As we stare at the images of the devastation to other communities from Hurricane Helene, somehow Big Canoe was spared. Predicted to inundate our area, it’s path instead veered East leaving us unscathed while others were so much less fortunate. Without even the precautionary ability to lower the volume of Lake Petit in preparation for a storm’s wrath, one might shudder imagining what could have been.
Maybe it’s time to put all the extravagance and frivolity aside and just get it done. The interceptor drains, the lower level outlet, the spillway! An estimated $9 million in repairs! Let’s prioritize and use the dollars we do have before embarking on any further non-emergency capital expenditure. Hopefully, this restraint will be reflected in management’s upcoming capital plan for 2025.
And once complete, perhaps leadership can honor their fiduciary duty and recommit to the spirit and intention of Article VI, Section 13 of our covenants (1) by appropriately funding the Capital Reserve Fund to the recommended levels. Then, and only then, should we revisit the unleashed extravagance of the past.
Meanwhile . . .
With the closing of the Lake Sconti clubhouse for renovations so came the board’s announcement that all regular board meetings would be closed to the property owners at least through year end. And although the Chapel graciously offered use of their space, it was determined unfeasible by leadership due to audio/visual restraints. So goes yet another previously undisclosed consequence of the Renew Big Canoe endeavor.
That said, the first regular board meeting broadcast from the fire station with no property owners in attendance was a more subdued performance by management and leadership. And although the missing theatrics were refreshing, the financial presentations included several odd gaps in the information. (2)
Undisclosed additional debt . . .
For example, a quick look at the August Statement of Cash Flows (3) as compared to the previous month’s report reveals that loan proceeds increased $365k during the month. Certainly not unexpected given the Renew Big Canoe expenditures, but why did the Director of Finance fail to even mention the increase considering the President’s recent pledge (4) that all draws against the line would be approved by the Board and described in detail?
Was this draw truly for Renew Big Canoe? Or was it a draw against the revolving credit line? Or was it something else? Needless to say, anytime the Association acquires additional debt, it should be noted and fully explained in the financial presentation.
A $750k transfer . . .
As another example, comparing the August Statement of Cash Flows (3) to the previous month’s report, it is apparent that $750k was transferred to the Capital Fund from the operating account. Again, not necessarily a questionable transaction, but once again, no mention was made of this transfer.
With the Capital Fund dropping as low as $96k in July, (5) could it be that these dollars were transferred to that account in order to repay the “kitty” for the insurance proceeds that had been designated for repairs to the Chimney? (6) https://bcmatters.org/on-and-on/
Perhaps. If so, kudos to leadership.
Cruising the nines on every property owner’s dime . . .
And since the previous post on the subject, (6) management informed the board (and later the community) that the lease on the golf carts will be treated as a capital/financing lease rather than an operating lease. (7) One might question why the board was not informed or aware of the specifics of the lease when it was approved in 2023 (8) and later executed in April 2024? (9)
Further, what this really means is that unlike the lease on the previous cart fleet, the amortization or cost of the million dollar fleet will be absorbed by every property owner (regardless of golf status) and not reflected in the golf amenity financial performance.
Note: Similarly, the cost of all capital improvements to the courses including the current Choctaw nine, advanced without a property owner vote, as well as mowers and other maintenance equipment are absorbed by each and every property owner regardless of golfing status and not reflected in the golf amenity financial performance.
And now, after fifty two years, could it be time to consider a more equitable approach to the allocation of capital expenditures for the amenities especially since there is no covenant dictating otherwise?
More about that ladder truck . . .
Also noted previously, this writer questioned leadership’s authority to proceed with the order of the $1.7 million fire engine ladder truck without a property owner vote.
After additional review of the Association’s governing documents, it is apparent that the POA Treasurer not only erred when she stated that the truck was a routine, replacement capital item that did not require a property owner vote, (10) she also failed to recognize that even the Board’s own ill-advised power grab known as Policy 152 restricts their authority to the maintenance and operation of “Common Property” only.
In accordance with Article I of the covenants, (11) the fire engine ladder truck is clearly not defined as “Common Property”, and thus should require property owner approval prior to ordering.
Note: This is not a for or against position regarding the new ladder truck. Instead it is simply a request that the Board adhere to the governing documents by putting the purchase to a property owner vote.
Maybe it’s time for the community to insist that our leaders begin following the rules.
A vacancy on the Board . . .
And lastly, just like others before, yet another director has departed Big Canoe, only now prior to the completion of his three year term. Given his tenure as liaison to the recently embattled AECC (after also serving as that committee’s chairman for over a decade) as well as the board’s liaison to the water committee, it was a surprise to learn of his early departure.
With the sale of his home several weeks before and loss of property owner status, he became ineligible to continue as a member of the Board.
While expressing appreciation for his past service and well wishes for the future, it was quite noble of the POA President to also explain that the vacancy created by his departure would not be filled and would be handled in accordance with section 3.5 of the Association’s bylaws.
And yet, contrary to the governing documents, the Board allowed the departed director, a non-property owner, to attend and participate in a September 23rd closed door meeting (via Zoom) which also included a two hour long executive session.
Needless to say, actual property owners are not allowed access to the closed door meetings of the Board much less an executive session. But then, this is Big Canoe.
Other odds and ends . . .
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Contract for Petit Dam lower level outlet approved in the amount of $1.7 million (2a), however the anticipated start date does not take place until March 2025 (12)
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Appreciation to Big Canoe Public Safety and Big Canoe Volunteer Fire Department for organizing hurricane relief efforts.
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Despite management’s presentation of some positive financial results during the month of August, both the GM and Treasurer displayed an ominous outlook for the following months of the year. Stay tuned for those results.
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And for whatever reason, as of this publication, the August financial package has not yet been posted to the POA website rendering any further discussion of those results impossible.
Disclaimer: Given leadership’s non-responsiveness and often outright refusal to provide answers to this writer’s questions or requests for information, no Ask the POA questions have been submitted regarding any of the above topics. Perhaps, explanations will eventually turn up in the President’s “Trending Topics” section of some future board meeting.
Wrapping it up for now . . .
Silence in the trenches should not be construed as complacency.
. . . . .
If you believe the information contained on this site is important, please continue to share and pass it on. Should you wish to see additional articles posted in the future, please subscribe for an email notification or check back frequently. And as always, feel free to contact me at thepcrosses@gmail.com for questions or further discussion. Meanwhile, take care, stay safe and thank you for your readership.
Patricia Cross
10438 Big Canoe
References:
1) Article VI, Section 13 , of the Second Amendment to Amended and Restated General Declaration of Covenants and Restrictions of the Big Canoe Property Owners Association and Big Canoe Company dated August 21, 2010.
(POAWebsite>login>POA>Governing Documents>Covenants>Capital Reserve2010)
2) Big Canoe POA Board meeting, October 3rd, 2024, video on Youtube at a) 48:25 https://www.youtube.com/watch?v=_cYB1_t3HDA
3) August Statement of Cash Flows slide presented at the October 3rd, 2024 board meeting
4) Big Canoe POA Board meeting, August 29th, 2024, video on Youtube at 41:25 https://www.youtube.com/watch?v=xkiCNeV4z1U
5) July 2024 Statement of Cash Flows slide presented at the August 29th, 2024 board meeting
6) “On and on”, August 14th, 2024, bcmatters.org, https://bcmatters.org/on-and-on/
7) Special Board Meeting Minutes, August 26th, 2024 (POAwebsite>login>POA>Meetings>Meetings>Minutes>2024>August 26th, 2024)
8) Regular Board Meeting Minutes, May 25th, 2023 (POAwebsite>login>POA>Meetings>Meetings>Minutes>2023>May 25th, 2023)
9) 2023 Audited Financial Statement, dated June 27th, 2024, by Mauldin and Jenkins, Pg. 26, Note 15. Subsequent Events (POAwebsite>login>POA>financials>AuditedFinancials>2023)
11) Amended & Restated General Declaration of Covenants and Restrictions, dated March 26th, 1988 (POAWebsite>login>POA>Governing Documents>Covenants>Covenants1988)
12) Special Board Meeting Minutes, September 9th, 2024 (POAwebsite>login>POA>Meetings>Meetings>Minutes>2024>September 9th, 2024)
Patricia,
My wife and I are so grateful for your continued efforts analyzing the actions of BC management. We don’t have the skills necessary to ferret out abnormal or potentially harmful plans, votes, or disbursements, and count on people like you to help the rest of us. Thank you, thank you!!
Lessons learned or lessons ignored?
I doubt those folks living in parts of Georgia, Tennessee and North Carolina ever expected a hurricane hundreds of miles away would affect their lives and livelihood in such a disastrous way…but then came Helene.
Big Canoe could very easily be caught in the same situation with an aging dam and few proactive measures in place to protect against dam disaster. Band Aid patches won’t work forever.
For years the inadequacies of the Lake Petit dam have been discussed, but always relegated to the back burner for later debate.
Are we so confident and complacent to think a natural disaster couldn’t affect our community?
It would cost about $9 million to fix this pressing dam problem. We “have the money” as the POA board and GM insist after taking out a line of credit, apparently not understanding those available funds are really just a loan. We have to pay back what we use with interest. That $9 million is about what is being spent for the “new and improved Clubhouse.”
Instead the board voted to renovate the Sconti Clubhouse, an amenity losing hundreds of thousands dollars every single year without a legitimate analysis of why those excessive losses happen and what can be done to stop them.
If the dam “malfunctions” and the area is flooded and property values plummet, will anyone want to enjoy the view sipping cocktails with murky water lapping at their ankles?
It’s past time to fix our infrastructure before buying new crockery or wildly expensive dining room chairs. A fancy clubhouse won’t encourage new homebuyers to consider Big Canoe as a home investment if our increasing monthly assessments are shown to be the result of poor management.
Let’s get proactive and get our priorities in order. Let’s fix what’s broken and build from there.
Wait a minute! Another board member skips out forfeiting his three year commitment after serving on the Reign of Terror AECC board and doing nothing to mitigate monster water rate increases without his name being published? So his home is sold and he’s safely in his bunker, yet privy to matters going on in a board meeting after his departure? This place is run by idiots! Would use profanity but well, you know how that would go over.
Patty Bloeser brings up a valid point for discussion. I don’t recall the names of all board members who skipped out after a short stint on the board without fulfilling their three-year term, but I know several fit in that category.
I recognize life has twists and turns and is not always predictable, but we seem to have a good number of those in charge who fail to meet their commitment of being a board member or General Manager.
These board members/General Managers make decisions that positively or negatively affect the future of Big Canoe but often don’t stay around to see the impact of their decisions. We as property owners must live with (and pay for) all decisions.
I do recall past POA Board President Sandi Smalley leading the cheering section for the Property Purchase boondoggle, and then shortly after she and her husband departed Big Canoe, leaving property owners holding the financial bag of fallout.
Over the 20 years I’ve called Big Canoe my home, there’s been a parade of General Managers, some being downright out of the league our community should hire to run the place.
We’ve hired headhunters to find candidates for the GM position, only to be disappointed. We have an incredible pool of talent here, business leaders who are well qualified to pick and choose those who have the appropriate qualifications to lead our growing community. Yet the POA boards hire outside companies who aren’t necessarily knowledgeable about Big Canoe to pick our General Managers. Choosing a General Manager is a critically important issue. At the very least, that person should have years of experience successfully running a community. We pay top dollar for the Big Canoe GM position and should have the best person for the job.
That also happened with the creation of the POA website. A firm out of the Carolinas was hired to create a new and improved community website, costing tens of thousands of dollars, took much longer than promised and still has glitches. A well qualified POA staff member created a workable, completely adequate and “high wow” website to replace the old site but the board decided to go with the company that didn’t know our community. By the way, that staff member produced website was completed on company time so there was no additional expense involved.
Yes, there is some input from a select group of property owners when the latest General Manager is interviewed but one of those chosen folks said personnel decisions were already made and he felt being on the search committee was a waste of his time.
There are several questions I propose the POA Board answer…
1. Over the last 20 years, what is the total amount paid to outside headhunters to select candidates for key leadership positions? Just a total figure, no need to identify who was paid what.
2. When a General Manager or other executive position is let go for whatever reason, how much has been paid to buy out the contract for that employee? Again, no names necessary, just a total figure. Buy-outs can be very expensive and unnecessary if proper vetting is made.
3. What are the qualifications in place to consider candidates for the position of General Manager? What experience is required?
These are important questions to answer as I suspect many of our dollars are being spent unnecessarily.
It’s time to tighten our belts!