We need to perform reality check about our ability to do extensive construction within this association.  Lake Forest is essentially on a FIXED income.  Many of you know what that means.  Our revenue sources are maintenance fees, which can only be raised by a vote of the membership, and user fees.  We are not a developer that sells lots and homes generating extra revenue.  Of course, those maintenance fees can be raised at the annual meeting without prior notification to the membership as we did several years ago. 

By the way, regarding that last dues increase, the reason there was not prior notification at that time was that the board did not know that the developer would support the idea until it was too late to put it on the proxy.  It was a timing problem, which required striking while the iron was hot.  It was also one of those things that this writer has regretted ever since, although would do again if the same conditions existed.  It is not that it would have made any difference to the vote.  It would not. The developer's vote would have carried the day at that time. 

The only other potential sources of income are the assessment and loans.  The assessment is limited to $50 per year.  The loan cap is limited by the by-laws to $100,000 per year.  Lake Forest has an annual revenue of just under $2,500,000.  We also have annual operating expenses of just under $2,500,000. Those expenses have included keeping the existing amenities in reasonably good condition.  As one can see, there is not a whole lot of wiggle room there.  Does anyone think that increasing energy efficiency with new facilities will make enough difference to fund such facilities?  Does anyone think that new facilities would increase the number of users, thereby increasing user fees?  There would not be much revenue generated by an Aquatics Facility.

We had hoped that the new development by Friday Construction would deliver several hundred new members.  That would be great and it would change the revenue picture somewhat.  However, it has been quite a while since the first two sections of the new development were completed and there has not been one shovelful of dirt moved for a new house.  And, the developer has offered to sell a large chunk of that property to the schools for a bargain price.  Such an action, by the way, would reduce the number of new members.  That is discouraging.

Now, when the revenue/expense ratio is examined, where is the money necessary for a new Country Club and Aquatics facility going to come from?  There maybe creative ways to finance such projects, but when the excess over expenses picture for the last decade is checked, it certainly does not look like something that would easily be pulled off.  The plan last year, that involved selling the Yacht Club for big bucks, really seems to be the only way to handle the funding.  But then the question was, "Where is the demand?"  The value of the Yacht Club property for future generations could be staggering.  Would the majority of the members want a new Country Club and Aquatics facility instead of a Yacht Club?  The answer to that is probably no.  In fact, if asked what they would like to see, this writer believes that one would probably have a greater chance of hearing, "A remodeled and active Yacht Club."  This seems to fall more in line with the goals stated recently in a contribution from one of the current directors, a member of the "Slate".

Now as one who does not care for those who always find reasons why things will fail and never come up with ideas to make them succeed, let us see if we can find any way to build that Aquatics facility.  What if, the proponents went to the trouble of having a plan for the proposed facility developed?  What if they commissioned a legitimate public relations firm to create a marketing plan for the new facility?  What if they presented such a plan on a proxy for a future annual meeting?  What if the marketing plan was so nice, showing how beautiful the new facility would be and how it would increase property values for all members whether they used it or not, that most everyone would be interested?  What if the proposal was to add $10 per month to each member's monthly bill for three years to fund it?  That would bring in about a million dollars.  Would they get enough members to vote for it?  If they could not get enough members to vote for it, would they drop the idea? Would the developer vote for it?  For the developer to vote for it would be somewhat unethical, because the developer does not pay those monthly fees.  The point is, though, that the developer does have the right to vote on issues such as these.  Of course, the last developer did not pay dues either.

Unfortunately, the track record of this board does not seem to suggest that they would work out in the open in such a way.  We have one board member of the "Slate", who writes to let us know his opinion of what is happening in the association.  We have heard nothing from the rest other than what they say when they think no one is listening.  They seem to have a monthly "Executive Session" according many reports, so that they can discuss issues without members listening in.  So, would they sign on the dotted line to build new facilities without a vote of the membership?  What do you think?  Could an action like that bankrupt the association?  We could end up having to sell that Yacht Club whether we wanted to or not.

The last paragraph is the one that bothers the writer.  It would be so nice to say, "Oh, they wouldn't do that."  But, having closely observed Henry and his posse for a couple of years, we cannot be all that certain.  Many of you who saw a threat to your community a couple of years ago, banded together to "Save Lake Forest".  You might want to consider that there could be sufficient risk to Lake Forest to justify putting together your own slate of members with good business sense to run for the board this year.  There are going to be four positions open.  Hopefully, Ed Kirby, who's term expires this year, will run again.  We need level-headed men and women like him to guide Lake Forest.