CAROLINA SHORES PROPERTY OWNERS ASSOCIATION
BOARD OF DIRECTORS MEETING

NOVEMBER 13, 2006

MINUTES OF THE MEETING


BOARD MEMBERS PRESENT: Joyce Dunn Davis, Presiding; Monty Craig; Bill Harniman; Nancy Harthausen; Mike Mundy
BOARD MEMBERS ABSENT: None

CALL TO ORDER
President Joyce Dunn Davis called the meeting to order and announced that the primary purpose of this Board meeting would be the presentation and discussion of the draft 2007 budget for the CSPOA. In order to allow ample time for member comments on the budget there would be no committee reports presented at this meeting.

APPROVAL OF THE MINUTES
The Board voted unanimously to approve the minutes of the September 2006 Board meeting with no additions or corrections.

OLD BUSINESS
Replacement of the Entrance and “Gate” Signs. Mike Mundy presented bids from two companies for replacing all of the Carolina Shores community entrance and “gate” signs. Mike informed the board that, responding to complaints from members about the condition and readability of some of the signs, he had examined each of the signs and determined that all are in seriously deteriorating condition, that the posts on which the gate signs hang are deteriorating, and that the many of the gate signs are difficult to read at night. Both bids include all new signs and posts, installation of all the signs and posts, and removal of all the old materials. After discussion of the design, composition, and materials in each proposal and input from POA members attending this meeting, the Board voted unanimously to accept the bid for $21,295 from The Sign Shoppe in Supply, NC, with the signs in green with white borders and silver/white reflective covering on all of the gate numbers. The Board authorized Mike Mundy to begin the project immediately and to pay The Sign Shoppe in three installments: the first installment upon signing of the contract, the second installment when The Sign Shoppe completes creation of all the items, and the final installment when all the signs are in place and cleanup of the old materials is complete. Mike informed the board that the goal is to complete the entire project by the end of 2006. Mike also informed the Board that he is investigating the possibility of installing lighting to illuminate the entrance sign located at the corner of Thomasboro Road, which is difficult for drivers to see at night. The cost of installing the electric wiring would be about $2,500. He is contacting BEMC to determine the ongoing cost of providing electricity to the sign. He will report back to the Board when he has all the information.

Member Survey Results. Joyce Davis distributed to Board members and to POA members in attendance a handout that contains the complete results of the POA Member Survey conducted in September 2006. One handout contains all of the statistical results of the survey and the other handout contains an analysis of the results and a list of suggestions members included with their surveys. Joyce announced that the same information would be placed on the CSPOA Web Site and copies of the handouts would remain available for people to pick up at the POA office. In addition, a summary of the results would be published in the December POA Bulletin. Joyce also announced that the Board decided to delay decisions about any major changes or high-cost items from the survey until installation of the new, seven-member Board of Directors in February.

NEW BUSINESS
Holiday Party. Board member Nancy Harthausen, chair of the CSPOA Holiday Party, announced that the party will be held on December 3, 2006 from 5-8 in the clubhouse. She has contracted with The Trestle to cater the party, and the only major change this year will be serving a steamship round of beef instead of ham.

Board Election and Candidate Forum. Nancy Harthausen, who serves as chair of the Nominating Committee, announced that the committee has been meeting regularly to review and update the election procedures in order to ensure that members are well informed about each of the candidates for Board positions. The committee is preparing an insert for the December Bulletin that will provide a photo of each of the 10 candidates, along with each person’s response to a standard set of questions. This fact sheet also will be available on the CSPOA web site. In addition, there will be a Candidate Forum on Sunday, January 7, at 3 p.m. at the POA. The committee also is exploring ways to make the ballot that is mailed to POA members clearer and simpler in order to avoid the problem of ballots having to be discounted because of improper submission of proxies. The ballots will be mailed to members in early January and the Board election and installation of new members will take place at the CSPOA Annual Meeting on Saturday, February 3, at 11 a.m. at the clubhouse.

PRESENTATION AND DISCUSSION OF THE CSPOA 2007 BUDGET
Treasurer Bill Harniman distributed a draft 2007 budget for the CSPOA and then provided a detailed overview of the expected 2007 income (revenues) and expenses. He pointed out that ~ 92% of the POA’s annual income comes from member annual dues. The major portion of the remaining 8% comes from interest income (which has increased significantly in the past two years) and building permits (which have declined this year as the real estate market has slowed). He has removed ACC Fines from the “Revenue” category because it is inappropriate to build a budget on the expectation of fining builders or members. Bill then noted that while the POA’s income remains relatively constant, many of the operating expenses increase annually (e.g., utility bills, postage, property and casualty insurance, and grounds maintenance and repairs). He was pleased to report that he just learned from the insurance company that the 2007 cost increase will be lower than we had anticipated, but still an increase over 2006. POA legal fees decreased significantly in 2006 as a result of the Board’s decision (in consultation with the POA attorney) to make every effort to resolve problems with members and builders without involving the services of the POA attorney. Bill concluded his discussion by noting that, if all of the assumptions he has made and the draft costs he has included are reasonably accurate, the annual member dues that would be required to cover the budget would be $168.00 per property. He explained that following this meeting the Board would evaluate all of the member input and set the final budget and establish the 2007 dues.

He then opened the floor for member comments.

Member Questions and Comments on the Draft 2007 Budget

Angela Kopitopoulos: Since the entire community is already subdivided into individual lots, and the CSPOA dues are paid per lot, does this mean that the number of properties paying dues will always be the same? Answer: Yes. Carolina Shores contains 1247 pieces of property. That number will never change. Dues are paid per property (occupied or vacant), and thus do not increase when a home is built and people occupy it. Consequently, the only way to increase revenue is to increase the dues paid per property. [Mayor Dan Mann noted that the town of Carolina Shores holds one lot and has an agreement with the CSPOA that exempts it from membership dues – thus there actually are only 1246 properties paying annual dues to the CSPOA.]

Joe Martere: The CSPOA annual dues should always be specifically divided, with a set percent designated for the Reserve fund.

Dick Wilson: Why doesn’t the Board do special member assessments to cover large maintenance and improvement items instead of dues increases?

Helen Morrison: The Board should structure all POA-sponsored social events (picnics and parties) to be self-supporting. For the picnics, this could mean holding a 50-50 cash raffle or charging for the hotdogs and drinks.

Kathleen Gulliver: Does the CSPOA have a 5-year financial plan? Answer: Bill Harniman is currently preparing a 5-year plan using a piece of software provided by a financial consultant recommended by our auditors. The result will be a projection of the long-term cost of repair or replacement of each major asset of the CSPOA (e.g., pool, tennis courts, parking lots, clubhouse).

Richard Boyle: Having a good 5-year plan would allow the Board to determine the amount that must be in the Reserve Account.

John Manning: Why does the CSPOA pay the electric bill for the Villas? Answer: Over 20 years ago the CSPOA Board signed a written agreement with the Villas Board to pay the monthly cost of the outside lighting at the Villas. Then, about two years ago, the Villas did a costly replacement and upgrade of their lighting, which BEMC began charging to the monthly bill. The previous Board noted the significant increase in the monthly bill, investigated the cause, and informed the Villas that the CSPOA would not be responsible for the cost of the upgrades, but would continue to pay the nominal monthly cost of keeping the lights on at night.

Maslin Kain: The budget contains a line item for pool maintenance, repairs, and supplies. Will that be fully expended for 2006? Are any further expenditures planned for this year? Answer: The majority of the expenditures have already occurred (repairs to the decking and water fountains, replacement of furniture, etc). There is a year-round cost for the pool service and the supplies needed to maintain the interior of the pool. Facilities Maintenance Chair (and only volunteer) Joe Martere explored the possibility of adding a cover for the pool to reduce the year-round maintenance and electric costs, but because of the age and design of our pool the cost would be prohibitive and turning off the pool pumps for any length of time could cause them to fail – resulting in large replacement costs).

John Manning: Noted that the Town of Carolina Shores pays the CSPOA $200 per year for watering the landscaping around the town sign in front of the POA building.

Al Franklin: Why is the cost of the Bulletin increasing? Answer: Because the amount of information submitting for publication has increased, requiring additional pages each month. The Board has asked the Communications Committee to explore options for reducing the cost, including limiting the length of articles submitted for publication. The Communications Committee also is exploring the possibility of including advertising as a means of covering the cost of publication (similar to what was done with the Member Directory this year).

What is covered by the line item for Special Projects? Answer: It is to pay for work done by outside consultants at the request of the Board. This year it paid for having a survey done and an updated plat developed of all the property the POA owns that abuts property owned by the golf course. It was done to clarify property lines between the POA and the golf course. In 2007 the Board will likely explore how to replace and/or upgrade the pool buildings and the storage sheds by the tennis courts.

Barbara Jones: If the POA adds a regular bingo game (currently being planned), could the resulting income be put in the Reserve Account. Answer: The Recreation Committee is currently planning to start a regular bingo game at the POA in 2007, with the 50% of the proceeds used for prizes and 50% of the proceeds contributed to the CSPOA to be used to purchase additional amenities for the use of members (such as a large-screen TV for the clubhouse).

Betty Kibblehouse: It is clear that the current Board is working very hard on behalf of the community and this work is appreciated.

Marlene Stewart: The Member Survey is a very comprehensive and informative document and thanks go to the Joyce Davis for developing it, distributing it, and counting and evaluating the results.

John Russo: He is willing to take the lead in adding a “Horse Race” game at the annual picnics if he can get help from someone who would is good at doing the math required to do the scoring.

Ester Malmfeldt: Could the POA host a bingo game that gives prizes instead of cash to the winners and thereby avoid having to get a state license. Answer: State laws require licensing for all bingo games that give gifts or cash prizes valued over $10 each.

Dave Pflaster: Thanks go to Bill Harniman for all his hard work on the budget and his explanation of the process.

Ken Holford: Construction is underway at the sewage treatment plant adjacent to Carolina Shores, resulting in large trucks driving in his neighborhood to reach the site. Shouldn’t the POA provide advance notice in the Bulletin of such activities? Answer: Unfortunately, the plant belongs to Brunswick County and they are not required to notify the POA about planned activities and seldom do so – including this situation. Mayor Dan Mann was asked what the town knows about the project and replied: The County is doing a $300K upgrade to the facility that will help prevent sewage spills such as have occurred in the past at this site. The project will benefit all of us. However, the County was not required to notify residents in advance. The only access to the facility is through CSPOA neighborhoods.

Bob Jones: There has been a sewage spill problem in the past. Not long ago some ACC members found a sewage leak directly onto our property. These repairs are needed.

Judy Harrington: Will upgrades to the sewage treatment plant mean that the County will increase the amount of sewage processed there? Answer from Dan Mann: No. The project is only being done to avoid the spills that currently occur. The County’s long term plan is to shut this plant down entirely. Question from Judy: Could we periodically include in the Bulletin a list of who residents should call for various types of problems/questions (the Town? The POA? The County?). Answer: That is a good idea. We will do it.


Jackie Orwig: The POA buffer property adjacent to her house is in need of maintenance. She has called the POA multiple times and not received a response. The Orwigs have been cleaning it but would like the POA to take care of it the next time. Answer: Mike Mundy is looking at all buffer properties with our grounds maintenance company to determine what regular upkeep is appropriate for each. It will be included in our contract with them next year.

ADJOURNMENT
There being no further comments from the members present, the Board concluded the budget discussion and adjourned the meeting at 8:30 p.m.