered the decision to release the $10,000 payment to the county.

According to Hearn, CCG Land owns approximately 700 or so lots in the un-developed sections of 12-18.

“As just about everyone on the plan-et is aware, except for the Accomack County Assessment office and Trea-surer’s office, these lots have a value of somewhere between $100-$400, based on comparable sales for the past seven years,” Hearn wrote. “Accomack Coun-ty has continued to try to assess these lots at a value starting at $4,000 and, in certain cases, increasing above that amount.

For obvious reasons, he said that

CCG Land has appealed those assess-ments, and “under state law, the appeal is retroactive back as much as three years.”

Hearn said that because of the overall volume of the amount of lots involved, Accomack County has struggled to com-plete the appeal process.

“However, once this is done, it is as-sumed that the new values will be es-tablished and the taxes paid on that far lower amount,” he added.

According to Hearn, Bundick, the county treasurer, seems not to under-stand the appeal process for property assessments in Accomack County.

In the recent newspaper article, she “comes across as being completely un-informed” about the appeal process and how its outcome may affect property tax collections in Captain’s Cove.

“Most public officials would be telling the (Accomack County) commissioners to expect a write down of close to $500,000 in the amount she was quoted

36 Ocean Pines PROGRESS March - Early April 2015 LIFESTYLES

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HAPPENINGS

From Page 35

Captain’s Cove

as using, given the appeal process, but it will be for her to explain to her bosses why this ends up being such a surprise,” Hearn wrote.

In his recent email, Hearn noted that CCG owns about 350 lots in Sections 1 through 12, where assessed valuations of $30,000 per lot are common.

“Needless to say, the Assessment amount of $30,000 per lot is similarly overstated and will be reversed in the appeal,” he predicted.

Hearn said the same conditions apply to the 300 or so lots that the Cove POA has acquired over the decades, including those acquired in foreclosure sales that have occurred since Hearn became the Cove’s president in 2012-13.

“At a Board Meeting during the 2015 budget process last summer, it was discussed that Captain’s Cove Golf and Yacht Club (the Cove POA), and any other owner in CC, should plan on appealing the assessment amounts for

its property once the CCG Note And CCG Land appeals are completed,” he said.

While it was not expected that the appeal would go into 2015, “clearly the Treasurer’s offi ce in Accomack County is not feeling motivated to conclude this process,” Hearn said.

Bar seating issue resolved -- At the Feb. 21 Board of Directors meeting, the directors, by a 5-1 vote, enacted a revised policy regarding minors seated at bars within Captain’s Cove. The revision followed a well-publicized incident at the bar in the Marina Club involving a minor, which prompted concern among some Cove residents.

Under the policy, no unaccompanied minors (individuals under 18 years of age) are to be seated at any of the CCGYC bars at any time. Minors accompanied by an adult may be seated at the Marina Club Restaurant bar until 4 p.m. unless the “bar manager or bartender deems that it would be more appropriate for the individual to be seated at a table.” No minors are to be seated at the tiki bar at the outside Marina Club pool anytime.

Saturday, March 14Pine’eer Craft Shop, opening for

the season. Selection of handmade items created by local crafters at reason-able prices, jewelry, hand-stitched items, beach décor and much more. Open Sat-urdays, 9 a.m.to 3 p.m., and Sundays, 11 a.m. to 3 p.m.

The Ocean Pines Anglers Club, monthly meeting, Ocean Pines library, 9:30 a.m. Discussion of rods, termi-nal tackle, bait and fi shing techniques. A short video taken during the 1998 Nor’easter will show how storms can affect local bays. Matt Heim, currently leading the Assateague Coastal Trusts efforts in regards to offshore oil and gas exploration, will review legislation and what affect it might have on our local waters. All welcome.

Sunday, March 15Sharing Sunday, sponsored by

the Democratic Women’s Club, 1-3 p.m,, Southside Fire Station, collection of non-perishable food, toiletries and pa-per products, to be shared with a local food ministry. 410-641-8553.

Thursday, March 19Pine’eer Craft Club. monthly

meeting, 9:45 a.m., Ocean Pines Com-munity Center, craft, greeting cards, supplies $3. RSVP Janet, 410-641-6187.

Friday, March 20Worcester County Tea Party

Speaker Series 2015, Worcester Coun-ty library, Ocean Pines branch, 7 p.m. Featuring Mike Bradley, morning host of the “Talk of Delmarva” on WGMD (92.7 FM), “Stories From Behind The Microphone.” Free and open to the pub-lic.

Kiwanis wine tasting and Chi-nese auction, 4-7 p.m., Ocean Pines Community Center, $20 per person. Va-riety of wine samples, hot and cold hors d’oeuvres, desserts, coffee, tea and soft drinks. Proceeds will benefi t the Kiwan-is Scholarship Foundation. Tickets from any Kiwanis member or Ralph Chinn, 410-208-6719.

Saturday, March 21Sons of Italy Festival, a day of food,

games and music, St Andrews Hall at 144th and Sinepuxent Streets, Ocean City, 11 a.m. to 6 p.m., from 11 am to 6 pm on March 21. Ravioli and meatball platters, meatball and sausage subs, freshly made cannoli, minestrone soup and wine, soda and beer.

Sunday, March 22Mid-Atlantic Symphony Orches-

tra Spring Concert, Community Church of Ocean Pines, 3 p.m. $38 per ticket. “From Leipzig to London,” featur-ing Mendelssohn’s The Hebrides, (Fin-gal’s Cave), Schumann’s Concerto for Cello featuring Lukasz Szyrner on the cello and Haydn’s “London” Symphony Number 104. 1-888-846-8600 or visit midatlanticsymphony.org for tickets or information.

Tuesday, March 24The Maryland Saltwater Sport-

fi shing Association, monthly meet-ing, Lions Club on Airport Rd. in West Ocean City, 7:30 p.m. Guest speakers will be talking about the proposed oil and natural gas drilling off the Mid Atlantic Coast.

Wednesday, March 25 OPA Search Committee, open

meeting, 6 p.m., Ocean Pines Commu-nity Center. Agenda includes outline of the function of the Search Committee, description of qualifi cations of the can-didates, responsibilities of OPA Board members, and input on fi nding interest-ed candidates.

Thursday, March 26The Republican Women of

Worcester County, monthly luncheon meeting, 11 a.m., Golden Sands Hotel, 109th St, 22nd fl oor, Ocean City. Guest speaker, Michael Franklin, CEO of Atlantic General Hospital. $16 per person. For reservations, Ann Lutz, 410-208-9767 or [email protected].

Democratic Club of Worcester County, monthly meeting, Ocean Pines Assateague Room. Refreshments 6:30 p.m., followed by guest speaker, Michael Mathers, PA, who will discuss

ideas for creating estates and trusts, and elder law in particular. Democrats and independents welcome.

Women’s Club of Ocean Pines, monthly meeting, Ocean Pines Community Center, 10 a.m. Corrie Boger, the new owner of Home Instead Senior Care in Berlin, guest speaker. Light refreshments, 50/50 raffl e. Dianna Bolyard, 410-208-9326 or [email protected].

Saturday, March 28Regular monthly meeting,

Ocean Pines Association, Board of Directors, Ocean Pines Community Center, Assateague Room, 9 a.m. Includes public comments segment.

NARFE Alzheimer Fundraiser , noon to 3 p.m., Carrabba’s Italian Grill, West Ocean City, $10 per person. Choose from chicken marsala, Italian cobb salad or spaghetti and meatballs. Also includes coffee, tea and dessert. For tickets, Jo Fortney, 410-208-6246, or Larry Waltom, 443-831-1791.

Tuesday, March 31Annual Mediacom town hall,

Ocean Pines Community Center, Assateague Room, 6 p.m. Questions, gripes from Mediacom customers directed at Mediacom executives.

Thursday, April 2Women’s Club of Ocean Pines,

card and game party, 10 a.m. to 2 p.m., the Restaurant at Lighthouse Sound, near Bishopville. Munchies, coffee, tea and water during play, lunch. Fundraiser to benefi t the Club’s high school scholarship fund and community donations. $25 per person. Checks should be payable to WCOP and sent to WCOP Card Party, 20 Chatham Court, Berlin MD 21811. Deadline for

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March - Early April 2015 Ocean Pines PROGRESS 37OPINION

COMMENTARY

reservations March 26. Pat Addy, 410-208-0171.

Tuesday, April 7Arts Night, Dazzle gift shop,

Manklin Station (near DeNovos), 4-7 p.m. Refreshments. Showcasing local artists creating their artwork. Artists Jim Adcock, Bev Wisch, Dot Park and Marcia Cupschaulk. Opportunity for

Star Charities should get full refund

If Ocean Pines Association management would bother to read and apply the applicable resolution governing the use of the Ocean Pines Community

Center by organizations comprised of Ocean Pines residents, it never would have charged the non-profit Star Charities $450 for use of the facility for its annual beef and beer fund-raising to benefit wounded veterans.

That General Manager Bob Thompson and his “secret” group of advisors are considering changes in the use policy is irrelevant to whether Star Charities should have been charged under the existing policy, and whether the group, headed by the tenacious Anna Foultz, should receive a refund of the money improperly collected.

As OPA Director Marty Clarke has noted, the applicable resolution that has been in place for some time says that charitable organizations with a majority of Ocean Pines residents as members are exempt from Community Center fees.

Had OPA staffers bothered to enquire of Anna Foultz, they would have learned that her charity is comprised entirely of Ocean Pines residents. That the group is doing great work on behalf of wounded veterans goes without saying, and it should have triggered more than just the typical bureaucratic rigidity on the part of staff when deciding to impose rental fees.

The OPA Board of Directors hasn’t exactly risen to the occasion on the matter, either. Clarke’s motion at a recent board meeting to refund the rental fees failed on a 5-2 vote. Sadly, the justification used by five directors to table the matter rests on the fact that Thompson and his merry band of “secret” advisors – Okay, really not that secret but secretive in the sense that their meetings are not open to the media and OPA members – is contemplating some changes – clarifications or whatever – to the use policy.

Thompson says he will be making some recommendations to the board of directors very soon, and he very well could follow through. Then again, he might not, depending on whether he and his advisors can come up with something reasonably coherent that they feel could pass board muster.

Thompson hasn’t always delivered on soft deadlines. For instance, at the Feb. 22 board meeting he promised to deliver a revised year-end forecast for golf operations within a week of the meeting. A week later, according to OPA President Dave Stevens, the revised forecast had not arrived in directors’ in-box.

Assuming for a moment that Thompson delivers a revised use policy for consideration, that’s hardly the end of the process.

The directors then weigh in, massaging, debating and finally deciding what kinds of changes, if any, ought to be made to existing policy. Then the whole

Board needs to consider Yacht Club leasing option

thing is delegated to the Bylaws and Resolutions Advisory Committee for proper wordsmithing, with guest involvement by the OPA attorney if some vexing legal issues arise.

In the meantime, the OPA is holding on to Star Charities’ rental fee.

There’s only one sensible way to resolve the matter.There should be no further delay in refunding the

fee.If Thompson won’t act on his own volition to do it,

then Clarke should try again at the earliest opportunity to offer his motion to force the general manager to act. This time, the directors shouldn’t use a lame excuse to hold on to money improperly collected from Star Charities.

The simple fact is that existing policy exempting certain charitable organizations with substantial Ocean Pines membership from having to pay a rental fee should not be changed. Neither Thompson, his merry band of advisors, nor the board should be wasting valuable time trying to tweak a policy that is acceptable as is.

Even if the directors for some reason disagree and decide to change policy, the existing resolution applies to Star Charities.

There is no reason whatever not to refund the rental fee, immediately, with apologies for having collected it in the first place. - Tom Stauss

There could not be a better time than now for the Ocean Pines Association to solicit proposals for leasing out the Yacht Club.

Having dealt with management of the Ocean Pines golf course in a way that offers some hope for rebuilding a depleted membership base, OPA management can now devote some energy into figuring out a better way to manage the Yacht Club, which is heading towards a very poor end to the fiscal year despite a rosy forecast recently issued by the OPA general manager.

As it has for most of its history, the Yacht Club managed to make a decent profit this past summer, in part because OPA members wanted to check out their newest amenity, purchased at a $5 million price tag or thereabouts. Part-time summer residents in particular flocked in large numbers to the new facility, proving that even the OPA can make money in the summertime at the Yacht Club.

It’s the rest of the year that’s the problem. Beginning in the shoulder months of the fall, profits racked up in the warmer months began to dissipate. As of Jan. 30,

after several months of substantial losses, the Yacht Club was $70,764 in the red for the year, with the less-than-stellar months of February, March and April likely to add further to the cumulative losses. January’s actual loss was $45,876, and there’s no particular reason to believe that February, March and even April will be much different.

General Manager Bob Thompson informed the directors recently that some personnel cuts were made recently to reduce losses, but we’ve heard that song before. The greater likelihood is that the Yacht Club’s loss for the year will be somewhere between $150,000 and $200,000, notwithstanding management’s latest rosy forecast of a $76,513 loss for the year.

How credible is that forecast, given that the loss through January is just a few thousand dollars short of $76,000?

Thompson has not yet hired a new Yacht Club manager following the termination of the previous manager last fall, and the summer season is fast approaching. Rather than go through the exercise of screening and interviewing a multitude of candidates

to fill the position, the general manager would be well advised to draft a request for proposals (RFP) seeking qualified restaurateurs to lease out the Yacht Club.

Were he to present such a proposal to the Board of Directors for consideration, he might find the directors receptive.

Or, the OPA could hire a local commercial real estate firm to handle the matter from start to finish. Prominent Ocean Pines resident and businessman Marvin Steen has been prospecting locally for the right firm and may have found a good one, with years of success in filling commercial space in Salisbury and elsewhere. Thompson would do himself and the OPA a favor by picking up the phone and talking to Steen.

Leasing out the Yacht Club could have the result of turning an amenity that has never made money for the OPA into a profit center akin to Beach Club parking and marina boat slip rentals.

It’s an idea whose time has come, if only our elected and unelected leaders could rise to the occasion. - Tom Stauss

HAPPENINGSFrom Page 36

area residents to meet and greet local talent. Ongoing

Free platform tennis clinics, Saturdays at noon, Manklin Meadows tennis complex. Bring sneakers, the rest is provided. Annual memberships start at $150 .

Pine Tappers free adult tap dance classes, Tuesdays, 2-3:30 p.m., Ocean Pines Community Center. Exercise and have fun with choreographed tap

dancing routines. From 2-2:30 p.m., brush up on basic techniques and a review of the routines, then join the regular class from 2:30-3:30 p.m. Every week or drop-in as convenient. Lori at 410-251-2162 or [email protected].

Ocean Pines Ping Pong Club, Ocean Pines Community Center, Monday noon to 2 p.m, Wednesday and Friday noon to 3 p.m. All levels of players welcome. Neil Gottesman, 732-773-1516.

The Kiwanis Club of Greater Ocean Pines – Ocean City every Wednesday at 7:45 a.m. in the Ocean Pines Community Center.

Sanctioned duplicate bridge games, Ocean Pines Community Center, Sundays 1 p.m., Mondays noon, Tuesdays 10 a.m. Partners guaranteed. $5, special games $6. Third Sunday of every month is Swiss teams (no partner guaranteed for teams). Felicia Daly, 410-208-1272; Pat Kanz, 410-641-8071

38 Ocean Pines PROGRESS March - Early April 2015 OPINION

“My bigger concern is we made a decision to move down a path … a different path with a different company. How much research went into that company before we made the decision? That’s a concern for me. And I’m not making light of it. I’m not hoping it was wrong. But I’m trying to go back and get my arms around it … reading everything because I’ve been asked to support the new team coming in. And as I read through it, it does not appear we did our due diligence in the same way that we did when we brought a different company in (Billy Casper Golf). And I think it’s important to note that or ask about it. And I’m not out of line asking it because I think it’s appropriate to understand that.”

– Ocean Pines Association General Manager

Bob Thompson

The Ocean Pines Progress, a journal of news and commentary, is pub-lished monthly throughout the year. It is circulated in Ocean Pines, Berlin, Ocean City, and Captain’s Cove, Va.Letters and other editorial submis-sions: Please submit via email only. Letters should be original and exclu-sive to the Progress. Include phone number for verification.

127 Nottingham LaneOcean Pines, MD 21811

PUBLISHER/EDITORTom Stauss

[email protected]

Advertising SalesFrank Bottone410-430-3660

ART DIRECTORRota Knott

CONTRIBUTING WRITERRota Knott

[email protected]

PROOFREADERJoanne Williams

LIFE IN THE PINESAn excursion through the curious by-ways and cul-de-sacsof Worcester County’s most densely populated community.

By TOM STAUSS/Publisher

LIFE IN THE PINESAn excursion through the curious by-ways and cul-de-sacsof Worcester County’s most densely populated community.

By TOM STAUSS/Publisher

Comments addressed to the Board of Directors by General Manag-er Bob Thompson at the Feb. 22

board meeting regarding the directors’ recent decision to change management companies at the Ocean Pines golf course were wrapped in a threadbare cloak of sincerity.

It might be supposed that the gener-al manager was genuinely perplexed by the decision the board made to replace Billy Casper Golf with a new manage-ment company, Landscapes Unlimited. The decision, after all, was not one that had been endorsed by Thompson, who rather publicly if even obsessively advo-cated for the retention of BCG.

How could anyone have concluded differently? he might have asked him-self.

It may even be possible to entertain the charitable idea that by suggesting that the board had not done its due dil-igence before selecting LU, Thompson was not really intending to convey the impression that the board majority had royally screwed up.

Possible, yes, but more likely not even close to the truth.

Judging by the reaction of certain directors to Thompson’s comments, they weren’t impressed by the feigned mask of sincerity and weren’t buying the notion that the general manager really can’t understand that rationale for selected LU as the new golf course manager.

They were especially ticked off that the general manager more or less im-plied, with a very thin layer of plausible deniability, that the board hadn’t done its homework before making its decision to finalize a contract with LU.

But what crossed the line is that Thompson did all this in public, ap-parently egged on by two unnamed directors who urged him to bring his concerns to the full board. Perhaps the general manager should take his coun-sel elsewhere if that is the kind of ad-vice he is given.

If indeed it was a wise move to air it all in public, then at least it should have been done in a way in which a board decision – and the way in which the decision was reached – was not so transparently criticized.

But it was not. It was a public airing of a disagreement with his employers, the sort of thing that ought to be done privately, if at all, once a policy decision has been made by those hired by the OPA membership to make such deci-sions.

The time to have expressed disagree-ment was before the decision was made. To question the decision afterward is

an act of defiance, an expression of the notion that the general manager knows best and the directors, his nominal boss-es, should go along with what he recom-mends.

Recall Thompson’s pronouncements when a sizable number of Ocean Pines property owners didn’t embrace the new Yacht Club when it was approved in ref-erendum, built and then opened to the public amid a lot of hyped cheerleading.

Thompson expressed concern that a vocal minority was still not going along with the majority, apparently unwilling to bend their wills and opinions.

He even in conversation compared it to someone in a military situation, once a decision by the brass was made, elect-ing to criticize or question his superiors.

That was then. This is now, with sit-uational ethics apparently dictating a differing modus operandi.

The rationale for hiring Landscapes was perfectly understandable, and should have been obvious to anyone privy to the board deliberations that led to the decision. And that includes the general manager. Clearly, a majority of directors bought into the business plan brought to them by LU executives – one that emphasized the need to rebuild the embarrassingly depleted membership base in Ocean Pines as opposed to focus-ing primarily on capturing revenue from non-member play.

BCG and the other finalist for the management contract certainly were aware of how low the golf membership ranks have sunk. But it was Mark Mat-tingly, the regional vice-president of Landscapes, who emphasized the need to rebuild it and then persuaded the board majority that he had a coherent and achievable plan to accomplish the goal.

It was not as if he was advising the board to abandon outside play, as that would amount to financial suicide. Rath-er, his company’s business plan calls for membership revenue from members and non-members in roughly equal share. The BCG plan, in contrast, seemed more or less to accept the status quo relative to membership.

That, at least, was the perception of it by a board majority who studied the competing proposals.

In addition, as Thompson should have known, if he did not, is that most of the directors were not convinced that BCG would be bringing in this year’s budget numbers, let alone the delusion-al $14,000 loss forecast for next year.

A proposal that projects red ink of $14,000 next year is laughably not cred-ible. There is no rational basis for it. It presumes a renaissance in golf that, if achievable at all, could only be accom-plished over a number of years, with steady year-over-year improvement.

The current forecast for golf with Thompson’s fingerprints all over it is for a loss around $90,000 in the current fiscal year. He has since backed off on it, but it was never a realistic number, based as it was on an April bottom line that would have exceeded anything that has been achieved in recent memory.

Golf had a cumulative deficit of about $40,000 through January, and BCG’s own projections add another $110,000 or so in red ink during February and March, meaning that golf operations probably will be swimming in roughly $150,000 in cumulative losses going into the final month of the fiscal year.

How well did golf perform in April of last year? Roughly a $15,000 loss, ac-cording to the OPA’s audited numbers. April on the Eastern Shore is known for its fickle weather; April showers are the norm, and a last-gasp snowstorm is not unheard of in the early part of the month.

To project a $90,000 loss for the fiscal year assumes an April with a $60,000 surplus. That would represent a $75,000 turn-around from April of 2013 and as-sumes a huge improvement in non-mem-ber “outside” play aided and abetted by balmy, sunny weather.

This was a forecast driven by what appears to have been a political agenda – securing the continuation of the BCG management contract. Ultimately it failed, because four OPA directors con-cluded that it was simply not credible in light of recent history.

Thompson’s subsequent abandon-ment of his own projection – blaming it on the board for its decision to change direction at the golf course – was classic bait and switch.

This way, especially if April performs even worse than last year, he can say it wasn’t his fault; it was all the fault of the board for sending Casper on its way.

Hogwash. The projection was never credible to begin with.

Such gamesmanship should stop.

To project a $90,000 loss for the fiscal year assumes an

April with a $60,000 surplus. ... This was a forecast driven

by what appears to have been a political agenda – securing the continuation of the BCG management

contract. Ultimately it failed, because four OPA directors

concluded that it was simply not credible in light of

recent history.

Playing politics with golf management decision


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OPINION

LETTERSandpiper FrustrationWatching the weather reports of the

Berlin area from my sunny 86 degree vantage point on the ocean in Puerto Rico, I have felt a sincere empathy for all my friends in the Pines. Not only are they suffering the terrible weather, but they are being hammered financially with their heating bills. As a strong advocate of natural gas consumption, I have had many emails on the subject of the stalled negotiations between Ocean Pines and Sandpiper Gas. Here are my personal thoughts on the failure to reach an agreement.

Ocean Pines continued insistence on getting a franchise fee from Sandpiper is a waste of time. Although OP gets a fee from Mediacom, Sandpiper rates are specified by Maryland’s PSC, based on published natural gas costs, where Mediacom’s rates are based on Mediacom’s financial statements, that is, the costs Mediacom says it pays to provide their services. (I believe all cable companies have been getting away with this scenario because of their lobbying strength and political involvements. No other utility has this luxury. Telephone and electric companies have been forced to share their distribution service with many different suppliers. Have you ever wondered why you can’t receive Comcast or Time Warner media over your Mediacom cable?)

Another point to make about franchise fees is that a company forced to provide them just increases their fee to the customers thereby, in a subtle way, applying a hidden tax on those customers who use the service. When you think about it, OP Mediacom customers actually pay MORE assessment fees than noncustomers because Mediacom collects an added amount of money to pay the franchise fee, then supplies it to Ocean Pines as a franchise fee, which then goes into the general fund. That to me looks like a hidden OP tax on Mediacom customers only. Do we want to do the same thing to Sandpiper customers?

Because of the PSC tariff structures, Sandpiper must be thought of as a utility similar to Verizon or Choptank, not like Mediacom. Do we get a franchise fee from either Verizon or Choptank? No! They have their cables in the ground on Ocean Pines property. What is the difference between cables in the ground or a pipe in the ground? I see none.

Let’s get down to common sense and not unattainable ideals. Many people in Worcester County are financially suffering with their heating costs. Sandpiper has continued the extraordinary accounting strategy of Eastern Shore Gas, by telling the PSC that they will pay for conversion costs if they are allowed to continue these exorbitant rates. The PSC went along with that, and gave them the rate structure for only 30 months. The tariff expires December 2015. The stalled negotiation with Ocean Pines now gives Sandpiper the ability to go back to the PSC and tell them that there are still thousands of homes to be converted, and that they will need to continue with the special rate structure. (Having had

some experience negotiating with the NY PSC, I believe the PSC’s response will be a slightly lower rate structure for another 30 months.) In other words, we will not be in a position to gain the real benefits of natural gas as customers in the other counties of Maryland have, until sometime in the future.

Another item I have heard in the negotiation discussion is, “What benefit will those people who do not use gas get if we turn the pipe over to Sandpiper?”

I have two replies to that question. First, have they been the people who have been raped financially by ESG and Sandpiper? And secondly, the pipe has no intrinsic value, unless it is utilized by another expensive propane dealer. Does anyone want this scenario?

This is the bottom line and just plain old common sense. As they say in New Jersey, “Forgetaboutit”!

Stop negotiating for a franchise fee, give the damn pipe to Sandpiper and

start pressuring them to start natural gas conversion ASAP! It will make a lot of OP residents very happy, instead of continuing to be frustrated by the board’s lack of success during the negotiation. Maybe you can get Sandpiper to pay the legal bills associated with this unsuccessful negotiation.

I certainly hope that this suggestion is implemented swiftly, so that we will have at least a vision of relief, before we go through another horrendous winter, as the last two have been.

Budd SheaOcean Pines


Work: 410-835-8338 Cell: 443-880-6250Email: [email protected]

Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 Work: 410-835-8338 K.C. COLGAN

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34690 Old Ocean City Rd., Pittsville, MD.

OPEN TIL 8PM MON-FRI • 5PM SAT • 24 HOURS ON-LINEwww.pittsvilleford.com

32 Ocean Pines PROGRESS December 2012

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2014 FORD F-250SAVE OVER

$12,0002014 FORD FLEXSAVE OVER

$5,0002014 FORD FUSIONSAVE OVER

$6,4002014 FORD ESCAPESAVE OVER

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2014 FORD FOCUSSAVE OVER

$6,0002014 FORD EDGESAVE OVER

$5,5002014 FORD F-150SAVE OVER

$6,000

Receive Employee Pricing

2014

TEMPORARY EMPLOYEE ID #

4108258338

34690 Old Ocean City Rd Pittsville, MD 21850PittsvilleFord.com

877-404-3025

SAVE UP TO 65% OFF ORIGINAL MSRPPRE-OWNED VEHICLES

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for a Deal

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ocean pines progress march 2015

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