Candidates discuss subsidies of amenities

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This week, candidates discuss the value of Canyon Lake’s revenue-earning amenities and whether it’s appropriate for property owners to subsidize the amenities. Is there even an expectation that amenities be required to break even?

Over the years, the Lodge and Country Club restaurants have been held up as examples of amenities that never seem to be able to pay for themselves. For example, in the 2015-16 Annual Budget, the subsidy from property owners on the Lighthouse Restaurant in 2014-15 was $87,031; on the Country Club Restaurant, it was $167,260. For meeting rooms at the Lodge, the subsidy was $124,163.

And then there is the Golf Course, which has been the subject of feuding between factions in the community due to the amount of annual subsidies. According to the Annual Budget, the subsidy on the Golf Course was $860,203 for 2014-15. (At this week’s Board meeting, Directors voted unanimously to reverse an April 1987 decision to close the Golf Course to outside play. This action was too late to include in this week’s question, but it likely will be a topic for discussion at the upcoming Meet the Candidate Forums.)

This week, the candidates are listed in alphabetical order.

Question

Several Canyon Lake amenities like the Lighthouse and Country Club restaurants, the Golf Course, the Equestrian Center and the Campground bring in revenue but are subsidized by member assessments. Do you believe that is an acceptable aspect of association living, or should these amenities break even? Do you have ideas for helping these amenities, particularly the restaurants, bring in more revenue?

Larry Greene

I do not believe the POA’s user fees were designed to pay 100 percent of the cost to operate an amenity. This is why Canyon Lake residents pay Association dues, and as costs have increased, so have our dues. Revenue and user fees were established to lessen these dues. Residents moved here to enjoy the many amenities. Reflective of how good these are can be seen in our property values.

The city I previously worked for had many services and amenities which created revenue streams. User fees established by this city were used to offset operational costs and not to fund entire programs. My opinion is Canyon Lake amenities are no different.

An area were we could possibly offset our operating costs would be in our two food venues. The Country Club is the only restaurant to which the public has access. More widespread advertising, weekly “specials” and improved signage would encourage and increase patronage from outside our gates.

The Lodge is a much different and more complex entity. We need to attract the families who reside in the Lake to the restaurant by hosting more special events, offering dinners centered around a more relaxed, family-orientated atmosphere, and keep the cost within a reasonable range for these menus.

Progress has brought many choices for dining out in this immediate area, unlike when the Lodge was first built and it was practically the only place to get a meal! I believe if we can provide a good food service at reasonable cost this community will respond.

Improvement to the revenue generated by the Lodge is necessary; if not, then we as an Association will need to evaluate the costs verses benefit. I stress user fees/ revenue are to offset operating costs. They are not to pay for the entire cost of any amenity.

Ted Horton

Our POA is the cornerstone of our community’s lifestyle. It brings continuity and order, safety and security and, preserves our neighborhood’s architectural integrity. Also, it maintains and operates our common amenities like the Lighthouse and Country Club restaurants, the Golf Course, the Equestrian Center, the lake, the campground and others at reasonable cost for all residents to enjoy. By properly running these amenities, the Association promotes our concept of “community” and protects property values and the lifestyle we desire.

Each amenity cannot, unfortunately, operate as a stand-alone profit center. The constrictions of the gates prevent the amenities from attracting use from a large enough constituency to assure adequate traffic for profit. But, recreational and dining facilities that might not otherwise be available to homeowners and residents on an individual basis are made available to each of us. Our monthly fees subsidize it all.

These charges don’t accumulate in a profit center, but instead filter back to benefit every single resident, every day. Each amenity appeals to a segment of the population but has a net benefit to the entire community.

For example, although the Golf Course and the lake are not profitable, every home in our community is valued a little higher because of their proximity. So, while some may enjoy affordable golf and water sports, we all benefit. I think a similar story can be told about each of our amenities.

The core responsibility we have is to operate our amenities as cost efficiently as possible while exploring the alternatives to increase revenues such as:

  • Increased banquets and weddings at the restaurants;
  • Lodge food and beverage diner’s card for non-residents;
  • Enhanced marketing of tee times to the community and memberships to adjacent community residents;
  • Nominal fees for youth camps at the various amenities.

Website: www.electtedhorton.com Email: tedhorton@gmail.com Tel: (951) 764-0460

Harold Larson

Harold Larson

Harold Larson

As in most communities, amenities must be subsidized to assure their value and maintained for the enjoyment of the membership.

In some cases, amenity cost can be lowered. However, that is by total review and budget constraint and fee schedules.It would be a challenge to a break-even dollar cost and in most cases is impossible.

When I was on the Budget Committee, we approved several items to bring revenue to our community. One was placing a sign on the entrance to the Country Club to specify we were open to the public.

In addition, advertising was to be placed in local media to bring patrons in to our Country Club. The Golf Pro was to solicit outside organizations to play on our course in a tournament format. Revenue would come into the Club both in golf fees and food and beverage sales. I see only a little action taken on these items.

Relative to Country Club revenue, we have a large subsidy for a small facility which is lacking in revenue and not living up to its potential. In the last couple of years, we have had three managers and several chefs and changed menus three to four times times.

My position would be to bring in a major restaurant management firm to assist in establishing a business plan to assure we can get this Club back to a significant revenue source. Or if feasible, lease the facility and not worry about profit and loss. Which I feel every POA should do, this would bring cost savings and reduction in fees.

With your support we can get the Board back to us. I have no special wants – only to assure we govern the Association!

Tamie Mongold

Tamie Gold

Tamie Gold

Part of the charm of Canyon Lake is all the amenities it has to offer. The reason many of us move to a community like this is we want a home with vacation like activities as part of our every day life. There is a cost associated with living in a community that has the amenities we enjoy.

However it would be nice to come a little closer to breaking even on our amenities. Some ideas would include: the Lighthouse could offer a kids’ meal (like grilled cheese) at a reasonable price. The bar manager/bartender could do some public relations work. Like posting to the Lounge or Neighbor Watch what kind of entertainment they’re having on the weekends.

Another option would be to only have Sunday brunch on special occasions. Limit the champagne to only two bottles per table. The Country Club could limit the amount of soda refills per customer.

The Golf Course could increase their green fees to members. Also, the Golf Shop, golf carts and driving range need to be back in Canyon Lake’s control and we could make money from these items instead of the Golf Pro. These are just some ideas to bring money back to our members. Please feel free to share your ideas thallmark@yahoo.com.

Lawrence Neigel

Lawrence Neigle

Lawrence Neigle

All revenue-generating programs should operate at a zero net according to the law. We should not be making a profit, especially on our members, this is a non-profit corporation.

The Association, by law, is to provide for the maintenance of all common property through the use of our annual assessments. It is the obligation of the POA to maintain all grounds and buildings on each of the listed amenities. It is not the POA responsibility to pay for associated costs such as food, beverage, staff and materials for the individual users of the amenities. That cost should be borne by the users of the amenity.

If the particular revenue program fails to break even, than the users cost should be adjusted so that the burden doesn’t fall on the general membership to pay for.

That is the distortion that has occurred over the years in our Association. We the property owners and assessment payers should have our payments applied to the actual costs of maintaining the amenities, not subsidize the costs of usage by others.

For example, the cost for maintaining a park with all of its attributes are commonly owned and available to those who wish to use it. The lake is available for all to use for recreation. The tennis courts, swimming pool and building facilities are open to all and cost no additional fee to use daily. There is no additional expense to make it available to all.

The (boat) lake use fee is an example of an additional charge that should not be required. We already pay the assessment for the lake use. The additional vehicle decal fees should not be charged, we already pay for them!

I will work to remove all additional charges placed on the residents and improve the food services by eliminating menus that do not serve the general population.

Paul Queen

Paul Queen

Paul Queen

This is a problem that the new Board will need to deal with. The POA exists to support our common amenities, but is there a point where you say, “That’s costing us too much?” I believe that we need to look at these money-generating amenities as the businesses that they are, and run them as businesses to reduce the costs to the membership.

For example: When do they bring in money? When do they lose money? Are staffing levels adjusted for the slow times? Do the hours need to be changed?In the case of the restaurants, we need menus that better suit the community.

I believe the Lodge is too expensive and too “high brow” for the people of Canyon Lake. We need it to appeal to a more casual customer base if we are going to bring in the masses of Canyon Lake residents.

The menus should have crowd favorites like nachos, hotdogs, tacos, burgers, pizza and sandwiches, and the atmosphere changed to make us feel comfortable showing up in shorts and T-shirts like the old lodge did. People boating on the lake should want to stop in for “a dog and a beer” before going home.

In the case of the Golf Course, there are just too few memberships to support it. I believe there were around 200 yearly memberships sold in 2014. That is not enough to support ours or any golf course. We need to sell outside memberships to our club and get the yearly paid memberships up to at least 400.

We will probably never eliminate the need to subsidize these amenities to some degree; but with the right changes, I think that the amounts we have to pay can be greatly reduced, and with that our assessments can be reduced as well.

Eric Spitzer

Eric Spitzer

Eric Spitzer

Supporting the amenities is just part of life in a property owners association. We want them to be as close to break-even as possible but you can’t expect that. As far as the restaurants go, we just need to keep them open constantly and stop changing the hours. I can never figure out when they’re open and when they’re not. How about if we pick a closing time and stick to it. I think that’s the biggest issue with the restaurants.

Dale Welty

Dale Welty

Dale Welty

We have a history of being an association whose philosophy is to provide significant subsidies to amenities. We have a history of voting in Directors to the POA because of their commitments to fund special interest projects and promises of low fees, instead of Directors who have the best interest of the community in mind.

This practice has fragmented the community and created embattled subcultures within the community. This history is part of why we have developed a huge distrust in our elected Board members, even if they have the best interest of the community in mind. It has also opened the door to accusations of fraud and mismanagement of the POA management.

We need to change our culture from where the members believe in taking subsidies to taking responsibility. There are other HOAs that are run like businesses and expect the special interests to take some level of responsibility for their amenity. If you would like to see what communities look like that take responsibility look at http://www.robson.com/communities/pebblecreek. My father-in-law lives there and, even considering the lake lease, he pays lower dues than Canyon Lake members and gets state-of-the-art amenities.

Canyon Lake restaurants’ food and service has gotten significantly better the past two years. Members in the community have gotten together focus groups to see what can be done to improve the restaurants. The Lodge and Country Club have wonderful specials, and the dining experience is clearly worth the bargain prices.

If the community wants lower subsidies on Canyon Lake restaurants, try dining there once a month. If you are unhappy with the food or service, let the POA management know so they can make improvements. A busy restaurant will retain great servers, cooks and bartenders and provide a great dining experience.

Bruce Yarbrough

Bruce Yarbrough

Bruce Yarbrough

In reality we would all hope that we could produce enough revenue for all of our amenities to break even, but reality shows that none of these amenities break even and they never have. These and all the other amenities are what make up Canyon Lake, and removing any amenity because it does not break even would lessen the overall appeal of the community.  Understanding that subsidies are needed to maintain the amenities, it is vital that we keep reviewing the financial performance and make adjustments to keep the subsidies as low as possible. Reviewing the subsidies for the amenities in this question, you will see that comparing the 2013 budget to the 2016 budget, this POA Board has reduced these subsidies by $164,675.

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Sharon Rice