Big Canoe, Letter to the Editor: . . . New Directions

Just when it seems that discussions regarding out of control spending and food and beverage issues seem to be exhausted, new directions taken by management and the board prompt further thoughts from this author.

That being said, it should briefly be noted that, yes indeed, as pointed out by management, year to date net income through August 2019 is in fact $489k ahead of the previous year. (1) What is not said is that this improvement is a direct result of the $525k increase in property owner assessments and not due to any prudent management of expenses by our leadership. (2) This can not be overemphasized. In fact, while net income of most amenities has improved, food and beverage losses have continued to increase along with a $52k increase in operating expenses over and beyond the already admittedly poor performance of 2018 placing us $180k under plan. This does not look like progress.

And what happens to this income? It services the land deal debt. After that, it is spent on capital projects, so many of which are new and unnecessary, and without anything appearing to be contributed to the capital reserve fund as mandated by the Big Canoe covenants. Let leadership not forget – the six property owner elected directors have a fiduciary responsibility to the property owners and that responsibility clearly includes adherence to the Big Canoe covenants as noted on the POA website. (3)

Now . . . shifting gears back to food and beverage with an eight month – year to date – loss of $527k. (2) Although the validity of the rumors regarding the POA contracting with Troon or some other similar management company was questioned by several property owners during the Q&A at the September 12^th board work session (which has been excluded from the video of the meeting), leadership assured those present that there was “no initiative” but rather, only discussions regarding suggestions these companies might provide regarding the F&B losses. Clearly there was an initiative as only five days later, and although there is no documentation in the finance committee minutes, the proposal to engage Bobby Jones Links was outlined by management to the finance committee members at the September 17^th meeting. (4a) Two days later, it was announced at the September 19^th board meeting that the general manager and the board had decided to “retain” Bobby Jones Links for help in reducing the losses attributed to F&B. (4b)

When and where was this decision approved? Surely a decision such as this was not made in less than a week and without any documented discussion. This is yet another classic example of the board’s lack of transparency, if not deception, and it is precisely these types of situations that create the questions and mistrust by property owners.

While everyone surely agrees that the F&B losses are outrageous and that something must be done expeditiously to reduce those losses, consider how novel it would have been, if management would have first simply analyzed, as promised, the source of the losses and then made appropriate decisions going forward rather than stalling for eight months only to throw out more money to a management firm in an attempt to fix the problem.

But just as we are retaining Bobby Jones Links under the pretense of “saving money”, we are already contemplating “spending” $66,000 more money (5) to renovate the Chimneys kitchen for even more non-property owner events when these endeavors are likely* generating a loss. Perhaps we should hit the pause button on these types of events.

*Given the level of food and beverage losses, leadership must recognize that they can not realistically expect property owners to believe that these endeavors are profitable if they are unable to provide an itemization or breakdown of f&B losses by category.

And what is the price tag for the Links’ services? A Smoke Signals editor actually posed this question to management, and just like so many of us, she failed to receive an answer. Only the vague “an agreed amount monthly”. (6) And how will this fee be accounted for? As a charge to F&B (which would be appropriate) or will it simply be tucked away in administrative expenses with all other consulting fees?

As importantly, who is Bobby Jones Links? According to their website, they are a “21^st century club developer and manager making clubs relevant and modern . . . ” (7) Each page of their website contains a reference to clubs.

Big Canoe is not a club. Big Canoe is a community – a mountain community.

There is no reference on their website to communities much less mountain communities. Truly, what is the price tag? Is this just the first foot in the door towards complete management of F&B and golf and maybe the entirety of Big Canoe and driving us in a direction that most property owners may not wish to go? Where is our board taking us?

Where does all this constant insanity come from? Really? After months of discussions and questions and promises by management to produce answers, property owners have zero information. How does $527,120 in the form of F&B losses simply evaporate in only eight months? Will Bobby Jones Links provide the answer to that question? I doubt it.

Consider this thought . . . perhaps property owner assessments would be better spent contracting an independent, external audit of the entire food and beverage operation.

Property owners, if these things matter, we must voice our concerns. We must ask the questions, and we must insist on the answers.

Please feel free to distribute, share and pass this on. Likewise, if you have questions or would like further discussion, I can be contacted at thepcrosses@gmail.com.

Patricia Cross

10438 Big Canoe

References:

1. Smoke Signals, October 2019 Issue, Pg. 2; (POA cont~ Column 3)
2. POA Financial Package, August 2019, Pg. 20, Income from Operations
   (POA Website>login>POA>Financials>Summary of operations>August 2019>pg. 20)
3. POA Website>login>POA tab
4. September 2019 Board Meeting Video at (a) 8:00, (b) 2:55
   (POA Website>login>POA>Meetings>Videos>September 2019 Board Meeting)
5. Long Range Planning Committee Meeting Notes, September 16, 2019, Pg. 2
   (POA Website>login>POA>Committees>Long Range Planning Committee>Minutes>September 2019)
6. Smoke Signals, October 2019 Issue, Pg. 1
7. bobbyjoneslinks.com