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Email Exchange Between Dan Stachurski and Joe Reynolds on Space Needs
4/26/2005

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Below are several emails in an exchange between Joe Reynolds and Dan Stachurski. My emails were sent to all board members. Dan was the only one to reply and his email is posted with permission:


Dan and All,

At the April 22, 2005 board meeting it was mentioned there were some issues with the "Sports Core" area related to being in the "Critical Areas." This will complicate the permit process, as the board observed, and throws another "unknown" into the Town Center equation.
 
Land is our most precious physical asset, and we have far too little. The property along Route 589 between Taylor Bank and Route 90 is an ideal location for the site of a new Town Center, perhaps with architectural design along the lines of the adjacent post office. The board has discussed selling some or all of this property to help finance the new community hall. I don't recall board discussion about use of this area as the Town Center. Doing so would solve a number of problems, however.
 
The property is probably not in the critical areas, and thus we could have a decent paved parking area. It would keep all traffic activity on one side of Cathell Road. It would virtually eliminate sure-to-surface controversy about the nature of commercial operations if the property were developed for business. It would dampen considerably the objections of those who want to see the land around the pond kept as parkland -- and my sense is there are a considerable number of association members who think it should be kept as open space.
 
We could build a new 25,000 square-foot community center at the above location for $3 million, at your projected cost of $120 per square foot. Such a structure would provide Ocean Pines with a facility 11,000 square feet larger than the new Community Church building. For perspective, 11,0000 square feet is an area over twice as large as the gymnasium area in the 14,000 square-foot Community Church building; it would be a building 7,000 square feet larger than the library.
 
As for the existing Community Hall, there are far, far too many unknowns at this point. At a minimum, the board should have an intrusive engineering survey done on the building -- as recommended by a prior non-intrusive survey the board commissioned with a structural engineering firm in Columbia. Not to do the recommended intrusive inspection would be a failure in due diligence and fiduciary responsibility.
 
What this board proposes will have a dramatic and long term impact on Ocean Pines. While the board has studied space needs for long time and reached a decision, good leadership should always be willing to afterwards take a long hard look at the fundamental logic of any decision before reaching the point of no return. We have not reached the point of no return.
 
If the board's decision has been made and "now it's time to get the show on the road," as stated by Dan Stachurski, this indicates a finality of board opinion making one wonder why we are having a Town Meeting on April 27. If the board decision is final, why ask the community for input?
 
Both Glenn Duffy and Art Sachs have warned of the danger in producing a camel when Ocean Pines needs a horse. Perhaps the current board decision hasn't produced a camel, but the horse seems to have a very large hump.
 
Regards,
 
Joe Reynolds


Dan Stachurski's Reply

Joe:
 
You're asking good questions -- some that we have asked and answered to date, and some that the Board has not yet undertaken.  But you need to be able to separate the issues of meeting community space needs which the Comprehensive Plan Committee defined as 25,000 square feet, the conceptual estimates put together by Design Atlantic based purely on their experience -- no designs or engineering or site survey work or anything else was done  -- and the actual issues and costs involved in either rehabilitating existing structures or building new ones or a combination of both.  All of us on the Board are very aware that a world of decisions are yet to be made once we begin this project -- if we begin it.  Our sole effort at this point is to get the community to agree that, first, we should provide the space; second, that the space should be financed through the use of existing reserves and the sale of land assets owned by the community as opposed to borrowing the construction funding and raising assessments; and last, that a budget goal to accomplish this task be set at some reasonable level. 
 
April 27th is, truly, an opportunity for the community to hear the Board's thinking and to provide any input to the Board that they so desire.  It is not the only avenue to use to reach the Board, as you well know.  We do read and respond to email and letters, and we do have listed telephone numbers.
 
Please note that the Board has not yet decided to take this issue to referendum.  More important, our discussions to date have been purely conceptual:  we are attempting to define a project, literally estimate a reasonable construction figure in order to get to a total, figure out how to finance that total, then ask the community to decide.  We have yet to design a building, do any site work, any intrusive engineering analysis, or take on any cost of prospective construction until such time as the community agrees on a project and places a financial goal out there for the Board to use.  So firing questions about actual issues on buildings -- and assuming decisions on the part of the Board that have yet to be addressed -- is premature.
 
With respect to your comments:
 
The Sports Core area is not part of the CMA (Conservation Management Area) that includes the South Pond as far as I know -- and I will reverify this with Sandy Coyman.  The line is literally along the shoreline of the Pond.  The only issue with using this piece of property will be how the drainage ditch from the intersection of 589 and Cathell Road Extended to the South Pond is handled -- and we won't know the answer to that until we get to the permit stage.
 
The commercial property along 589 from Taylor Bank to the on ramp to Route 90 represents a bank account to Ocean Pines -- the Board would sell this land in order to raise a good portion of the construction funding necessary to meet our space needs. If we were to build a new community activity center there, we would be effectively adding the value of the land to the cost of the building.  Four years ago, that land was valued at $900,000.  I have already received an expression of interest from a buyer for one of the three lots that this land can be divided into -- and that interest is backed by an offer for $1.25 million -- or $3.75 million for the entire property.  We have a commercial value estimate coming in from a professional appraiser in the near future, so don't take my number to the bank.  Point is that, to accomplish your potential scenario of building on this particular property, we would be adding the value of the land to the cost of the building -- and we'd have to find some other source for the cash to build.  That takes your building on this property from $3 million to $6 million plus -- at a cost per square foot of over $240!
 
Design Atlantic took the target of 25,000 square feet of space, as defined by the Comprehensive Plan Committee, and looked at providing the space using combinations of 16 different alternatives (their August 1, 2004, Community Facility Evaluation as first presented to the Board).  The first step in this analysis was to add service, storage, and utility spaces to the 25,000 square foot estimate to arrive at a target square footage needed -- and that number is 29,523.  This was arrived at based entirely on their experience -- no design work was done.  They then went on to provide every option they could find -- sixteen of them -- for the Board to consider as it worked toward meeting the community's space needs.  Included was a completely new building of 29, 523 square feet at an estimated price of $4,025,506 -- or $136 per square foot in 2004 dollars.  But to do this option, Ocean Pines would have to demolish the existing Community Hall at an estimated cost of $76,000 and build a new fire substation at an estimated cost of $909,466.  So the total estimated cost of a new structure to provide the space we needed works out to the sum of $4,025,506 plus $76,000 plus $909,466 which is $5,010,972.  And that's 2004 dollars.  Apply the inflation factor you think appropriate to get to 2005/2006 dollars, when we would actually be trying to undertake this project.  That means that, to achieve the target 29,523 square feet of space, we would spend not $136 per square foot, but $169.73 per square foot because we would have to demolish the old building and build a new fire station in order to build a new community hall.
 
Regarding sure to surface controversy about commercial operations on the commercial property the Board feels should be sold to help finance this project, remember that we can place any deed restriction we wish on these properties.  The Board's conversations to date have been focussed on seeking builders of professional space only -- preferably medical, dental, or other health-related service operations.  Would that be controversial?  We can, and will, include building design restrictions in addition to use restrictions.
 
Using $120 per square foot for 20,000 square feet of building (as currently under consideration by the Board), the estimated cost is $2,400,000.  Add to that the cost estimate from Design Atlantic in 2004 of $1,863,964 to do an extensive renovation to the existing Community Hall, which is 10,823 square feet of space, and the board is suggesting that we can provide 30,823 square feet of space for the community at a cost of $2,400,000 plus $1,863,964 for a total of $4,263,964 or $138.34 per square foot.  Yes, it is more expensive, per square foot, to renovate than to build anew, but it is the total cost per square foot and the total budget that we must remember.  And retaining the existing Community Hall rebuilt to pristine condition allows us to keep the fire station -- and it gives us two new areas to use for community activities so that we can separate activities (such as the summer children's program, card playing, square dancing, exercise activity, board meetings and so on).
 
We fully understand the relative sizes of buildings, having visited the 27,000 square foot new Senior Center in Snow Hill just before it was opened, the new 42,000 square foot gymnasium the county is building in Snow Hill, the YMCA in Pokomoke City (size unknown precisely), and the new 14,000 square foot Family Life Center addition at the Ocean Pines Community Church.  Based on these visits, the Board has agreed that a new building of approximately 20,000 square feet combined with a complete renovation of our existing Community Hall offers us a workable solution to our space needs and provides some valuable bonuses -- the separation of summer children's activities from adult pursuits being the quickest to come to mind.  As for our pricing level -- is it an estimate based on the roughly $85 per square foot the church is spending for an unfurnished bare bones building and the $145 per square foot the county spent on what is a lavishly appointed Senior Center.  Our $138.34 figure is for completely finished and furnished space by the way.
 
The Board is very aware of the impact of this project and is proceeding with lots of care:  we have taken nearly three years just to get to this point.  Before we go any further (and, please remember that going further means spending some serious money on things like architects, site engineering and permits, for openers), it is time for us to ask the property owners whether they want to provide the space, whether the two step method the board proposes sounds logical to them, whether the budget target (and I would make that $4.5 million, by the way, to allow for some inflation) is reasonable, and whether they agree to the financing methodology the Board proposes of selling real estate assets that we do not use combined with up to $1,000,000 from our reserve accounts which currently stand at roughly $3,000,000 (with NO increase in property assessments!).  Once we have this set of answers, we can proceed to the actual development and execution of this project. Or, we stop here.   Yes, Joe, I would like to get this show on the road, but, in saying that, this is the road of which I speak.
 
I don't know much about horses that look like they have humps, but I do know that what one sees through a telescope depends entirely upon which end one chooses to look.  The April 27 meeting is no joke.  The Board is elected by the property owners of Ocean Pines to represent their interests and we are absolutely not going to make any decisions that do not hold these interests paramount.  So, as one property owner who happens to sit on our Board of Directors at the moment to one who does not (and why are you not yet filed as a candidate for the Board in the upcoming election?), believe me when I say that we share a common interest in protecting and enhancing the value of our property and I'm certainly not going to to anything to endanger that value.
 
Dan


Joe Reynolds reply 

Dan, thank you for your thoughtful response. There are several items we could debate, such as the value of the land along 589. In my view our OPA-owned land is "priceless," whether it is along 589, the golf course, the beach, or White Horse Park.
 
If nothing else I'm hopeful my previous comments/suggestions sparked some degree of introspection and thought by the board. Ultimately we all want what is best for Ocean Pines, but the "possible" referendum will be the deciding factor. My comments were intended to present alternative approaches that might contribute to a greater possibility of a YES vote and obtain the best value for our construction dollars.
 
Regards,
 
Joe



Uploaded: 4/27/2005