(March 3, 2016) The fundamental aspects of the first draft of a reserve study, created for Ocean Pines by Design Management Associates Inc., have been public for more than a month, following discussions by several directors during public meetings.
In the draft, the firm suggested Ocean Pines’ reserves are more than $10 million below recommended levels. That conclusion, as well as how the board should move to finalize the document, has generated some debate.
General Manager Bob Thompson, speaking during a board of directors meeting in the community center last Thursday, gave what he believed would be a brief update on the subject.
On Jan. 28, Thompson distributed copies of the study to the board and asked for members’ input. Once the board approved the fiscal year 2017 budget, he said he would send those numbers to Design Management and the directors would meet with the company in March.
According to Thompson, the first draft includes more than 1,500 Ocean Pines assets, listed and grouped, with an estimated life expectancy based on current conditions and an inspection by the company. That data, he said, was plugged into a spreadsheet.
“There is no manipulation of the data … There’s no messing with the figures,” Thompson said. “They are what they are.”
Director Tom Terry said no board member had met with or spoken to the consultants directly. Thompson clarified that assistant treasurer Pete Gomsak – who is not a board member, but does work for the board – was present, once, during a conference call with the company.”
According to Terry, the next step would be to decide which capital projects were in Ocean Pines’ long-term plans, adding, “we already know some.”
“You imply that all of this is just about looking at our assets,” Director Dave Stevens said. “What’s in the book now are projections of what we’re going to have in the future … There are assumptions in there that are far from having been agreed [upon] by the board.”
Agreeing on a plan for future projects, he said, would not happen quickly.
“I think it will be long discussions – as long as the budget meeting – and it should be a long discussion [if] we’re going to get an accurate reading,” Stevens said. “None of that is close to being done.”
Stevens said it was telling that Thompson had yet to receive any feedback on the study from the directors
“I didn’t send an email,” Stevens said. “It would be fruitless to ask that number of questions without being able to talk to [Design Management] face to face – absolutely useless – and I’m not going to waste my time doing that. Moreover, apparently the rest of the board thought so too.”
Stevens went on to say the list of future projects used in the study were given to the firm by Thompson – not the board.
“It can definitely lead to a very misleading result, which was published in a newspaper,” Stevens said.
“Interestingly enough, Mr. Stevens, the only people to have the report are board members. So, if it got out, you’ve got to look at each other,” Thompson said. .
Directors Cheryl Jacobs and Pat Renaud clarified that they wished to meet with the consultants before discussing the study further.
“I’ll admit my inability to [ask questions],” Jacobs said. “One of the reasons, perhaps, that we have not submitted questions yet is because we have lacked the ability to talk about it amongst ourselves and DMA.”
“I completely agree with Cheryl,” Renaud said. “I have a little bit of discomfort reviewing this study without knowing what questions to ask … Obviously none of us, including myself, have gotten back to Bob with any questions for DMA, which shows, to me, a lack of understanding.”
The board agreed to move on without action. A formal date for a meeting with the firm has yet to be set.
“This should have been a good thing. I have no idea how we turned things bad,” Thompson said. “I was giving an update of where we were.”
In the draft, the firm suggested Ocean Pines’ reserves are more than $10 million below recommended levels. That conclusion, as well as how the board should move to finalize the document, has generated some debate.
General Manager Bob Thompson, speaking during a board of directors meeting in the community center last Thursday, gave what he believed would be a brief update on the subject.
On Jan. 28, Thompson distributed copies of the study to the board and asked for members’ input. Once the board approved the fiscal year 2017 budget, he said he would send those numbers to Design Management and the directors would meet with the company in March.
According to Thompson, the first draft includes more than 1,500 Ocean Pines assets, listed and grouped, with an estimated life expectancy based on current conditions and an inspection by the company. That data, he said, was plugged into a spreadsheet.
“There is no manipulation of the data … There’s no messing with the figures,” Thompson said. “They are what they are.”
Director Tom Terry said no board member had met with or spoken to the consultants directly. Thompson clarified that assistant treasurer Pete Gomsak – who is not a board member, but does work for the board – was present, once, during a conference call with the company.”
According to Terry, the next step would be to decide which capital projects were in Ocean Pines’ long-term plans, adding, “we already know some.”
“You imply that all of this is just about looking at our assets,” Director Dave Stevens said. “What’s in the book now are projections of what we’re going to have in the future … There are assumptions in there that are far from having been agreed [upon] by the board.”
Agreeing on a plan for future projects, he said, would not happen quickly.
“I think it will be long discussions – as long as the budget meeting – and it should be a long discussion [if] we’re going to get an accurate reading,” Stevens said. “None of that is close to being done.”
Stevens said it was telling that Thompson had yet to receive any feedback on the study from the directors
“I didn’t send an email,” Stevens said. “It would be fruitless to ask that number of questions without being able to talk to [Design Management] face to face – absolutely useless – and I’m not going to waste my time doing that. Moreover, apparently the rest of the board thought so too.”
Stevens went on to say the list of future projects used in the study were given to the firm by Thompson – not the board.
“It can definitely lead to a very misleading result, which was published in a newspaper,” Stevens said.
“Interestingly enough, Mr. Stevens, the only people to have the report are board members. So, if it got out, you’ve got to look at each other,” Thompson said. .
Directors Cheryl Jacobs and Pat Renaud clarified that they wished to meet with the consultants before discussing the study further.
“I’ll admit my inability to [ask questions],” Jacobs said. “One of the reasons, perhaps, that we have not submitted questions yet is because we have lacked the ability to talk about it amongst ourselves and DMA.”
“I completely agree with Cheryl,” Renaud said. “I have a little bit of discomfort reviewing this study without knowing what questions to ask … Obviously none of us, including myself, have gotten back to Bob with any questions for DMA, which shows, to me, a lack of understanding.”
The board agreed to move on without action. A formal date for a meeting with the firm has yet to be set.
“This should have been a good thing. I have no idea how we turned things bad,” Thompson said. “I was giving an update of where we were.”