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Looking into details of OPA golf management contract

(Dec. 3, 2015) As details of the golf management contract between Nebraska-based Landscapes Unlimited and the Ocean Pines Association have become a subject of debate during public meetings, the average resident might be wondering what the terms of the contract might be.
Essentially, the contract signed on May 1 by then Board President Dave Stevens and Landscapes Vice President Tom Everett authorizes the company to manage the clubhouse, Tern Grill, golf course and cart facility, but that’s just the foundation of a much more detailed agreement.
The 36-month contract includes a base management fee of $6,500 per month, with an annual increase of three percent starting on May 1, 2016, and a “contingent” fee of 10 percent of “any improvement in each fiscal year’s net operating income over a baseline net operating income” of a $100,000 loss, not to exceed 25 percent of the total management fee.
Several clauses in the contract call for review by the general manager, including “decisions … that could affect [the OPA] beyond the scope of operations at the course.”
Landscapes is required to submit proposals for major expenditures – $10,000 or more – to the general manager, as well as have approval for “all major policy decisions” from the general manager
By Nov. 1 of each year, the company must submit a written business plan and a proposed operating budget to the general manager, which has to be approved within 120 days of Nov. 15, after which time it’s considered approved by default.
All data and reports generated by Landscapes have to be accessible to the general manager and OPA Board by Oct. 15 of each year and the company is required to submit a golf operations, maintenance, food and beverage, sales and marketing, membership and capital improvement plan for review of the general manager and “designated representatives of the OPA Board of Directors.”
Those plans include “goals and milestones which will serve as the basis for monthly reporting to the OPA General Manager and up to three designed OPA Board representatives.”
Landscapes is also required to meet quarterly with the three designated board members, as well as meetings of the “OPA Board Advisory Committees on golf.”
An early termination clause goes into effect on June 1, 2017, giving the association the right to opt out of the contract if Landscapes fails to meet prior-year budget projections by $50,000.