Parcel A + Exclusive Use Issue

[Forum Administrator]

This board is for discussion of ideas of future use for Parcel A (the Isle Dauphine property), and for discussion of the Exclusive Use issue.

Some proposals for Parcel A future use involve public and/or non-member access, therefore, there have been efforts toward discovering what process would be involved in modifying the Exclusive Use clause in the property deed to allow non-members to legally access the property.

Argument for modification of the Exclusive Use clause revolves around the idea of finding a longer-term lessee to help renovate the golf course and/or other amenities, and perhaps to add amenities, such as a boutique hotel. The argument is that a hotelier or golf course investor/management company would not invest if the deed does not legally allow access by the public or non-members to help recoup the investment dollars they would spend.

Arguments against modification of the Exclusive Use clause revolve around the current language of the deed which states that the property is for exclusive use of DIPOA members only.

Weigh in with your thoughts on this topic on this thread.

[tombowden]

The deed to Parcels "A" and "B" states the property is to be kept and maintained by the DIPOA “forever as a recreational area for the exclusive use and enjoyment of those persons who shall be and remain members of the Dauphin Island Property Owner’s Association.”

This new ProBoard topic seems to be a continuation of the extensive five page discussion from March 2011 to June 2012 under the ProBoard topic of Constitution and By laws – Removal of Member’s only deed Restriction. That topic involves the 2011 DIPOA Board's efforts to pass a straw vote among the membership on the issue of removing the "exclusive use" provision from our 1953 deed to parcels "A" and "B". Anyone reading this new board topic should absolutely read that entire discussion for a little history on this subject, but for those who do not have the time, suffice it to say the subject was well argued by both sides, and the proposal failed miserably when the vote was counted - but the Board apparently began its efforts by seeking legal advice to remove the "exclusive use" provision again almost immediately after the straw vote.


The current Board seems equally committed to the idea of removing the "exclusive use" provision from the deed to Parcel "A", and last year the DIPOA attorney proposed an amendment to our 1953 deed which can be seen at the DIPOA website – Archives – Legal – Restrictive Deed. This proposed amendment has several serious problems. As a precedent for the removal of the “exclusive use” provision, the proposed amendment says the Chamber intended that the DIPOA build a public golf course on Parcel “A” which is wrong in that the public golf course was originally planned and apparently built on a different parcel and was only later rebuilt on Parcel “A” after a storm. Also, the new language of the proposed amendment is contradictory in that it seems to firmly retain the “exclusive use” provision in one sentence and then provide for its removal in another. Finally, the whole concept of transferring the property back to the Mobile Chamber of Commerce only to have them convey it back to us is fatally flawed in that the original 1953 deed expressly says the property can never be conveyed back to the Chamber.

I and several other members joined the Future Use Committee at an open Board meeting in September of 2013 when the idea of putting a water park and drive-in movie theater on Parcel "A" was raised. I think we all immediately envisioned asphalt covering our beautiful golf course and sand dunes and became involved to erase this vision. The Future Use Committee has not held a meeting to this date, but some of us have communicated by email and some potentially profitable uses of Parcel "A" have been suggested which would not require removal of the "exclusive use" provision nor the issuing of a long term lease.

Not having discovered the prior discussion posted under the Constitution topic, I assumed this board had nothing on the subject, so I have personally been in extensive email discussion on the "exclusive use" issue with the Board President, Laura, over the last several months. In addition to many of the Board arguments raised previously, Laura has emphasized that we are in bad financial condition and need something like a small hotel on Parcel "A" to keep us going. Laura suggested we move our discussion to the ProBoard which is now happening. This is a very important issue which has been bubbling for 60 years and could substantially change the nature of the island. Hopefully, lots of members will voice their opinion, and we can educate each other to resolve this issue once and for all.

My own point of view is that the present Board, however well intentioned, is making a serious mistake in attempting to remove the “exclusive use” provision from the deed to Parcel “A” and in considering a long term lease on Parcel “A” for any purpose. First, I seriously question whether the provision can be legally removed from our 60 year old deed. I think the “exclusive use” provision created a contractual, property, and trust right in each DIPOA member which cannot be removed by the Board or even by a 99% vote of the membership. At least one local attorney has apparently advised a previous Board that "exclusive use" means "exclusive use" and the deed cannot be changed.

Second, I believe the DIPOA can preserve the natural beauty and serenity of this invaluable property better than any private individual or corporation. While we can put provisions in a lease to protect our interests, we are limited by what the lessee will accept and by their ongoing desire for a profit. The Board is non-profit and has been tasked with managing all of the DIPOA property in accord with the original deed as a recreational area for the “exclusive use” of our members. The fact that times may be more difficult doesn't change the task. Major development seems to just bring more problems. Construction of even a small hotel will take the upper portion of the present golf course and leave us with a lower 9 hole that washes out in big storms. An RSA golf course development group would reportedly take all of the present golf course plus want to tear down our club house buildings to gain space.

Third, I question the necessity of removing the “exclusive use” provision. The Board must be congratulated on its cost saving measures thus far, and as stated above, the Future Use Committee has come up with a number of ideas which could raise money without giving up a long term lease on Parcel “A”. A few of these ideas include a nature trail, development of a convention/wedding/reception business, a mooring field in front of the clubhouse, a renewed dues drive, pursuing BP federal and state damages money, more efficient golf course management, better promotion of what we have through tour companies already coming to the island. The DIPOA also apparently owns other properties in the commercial area on the island that should be used to generate income. Laura points out that the Board has been faced with a general lack of interest and/or high salaries for DIPOA management for these types of businesses which has led to the current short term restaurant leases. Insmuch as there does not seem to be any serious objection to the short term leases and the DIPOA still has substantial control over the property, there is no reason to change the situation. I believe that a reasonable interpretation of the “exclusive use” provision does provide for some leeway in how we use Parcel “A”. Obviously, members should be able to invite their family and friends to use the property. We should also be able to invite members of the public on a limited basis for the good (financial or otherwise) of the DIPOA as we have for many years with the golf course and most recently with the restaurants.

The Board is currently interviewing local attorneys, in part at least, to continue the effort to remove the “exclusive use” provision from the Parcel “A” deed. I have offered to sit in on these attorney interviews to try to make sure we aren't just hearing what some attorney thinks we want to hear to get the job. So far, my offer hasn't been taken up. Bad advice on a deed change for this multi-million dollar property could cost the DIPOA dearly and put us in even worse financial condition than we are now.

Let us know what you think!

[JBJ]

What the board is pursuing is an amendment to the deed removing the "exclusive use" provision for parcel A only. There is no plan --at least to my knowledge-- to have the property transferred back to the MACC (Mobile Chamber) and then have them re deed it to the DIPOA. Has someone proposed that as an alternative? So if the deed could be amended to remove the restriction the POA would be "legally free" to continue to do what we've done for the past 35 years or so, that being to have non-members use the facilities for a fee or as customers of lessees. Removal of the restriction would not require that the property be "open to the public" it would simply allow it to be. With an amended deed the POA could--with approval of a super majority of the members-- revert back to a private club arrangement, make the property a public park, or do most anything in between. We would have more options than we now have--one such option being a long term lease. So I have a hard time understanding how the removal would be a mistake. Some argue that removal of the restriction would make it easier to make a bad decision--to do something foolish. Easier, perhaps--but not easy. We have effective controls in place that require a super majority ( 2/3) of a super quorum ( 750) to approve any property encumbrance beyond a simple three year lease. I simply don't think it's necessary for us to protect our members from themselves.

[tombowden]

The plan was described at an open Board meeting as a conveyance to the Chamber and back to us, and the amendment itself suggests the same in that the "Grantor (the Chamber), by this instrument does hereby amend the Deed ...." The Chamber currently has absolutely no legal interest in Parcel "A" to amend and they could never do anything with the deed unless we give title back to them or they took it back on some technicality such as if the original deed was invalid. We would be asking the Chamber to do something they have no legal standing to do.

So, if we have gotten along with the "exclusive use" provision for 35 years, why change it now? DIPOA is a non profit corporation with only its members to satisfy. We reportedly have about $400k in the bank and the present Board has done an excellent job of cutting costs and raising revenue with the short term restaurant leases. Of course, the present Board would not intentionally do something foolish, however past Boards that apparently spent millions of DIPOA dollars with little to show for it; the people who built our pier to nowhere; our west end public parking lot in the gulf; the Board that gave the town our DIPOA property at the west end to get government grants that never appeared; and the "final" settlement with the Army Corp are all looking a little foolish now.

What could go wrong with a hotel on Parcel "A"? I don't know, but how about - a hurricane destroys the hotel and insurance goes through the roof and the company just walks away leaving us with an eyesore, no income, a bill to clear the land, and a lawsuit to terminate the lease. There are plenty of other bad news scenarios, but why risk our incredibly beautiful property when we don't have to. Even short term leases are a stretch, but at least, now, we can correct our mistakes every three years instead of being stuck with them for 50 or 100 years like a hotel developer will require.

The Board should continue to concentrate on what can be done under the current deeds to raise money and should continue to avoid any "good old boy" contracts to save money. There is a reason we have come 60 years with the "exclusive use" provision in our deed to Parcel "A".

[JBJ]

I must have missed that meeting--I've only missed one, so it must have been Sept. Who presented that plan? But it's not what we plan to do unless our new attorney convinces us to change our direction.
Re. why change now. I've explained that why in spades on a number of occasions, short answer is that we must if we are to pursue a long term lease. So the better question perhaps should be why pursue a long term lease. My "why" is that I want to find out--once and for all, as they say--what , if anything, is possible. I'd like to put on the table, along with the other items that we're discussing, development proposals from serious prospects to see what those options may be. I'm NOT predisposed to jump at any of them--I just want to see what interest ( if any) there may be. But --AGAIN--I say, a proposal would have to be VERY attractive to get a super majority of the board, and then a super majority of a super quorum of the members to accept it.

Re. how foolish the previous decisions are. First, the board didn't unilaterally deed the west surf beach to the town, the membership approved it. ( High hurdle--see previous references) It was and is a good decision. The WSB is now public. We may not get public, or quasi public, $$ for our public beach but we damn sure wouldn't get it for a private beach. We're now hoping to garner public support for HB386 which would require a bit more $$ from basically public coffers to help save DI's shoreline. Good that we are asking to save public beach with public $$, rather than private property with public $$.

And the COE lawsuit settlement. To suggest that we somehow erred by taking that settlement--particularly to suggest that, willy nilly, as a fact, reflects a lack of understanding of the facts of the matter. We had lost the lawsuit. Now , to be sure, we were screwed--but we lost. We could take the loss and get nothing, or we could take the bone ( 1.5 million is a decent bone). At the time we needed the $$ more than we do now--but having that $$ now is important. We gave up our right to sure the COE for similar issues, but only the members of the class did so. Others can sue, and may if the situation changes. I voted to accept the settlement --thought it was the right thing to do then and continue to think so now.

And to your ..."why risk our beautiful...." point. That risk would come into play AFTER the deed restriction was removed and when we were voting on a lease proposal. If we were ever to actually vote on a proposal. I doubt that we would because I don't think we'll get an attractive one. But why not find out? Again I say we don't need to protect ourselves from ourselves.


PS--it's kind of lonesome on this discussion board--maybe someone else will pitch in.....

[tombowden]

I believe it was the Sept meeting where conveying Parcel "A" back to the Chamber of Commerce only to have it conveyed back to us without the "exclusive use" provision was raised. I don't recall who presented the idea, but I believe these meetings are recorded by the Secretary. This was the meeting where I and several other members joined the Future Use Committee - in response to the waterpark/drive in movie theater on Parcel "A" discussion.

As I said above, the proposed amendment itself has the Chamber of Commerce amending our deed when they have absolutely no current interest in Parcel "A". So, how could the Chamber legally amend our deed unless we convey the property back to them first? Even if the Chamber agreed to violate the deed they wrote saying the property could never be conveyed back to them, and even if the County Recorder's Office allowed the Chamber to file such an amendment, it would never stand up to a legal challenge, and I can't imagine that any legitimate long term lessee (e.g. hotel developer) would want to risk their money on such a recording.

At either the Sept or Nov meeting, members of the Board seemed to disagree on whether the Board on its own, a majority vote of the membership, or a super majority vote of the membership would be required to get rid of the "exclusive use" provision and/or issue a long term lease. One Board member pointed out that the Chamber granted the property to the DIPOA and not to the members themselves, apparently in support of the argument that a membership vote would not be necessary. While that Board member was technically correct, this view failed to consider the trust/contract/property aspects of the deed, and it certainly didn't instill confidence that a super majority of the membership would be required for anything in the future.

Please do not misunderstand, I have the highest respect for the current Board, but given the general history of politics, it is hard not to believe that if we hang an a big rosy red apple out there, someone will eventually grab it for themselves. According to the Mobile Harbinger's 1999 series of articles on the history of Dauphin Island, the Chamber earned $6 million ($37 million in 1999 dollars) from the sale of properties on the island - of which they gave the DIPOA 70% after costs and expenses. The DIPOA has received additional oil/gas royalities and BP settlements over the years, but we reportedly have less than $500 thousand today. With this track record, maybe we do need to be protected from ourselves, or at least Parcel "A" needs to be protected.

As long as the DIPOA maintains control over Parcel "A" (even with short term leases), we can easily correct any mistakes. With a 50 or 100 year lease, we can't. There are ways for the Board to make money without destroying the last large piece of natural and semi-natural gulf front property in Alabama. If the Board is in desperate need of money and they want a hotel, put it on the DIPOA property next to the condos on Bienville.

As for a long term lease on Parcel "A", this is clearly not what the Chamber intended when they deeded the property to the DIPOA. Members have relied on the "exclusive use" provision for 60 years in buying and selling property here. Finally, the membership clearly expressed their opinion when they voted down the 2011 Board's straw vote effort to get rid of the "exclusive use" provision. Why is this still an issue?

[tombowden]

As stated above, I and several others joined the DIPOA Future Use Committee at the Sept 2013 open Board meeting following a discussion of putting a waterpark/drive-in movie theater on Parcel "A". This idea engendered a vision of asphalt covering our lovely dunes and golf course property - for me at least. Later discussion included some disagreement among the 2013 Board as to what would be required to get grant a long term lease and/or get rid of the "exclusive use" provision on Parcel "A" with at least one Board member expressing the view that because the Chamber of Commerce gave the property to the DIPOA as opposed to property owners, just a simple 50% majority vote of the Board would suffice. Other members of the Board said a 2/3 majority vote of the membership would be required, while still others said a 50% majority vote might be enough. Surprisingly, there was no discussion (that I heard) of the 2011 Board's proposal to get rid of the "exclusive use" deed provision which was defeated in a membership vote, so I began a rather protracted series of email conversations with members of the Future Use Committee and the Board on this issue. I only became aware of this ProBoard discussion and of the 2011 vote when I recently moved the email conversation to the ProBoard.

Notwithstanding the membership rejection of the 2011 Board's proposal and the 2011 Board's preliminary explanation that they did not want to spend money on an attorney unless the membership approved the removal of the "exclusive use" provision, the 2013 Board apparently paid an attorney in early 2013 to draft an amendment to the deed to get rid of the "exclusive use" provision on Parcel "A". That proposed amendment can be found in the DIPOA Archives under "Legal". The Board is currently interviewing local attorneys, presumably in part at least, to get new advice on removing the "exclusive use" provision on Parcel "A". The Future Use Committee's ideas for alternative means to earn money seem to be falling on deaf ears. It certainly appears that some on the current Board are very intent on getting rid of the "exclusive use" provision on Parcel "A". Inasmuch as the removal of the "exclusive use" provision from the deed to Parcel "A" is very likely to once again appear at the 2014 annual members meeting in May, we should all read both ProBoard topics: the Constitution By-Laws Removal-Members-deed-Restriction topic and the new Parcel "A" + Exclusive Use/Deed Restriction topic.

Inasmuch as the Constitution By-Laws discussion is so long I have attached the following Feb 2011 introduction to the 2011 Board's proposal and one May 2011 post which follows the 2011 membership vote for a preliminary understanding of the issue:


2011 Post Introducing Board's Proposal:


Quote

Post by JBJ on Feb 17, 2011 at 11:53am
Last evening at the POA board meeting a number of items were approved, one pertaining to the removal of this deed restriction. The first step in the process will be to ask the membership to vote for or against the initiative. Should the membership vote "yes", we will proceed to determine exactly how to accomplish the effective removal--be it a newly issued deed, a "friendly" lawsuit seeking judicial declaration, or some other way. We just didn't want to spend the money for legal fees until we hear from the members.

Here is what will be on the ballot mailing:



[Deed Restriction


The common property owned and operated by the POA was originally deeded to the POA by the Mobile Chamber of Commerce in the 1950’s. The Deed which conveyed the property to the POA contained language that the property was to be kept and maintained forever as a recreational area for the exclusive use and enjoyment of those persons who shall be and remain members of the POA. As most are aware, the facilities were operated as a “members only” club for many years, but this was changed in the aftermath of Hurricane Frederic when the facilities were opened to the public. A majority of the Board believes that it is in the best interest of the POA to remove or eliminate the enforceability of this language for two reasons—to adjust our governing document to conform to our current reality; and to remove or have declared unenforceable what could be a barrier to receiving public or quasi-public funding/investment for improvements to our property. The removal of the restriction could possibly be accomplished by several means, however, prior to incurring the legal expense for determining exactly how to accomplish it, the board wishes to have a vote of the members indicating support or opposition to the initiative. Accordingly, we ask that you indicate your preference by voting “for” or “against” pursuing this change:


I am _____in favor of

_____opposed to

pursuing a removal of the “members only” deed restriction





2011 Post Following the Membership Vote:

Quote

Post by LLL on May 15, 2011 at 2:03pm
The membership spoke clearly by the vote defeating the proposal designed to gauge the the support for removing the "members only" deed restriction. It was soundly defeated, with the membership rejecting the Board endorsement of the proposal. The board had solicited proxies in the official ballot mail out, and even with this advantage to recruit support, a significant voter turnout demonstrated the membership was not in favor of continuing to divest itself of ownership rights deeded to them. The sound rejection of the mandatory dues proposal, also supported and endorsed by the Board, further indicates, at least on these issues the Board brought to be voted on by members, the majority Board's direction is not consistent with membership views.

As a result, can the members hear from the present Board through this forum whether a redirection of the Board's approach as to divesting or further diluting ownership rights will take place? Will future concepts for POA property uses now place a primary consideration on property owners maintaining, in principle and practice, current use and possession rights belonging to owners? Or does the Board have a different assessment of the voting results?

[Laura Martin]

Feb 19, 2014 20:04:32 GMT -6 JBJ said:

PS--it's kind of lonesome on this discussion board--maybe someone else will pitch in.....

Bruce - I will be pitching in with my comments soon.

[Laura Martin]

This is the first of a number of responses to Tom Bowden’s posts on this thread.

Right up front, let me say that I like Tom and I respect his ideas and opinions, and I fully defend his right to express them. I do not agree with many of his points, however, so my comments here below and elsewhere on this thread are merely to point out another view, and to correct some of Tom's statements which might leave some people with inaccurate information or inaccurate impressions of the past or the present.

From Tom's post re the Board’s stance on Exclusive Use (2-17-2014):
"The current Board seems equally committed to the idea of removing the "exclusive use" provision from the deed to Parcel "A", and last year the DIPOA attorney proposed an amendment to our 1953 deed which can be seen at the DIPOA website – Archives – Legal – Restrictive Deed."

Do not assume that the entire Board is made up of champions for EU-modification/removal. The Board consists of nine different people with varying opinions on how Parcel A could best be used. For too long, too many people have referred to the Board as a collective - "the Board this" and "the Board that." The Board is not a hive mind by any stretch of the imagination. The nine Board Members fight battles of vision, policy and process with each other every day. The Board should always attempt to fairly represent ALL points of view, but they are bound to ultimately represent the will of the majority.

Even pursuing the process for EU-modification, it would STILL have to go to the members for a vote. This is not a dictatorship here. The same right that EU-proponents have to promote and vote against change is the same right that EU-modification-proponents have to continue to pursue and propose modification. Both groups believe their solution to be a viable one, and both have a right to promote their visions and ask the membership to consider those visions...more than once in the lifetime of the Association.

I don't know about past Boards, but THIS Board, as long as I lead it, is committed to doing what the majority of property owners want to do. I am personally in favor of modification of the clause for all the reasons I stated in my email exchange with Tom recently (which I am in the process of converting into blog essays), but not all nine of us are.

The only way to determine what a majority of the membership wants is to put together several possible plans for Parcel A use and submit those to the membership. I have asked the Properties Future Use Committee to develop business plans for each of the proposals, with estimated P&L and ROI. We need to determine what sort of initial investment is needed, what will be involved with maintenance, and estimated revenue based on similar venues as well as our own member and visitor interest.

For an example of the kind of information we need to make an educated, well-informed and sound financial decision on the use of Parcel A, see this blog essay:
aviewofthedunes.com/dipoa-issues/business-plans.htm

[Laura Martin]

From Tom’s post re a waterpark (2-25-2014):
“I and several other members joined the Future Use Committee at an open Board meeting in September of 2013 when the idea of putting a water park and drive-in movie theater on Parcel "A" was raised. I think we all immediately envisioned asphalt covering our beautiful golf course and sand dunes and became involved to erase this vision.”

As stated in several meetings, the waterpark was the idea of a Town Council member, NOT an idea put forth by the Board. The Board merely mentioned it since it was one of the ideas floated.

Most members with whom I have spoken are not in favor of such an amenity on Parcel A, and neither am I. Don’t get me wrong - I think a waterpark on the island might be a very good idea, but it should be located on the “main drag” somewhere. A large, “industrial” type structure such as that can be placed in a more commercial area. It does not need to occupy one of the most prime real estate parcels on the entire island. An unobstructed view of the gulf is not needed for a waterpark. People don’t go to a waterpark for a view. They DO however, want a water view when staying at a hotel or a rental house or to play golf near the water.

I think most of us agree that Parcel A lends itself to more quiet amenities - a golf course, nature trails, etc. I feel that even a small hotel in a far corner of the property would be an appropriate amenity and would not involve asphalt covering the entire golf course and dunes.

Brainstorming ideas is one of the best ways to work through a problem, as has been proved over and over in the business world. And brainstorming sometimes leads to “bad” ideas or ideas which ultimately are not viable. That does not mean that we should circle the wagons after a less-popular idea has bubbled up. We need to remain open-minded and consider each idea on its own merits. One fraying string does not have to result in the unraveling of the entire tapestry.

Doomsday thinking is a problem which has faced this Association for years. When a not-very-popular idea is floated, sometimes a massive fear-mongering campaign begins which worries people and makes them feel the need to “erase” such visions. We all do this, myself included. So we must try to look at each idea independently.

The Board Members, and the Properties Future Use Committee Members, are tasked with reporting on ANY AND ALL IDEAS which members may bring forth, no matter how distasteful they may be to some. We are a democratic organization - or we should be. No voices should be stifled.

That said, I think it is safe to say that many members would agree that quieter, perhaps more “high-class” amenities would be more appropriate for our beautiful parcel on the gulf.

So we do not have to reject outright the idea of modifying the exclusive use provision for Parcel A (in order to allow longer-term lessees for professional golf course management or a small hotel or some other public-access amenity) just because most of us don’t like the idea of a waterpark or other high-traffic, high-noise amenities. These are VERY different visions. Let’s be reasonable and not throw the baby out with the bathwater.

[Laura Martin]

From Tom’s post re the RSA (2-17-2014):
“An RSA golf course development group would reportedly take all of the present golf course plus want to tear down our club house buildings to gain space.”

It is not really fair to bring that up as a present or future threat. That was in the past. That is NOT what most members want, and that is at least part of the reason why the proposal for such (put out by some Board Members at that time, not by the RSA) met with resistance before.

THIS Board is pursuing designation of the Isle Dauphine buildings as a historic landmark. We are in the process of applying to be on the National Register of Historic Places, in part to ensure that our architectural treasure with its unique mid-century design is always preserved. If the RSA or any another management company is interested in a lease, tearing down those buildings would be a show-stopper. Right up front, it can be stated that the buildings must stay, particularly once they have the historic designation.

Besides, my hope would be to find someone willing to foot the bill for restoration of the Isle Dauphine, as part of the lease agreement of another portion of the property. David Bronner of the RSA LOVES historic buildings. In downtown Mobile alone, the RSA has restored the famous 1908 Battle House Hotel, the 1960s BankTrust Building, and is now restoring the 1907 Van Antwerp Building, the first “skyscraper” built in Mobile. The RSA may be interested in restoration of the Isle Dauphine - it would be worth it to find out.

It is important to avoid black-or-white thinking - that we can ONLY preserve our treasures and maintain substantial control if we do everything ourselves, and that partnering with someone else will result in Parcel A-rmaggedon.

This kind of thinking has brought us to where we are today - just a few hundred thousand dollars in the bank away from no more cash.

To continue to do the same thing (managing Parcel A as it was managed for years and years - in the red) while expecting a different outcome is the definition of...well, you know.

From Tom’s post on this same topic (2-23-2014):
“There are ways for the Board to make money without destroying the last large piece of natural and semi-natural gulf front property in Alabama. If the Board is in desperate need of money and they want a hotel, put it on the DIPOA property next to the condos on Bienville.”

Again with the nihilist thinking! I don’t see how beautifying Parcel A with a classy hotel and a restored golf course would “destroy” the property. I am not sure how such a catastrophic vision can be derived from such a proposal. (As must be stated for the record, we are not talking about high-rise condos or anything else which would radically alter the ambiance of the parcel.)

As for other locations on the island for a hotel, sure, that would be great too. But the whole point of a small hotel on Parcel A is to attract GOLFERS who want to stay where they can see and walk to the GOLF COURSE. The idea is that the hotel is the way for an investor to recoup the millions they have to lay out up front to fully restore the golf course - whether as a traditional golf course or a combination of traditional golf and disc golf, plus a driving range, a putting green, etc. - in addition to nature trails and other quiet amenities which utilize the landscape. All that takes a lot of money and an investor has to have some way to recoup that. Greens fees and/or disc golf playing fees will not be enough.

[Laura Martin]

From Tom’s post re attorneys opinions on the exclusive use issue (2-17-2014):
“[We need to] make sure we aren't just hearing what some attorney thinks we want to hear to get the job.”

It is our duty as Board Members to ensure that our attorney(s) provide us with what the law says, not just "tell us what we want to hear." Again, that may have been true of past Boards, but as long as I lead the Board, that will NOT be the case. Board Members are elected to serve the wishes of the majority of the members and uphold our constitution, including amendments and changes to that constitution implemented through a majority vote of the membership. So we are attempting to find possible solutions to our issues, present the best arguments we can for one side or the other, and let the membership decide.

What that means is we have to ask our attorney(s) what CAN be done and what CANNOT be done - UNDER THE LAW.

Another of Tom’s statements regarding attorney opinions:
“At least one local attorney has apparently advised a previous Board that "exclusive use" means ‘exclusive use’ and the deed cannot be changed.”

Okay, if “exclusive use” means “exclusive use,” then we have to put our money (or lack of it) where our mouth is. Lock the gates, post a sentry, and ask to see membership cards for all who enter Parcel A. NO EXCEPTIONS. NO ONE except property owners should be allowed to enter and use the facilities.

We cannot say in one breath that exclusive use means precisely what it says - that it is ONLY for use by the members, and then in the next breath back-pedal and say we may have to allow non-members to enter and use the facilities because we cannot survive on member dues alone.

It’s one or the other. Choose. And live with the financial consequences of that choice, not by bending the rules to make a round peg rule definition fit into a square hole reality.

[Laura Martin]

From Tom’s post re the downside of a hotel (2-19-2014):
“What could go wrong with a hotel on Parcel A? I don't know, but how about - a hurricane destroys the hotel and insurance goes through the roof and the company just walks away leaving us with an eyesore, no income, a bill to clear the land, and a lawsuit to terminate the lease. There are plenty of other bad news scenarios, but why risk our incredibly beautiful property when we don't have to.”

The risk is here NOW. We do not have enough cash to pay for flood or wind insurance on the gorgeous (but deteriorating) Isle Dauphine buildings. If we had a deep-pocket partner on a substantial lease agreement, we would have the revenue from that to help protect our treasures. A hurricane which destroys a hotel (say a small Courtyard Marriott), set perhaps 500 feet back from the water on the eastern edge of the golf course, would do the same or worse to the Isle Dauphine buildings which are only about 200 feet from the water’s edge. But today, we have not near enough financial resources in cash or insurance to restore them in a worst-case storm event. A Marriott, with its substantial coffers, would be built back faster than an Isle Dauphine, especially an Isle Dauphine with no insurance.

Also from Tom’s post of that date:
“The Board should continue to concentrate on what can be done under the current deeds to raise money and should continue to avoid any "good old boy" contracts to save money.”

I’m not sure what “good old boy” contracts are being referred to here, but becoming business partners with financially stable, widely-known entities such as Marriott or the RSA/RTJ Trail (which have not only the resources for building, restoring and maintaining, but also for critical ADVERTISING) would be a smart move. Cronyism usually involves awarding contracts (particularly no-bid contracts) to friends, whether or not those friends are the best persons to make the facilities financially viable.

[Laura Martin]

Re: Past Rejection of Exclusive Use Modification by Members

In a number of Tom’s posts, he refers to “the membership rejection of the 2011 Board's proposal to remove exclusive use” and that it was “soundly defeated.” We must be careful to avoid a misleading statement of what happened then, and how it relates to now.

In 2011, this was not a vote to formally change the exclusive use clause in the constitution. This was merely a poll to test the waters.

Prior to the poll, there had been little to no in-depth discussion widely across the membership about the consequences of “staying the course.” Most property owners do not attend the meetings. For many of them, this is not because they do not want to, but simply because it is not feasible for them to make the trip to the island on those specific dates and time every month, particularly when the meeting times jump around and particularly when they are held on weeknights.

Also, most property owners were not aware of the Proboards discussion forum at that time. The Board at the time of the creation of the forum was not enthusiastic about getting the word out about the forum. With a dismal advertising and information campaign to direct people to the forum, it resulted in a small online discussion group, most of whom were among the same group of folks who regularly attend the meetings.

Because of this, a large number of members did not hear all the pros and cons of the issue. So naturally, a number of those who responded in the poll were queasy about removing exclusive use.

According to the election results of May 2011, only 698 members chose to answer the exclusive use / members only question. Of those, the votes came in as follows:

For/Yes to the removal of exclusive use…..303 votes

Against/No to the removal of exclusive use…..395 votes

I would not call a margin of only 92 votes to be a “sound defeat,” particularly with only 698 votes total.

With app. 3,000 property owners, 395 is a very small sample, little more than 10%. And as mentioned, many of those voting had not heard all the pros and cons, and most were uninformed about how dire our financial situation was - which was of course the entire reason for bringing up the issue for a poll in the first place.

Lastly, and most importantly, that poll was taken in May 2011, when everything “seemed” to be going well, when many members on and off the board were still in deep denial of our dire financial straits (and many non-Board members had no knowledge of what was imminent). The poll was conducted only six months before we were forced to terminate all Isle Dauphine staff for lack of funds, and the golf course was forced to close the following year when it became apparent that an all-volunteer staff to maintain such a massive operation was simply unsustainable. It’s a brave new world now. Very different from 2011.

[Laura Martin]

From Tom’s post re exclusive use (2-19-2014):
“There is a reason we have come 60 years with the "exclusive use" provision in our deed to Parcel A.”

Yes, there is. There is a reason we are teetering on the brink of insolvency. Because exclusive use for our membership configuration has never worked. From the very beginning, dues were not required - only property ownership. I understand why - the founders were attempting to develop the island and draw more people, so property ownership came with membership, dues-free, as an enticement. Then we allowed non-property owners to play golf at the Isle Dauphine to make the facility viable. In the 1980s, we had to open up the property to the general public to try to keep our heads above water. But even that didn't work because we spent down a trust until we reached our current situation. Which is why talks about partnering with a more financially sound entity than ourselves have become more prominent of late.

I do not see how we can survive with past business models. But it may take spending every last dollar before that will sink in.

[Laura Martin]

Proving the value (or non-value) of modification of the EU clause:

The burden of proof is on myself and other EU-modification proponents to convince the membership that EU-modification is a better path.

But the burden of proof is also on EU-non-modification proponents to prove that the funds can be raised to restore and renovate our existing amenities, and create new ones, in order to encourage more members to pay dues to stave off eventual bankruptcy.

And to those who champion mandatory dues...implementing mandatory dues will make little difference (even if a majority voted in favor of this - in the past, they voted it down). To implement mandatory dues now, with our current amenities which are limited and/or in bad shape, I would wager that we would bring in roughly the same dues funds than we do at present. So as they say, "show me the money." Tell me where it would come from. Crunch the numbers.

Even when the golf course and the building facilities were open and fully functional (and in far better shape than they are now), we were spending well over $100,000 per year to keep everything running. And that was with reasonable salaries for the staff. (I never said those salaries were unreasonable or too high, as reported in Tom’s post of 2-17-2014, only that we could not afford them with our limited revenue stream. They were not unreasonable salaries in the world of golf course and facilities management.)

From the 2005 Treasurer's Report: "In 2004, expenses exceeded revenues by roughly $130,000 a year and the trust account was drawn down from $800,000 to about $540,000." That doesn't mean expenses were only $130,000 that year. Since we know we were running around $100,000 per year in salaries (a little less than that, at that time), that means total expenses were well over $200,000 that year. Only about half that deficit was offset with revenue, while the rest was pulled from a dwindling trust account.

Using our previous business models, the math simply doesn't work.

We have had not had the revenue literally for years to support salaried employees, which is part of why I personally developed a stance on preferring to use lessees and deep-pocket investors or management companies over direct employees to the Association.

In 2012, we finally reached the point where that operating deficit was unsustainable and we had to close (temporarily). If the will of the majority is to continue on our current path until we reach that point again, or worse, the point of complete insolvency...until we spend every last dime because we are so afraid of "losing control" of a dying resource that we arrive at the point where we lose ALL control due to seizure for lack of funds or complete loss due to lack of replacement-value insurance, then that is what will happen. The majority rules. Sometimes to its own detriment.

So this is our task - for each of us to convince a majority of the membership which path is best.

If EU-proponents can prove in a well-researched and market-tested business plan that exclusive use will bring in enough cash - to not only restore and renovate the properties to the level required to get enough people wanting to pay dues again - but also to annually generate the funds to keep things going long-term, year after year...not in a dismal state on the edge of insolvency or in the red, but in a robust state in the black….then GREAT!

I want to see the properties thriving, however we get there - exclusive use, non-exclusive use, whatever - as long as we retain the general ambiance of the space AND can maintain it in viable financial shape without drawing down on non-renewable funds.

It's just that I've seen the history of this association and I see how we got to where we are today. And those who do not know history are doomed to repeat it.

[Dennis Knizley]

Laura and Tom,

Both of you have expressed logical and reasonable positions here regarding the exclusive use clause. The exchange of ideas in this manner promote reflection on what is in the best interests of the island and create a positive atmosphere for discussion of property owner issues. As this forum has apparently been revived for comment, joining the e-conversation seems appropriate.

Tom's views on the exclusive use clause are persuasive. Without particularly addressing Tom's comments in detail or Laura's very pointed and well presented responses, the original Dauphin Island concept of property ownership is a very attractive and unique one, with the exclusive use provision for property owners of the DIPOA properties being the cornerstone. The provision allows a small group of property owners to have exclusive deeded access to miles of beaches, a pool and clubhouse area, expansive beachfront property that at one time was a golf course and could be again, small park areas and exclusive walkways to beaches. These POA assets, with proper management, development and promotion could significantly enhance quality of life on the island for all property owners.


Abandonment or significant modification of the exclusive use clause is not needed at this time, nor wanted by membership. Contrary to Laura's assertions, the removal of the exclusive use clause was soundly defeated. The language of the ballot proposal was very suggestive, stating that the clause had not been enforced for years and the majority of the Board wanted it removed. It was still defeated by more than a 55%- 45% vote notwithstanding the very biased presentation on the ballot.

Real property rights given in deeds, including use provisions and restrictions, should be essentially inviolate. Constitutional provisions of an entity should be perceived as something that can be relied upon unless the most serious and demanding circumstances required amendment. Unless those circumstances exist, do not tamper with this clause in deed or Constitutional respects. When and if a serious and financially beneficial lessee for the golf course appears, and they express a concern about the exclusive clause, should we then consider doing something that could modify it to ease such a concern. To do otherwise is premature.

Mandatory dues, which can be elaborated upon at another time, seem to be a viable and realistic option to make POA properties developed to the extent the owners want access to them and willing to pay dues to have the access.

                                                                                 
                                                                                                                                                     Dennis Knizley

[Laura Martin]

A note to all Exclusive Use proponents - you must be consistent.  If your argument is that the deed says for exclusive use only, and you champion that stance to the point in saying that it can never and should never be changed, then you must adhere to that philosophy without hypocrisy.

Lock the gates to Parcel A as they used to be in the past, post a sentry and check member ID cards at the gate.  No non-members allowed.

You cannot say that it is okay to continue to allow non-members when you say that the deed clearly says for exclusive use of members only.  The deed does not say guests of members or friends of members or the general public, even if invited.  It says exclusive use of members.

If you want exclusive use preserved, then preserve it.  Enforce it.  Stand by your philosophy.  Make it work with the restrictions the founders wanted - MEMBERS ONLY.  No exceptions.

If you're taking the deed at its word, then stand by that.  Don't "fudge" the words to fit an interpretation which includes "some" people outside the membership, ESPECIALLY the general public.  You cannot say "we invite the general public" because that is not at all consistent with the very clear statement in the deed which says exclusive use for members only.

Also, the DIPOA constitution states that members are ONLY island property owners.  No one else.  If you want to change that, and allow members to be people other than island property owners, that will require a 2/3 majority of the membership to change that before you can legally allow non-property owners to become members and thus, allow them legal access to the property.

So we should stop allowing non-members to enter until that change in the constitution is passed.  Once the exclusive use proponents hold the majority on the Board (probably soon, after the May 2014 election), then I will expect to see exclusive use of Parcel A enforced immediately.

If there is a desire among a majority of the new Board to allow non-property owners to be members, then you will need to pursue that change in the constitution and get the 2/3 vote of the membership to legally allow that change to the definition of membership.  You will have to wait for that vote first before allowing non-property owners to enter the property.

If members only/exclusive use of Parcel A is not enforced prior to a membership vote to legally change access to allow non-property owners to become members, I will see the Exclusive Use proponents as not being consistent in their stance on the issue.

If some of you cite the 60-year precedent of allowing non-property owners access as being an excuse for continuing to allow these people access, then you cannot cite the deed as written in stone to say that exclusive use cannot be removed or modified.  The mere act of continuing to allow non-members/non-property owners access, no matter how long we've been doing it in the past, is in direct violation of the deed - a legally binding document.  So non-property owner access must cease until a membership vote changes that, assuming it ever would.

Since EU proponents feel the exclusive use/members only clause in the deed is sacrosanct, this is the only stance you can take and remain consistent.  You must write to the Board and insist on enforcement of the deed restriction immediately.  Or vote to enforce this once you get on the Board.

[Dennis Knizley]

Laura,

Thank you for your response to the exclusive use proponents. I agree consistency in the exclusive use position needs to be maintained.

To be a consistent exclusive use proponent does not require a guard at the gate checking for property owner verification. The exclusive use concept set out in the deed was created contemporaneously with the Constitution. Contrary to your post, the Constitution at Article II section 2.1, Powers of the Association, provides the facilities are for the owners, immediate family ..."and their guests". The Chamber deeded the property to the POA and requires the POA to use the property for the wishes of the owners exclusively. The Constitution contemplated the owners would want family and guests to enjoy the exclusive benefit of ownership of these facilities. That would reasonably allow a restaurant to be leased out.

The Constitution also refers to a golf course that the "public" would allowed to be used. No need for a guard at the gate checking identification.

The exclusive use proponents concept is consistent with that of the founders. The owners of property on the island have by virtue of the exclusive use clause have control of how all property owned by the DIPOA is used. If solely used by the property owners, and whomever their guest may be within reason, that is who uses it. It is contemplated in the Constitution that the public may be allowed use the golf course, as that is a logical manner in which the owners may chose to use their property. If the owners while exercising their exclusive use power choose to allow the public, at their discretion, to use the their pool for a fee, so be it. So goes for all POA properties.

The use and upkeep of the property and facilities has to be paid for by someone, however. Mandatory dues are an option to address this issue .

Thanks,

Dennis Knizley

[tombowden]

Laura,

Let me say, I like you too and I also respect your ideas and opinions. I also don’t think that you or anyone else on the Board have anything but the most honorable intentions – I just think you are wrong in wanting to remove the exclusive use (“EU”) provision from the deed to Parcel A. That said - you should have been a lawyer, and I say that in the most favorable sense. You went through my comments with a fine tooth comb and you made very reasonable arguments for why the DIPOA needs new sources of money. While our conversation is getting closer to a full understanding of the EU issue, I don't think that you got to the real point of my comments which is that the deed may not be able to be legally changed; and even if the EU provision could be removed, you haven’t yet presented convincing details for the necessity and desirability of removing it.

Anyone trying to fully understand his issue is going to want a detailed legal explanation of how the EU provision can be removed. They will want a more detailed financial analysis of the DIPOA accounts and of the various other revenue proposals put forward by the Future Use Committee. Finally, they will want a real proposal for the use of Parcel A - that is compatible with not only DIPOA financial stability but also with the members’ future use of Parcel A.

Since the whole purpose of this exercise is to help all of us understand what is going on here, let me try to further focus the facts from your last series of posts starting from your first post:

Discussions of EU removal, the necessary voting process, and construction of a small hotel on Parcel A have come up at several of the recent open Board meetings, and while several Board members have spoken in favor of exclusive use (“EU”) removal, no one on the Board has spoken out against the idea. The Board was also included in our recent email communications on the issue, and I don’t recall anyone on the Board chiming in on the side that EU removal was either unnecessary, not desirable, or not legal. Likewise, all of this discussion comes on the heels of the 2011 straw vote where a rather suggestive Board proposal to remove the EU provision was turned down by the members. It also comes on the 2013 heels of the Board hiring an attorney to propose an amendment to the deed to effectively remove the EU provision. And, it comes following the activation of a Board only Exclusive Use Committee. Granted, the Board is diverse; however I think you will agree the momentum is there for another membership vote on EU removal if another attorney says it can be done.

I am comforted to read that you would not be in favor of the waterpark/drive-in movie theater on Parcel A idea, however it is not “fear mongering” to say this idea prompted several new members to join the Future Use Committee. While you and the current Board may not favor a waterpark/drive-in movie theater, can you guarantee some future Board won’t approve something equally less “high class” if given the blanket authority to grant long term leases?

I am sorry, but I just can’t picture “beautifying Parcel A with a classy hotel”, and we both know that any hotel and parking lot will consume a large part of the upper half of the present golf course – leaving only the lower half that washes out in major storms. As Dennis says, a hotel developer can always bring us a proposal. A developer is going to know our EU history anyway, so we don’t have to get rid of the EU in a vacuum even if we could. I see that the DIPOA also owns property on Pensacola Street near the condo area. If this property is large enough, a “classy hotel” would fit in there, and it would leave a full 18 hole golf course on Parcel A.
I don’t know who hired the last attorney, but his plan to remove the EU provision would have worked only if no-one objected, and I can’t believe it would have assuaged any legitimate hotel developer’s fears of a law suit in mid construction. As I said when we first began this conversation several months ago, I am not an expert in this area, but I don't think the DIPOA can legally change the deed to Parcel A. The Mobile Chamber of Commerce created a property right, a contractual right, and a trust right "forever" in each and every member of the DIPOA when they drew up our deed. The DIPOA didn't have to accept the property under those conditions, but they did; many people have relied on those conditions, and now we are stuck with them. The deed puts the Board in a position of protecting these rights for all of the members forever - not just doing what 51% or 67% of the members might want at some point in time. Short of losing the property to the State for failing to pay taxes, I don't think the Board or the DIPOA can get out from under the trust obligations of this deed.

As you say, we don’t want to throw out the baby with the bathwater, and just because we may not be able to change our deed, that doesn't mean we can’t give it a reasonable interpretation. As I said in February, our children and guests are not technically members of the DIPOA, but it would be patently unreasonable not to let them use the facilities. Dennis points out that the Constitution contemplated that family and guests would be able to use the facilities. It is not hypocritical to consider the financial condition of the DIPOA and the risk of losing the property in making a reasonable interpretation of the provision such as we now have with the short term restaurant leases. I suspect that members will tell us when our interpretation becomes unreasonable, and assuming we haven't given up all control of the property, we can make corrections.

Believe it or not, we are getting closer in our discussions. You are now using the term “business partners” in referring to a possible future relationship with Marriott or the RSA/RTJ Trail rather than just chastising me for wanting to retain DIPOA control “of a dying resource”. A partnership (maybe modeled after the Indian casinos) would certainly be preferable to an outright 50 or 100 year lease on any DIPOA property.

As Dennis points out, the 2011 Board’s proposed constitutional amendment to effectively remove the ER provision suggestively presented the pros of the issue. If anything, it was the cons that were under represented in that election. I keep hearing the conclusion that we are on the brink of financial doom, but have yet to see the numbers and hear why other suggested proposals for less intrusive projects will not work. Maybe the Board has considered all of this in their closed meetings, but as a member of the Future Use Committee, I have heard almost nothing from anyone on the Board about our proposals other than Jack reading a list at the last open meeting and a short discussion of Frisbee golf. The Future Use Committee hasn’t met since I joined it 6 months ago, and although we were communicating by email, even that seems to have stopped in the last several months - presumably because we are preoccupied with this EU issue. I am beginning to think I may have been kicked off the Future Use Committee for bad behavior and just don’t know it yet.

Tom Bowden

[domenic]

Greetings. After waiting almost 3 weeks to get staff approval I can finally post responses to the different topics being discussed.

All of the opinions posted really seem to have the same purpose which is wonderful. I sense that the goal of everyone involved is to maintain the island lifestyle that brought us here and to find a "perfect" utilization for the POA properties. Might I suggest that we attempt to organize an informal meeting and share our ideas face to face.

I hope to meet all of you tomorrow at the POA meeting,

Domenic Carlucci

[JBJ]

The deed amendment/exclusive use debate has developed a hearty life of its own--and the dialog has been interesting. I will offer just a point or two of historical perspective.

---The impetus for the effort to eliminate the "exclusive use" language , and the the "straw vote" done in 2011 --the result of which was a sound defeat, or a close vote depending upon how one views it--was not about leasing the property. Rather, we were hoping that we could possibly receive some funding from any number of possible "purses" that were being discussed in the aftermath of the BP oil crisis. So we had in addition to the general discomfort of our established practice being clearly in conflict with the deed language ( this alone not being reason enough to seek a formal removal of the language), an immediate concern that the presence of the language --characterizing us as a private, members only entity--could hurt or kill our chances of receiving BP related funding.

---So we included the "straw poll" along with two constitutional amendments in the 2011 ballot. One of those amendments--the one which would make dues payment a condition for membership was highly controversial. The other was largely administrative--it would have authorized the board to execute utility easements, a change from the existing requirement that ANY encumbrance, regardless of how large or small, be approved by a super majority of a super quorum of the membership. At that time we had a "just say no" group called Island Watch ( they are still around I guess but they've been quite lately) They were strongly opposed to the dues amendment and campaigned against them all --with signs, emails, etc. They did a much better job of saying no than the board did of saying yes ( some board members were also saying no) and ALL three of the measures were defeated. I think we missed a real opportunity by killing the dues amendment and invite the new board to review what was proposed and give it some thought.

---Now, sometime later--I guess it was late 2012 or so--the golf course was closing and the idea that we should seek an investor of some sort ( possibly a long term lease) was put on the table and supported by the majority of the board. We knew we would have to change the constitution to allow this and an amendment was passed ( over 90% approved) We were also advised by real estate professionals, title insurance professionals, etc, that the presence of the "exclusive use" language in the deed would be a show stopper for any serious investor. Now to be sure, we don't KNOW that to be a fact--but it made sense so we resurrected the effort to change the deed. I was ( and still am) OK with removing the language because I consider it low risk--it would remove no options that we have and would create more options. And it would leave in place the very high hurdle required for any action to go forward , i.e. a super majority of the board must approve followed by a super majority of a supper quorum of the membership. Of course the legality of such a change is not crystal clear--no one that I've talked to says it is. But we felt that if we could get the Mobile Chamber ( the original grantor) to approve an amendment, that just might be good enough to assuage the concern of a potential investor. Personally, I've never thought that we would receive any kind of a long term lease proposal that would satisfy the membership--but I may be wrong, why not find out.


I'm a short timer now and will not be shaping the path forward. I'm encouraged by the quality of slate of candidates and trust the new board will find the right approach for the future.

[JBJ]

By the way, JBJ= Bruce Jones

[Laura Martin]

Thanks for your comments, Tom. Great discussion. And very civil! (A rarity at times on this island!)

To clarify a few points…

I would be fine with the EU clause remaining as is, if (a) we stood true to that clause and did not allow the public and (b) we had a robust membership willing to pay a lot more money in dues, which they won’t do with the limited amenities we have now. And to get better or more amenities will take a business partner...as I’ve said before...the chicken-and-egg thing. And the business partner will be loathe to invest with the threat of a lawsuit out there from someone who wants to enforce exclusive use.

I personally don’t feel that the Chamber should be involved in changing the deed - I feel like that is a decision the DIPOA can make on its own, if it could be changed at all. Can an association legally change its deed or covenants? Of course it can. It can be difficult though. It usually winds up being determined by a judge.

Several Board Members are very much against, or at least not happy about, the idea of removing EU. They have made this clear in statements in emails and in meetings, and/or when they were running for the Board. Ask each of them individually and you will see. The current Board is not collectively for EU removal or modification.


***

It is fear-mongering when some folks continue the drumbeat of “high-rise condos” and “giving up control,” and in the process, frighten off every reasonable idea and every potential investor for profit-sharing to make our properties financially viable. Someone said a year or more ago that if certain people running for the Board were elected, the next thing we would see would be 7-story (Town height limit) condos all along the western edge of Parcel A, blocking the view for the houses behind that. Nothing could have been further from the truth. That was a perfect example of fear-mongering, based on blatant falsehoods - a smear campaign in every sense of the term.

Also, I never said we should seek a 50 or 100 year lease. I always said “a deep-pocket partner.” I don’t know what is the least number of years for a long term lease that would satisfy a partner but it’s something we can certainly discuss with interested parties.

But again, some people are taking very reasonable ideas about uses for Parcel A and blowing them so out of proportion that those ideas die on the vine without any serious consideration. And that is most unfortunate. We should not consider every single idea floated by “the opposite side of the aisle” as being a fast and slippery slope to complete loss of control and drastically altered ambiance.


***

Re: Your statement: “...can you guarantee some future Board won’t approve something equally less “high class” if given the blanket authority to grant long term leases?”

First of all, the membership already approved a modification of the DIPOA constitution for leases of more than 3 years (the previous limit). This was done several years ago. A majority of the membership agreed that we needed to seek a business partner with more money to revitalize our once-greatest asset. That is how the clause modification was marketed, and a majority of the membership agreed with that idea. A business partner will not sink the volume of money required into creating a great amenity without a lease that is reasonably long to allow them to recoup their investment. It doesn’t necessarily have to be 50 years or 99 years but it certainly has to be quite a bit longer than 3 to 5 years.

Secondly, the Properties Future Use Committee reported recently that the number one item for the use of Parcel A - chosen by the respondents of their informal poll of a handful of people - was for an RV park. You can try to make such an amenity only for high-end motorcoaches, but when push comes to shove and not enough half-million-dollar RVs show up, we would likely have to start allowing towed trailers or other types of recreational vehicles in order to continue to bring in enough revenue to keep it going. And if that happens, it will take on the aura of a campground, much like the campground near Billy Goat Hole.

The proposed location for the RV park is on the portion of the golf course that I believe was last referred to as the 9th fairway, closest to the water. This would place RVs and trailers in full view of wedding photos being taken from the clubhouse 3rd floor balcony facing east, and from many locations on the beach. I’m not sure how an RV park - no matter how “high-end” it tries to be - would be classier than a nice hotel, especially when you can’t avoid it in the background of all your vacation or wedding photos.


***

Re: your statement: “we both know that any hotel and parking lot will consume a large part of the upper half of the present golf course”

I walked the entire length and breadth of Parcel A a week ago and was stunned at how large it is. I had been on the golf course a few times in a cart, but I had never really walked the entire parcel. A 3 or 4 story boutique hotel, placed on the far eastern edge of the golf course, would likely not even be seen from the clubhouse, due to the way the land rolls and due to tree cover. Walk all the way out there, almost to Hernando, stand on that old tee and fairway there on the far north edge of the golf course, and you’ll see what I mean.

Even if a small hotel was placed just left of the main entrance, it would still consume only a few acres of the entire parcel which I believe is around 180 acres. The parcel is ENORMOUS. Walk it sometime, from east to west and north to south. Try to view one end of it from the other end - it’s challenging.

There is plenty of room there for a hotel, and a 9-hole golf course, either on the old front 9 or the old back 9 areas, leaving plenty of space for walking trails and picnic areas.

Let’s look at some facts, rather than make assumptions…

From HW Management, www.hwhotels.com/checklist.html

For 80 Rooms, you need 1.7 acres.

For 140 Rooms, you need 2.5 acres.

For perspective, the Isle Dauphine complex (buildings, parking lot, tennis courts, access road, etc.) take up maybe one acre? Two acres? Not sure. But a small hotel would not take up much more space than that. Look at the satellite views from Google Maps to see how incredible long Parcel A is. And definitely walk it sometime.

Also remember that the old golf course area is just the part of Parcel A that is east of the clubhouse. There are a number of acres west of the clubhouse too (but I personally feel that area should be left natural).

With all that acreage, there’s even room for an RV park too! But the RV park (in my opinion) should be positioned more towards the back of the property, perhaps in that far eastern corner, then maybe have a hotel near the current entrance off Orleans. A hotel marketed to golfers and an RV park should not be near one another. They appeal to different groups, and the hotel guests will not want to look at an RV park...and neither will guests to the clubhouse, particularly when posing for wedding photos.

Of course, this is my vision. Some share that vision; some do not. Each member is entitled to his/her own opinions of course.

But while forming those opinions, we need to be crystal clear about the facts - about how many acres are actually needed for a small to medium sized hotel. Let’s not leave people with the impression that creating such an amenity means paving over the vast majority of Parcel A. According to the HW Management site, it would only require about 1% or 2% of the entire parcel known as Parcel A.


***

I agree with you - a reasonable interpretation of the deed should allow for family and friends. But when you allow the public to play the golf course and visit the restaurants and swim in the pool and go to the beach...well, then, we are very far away from any reasonable definition of “exclusive use.” We will NEVER get members to pony up substantial enough dues to support the facilities when they can just enjoy the amenities for less money as a member of the public. Why pay $1,000 a year, or even $100 a year when you can just pay-as-you-go for the few times you use the pool or beach or other amenities? There’s no incentive to “join.”

And we can’t levy fines or liens on property owners who refuse to pay dues. That would also be changing the covenants, and would impose something like a tax on property owners - a power which the DIPOA does not possess.

So we really do have to decide - are we exclusive use or are we not? If we are, then we should not be “inviting” the general public to use everything that the rest of us are encouraged to pay dues for - or demanded to pay dues for, if a mandatory dues clause is implemented.

And let’s remember - some will use the same argument for dues as for exclusive use. If exclusive use cannot be changed (a promise is a promise, the promise in the deed), then how can we argue that we can institute mandatory dues? Again, a promise is a promise - property owners were given free membership in the POA as incentive for investing in property on the island. Will we break that promise and force them to pay dues? If so, how is that not the same as breaking the promise of exclusive use?


***

Finally, thanks for saying I should have been a lawyer. I do consider it a compliment. A good lawyer argues a good case and maybe convinces some folks in the process.

[tombowden]

Laura (aka Ms Forum Administrator) and Bruce

I want to thank both you and Bruce for your attention to the exclusive use (EU)/ financial need issue. This issue along with the beach restoration efforts are probably two of the most important issues the DIPOA has considered over the last 60 years. I walk across the dunes on Parcel A several times a week, and I have biked across the golf course many times which is why I am so passionate about protecting all of Parcel A. A new membership vote on removing the EU provision has apparently been delayed until next year in order to provide everyone with more time to consider the issue, and by then we should have covered every possible perspective on the issue.

I have raised three questions on the EU/financial need issue: 1. Can the EU provision be removed legally without a high chance of reversal in court? 2. Are our current finances in such bad shape that we really need to remove the EU provision for a long term lease? 3. Are there other viable alternatives to make money?

First, this is not an ordinary deed. The DIPOA holds this property in trust for each and every “member” of the DIPOA. I do not think this right can be taken away, and it is not a matter of democracy (i.e. the majority wins); it is a matter of fairly established property, contract, and trust law. If we filed an amendment to this deed there would be no problem, until just one member filed their objection in court which would then put the decision in the hands of judges as you say. A deed is very different from a constitution which can be changed by a vote of the membership. That said, the immediate decision on whether to continue the effort to remove the EU provision will apparently depend in part on our new attorney’s advice.

Second, my (again non professional) review of our year over year profit and loss statement indicates that the DIPOA was doing fairly well in 2013-14 due in large part to the current Board’s cost cutting efforts. Our net ordinary income (loss) was reduced from minus $68,645 in 2012-13 to a minus $24,488 in 2013-14. If we consider certain, hopefully nonrecurring “ordinary” items in the 2013-14 statement, the loss disappears altogether. These Items are a reduction in dues from $54,384 in 2012-13 to $34,879 in 2013-14; an increase in legal fees from $3,086 in 2012-13 to $18,028 in 2013-14. The reduction in member dues is something we should be able to correct, and I understand that the extraordinary legal fees were an accumulation fees billed once (maybe years ago) but not paid and not re-billed until last year. Just correcting these to items would have added $34,447 to our net ordinary income, so we would have had an actual ordinary net income of plus $9,958. These numbers include oil royalty income but not BP settlement income, and they assume a continued annual repair and maintenance expenditure for the Isle facilities of $28,012.

Third, I thought I was on the Future Use Committee and although we have not met in the last six months, we have had numerous email discussions of how to increase revenues through the use of Parcel A. I don’t know whose “informal poll of a handful of people” that put an RV park on the top of the list for Parcel A uses Laura is referring to, but it sure wasn’t expressed in our email discussions, and I don’t think it represents the view of the Future Use Committee at all. I can’t say I represent the Future Use Committee either, but here are my ideas on increasing revenue without removing the EU provision on Parcel A:

1. Mandatory Dues
A. Propose a constitutional amendment to make membership dependent on mandatory dues set at $100/year. Specify that a 50% membership vote will be required to raise the amount, and that all dues money will go to pay taxes, to pay insurance, and to repair and maintain Isle Dauphin facilities. (A constitutional amendment does not involve the legal problems a deed does.)
B. Specify that delinquent property owners may become DIPOA members at any time by paying all back dues to the date the amendment passes.
C. Specify that any member who rents their Dauphin Island property may designate their renters as guests and allow them to use that member’s pass.
C. Specify that non Dauphin Island property owners (i.e. the public) may become DIPOA guests (not members) for $10 per person per day or $300 per person per year.
D. Members and guests get free parking, beach access, tennis, pool, volleyball courts, Frisbee golf course.

2. Seasonal Beach Business
A. Raise parking/beach fee to $10/day per car for non members (restaurant lessees can give free vouchers to actual customers. All fees going to the POA not lessees, but lessees get benefit of increased traffic with no cost to them. Issue free parking dash ID cards for members and guests. Install parking pass machine and tow cars that don’t pay.
B. Buy a few beach chairs and umbrellas, small sailboats, wind surfboards for member/guest rental at minimal fee to pay beach/parking lot boy or girl. Any profits go to DIPOA, but primary purpose is to offer members something for their dues.

3. Golf Course
A. Look for a partner to repair and run the golf course and share the income with POA.
B. Until partner is found, operate golf course as a free but low cost (i.e. cut grass and place buckets) Frisbee golf course and hiking/biking trail to members and guests.

4. Hotel
A. Find a national hotel company to partner or lease the DIPOA property on Bienville at Le Moyne.
B. This Bienville DIPOA property is approximately 2 ¼ acres which would be adequate according to Marriott estimates for a 105 room hotel and is located where people could actually find it.

5. Reception/Convention/Party Business
Pay Denise to manage the lower clubhouse with all profits to the POA.

6. Club Maintance and Repairs
A. Hold open Board meetings on Saturdays at 9 am (Dom’s idea), and solicit volunteers to work those Saturdays from 10-2 pm paint prep, painting, woodwork, cleaning, pool maintenance, beach clean-up, etc with free sandwiches and drinks for workers – at 2 pm.
B. Minimum of three bids on any repair job over $100 and full Board approval on any contract over $1000 with at least a yearly accounting and description of work completed to gain the trust of members.

These are a few of the ideas that come to mind and are probably specific enough to aggravate just about everyone, but then being on the Board is a difficult and thankless job anyway, so I probably wouldn't miss it.

Tom Bowden