By Josh Davis, Associate Editor

(Oct. 25, 2018) Remarks made by Ocean Pines Director Frank Daly dominated the public comment period of a board meeting on Saturday, as members of the golf community strongly objected to any notion of temporarily closing the course in order to save money, and a battle of words erupted between Daly and several others.

Larry Perrone was first to the microphone, saying he represented the Ocean Pines Golf Members’ Council. He is also a member of the association budget and finance committee.

“We’re here and a bunch of our golfers are here today to address … comments and emails sent by Director Daly regarding the closure of the golf course based on his, what we believe, flawed analysis of the operational results,” Perrone said.

“The golfing community, quite honestly, is tired of the same old lines, the same old complaints, that there’s 50 golfers — that the golf course is here to benefit 50 people — and that the community is carrying the load for 50 people,” he continued. “The reality of it is there are 160 members … of the golf course.”

In fact, Perrone said 1,800 Ocean Pines households use the course.

However, based on financial results from November through March, Daly apparently suggested that temporarily shuttering the course would save $120,000.

“The CFO [John Viola] will tell you that, if in fact that occurs, we will lose an additional $80,000,” Perrone said.

Using Daly’s logic, Perrone quipped that because the course made $28,000 since May, “why don’t we buy another golf course?”

He said as of Sept. 30, golf and racquet sports memberships were at 94 percent of what was budgeted, while aquatics was at 83 percent.

“All things being equal, why don’t we shut them all down?” he said.

“Mr. Daly’s analysis that he sent out through a spreadsheet to members of the budget and finance committee, and I know to the board of directors and also to some of the members of the community, indicate that the golf course lost about $200,000 last year,” Perrone continued. “In fact, the golf course made a profit of $5,000. How can the numbers be so disparate? Well, the answer is that Mr. Daly inappropriately is adding in depreciation to operational results.”

He said there was also “a continued attitude … that the golf course is there for a few.” Perrone read several apparently emailed comments from Daly, which he said were offensive to the golf community.

Among them was: “I think I’ve been very clear on my intent to bring a culture of operating excellence to Ocean Pines. Along the way, I expect situations where people will use misinformation, fear and innuendo to preserve the status quo. And when [they] use that to benefit the few at the cost of the many, you can expect me to confront them.”

He also paraphrased a quote about costs to renovate the country club that, “Why should I spend a $1 million on a building for a few golfers?”

“That, in our mind, is offensive and disrespectful. For a community that is based on amenities … we find it offensive.”

Perrone said Daly planned to introduce a motion to partially close the course. He said it wasn’t on the agenda this month, “but we don’t know what’ll happen next month.”

Don McMullen also spoke at length and said he’s been a golf member for more than four decades.

McMullen said the golfing community “hasn’t asked for anything,” but instead benefited Ocean Pines by hosting many charitable events. He said annual tournaments raising thousands for local people and nonprofits include the Ravens Roost #44 Scholarship Golf Tournament, Mary Mac Foundation Tournament, Taylor Bank Junior Golf Tournament, Ocean Pines Veteran’s Memorial Golf Fundraiser and the Ernie Stiles Memorial Golf Charity Tournament.

“Our golf community has raised tens of thousands of dollars for charities and thousands in revenue for our golf club and the yacht club,” McMullen said.

He said golf members also volunteer during the spring and fall to assist with course maintenance and cleanup.

“We’ve been closed out from many days of play this year from outside groups. We’re not complaining,” McMullen said. “Our course is making money under [Golf Director] John Malinowski’s leadership … The Ocean Pines Golf community continues to support this amenity.”

Daly, Viola and Association President Doug Parks each addressed the audience with public comments. It was perhaps the first time any association board member or officer stood up during public comments since Slobodan Trendic sought to defend himself against an attempted removal from office more than a year ago.

Daly began that a “factual discussion” was not meant to detract from the good of charitable events held by golfers.

“Let’s talk about some facts, not fantasies,” Daly said. “As a member of the [budget and finance] committee, Larry is intimately familiar with the financial details of the association. He quotes a $5,000 profit. What he left out of that, is for the first time since 2009, last year the financial statements were changed.”

Daly said the Tern Grille, based inside the golf and country club, was separated from the course on the financial statement.

“When you put the Tern’s Grille financial results into last year’s operating results, golf lost $31,225,” Daly said. “That’s from our audited statements … let’s don’t spin it any different for any other reason.”

He went on to say Viola earlier during the meeting said the association needed to address a $1.6 million operating deficit incurred during the last two years.

“Golf contributed to that net operating deficit approximately a quarter of a million dollars,” Daly said. “That shows up in your assessment — it’s a fact, not a fantasy.”

Daly said he stood by every quote Perrone read — except one.

“From day one, minute one … I supported the clubhouse renovation,” Daly said. “I fully supported it. I intend to support it in the future.”

He added accusations he intended to close the course were an “absolute, total lie,” but said it was a fact the course lost $118,912 last year between November and March.

“My comment was … when you look at those numbers and you’re looking at shutting down the country club for a major renovation, and you look at the addition of the expenses that keep it open during that time period, a better business decision would be to shut it down for that time period — not permanently in the winter,” he said.

According to Daly, both Viola and General Manager John Bailey responded that would be “a terrible decision” because there are contractual obligations and ongoing maintenance scheduled during that time.

“I fully accept their reasoning. It is logical and it is good for the best of the association. Anything else is pure BS and innuendo,” Daly said.

He added Perrone was “starting a … campaign of fear” regarding amenities, while Bailey had helped spearhead an overall “dramatic turnaround” of about $500,000.

“That’s why golf is up next, because we can show that we can get customer service and we can get net operating results at our amenities, and all of them have to do it,” Daly said. “That’s what the plan is for the upcoming budget — nothing more, nothing less.”

Perrone asked to respond, but Parks said he would not allow “this to devolve into a personal tête-à-tête, going back and forth.”

“I’d also appreciate if you take it offline,” Parks said. “Yes, there’s some discussion on factual versus fantasy. I don’t want to use public comments to do that right now.”

“The Tern’s Grille operation last year was run by the yacht club. It was not run by golf operations. So, if you want to talk about fantasy, Frank’s response was [fantasy],” Perrone said.

Viola asked to speak next and held up a lifetime golf membership card as he did so. As well as being a golfer, he is also the volunteer chairman of the budget and finance committee and as the association’s appointed chief financial officer.

“It cost a lot of money,” Viola said of the lifetime membership. “With it came an assurance that the golf course would be maintained properly. I checked the contract. It’s in there. But that’s not why I’m up.”

Viola said he, Bailey as the general manager and Finance Director Steve Phillips were the ones tasked with releasing financial statements.

“If we’re going to start having the board sending out emails with attachments with numbers from all over the place, it’s not for me. I never had something like that [happen] and, unfortunately, now I have to stand up to refute what a director is saying. And I didn’t want to do that,” he said.

Viola said Daly was using “an old page from an old playbook” with outdated documents.

“The golf course last year, per our scrolls, [made] $5,000,” he said. “Tern’s Grille last year was taken away from golf and put under food and beverage. Now, you want to couple it with golf because it had a loss of $40,000.”

Viola said he asked Daly not to couple the two operations, but Daly did so anyway. The same could be said for including depreciation.

“I’ve asked you not to do it, the scrolls say not to do it … but then you turn around with the yacht club numbers and you give numbers that are favorable — and you don’t include depreciation,” he said. “I gotta be honest with you. This is a lot of work. I don’t need to deal with that. These people, who are working hard, don’t need to deal with that.

“If we’re going to have somebody running around, sending emails with attachments to confuse people, it’s more work for me, it’s more work for [Bailey], and it reflects on all of you — all of you — it’s not going to reflect on me,” Viola said.

He added touting the yacht club turnaround was a good thing, but golf had also improved. He said the course several years ago “looked like somebody spread Agent Orange on it.”

“It’s turned around more than the yacht club … and you’re refusing to listen to it,” Viola said.

He also refuted Daly’s apparent claim that money could be saved by closing the course during the winter.

“We’re going to lose more money than $120,000 if you shut it down,” Viola said. “You want to close it down, close it down. [But] give these people the right numbers.”

Parks then effectively ended the conversation with a public comment of his own.

“Let’s step back for a moment and refrain from the back and forth posturing on the issue. Nothing is accomplished by the rhetoric. I’d rather spend time and energy getting input from all involved on how best to position golf operations to minimize financial loses,” he said.

“Closing the golf course at any point in time will not yield positive variances to the bottom line. It is not a viable option,” Parks continued, adding time would be better spent with comparative analysis, improved marketing “and other traditional business tactics.”

“Let’s take the discussion forward in a professional manner with the intent of resolving the issue as best we can,” he said.

Parks said there was plenty of intellectual capital in Ocean Pines, adding, “Lets leverage it.”

“Let’s move forward and figure out a way to get to the point where we can have an amenity … run in a way that is reasonable with regard to [association governing documents], which says we have to run our amenities in a businesslike fashion,” he said. “We’ve got the opportunity to do that and, without pointing fingers, I think we’d accomplish that if we put our heads to it.”