Justice for Colonial

a. The Board holds E&O Insurance (Errors and Omissions) which is meant to cover instances like this. The amount of damage may be limited to only the insurance deductible. If a Board Member is found to have acted in bad faith decided by a judge, the Member would have to pay their own attorney fees as the E&O would not cover.

a. This attempt has been made. Please see a synopsis of a meeting to negotiate with the President by Howard Klein under the Letters Tab in the Menu Bar.

a. Home values are first and foremost market driven. At this time our home values are up 40% from 2021 due to home prices skyrocketing throughout the entire state of Florida.

b. Our community is currently not outdated, dilapidated or in disrepair. We’ve spent at least 10 million dollars in the last five years on: Clubhouse renovation; Hurricane Impact Windows throughout; newly rebuilt entrance Fountain; Preserve and Boardwalk Trex upgrade; New Fitness Center Equipment, Community Center interior makeover; Golf Holes 9 & 10 upgrades. Plus we added 2 Bocce Courts and 8 Pickleball Courts.

a. We are not advocating for no improvements. Common sense decisions during difficult financial and economical times should prevail. We are a Middle-Class, bundled golf community originally intended by the developer, Pulte Homes. This is what we are. We are not a high-end, private golf club such as Shadow Wood or Miramar Lakes with initiation fees of $150k.

b. Answers or suggestions might be: Leave the Pro Shop alone at this time. Do not expand the walls on the Community Center – possibly remodel the interior wasted space. Expand one wall on the cart barn for 400 additional bag storage spaces. The building will not fall down. Upgrade the pool deck, fencing and return the resort style cabanas – possibly expand the snack bar space and add an outdoor bar. Consider other options for additional outdoor dining, a bar, soft seating and fire pits near the Clubhouse where our kitchen and staff can accommodate the area without closing one for another.

a. NO. There are 711 DEEDED owners of the golf course. There are 1,699 DEEDED owners of the overall community. Troon is an outside contracted Management Company only, with its contract up for renewal in 2025.

Members, I have owned a unit in Garden Lakes V for many years. Also, Ray Povio and I sat on Garden Lakes V, local association board, during the housing crises and collapse, which occurred over a decade ago. Those were scary times! For a while, it looked like our condos would go the way of time-shares in terms of their value evaporating. Every week that passed, more and more condos fell into default. Once we finally weathered that economic storm, it became clear to me, in looking at the records, that Florida real estate operates on a boom or bust cycle. We just came through a boom. Now, with the insurance crises, a pattern of violent hurricanes, and high interest rates we are headed down, again.

Because of the bust cycle, this is not the time to embark on a wild spending spree. I know how Master Associations work! I have seen the good, the bad and the ugly. I served as an Ohio Judge for 24 years—12 of those years were on the 6th District Appellate Bench. Also, during that period, I was assigned on a case by case basis to hear matters on the Ohio Supreme Court. I am now totally retired. But, I often reflect on what I experienced as a judge. I have watched institutions, who have a fiduciary duty to their members (which Florida statutes impose on Master Associations) get into serious trouble when they ignore or try to short cut their own by-laws and regulations.

Here, this board is going to have a membership vote on the new pool restaurant because it’s over $500,000, but deny a membership vote on the health center (even though that is going to cost millions), by in-artfully disguising it as maintenance! Maintenance! How can it be maintenance, when you are changing the foundation and configuration of the building and even the name of the building!

I heard the board has a letter from a lawyer saying this is OK? Well, the test isn’t a lawyer’s letter, it’s what will a judge think about this scenario!

And, what if the Master Board votes to spend all this money and a Court says you breached your fiduciary duty! Then what? I hope you are protected by your errors and omissions policy. And, you have sufficient coverage.

Finally, the biggest problem in being on a board like this is separating, narrow personal preferences you might have from your fiduciary duty to all the members. This is a diverse community, based upon size and costs of the various units. My understanding is the food service section loses money each year. How can you justify, another restaurant, poolside, in competition to our main restaurant that was just refurbished—because someone wants to sit by a pool instead of a lake and putting green? Especially, when you have difficulty finding qualified staff to maintain the main restaurant.

The Colonial Country Club is currently under siege. We are fighting each other. We are not civil. Some in the community are at odds with the Master Board, have lost faith and mistrusts the Board. Optics are bad as related to the recent decisions regarding the Master Plan. This can destroy the camaraderie, the very spirit of the Club and ultimately have an unfavorable effect on our home values. Us against them does not promote a homogeneous society.

Historically, there has been tension between the Lakes and Golf villages for various reasons, and Master Boards attempted to relieve it. Today they seem to be unified and are at odds with the Board. A significant number of people have contacted me and through them I am aware of many more who have consternation about the Board’s actions.

Past Boards have been innovative in improving amenities despite some community objection. An example would be the Pickleball and Bocce courts which are each enjoyed by several hundred members. Leagues invite many outsiders to see our facilities, which increases exposure and ultimately our home values. The current Board is attempting to make improvements at a much greater cost than previous projects, thus perking the attention of our members.

It is urgent that an open and honest discussion take place, as some members are concerned with the vote-non vote question, timing, necessity and individual elements of the Plan. Effective communication and transparency have been lacking. Revisiting this will lead to civility at our Club.

We need to sit down and be willing to come up with compromises and ideas to rectify the situation. The Board must be willing to do this since they already have voted. You all know where I stand on the issues concerning the Master Plan, but I remain flexible for the good of the Club and would be willing to take a point position with regard to compromise.

Communication and compromise by all sides is essential to making Colonial the place it once was. If not, however good the intentions of all parties, Colonial will become an undesirable community even though “improvements” have been made.

WHAT SAY YOU?

Howard Klein

Dan,

I really appreciate your calling for a meeting in response to my Voice of Reason email to the Board. Our hour and a half meeting was friendly and respectful. I had hoped to tamp down the Colonial flame, but it was not meant to be. You remained steadfast in your position without compromise. The Board had an agenda, formulated a plan for its execution and exercised it to suit their goals. Timing of disclosure was essential in executing the plan. Even though there was the appearance of involvement, the community had NO SAY as to the timing, breadth and financing of the project. There were a few inconsequential changes made as the result of some noise from the community.

For me, questions emerged when I found out there would be no vote on material alterations which I sensed was the very essence of the Master Plan. I prepared a talk to the last-minute finance committee meeting which immediately preceded the upcoming town hall (finance) and board (vote) meetings. The sole purpose of the meeting was to disclose bids and financing arrangements. My comments (which I do not need to reiterate here) were based solely on my perception of what was going on with regard to the Master Plan. When Bob Harvey (who I truly respect) declared bullshit, committee members were intimidated and reluctant to carry the conversation further. I was subsequently contacted by a number of them who agreed with my statements. The problem was that it was already too late in the game to do something constructive, as the Board had already secured its agenda.

Going back in time, I explained the sequence which thwarted prior discussion. Since protocol was not adhered to, the Finance Committee was not allowed to vet the project prior to the final presentations. If so, as in the past, we would have analyzed the cost/benefit of the Plan, the timing thereof, financing and possible alternatives. We would have considered the material alterations vs maintenance question which was never presented to us nor to anyone else for that matter.

With regard to an outside attorney, you never felt the need to engage one to opine on the maintenance aspect of the golf course renovation, but did so with regard to the Master Plan. You explained this was necessary to support the predetermined position that this should not require a vote according to our documents. This was done secretly without a vote on the engagement of the attorney and without a vote on the non-vote proposition. It was decided by someone in advance. The decision to withhold any vote was withheld from the public until the very last minute. How could a discussion happen regarding this important issue when the question was never even brought forward to the public? I found out about it for the first time immediately prior to the Finance Committee meeting when I saw the Master Board agenda which stated there would be no vote on material alterations.

With regard to the separation of the golf cart barn from the golf pro shop, you explained that contractors would not take on a small job. This is no reason to combine the two projects. It may be more ominous than that, but I do not want to go there.

We discussed adding a second floor to the golf cart barn and you said the community would be against combining “golf property” with community property”. I offered to make the allocation if that were to happen as we were completely successful in allocating common expenses in the past. In fact, the finance Committee did a recent study with respect to allocating costs between golf and community pertaining to the maintenance area.

We were in agreement about the Golf working capital and the vote regarding removal of the 10% cap on annual increases and with the amount we would like to charge to new home owners. I expressed my disagreement with taking $500,000 out of working capital to support the renovation and that the reason for this was more than likely flawed. This will strip the fund of money that may be required in support of an unexpected event or other possible expenditures. The $500,000 should be assessed to owners.

When we discussed the various issues, you did not offer any rebuttal to my contentions. This leads me to have confidence that my points are valid. I believe your intentions were virtuous, but misguided. Your explanations would go a long way toward my understanding of what, why and how things were done.

I told you that I thought we were moving too fast. We discussed my fear that the timing and liability to the club created by these projects combined with known upcoming projects such as the maintenance area, roads, reserve shortages and the fear of the unknown such as weather related or another potential calamity could drive Colonial over a financial cliff. This would create liability for owners and drive home values down. You said the risk was small and although it should be examined, it was not. We agreed that neither of us would want to see that day.

That leads us to long range planning. As you know, I have always been an advocate for long range planning for colonial and was influential in starting the long-range planning committee. My goal was, and still is, to create a long-term moving capital plan for our club. Vision 20/20 sidetracked the committee and unfortunately it was never reinitiated. Most enterprises have such a plan. It would provide for more effective club management, sources and uses of funds, and owners would be apprised about the future and have knowledge of where they are going and of the finances needed to get there. This concept should be part of the strategic plan although you told me it is not. A number of finance committee members share my views.

With regard to strategic planning and current planned projects, we live in a bundled community with people of different economic needs and resources. This should be taken into consideration in planning. Do we want to alter the tenor of the club? If so, how will it effect the people? We discussed methods whereby the people who need help can get it.

The upcoming budget process is looming in our immediate future. I look forward to these discussions which will take our golf course closure, the Master Plan and future reserve calculations into consideration.

Looking forward, I would hope that master boards would not be so agenda driven, adhere to the rules, follow our protocols, which have, to now, worked well for Colonial, and be more transparent to service the needs of our members. Boards still have to be innovative leaders while providing balance to their decisions.

You are aware that a meeting took place at my home subsequent to my statements to the finance committee. I have nothing to hide, and people who attended and others with whom I spoke were deeply concerned about the exclusion of a vote on the Master Plan. You intimated that I was taken advantage of, but rest assured, I had no contact with anyone concerning my comments to the finance committee or the letter I wrote to the Board. I wrote summaries of my finance committee comments to distribute at the Town Hall and Master Board meetings. I haven’t shared the email sent to the Board nor this letter with anyone. You spoke of some statistics regarding for and against, but I place little stock in them.

I don’t think those who you term as complainers and many others to whom I spoke or had contact with will sit idly by.

WHAT HAPPENS NEXT?

I await your response,

Howie

Dan and Bob

Thank you for the efforts related to our golf course, and the Master Plan related maintenance and replacement projects.

I am one of the CCC members who would have preferred that we were permitted to vote on these important matters, but this note concerns only the financial side of these decisions.

You have done a good job of presenting the cash outlays expected for each member and have offered several options for payment. Even for this retired accountant, there are a lot of numbers so I appreciate the details. There are many ways to lay out numbers to make a point so I will try to summarize how at least one member views the cash requirements for living in CCC. As an aside, I always knew that living here and on the golf, side was a luxury and I was comfortable with our decision to move here, and we love CCC!!

In 2020, the total annual golf dues were:

Operating: $2,056

Cart Loan: 196

Rep Res: 742

Total golf dues: $2,994 (the Community dues were $3,189 for a grand total of $6,183)

As you know, in November 2023 the total community and golf dues increased to $8,996, for an increase of $2,813 or 45.5% over the 3-year period. The golf dues alone increased from $2,994 to $4,255 for a 42% increase. Those were huge increases and we understood that it was due in part to the Hurricane related increases in insurance, and covid related expenses etc.

Bob’s memo carefully and completely presented the costs of the Master Plan, which would be $1,409 annually for 9 years. The golf course maintenance adds another $816 to the annual cost and that will be for 12 years.

These new charges total $2,225 for the foreseeable future and represent a nearly 52% increase over our current golf dues (25% for increase in total dues). And that is before what we expect will be large increases for our 2024/2025 annual budget. That brings the increase in annual golf dues to $3,496 (117%), or a total dues increase of $5,038 or 81% since 2020. That is a material increase in cash expenses for most members.

Said another way, if I moved into the Golf Community in 2020, I will now see my golf dues more than double since I moved in!

I hope this helps the Master Board understand why some members are concerned that they did not get a chance to vote on what some members may view as a significant change in the cash required to live in CCC.

Thanks for your service as Board members

Jack Gontero

9343 Independence Way