Holly Lake Open “B” Board Meeting Minutes    

 

MAY 29, 2007

Agenda:
1. Algonquin Water Company – Mickey McKintosh
2. 70-year-old Cart Path Only Exemption
3. Renter’s Guest Ticket Responsibility
4. Fraternization/Nepotism Policy
5. Roads Plan
6. Roads Assessment and Dues
7. Emergency Temporary Guest List
8. B-Laws and Court Judgment as the Governing Documents of Holly Lake Ranch Association
9. Brush Dump
10. Emergency Exits
11. Golf Dues Waiver
12. Collection of Back Dues
13. Drainage
14. Volunteers
15. Restaurant Discussion
16. Golf Course Discussion

SUMMARY OF B-BOARD OPEN MEETING
 

The meeting was conducted by the Treasurer, Larry Bowman.  Larry introduced the Board members and the General Manager.  Rob James introduced the department managers.  The VFD was thanked for allowing the HL Association to use their beautiful facility for the Open Meeting. 
 

I. Algonquin Water Company – Mickey McKintosh was introduced by Larry.  He gave a brief over view of some of the projects currently being undertaken by the water company.  He gave a presentation and then answered several questions posed by either Board members or property owners.  In summary:
 

A. The yellow signs located on the Bulletin Boards around Holly Lake Ranch, indicate the water rationing policies.  It is mandatory that these signs be posted and they are in place year round.
 

B. There was an error in a “note” that was placed on the last billing statement that caused some people concern.  ??
 

C.  The policy of “dumping water” out of pumps is done ??
 

D. The water that is being pumped out by the Ozarka Bottling Company has no impact on the water supply utilized by the water company and the residents. ??
 

E. Plans for increasing water storage was discussed. ??
 

F. The company has not discussed rate increases.  Therefore, there are no immediate plans to raise rates.
 

G. The company sets water restrictions.  When restrictions are in place due to high water usage and/or drought conditions, they are set at very inconvenient times.  These times are usually set during the time of the day or night when water usage is lowest.  It is important to note that these restrictions are for sprinkler systems, which can be set during these inconvenient times.  These time restrictions not for water hoses that you might use around the house.  For example, you may water your garden or flowers with a garden hose during hours that are convenient to the individual. 
 

H. Mr. McKintosh asked that if residents have any questions concerning Algonquin or have any problems with service etc., please phone or come by.  He ended by saying, “We pay attention to people’s problems.”
II. 70-year-old Cart Path Only Exemption – Larry explained a new proposal that was presented to the B Board by the Greens Committee.  The policy will come into effect at the conclusion of this meeting.  Golfers, who are 70-years-old or older, may obtain from the Golf Pro Shop, one of the stickers that indicate they have verified their age.  This age group can ride on the golf course, utilizing the 90-degree rule everyday, unless the course is too wet for anyone to ride on the course at all.  If golfers have any questions concerning this policy, they can ask the Pro Shop staff for further clarification.
III. Renter’s Guest Ticket Responsibility – In the past, if a renter’s guest did not pay for a ticket he/she received from Security and the renter did not pay the ticket, then the owner was required to pay the ticket.  This “depth” of responsibility is unfair to the owner since he/she did not even invite the guest of the renter.  The new rule passed by the A & B Boards would remove the liability to the homeowner and place the entire burden upon the renter.  If the renter leaves without paying Holly Lake Ranch, the payment for the ticket would not be passed to the homeowner.  (NOTE:  Since the name of the guest in question is logged by Security, the guest could be banned from the Ranch unless he/she pays the fine.)
IV. Fraternization/Nepotism Policy – The A & B Boards passed unanimously the following policy:  Holly Lake Ranch enforces a nepotism and fraternization policy for any individual who has a direct supervisory power over another individual.  This policy includes but is not limited to hiring of family members or dating of direct line personnel.  Any violation of this policy could lead to termination.  The policy was established in May 2007 and recognizes the fact that some employees may have fallen into this category prior to its establishment and therefore would be grand fathered.
V. Roads Plan – Rik van Heyst, Chairperson for the Paving & Public Works Work Group and Billy Coyle, Manager of Maintenance Department.  Rik gave an overview of the report his Work Group compiled.  He indicated which roads were going to get worked on this year and indicated what roads were next to be repaired.   A copy of the Paving & Public Works Work Group’s report can be obtained from Bill Beggs, the Board Liaison for this Work Group or from Rik.
VI. Road Assessment & Dues – The A & B Boards passed unanimously the motion to abolish the $5.60 road assessment of property owners.  The General Fund will be used to pay for road improvements.  The Boards passed a dues hike of $5.60 that will be placed in the General Fund.  This change provides two important sources of income to the General Fund.  First, since there is a general fund increase, the amount owed by Silverleaf also increases.  Silverleaf did not pay a Road Assessment fee.  Second, this increases revenue from renters because they were not required to pay the Road Assessment fee; however, renters do pay dues.
VII. Emergency Temporary Guest List – A resident can request an additional 6 people to be added to their guest list.  This is for emergency situations, such as medical problems.  This emergency guest list is good for 30 days.  If the situation warrants, contacting Security can extend the time.
VIII. By-Laws and Court Judgment as the Governing Documents of Holly Lake Ranch – The A & B Boards passed unanimously the motion that the Board of Directors recognize and agree that the By-laws of the Association, as amended through August 28, 2003, and that certain Judgment of the District Court of Wood County, Texas signed June 29, 1990, govern the affairs of the Board and the Association.  It was explained that this was a major accomplishment of the A & B Board.  This agreement should allow for clearer understanding and cooperation between the A and B Board of Directors.  It was also explained that the need for the Amendments to the By-laws, that have been discussed for the past several months, will not be necessary since the Amendments were taken from the Court Settlement.  Now that the entire Court Settlement is part of the Governing Documents, that change to the By-laws is not necessary.
IX. Brush Dump – The new Brush Dump is operational.  The old Brush Dump will be cleared out shortly and then closed.  The proposal to buy a system whereby the old trees and debris could be “chipped” instead of burned will be reviewed.  However, at this time it is not monetarily feasible to purchase the type of equipment necessary to carry out this process with such a large amount of debris that is brought to the brush dump.  Again, Silverleaf was thanked for providing such a nice Brush Dump for Holly Lake Ranch.  The firefighters feel that the size and location of the dump are most acceptable.
X. Emergency Exits – The following issues were presented to at the meeting:
A. A homeowner indicated that there are approximately 4500 residents at Holly Lake Ranch.  She said that Security personnel have indicated to her that between 8,000 and 10,000 people are on the Ranch during the various holidays.
B. A homeowner explained the current system in place to warn people of a pending serious storm or emergency event.  Security and the VFD drive through the area, warning people.  She asked that a siren-type warning device be considered. 
C. (The Road Work Group is working on improving areas that can be used as emergency exits.  Once they are determined, they will be indicated on the next printing of the “911 Map of Holly Lake Ranch.”)
XI. Golf Dues Waiver – The payment of the golf dues will remain as is.  When Larry asked for any comments or questions, no one responded.
XII. Collection of Back Dues – The amount of back dues owed by property owners was discussed.  The methods, now used for their collection was also explained.  Also, the penalties for not paying dues were also explained.  The resident loses card for automatic gate entry and they cannot use any of the amenities.  At this time liens are placed against the property, but that is about the only recourse that can be taken at this time.  When the individual tries to sell the property, there is an attempt to negotiate a payment of some type.  Often this method of settling the past dues is not successful because the amount of debt is equal to or greater than the value of the property.  This matter is being reviewed for other alternatives.  The By-laws do enable the Association and the B Board to obtain legal opinion on issues and this will be done in the case of proper ways to obtain past dues, other than just liens.  In summary, the amount of money due the Association is growing.  Larry pointed out that we are paying for someone else’s share because all are not paying their share.  Again, this matter is being reviewed on a monthly basis.  Larry has reviewed those properties, which have a lien beginning in 2006. 
A. Someone else asked if these individuals and their families could use the pool, the golf course, etc.  No they cannot use the amenities.  They lose their gate pass, which means they have to get a token each time they come in the gate.  The Association has to allow the individual access to their home.  Someone said that on occasion, individuals get into the pool area by following another person.  This issue will be mentioned to the pool manager and it will be corrected.
B. Someone asked if the Association could foreclose on the property.  The Association cannot enact foreclosures because HLR is a “property owners” association, not a homeowners association.
XIII. Drainage – Questions were raised about the drainage problems that have been completed, those currently being repaired, and those under consideration.  Below is a summary of the comments, questions, and answers.
A. John Sparks commented on the installation of Hole #3 & #5 Drainage System.  The drainage issue off of Hole #3 and #5 was seriously effecting eleven homes.  An individual questioned that if this drainage issue was fixed, could it be considered an “amenity” or “perk.”   John said that Lake Greenbriar was filling up with sand and damage was being done to other utilities.  John Sparks and Clyde Johnson were Board members when they visited the area.  (NOTE:  Bill Beggs and Jim Armstrong were on the Board when the Board addressed this issue.  They approved the repair of this drainage problem and placed it in the budget.) 
B. Larry said that about 15 drainage problems have been brought before the Board.  In many cases, the problem was caused by the construction of new homes, garages, etc.  Larry stated that the Association did pay for a problem on Lakeshore Cove.  The force of the water putting about 35 feet of sand into the lake.  Plus, extensive damage was being done to the road.  But, the Association cannot pay for every drainage problem.  Some of the damage may be because of how the home was built originally.  We will examine the problems, along with Rik, to see what the causes of the damage are and what can be done about them.
C. Bill Beggs reiterated the problem explained by John and added that the drainage issue was not only eroding Hole #5 in particular, but it was seriously eroding the road that parallels Hole #5.  The flow of water coming off of these holes was also dumping an extreme amount of sand and debris into Lake Greenbriar.  He said that when our roads and the lake are effected in an extreme manner, the Association would review the issue.
D. Another homeowner gave an account when the Association came out and looked at the drainage problem on her street.  She said that telephone lines were exposed and the street was breaking up.  This was happening on both sides of the street.  She said that a committee came out, they looked at it and they took care of it; no perks involved.  She said it had to be done otherwise they would lose their phone service and the street, so it is just like they said.  If it effects the street, breaking it up because water was flowing under the street, utilities and such then repairs will be considered. 
E. One lady stated that we pay for permits to build and she wondered if there were any plans to review what is going to be built and determine if what is going to be built might cause a drainage problem.  Larry said that is exactly what the Architectural Committee wants to include when they issue permits.  Look at the situation before it is built so that we can minimize future drainage problems.  This committee is also going to review houses that are sold.  If certain requirements are not being met, they can address them with the new homeowners before they buy it. 
F. (Rik van Heyst asked to speak at the meeting on this issue, but time had become a factor.  Rik furnished a current report to the Board that he and his Work Group have been working on along with Billy.  This report outlines the progress being made on “requests for drainage improvements.”  The report outlines the plans for 2007 and it is entitled, “Drainage Improvements for 2007.”  Residents can talk with Rik concerning this report.)
G. A question was asked concerning the septic systems that are used at Holly Lake Ranch.  John Sparks reviewed the way it is determined what type of septic system can be used.
XIV. Volunteerism – A resident spoke about retaining an attorney, liability and volunteering.  She stated that a lawyer couldn’t be retained without 51% of the Association approval.  She said that a lawyer has been retained and money paid to him for legal services.  She feels that we need to request the lawyer to write up a disclaimer for all volunteers.  She feels that way about the ladies and gentlemen who take care of Holly Gardens at several locations on the Ranch.  This could be used for other volunteer groups as well.  They could continue their work of enjoyment with no problem and relieve Holly Lake of any liability.  (Time constraints precluded the GM or the Board of Directors to discuss the issue of legal counsel and volunteerism.  A lawyer was retained in January to examine the legal rights of the Association membership on such issues as the amendments to the By-laws proposed by the B Board, the rights the membership retains because of the Court Settlement of 1990, and easement rights of the Association.  One of the results is the unanimous passing by the A & B Boards of the By-laws and the Court Settlement of 1990 as the governing documents of the Association.  See item VII.  The only restriction on volunteerism is the use of Association grounds-keeping equipment.  The GM and the Board discussed liability issues around the use of such equipment by residents.  A policy was passed that does not allow residents to use grounds-keeping equipment.  Therefore, volunteers are free to engage in any activity of their choosing, as they have been doing for a long time.  Garden work is continually occurring around several areas on the Ranch.  Volunteerism is great for the individual, the clubs, and Holly Lake Ranch.)
XV. Restaurant Discussion – Larry pointed out that managers of Holly Lake Ranch have certain responsibilities.  He said that the restaurant was losing about $30,000 a month.  While all of us are appreciative of the former manager as a person, it was evident that the management part of the restaurant was not being addressed.  One thing about being a manager is that you have to accept the responsibility of making sure certain things are done.  The A & B board, GM, and work group have reviewed the issues and many meetings were held with Dave to correct the problems associated with the losses.  Unless all of you want to continue paying $25 a month out of your dues to cover the restaurant, we have to make a change.  It still may come to a monthly fee, but as of now we think there are other alternatives.  Larry said that this is an emotional issue and we should not get and will not get into personalities.  He will not let it get into personnel issues because that is not appropriate at a general meeting.  If you have constructive things to say then state them, but we are not going to get into personnel issues in a public forum. 
A. Several people did get up to speak and below is a summary of the comments.  (An in-depth record will be on file at the Admin Office.)  There were both positive and negative comments made about the decision to release the Food Service Manager.  There was concern about the quality of the food now being served and the speed of service under the interim management.  Three or four individuals mentioned their experiences at the restaurants.  One individual had some data that reflected that in March, the restaurant did not lose $30,000 and it gave the idea that the losses were declining.
B. (Due to time constraints, GM and the B Board Directors could not address all of the questions and comments made at the meeting.  It is important that some of the issues be addressed so that the membership will have more information.  One lady mentioned that the interim manager had received overtime pay and thought this was inappropriate since the restaurant is trying to save money.  The Board had decided to make that interim position a “consultant’s position” and was not aware that he was hourly.  One of the managers is not receiving any pay.  Rob James explained later that it was his decision to place the interim manager on an hourly wage.  He said he knew he would have to put in a lot of hours to begin the turn around procedures {inventory, input into the computer, research competitive vendors, order food, inventory the liquor, rearrange the placement of cold and dry food items, interview old and new employees, etc.}  Rob said that he does not usually grant overtime, but in this case he felt it was necessary.  He said of the new interim manager, “that it was his to make it or not.”  Rob also mentioned that by law, and hourly worker must receive overtime if he/she works more than 40 hours.   Rob mentioned that the lead morning person also received overtime pay because of her new duties at the 19th Hole.  The Board decided on May 30 that Rob’s reasoning was sound and back him on his decision.   We know that the food preparation has been unsatisfactory at times and that service can be slow.  The current interim management team is addressing these issues.  Two new cooks have been hired which will help.  We know that the manager was well liked and we feel the same way.  However, some of you do not understand that there is much more to the change than just the significant losses that continued for more then one year.  We have tried to not make all this a personal attack of anyone; however, there are many things that were not being handled and/or done correctly in spite of attempts to work with the manager.  The Restaurant Work Group has four members who run restaurants who met with the manager on many occasions, this year and last.  The Board met with the manager and Silverleaf management also met with the manager and reviewed items that needed to be implemented, yet things id not get implemented and there was little change.  Rob had discussed training programs for the manager, but they were not begun.  Rob spoke of implementing a “performance improvement system” with the manager.  Food and labor costs are so far over the industry standard that it is not worth mentioning.  In response to one ladies statement, Larry researched the losses quoted.  It is true that March indicated a $14,702 loss but it must be noted that March was a big sales month for time-share users and even property owners who utilized the restaurant more during the Spring Break season.  All which increased sales.  However, the expenses do not reflect five days of labor expended but not accrued in the cost numbers.  One month does not reflect a turnaround.  April’s loss increased almost 50% to $21,432.  There is still work to be done.  We have a $4 million dollar operation at Holly Lake and it is essential that we run it as a business.  We must keep in perspective that there was a $375,000, net of building loan expense, loss in 2006 and there was a $98,600 loss through April 2007.  That is a bit more than an amenity unless the property owners are prepared for higher dues to cover it or a reduction of other essential services, which has happened in the past.  Many of you have been in business or are familiar with what it takes to run an effective operation.  We ask you to consider the following questions:

1. Do you think you can run a restaurant if you do not take regular monthly physical inventories to determine usage, spoilage, theft, etc.?  Would you not want the computer set-up to handle inventory costing, sales detail, labor by department, etc?
2. Do you think you can run a restaurant if you do not know what the cost is of each menu items or catered functions?
3. Do you think you would want to know what sells on certain days and what hours of the day certain items sell best or how well specials are received?
4. Do you think you would want to schedule your workers to meet the occasion so you could contain labor costs?
5. Do you think it is a good business practice to pay cash for some major items?
6. Do you think wise to make cash deposits every day?
7. Do you think it wise to allow employees to utilize managements’ computer codes when opening the cash drawer or ringing up certain transactions?
8. Do you think it wise to consider competitive bidding to assure containment of food costs?
The list could go on but this is sufficient to provoke serious thought as to what some of the management issues are that needs to be addressed.
C. The former manager came up to speak to the audience.  In summary, he thanked Holly Lake for allowing him to be part of their lives for the past three years.  He said he knew he had some short falls when he took on Fore Seasons, but he did the best he could and appreciates the concern of the people of Holly Lake.
XVI. Golf Course Discussion –
A. The Parks and Recreation brought up the problem of some of the lakes in and around the golf course, to include the large lakes.  This Work Group is proposing the placement of chemicals in some areas of the ponds and lakes to rid the water of certain growth.  Dr. Robert McMann will be coming to Holly Lake in June to make recommendations.  If too costly, the procedure may be considered by the Board next year.
B. The Board, two golf work groups, the Finance WG and Silverleaf have had discussions concerning the proposed new nine holes.  There are two issues that need to be discussed with Silverleaf before the proposal can be presented to the residents.  Once that gets resolved, it is currently planned to hold to meetings with the membership, one meeting convenient to weekenders and workers.