Meeting Notice — October 19, 2021
MEETING SUMMARY
NORTH SHORES BOARD OF GOVERNORS
Meeting of Board of Directors
October 19, 2021
A regular meeting of the Board was held on Tuesday, October 21, 2021. Notice of the meeting was posted in advance on the North Shores website. Attending the meeting by video conference were: President Bruce Wilson, Vice President Steven Hollman, Secretary Debbie Director, Treasurer Helen Hoart, and Assistant Secretary Evan Thalenberg. North Shores legal counsel, Robert Valihura, and Community Executive, Jeff Sellman, also attended. As the first order of business the meeting was called to order by President Wilson and a quorum was declared.
The second item on the agenda, the Board met in executive session to discuss correspondence from a homeowner that included a threat of litigation. The executive session ended.
Board members and Mr. Sellman rejoined the meeting by teleconference in the general session of the meeting. Mr. Valihura left the meeting at the end of the executive session. Homeowners that contacted the office were provided the conference call dial-in information. Homeowners Louisa Hollman and Rob Director attended the teleconference portion of the meeting as observers.
The third item on the agenda was the review and ratification of votes taken by email taken since September 15, 2021. A complete list of votes was included in the meeting agenda and reviewed by the directors. President Wilson asked the Board if there were any questions or comments. There were no questions and Mr. Wilson moved to ratify the votes taken by email, the motion was seconded and approved by all.
Review and ratification of votes taken by email:
- Construction Permit Extension 7 Ocean Drive – approved
- Labor Day Weekend Pizza Truck and Staff Party – approved
- Construction Permit Application 7 Farview Road – approved
- May 13 and 19 2021 Meeting Minutes – approved
- June 2021 Meeting Minutes – approved
- Tree removal contract – approved
- Construction Permit Application 23 Cedar Road – approved
- Construction Permit Application 17 & 19 Holly Road – approved
The next item on the agenda was the proposed construction fee resolution that was voted on and approved by the community at the North Shores Annual meeting in May. President Wilson reviewed in detail the proposal presented to homeowners at the annual shareholders meeting. The measure is intended to reverse long standing subsidies, including subsidies by Board members volunteering time to conduct architectural review and provide for the administration of construction projects at no cost to the community, a model we could not sustain. The construction fee changes are proposed to align direct and indirect costs for those properties directly benefiting from the required administrative support. Prior to the meeting, Community Executive, Jeff Sellman, had provided the Board with written comments from homeowners regarding the proposal. The board engaged in an extensive discussion about the fee structure and the need to develop grandfathering in the proposal for properties owned by current shareholders, to reflect comments received from homeowners prior to the meeting. The revised proposal included fees for major and minor construction projects as well as new home construction. New home construction fees would be set at $2.00 per sq. ft. of GFA, with a maximum fee of $12,000. Included in the proposal: $2,500 application fee for major construction projects exceeding costs of $50,000 and $1,000 fee for minor construction. An implementation date of February 1, 2022 was also modified from the earlier proposal presented at the Annual Meeting. The Board also discussed projects qualifying for de minimis applications at no charge. Grandfathering provisions for new construction included a reduction to 25% of the fee for current owners that met the grandfathering requirements. The Board agreed to the proposal changes and voted to approve them unanimously for homeowner review and distribution and comment pending a final vote. A community mailing outlining the modified proposal incorporating comments received by the community will be sent in the near future, following the meeting.
The Board moved to the next item on the agenda, the proposed rental fee resolution. The measure, voted on and approved at the Annual Meeting in May, is intended to capture a portion of the direct and indirect costs associated with the income earning rental properties that directly benefit the owners. Currently the annual assessment is being used to cover the escalating costs of administration. President Wilson outlined changes to the current proposal and confirmed the fee would be collected primarily as a pass-through fee by local realtors as part of the online listing for each property. Mr. Wilson recommended a delay in the implementation of the 2% fee of gross rental income to 2023, using the 2022 rental season to develop metrics to assess the comprehensive rental costs incurred by the community. Mr. Sellman developed preliminary direct and indirect costs to the community, based on the 2021 season, and shared them with the board. The Board discussed: comments received from the community; additional direct and indirect costs to the community associated with rentals; use of the annual assessment to cover direct and indirect costs associated with income producing properties; the need to develop better rental tracking information; and the impact of the large number of rental guests on the community in the summer months. A reduction in the fee for rentals lasting more than eight weeks was also discussed and included in the updated proposal. Rental properties in North Shores will be required to register without a fee.
The Board agreed to the revisions in the proposed rental fee changes based on community feedback and voted unanimously to approve them, for additional homeowner comment and review, pending a final vote later this year. The modified proposal incorporating comments received by homeowners will be included in the community mailing, outlining the changes.
Treasurer Helen Hoart presented the YTD budget update as the next item on the agenda. She reported finances were currently $50,000 in the black, but did not include expenditures planned for the marina dredging project. Looking ahead to 2022, Mrs. Hoart anticipated a $200,000 deficit.
Secretary Debbie Director updated the Board on the North Shores website. She reported that she, along with new board member Steve Hollman and community executive Jeff Sellman, met with IT consultant, Tom Bason on September 20th. Mr. Bason presented an overview of the website that included: hosting platform functions; the homeowner database directory; the realtor portals and database used for managing summer rentals; the beach equipment set-up and reservation system for homeowners and rental guests; accounting and billing; and reports generated for day-to-day operations. Mr. Bason outlined at the meeting the need to begin planning for replacement of the aging software system, that may soon no longer be supported with updates. Mrs. Director recommended planning for the replacement of the database architecture to the board. She explained further, that planning and replacement should examine alternatives to the current system and that implementation and testing should be done in the offseason, beginning in January or February of 2023. The board directed Mrs. Director to engage Mr. Bason for development of an RFP to replace the existing system.
Community Executive, Jeff Sellman, presented a preliminary report to the board for the marina dredging project. Mr. Sellman has been working with DNREC officials to locate a site for disposal of the spoils. Timing of the project will be determined when the spoil site has been determined.
In other business, President Wilson informed the Board he would step down as President immediately, but remain on the Board. North Shores by-laws allow succession by Steve Hollman, the current Vice-President, to assume the role of President. Mr. Hollman praised Mr. Wilson for his extraordinary service to the community. He thanked him for his many years of leadership serving as President. Board members all thanked Bruce and expressed the enormous debt of gratitude that is owed to him for his many hours of involvement managing North Shores and his vision to lead the community for the past 12 years on many issues.
The meeting was adjourned.