An Update on the HFFA Transition

It’s been just over a month now since a new company began managing Huntersville Family Fitness & Aquatics (“HFFA”). The Swim Club Management Group (“SCMG”) based in Huntersville was awarded the HFFA management contract by the town board this summer after the prior management group had managed the facility since 2002. I wanted to see how the transition was going so I reached out to SCMG CEO Brian Sheehan to get his thoughts.

Eric


– What are some of the immediate changes SCM has implemented at HFFA over the past month?

We have made a number of changes, many of which members will begin to fully enjoy over the next 30-60 days. For example, we immediately closed down the outdated Café and signed an agreement with Summit Coffee to have them renovate and operate the Café and kitchen. We see an opportunity with this arrangement to increase our member service by offering a more diverse, healthy menu to our members. The arrangement should also be a boast to overall profitability. We have also signed agreements to purchase new fitness equipment. Members will soon see new equipment and repurposed spaces that will allow for bootcamp style classes and other specialized group exercise classes. 

We are also working with an outside firm to perform a membership survey at no additional cost to members or the taxpayers. We will receive their presentation on the results later this week and we expect to implement additional changes based on membership feedback. 

– How have HFFA members reacted to some of these immediate changes?

The response has been terrific. Some of the changes have been small. For example, we added complimentary fruit infused water at the entrance, dedicated a room to cycle/spin classes and created a classroom more conducive for the yoga classes. These changes cost very little but have made for a much better member experience. 

– Do you have any social media or marketing plans to attract new members to HFFA?

Yes, we identified this as an opportunity for improvement early on. We have enhanced our presence on social media and plan to do a better job of engaging our members through social media moving forward. In addition, we signed an agreement recently to have the HFFA website redesigned. The current website is outdated and unengaging. I believe the last time they updated the Current Events Section was 2015. Our members can expect a more functional and dynamic website within a few weeks.

– What are some of the short-term goals SCMG is focusing on at HFFA?

Our immediate focus has been on improving the members experience. We believe the best way to attract new members is to offer our current members a great experience. We have also put a heavy emphasis over the past 30 days on cleaning up a few risk management issues. Part of having a positive member experience is keeping our members and their children safe. This is a responsibility we take very serious and we are moving quickly to make certain all areas of the facility are operating at industry best-practice. 

– How do you see HFFA benefiting from or complementing the town’s new rec center still under construction across the street on Verhoeff?

We have quickly established a great working relationship with Parks & Recreation and we are excited to create synergies with their new space. They have offered all HFFA members free access to the facility which provides a great value proposition for our members. 

– Can you briefly explain how HFFA is funded – including how taxpayers contribute.

HFFA is funded, in part, by Tourism (Hotel/Motel) Taxes, along with other revenue sources like membership fees. Our goal is to reduce the reliance on taxpayer funds at HFFA. 

Within our first week we identified that there were numerous members with past due balances. In fact, the total dollar amount was in excess of $12,000. Our team worked diligently on this matter and within our first 30 days we have collected over $10,000 in past due fees. In most cases the issue was simply a member that had obtained a new credit card and forgot to update us. Making all those phone calls was certainly not the most fun job in the building during the first 30 days, but it was necessary to properly operate the business. We understand the fiduciary responsibility we have to the taxpayers to be good stewards of their money and the people of Huntersville can expect us to operate accordingly.   

– What message do you have for those who were opposed to the decision to make a change in management at HFFA?

Whether you advocated for a change in management or opposed a change in management, we welcome you as a member at HFFA.  I have lived here most of my life and I know the people of Huntersville are fair and open-minded. I hope everyone will take the time to stop into the facility over the next 60 days and see the positive changes we’re making. 

HFFA Transition Costs – Severance Pay

The town board voted well over a month ago on July 11 to change management companies at HFFA. As a consequence of that decision, pursuant to section 8.(c) of the current management contract between the town and the current management company, Health & Sports Works, if the contract is terminated without cause the town is required to pay a termination fee equal to 6 mos. base management fees AND 8 WEEKS SEVERANCE FOR DEPARTMENT HEADS. Interestingly, this line about severance was only added to the current contract that the prior board rushed through less than a month before the 2015 elections – approved 4-2  by Commissioners Julian, McAulay, Neely, and Bales (yes, the same Melinda Bales running for re-election this year).

In all three prior management contracts in 2002, 2006, and 2011, the termination language limited the town’s exposure to 6 mos. base management fees – of course, if the town had taken the reasonable position that the contract was being terminated for cause, taxpayers wouldn’t have had to pay any additional monies to terminate the contract. Why the town would ever agree to such unfavorable terms is a topic for another post.

Would you expect current employees at HFFA to receive “severance pay” if they maintain employment under the new management company? Dictionary.com tells me that severance pay is paid because of a lack of work. So if the new management company decides to hire employees of HSW and keep them employed in their same or similar positions, how will they be without work? Doesn’t make sense to me, but that’s the position HSW is taking according to emails sent to the town. Seems to me the town never intended to pay “severance” to people who maintain consistent work. Too bad the current contract doesn’t have a definitions section so any disagreements over terms could be easily resolved. Good thing the town has top notch legal counsel advising them on how to resolve disputes over easily understood terms like severance.

So, how much are taxpayers in Huntersville going to have to pay the current management company to stop managing HFFA? At present, the demand for severance appears to be $95,287.29 related to nine, YES NINE, department heads. Just to put that in context, the town only has six department heads, eight if you include the town attorney and town manager. Don’t bother trying to find information about each department at the HFFA website, it’s not there. Will the current town board and current town manager just agree to whatever amount HSW  demands in severance without negotiating? I guess we’ll just have to wait and see.

Eric

Huntersville Continues to Struggle With Transparency

The problem with putting a camera in town hall so your town board meetings can be live streamed is that sometimes people actually watch the meetings.

A closed session was listed on the agenda for the pre-meeting held this past Monday, August 21. The ostensible basis for this closed session was described on the agenda as “receive confidential information, Attorney-Client Privilege.” As I’ve written about before at this site, NCGS 143-318.11 sets forth the situations when a public body is permitted to go into closed session. The statute also states in section (a) that it is the policy of this State that closed sessions shall be held ONLY when required to permit a public body to act in the public interest as permitted in this section. [emphasis mine] The word shall makes this mandatory – meaning that when the Huntersville town board goes into closed session, they shall only do so for one of the ten (10) limited reasons listed in the statute.

To ensure a public body adheres to the limited exceptions to the open meeting laws in NC set forth in NCGS 143-318.11, section (c) states that a public body may hold a closed session only upon a motion duly made and adopted at an open meeting. Every motion to close a meeting shall cite one or more of the permissible purposes listed in subsection (a) of this section… a motion based on subdivision (a)(3) of this section shall identify the parties in each existing lawsuit concerning which the public body expects to receive advice during the closed session.

Now let’s compare the statutory requirements in NCGS 143-318.11 with what actually transpired on Monday night. The closed session was called at the end of the pre-meeting discussion over how to proceed with the town’s legal needs after the retirement of the current town attorney at the end of this year. You can watch the video here, the closed session is called at approx. the 23:54 mark. Mayor Anarella begins by saying he needs a motion to… when he is cut off by Commissioner Guignard before finishing the sentence. Commissioner Guignard says so moved, and then the mayor finishes… to go into closed session. He asks for a second and a second is made (I was unable to determine who offered the second). After hearing no discussion he asks all those in favor to vote. The vote to go into closed session is unanimous. The mayor then tells those in the audience he is sorry but they’re going to have to leave because the board is going to have a closed session… which is when the video ends abruptly.

Is it possible that as soon as the video cut off the mayor proceeded to comply with NCGS 143-318.11 by citing the permissible purposes for which the closed session was being called? Sure, anything is possible. But given the mayor and town manager’s attitudes towards transparency, it’s highly unlikely. Why is it so difficult for the Huntersville town board to follow the law when it comes to closed sessions?

Is the town involved in litigation that residents should know about? If not, what legal issues were discussed during the closed session? According to David Lawrence and Frayda Bluestein with the UNC School of Government, “the exception [NCGS 143-318.11(a)(3)] permits a public body to discuss any legal issue with its attorney. The attorney-client privilege does not cover nonlegal discussions between attorney and client. Thus a public body may not hold a closed session with its attorney to obtain his business or political advice.” If you’re interested (because why wouldn’t you be interested in the exciting world of open meetings law in NC?), you can find a more in-depth primer from the UNC SOG on closed sessions under the attorney-client privilege here.

The town manager and town attorney were both present when the closed session was called. Neither spoke up to advise the board they were not in compliance with state law. Maybe the next town attorney will be more willing to encourage transparency and compliance with open meetings laws. But no commissioner was heard to object to the closed session procedure either. Only two commissioners – Boone and Gibbons – are still in their first terms. The other four commissioners have served the public for many years now and we should expect more from them. I welcome a response from any current elected official or town staff member – or even from one of the town board candidates – on this issue.

I sent a request to the town clerk this morning for minutes and/or a general account of the closed session held on August 21, including identification of any legal issues discussed. I will update this post upon receipt of any records.

Eric

Crowdsourcing the Huntersville Fire Dept., Inc. Contract

I know how much the journalists at our local fake news outlet, the Lake Norman Tax the Citizen, hate it when my stated agenda manifests itself behind the dais at town hall, so I thought I would outsource this latest issue to other Huntersville residents for their input. As I reported here back on July 7, the town’s current fire services agreement with the Huntersville Fire Dept., Inc. (HFD) is set to expire in October. The town board agreed during their July 17 meeting to review revisions to the contract at their next meeting on August 7.

The language in paragraph 15 states that if neither party gives notice to the other at least sixty (60) days prior to the final termination date of this Agreement – which would appear to be October 15, 2017, such non-action shall be deemed a mutually agreed upon renewal for another five (5) year period on the same terms… This 60 day deadline is quickly approaching next month – either August 15 or 16 – which means the town board will have to take action on the contract at the upcoming August 7 meeting or else the contract will automatically renew prior to their next scheduled regular meeting on August 21.

I have included a copy of the current fire services agreement below. Please review and offer any feedback or suggestions you may have in the comments. Are there revisions the town could make to ensure a better deal for taxpayers? Is greater transparency needed to ensure accountability of taxpayer dollars? Why would the town ever agree to title all vehicles/equipment in the name of HFD even though taxpayer dollars were used for their purchase? (See paragraph 14.) Is five years the appropriate length for the term of the contract?

Time is of the essence so start offering up your suggested revisions as soon as possible!

Eric

Fire services K

Huntersville Fire Dept., Inc. Contract Questions

The following excerpt is from my column in the Sept. 29, 2016 issue of the Herald Weekly.        

Did you know the Huntersville Fire Department is not actually a department of the town, but a non-profit corporation that contracts with Huntersville to provide fire, rescue and other emergency services? The most recent service agreement between Huntersville and the Huntersville Fire Department, Inc. was signed in October 2012 for a period of five years. This contract will be up for renewal next year during an election year. It will be interesting to see whether any current town board members advocate for a competitive bidding process for fire services prior to agreeing to a renewal of the current agreement.

It’s been over nine months since that column ran and neither town staff nor the town board has taken any public action on the Huntersville Fire Dept, Inc. contract renewal. [See contract below.] The stated rationale to rush a vote on the HFFA management contract right before the last election and eight months before it was set to expire was something about the current management company needing time to plan for the future. We are a mere three months away from the current HFD, Inc. contract expiring, so where is the same sense of urgency from town staff or the town board on rushing a vote on the renewal of this contract?

Here’s my question for town staff and the town board – why isn’t this contract for services being put out for bid like the management contract for HFFA or like any other contract for services with the town? If I was a cynic, I’d be tempted to suggest HFD, Inc. is receiving preferential treatment because it’s an election year and no politician wants to be accused of being critical of firemen in an election year.

Huntersville budgeted $3,455,464 for fire services in the recently approved FY 17/18 budget. This is up almost a million dollars over last year. How much of this increase is related to salaries/payments for HFD, Inc. employees?

The current management company at HFFA has agreed to slash their management fee by $25K – back to their 2011 contract fee – solely because the town put the HFFA contract out for bid. Funny how competition works to lower prices. Could the town achieve similar savings on fire services by putting the HFD, Inc. contract out for bid? In light of the massive budget overruns for the massive new fire station #4 being built on McIlwaine, maybe a little more oversight and competition wouldn’t hurt.

An aside: How is it that taxpayers were charged far more than originally budgeted due to cost overruns for Station #4, yet HFD, Inc. recently took to social media to show off their brand new Tahoes?

The language in paragraph 15 states that if neither party gives notice to the other at least sixty (60) days prior to the final termination date of this Agreement – which would appear to be Oct. 15, 2017, such non-action shall be deemed a mutually agreed upon renewal for another five (5) year period on the same terms… This 60 day deadline is quickly approaching next month – either August 15 or 16. There are only two more regular town board meetings scheduled before that date.

If nothing else, the town needs to provide notice prior to the upcoming deadline to re-negotiate the terms of this contract to make fire services more transparent. There is no line-item breakdown for fire services in the town budget. Despite the vast majority of their funding coming from taxpayer dollars, there is also no requirement in the contract that open meeting and public record laws apply to HFD, Inc. Wake County already has an entire section in their fire services contract specifically requiring such transparency from their fire departments.

It probably wouldn’t be a bad idea to also re-negotiate the terms of paragraph 8 so the town doesn’t have to pay twice for vehicles/equipment in the event of termination or cancellation of the Agreement. That’s right – the town doesn’t even own the vehicles/equipment it purchases for HFD, Inc. with taxpayer dollars. Paragraph 9 may warrant review as well so HFD, Inc. doesn’t just get to distribute its assets to non-profits upon dissolution.

Today is officially the start of filing for local elections. It will be interesting to see if any candidates for office in Huntersville decide to make the HFD, Inc. contract renewal an issue on the campaign trail.

Eric

Fire services K

The Arrogance of Aneralla

“I hate rude behavior in a man, won’t tolerate it.”

– Captain Woodrow F. Call, Texas Ranger

I may have a slightly higher tolerance for rude behavior in a man than Captain Call, but what I will not tolerate is government attempting to suppress political speech or intimidate citizens. Gerry Vincent, the current interim town manager and former longtime assistant town manager in Huntersville, engaged in both this week when he tried to bar me from entering the meeting chamber in town hall shortly before 10am on Tuesday, June 20.

I was at town hall that day to sit in on a presentation by Health & Sports Works, the current company managing HFFA, as part of the ongoing bid process for future management of HFFA. The presentation was being made in the meeting chamber in town hall during normal business hours and Commissioners Boone, Gibbons, and Phillips and town staff Vincent, finance director Jackie Huffman, and Parks and Rec director Michael Jaycocks were present. Upon entering town hall, I stopped in the restroom and when I came out Mr. Vincent was standing in front of the closed doors of the meeting chamber. He had been informed of my plans to attend the day before.

We exchanged pleasantries and he then informed me that he couldn’t let me in the meeting chamber. I immediately opened my notebook and took out my pen and asked for the specific basis on which I was being denied entry to a public meeting in town hall and Mr. Vincent initially claimed it was a closed meeting, not an open or public meeting, since there was no quorum because only three commissioners were there. [Of course, Mr. Vincent is fully aware that the entire point of limiting these bid review committees to three commissioners was to avoid quorum and open meeting laws to begin with.] Knowing this explanation was garbage, I reminded him this was a public building and not having a quorum doesn’t mean a meeting is closed. He then tried the non sequitur that all types of staff meetings are held in town hall that aren’t open to the public, to which I pointed out this wasn’t a staff meeting. Finally, he tried the imaginary legal argument that I couldn’t enter the meeting chamber because neither I nor anyone else had attended the first presentation of one of the other companies bidding for the management contract so it wasn’t fair if someone attended HSW’s presentation. I asked him if anyone had requested or attempted to attend the prior vendor meeting and he admitted none had, so I questioned what that had to do with me attempting to attend this meeting and he again conceded defeat. After conceding defeat, he finally acknowledged he couldn’t keep me from attending this meeting, but made sure to inform me I could not ask any questions (I had no intention of asking questions, just taking copious notes.).

The really sad part about this incident is that Mr. Vincent put on his big boy pants Tuesday morning fully intending to stop a citizen from attending a public meeting in town hall without any legal basis and he still couldn’t come up with anything better than the excuses above. And some members of town board are seriously considering elevating him to the full-time town manager position. To any board members who vote to make Mr. Vincent the full-time town manager you’re now on notice – vote for him and you’re voting to condone government intimidation.

Later that same day I saw Mayor John Aneralla’s announcement of his intention to run for re-election. As one of the “accomplishments” of the town board under his leadership, he cited “bringing a new level of transparency and accountability to town government.” I decided to take my concerns about Mr. Vincent’s blatant abuse of power, along with concerns that the town is violating open meetings laws related to closed sessions (more to come on this, records request is pending), directly to Mr. Aneralla instead of just firing off a blog post since both issues are related to transparency in town government. I called him around 3:30pm and the call only lasted approx. four minutes. His response can only be described as arrogant (well maybe also as dismissive, condescending, and/or contemptuous…), but an arrogance above and beyond even that special kind of arrogance unique to politicians.

I first voiced my concerns to the mayor about the town’s potential violations of NCGS 143-318.11(c) whenever they enter into closed session. Under his leadership, the town board has entered into closed sessions ten times over the past 12 months. In only one of those closed sessions, on March 20, 2017, is it possible to verify that the closed session was called pursuant to the statute. Mr. Aneralla asked me why I thought I had the right to closed session minutes dealing with personnel matters – clearly not grasping the procedural issue I was raising about closed sessions – and told me to just trust him that the proper records are being kept. I think Ronald Reagan would agree that “Trust me, I’m the mayor, records are being kept” ranks right up there with Reagan’s other nine most terrifying words in the English language. I guess it’s possible I simply misunderstood the mayor and he was actually just testing out his new campaign slogan, “Stop asking so many questions and just take my word for it.”

I then proceeded to describe the incident with Mr. Vincent and he curtly responded by asking why I thought I was entitled to sit in on a vendor meeting? At that point, I apologized for bothering him with such trivial issues and told him I would not do so again in the future since it was clear we were going to have to agree to disagree about transparency in Huntersville.

Maybe he saw one too many “May It Please the Crown” memes on social media and started to take them literally.

I could almost understand his response if I had called to offer him advice on, say, asset management. But, I called to discuss one of the few areas I know a little something about and one of the areas he is basing his re-election on, transparency and open meetings laws. Exactly how Mr. Aneralla has brought a new level of transparency to town government has yet to be explained, especially considering live streaming the meetings wasn’t even his idea; although he did apparently come up with those riveting board meeting recap videos on social media all on his own.

It’s hard to understand exactly what a two-time political loser who was finally able to get elected facing an unpopular incumbent and while riding the coattails of the anti-toll candidates has to be arrogant about. For those who don’t recall, Mr. Aneralla lost the district 40 state senate race in 2010 and then lost in the primary of the 2012 district 41 state senate race to Jeff Tarte in a 5-way race. It’s interesting that despite living in Huntersville for the last 20 years according to his re-election announcement, it took him around 18 years to show any interest in Huntersville politics. It’s almost as if he settled for running for mayor in Huntersville after failing twice to get elected to the state senate. And let’s be honest, if Jim Puckett had run for mayor again in 2015 he would have won by a far larger margin than Mr. Aneralla. (Puckett lost to Jill Swain by a mere 32 votes in the 2013 mayoral contest.)

Mr. Aneralla’s response to the Vincent incident is even more absurd when you consider the mayor is the one who formed an ad hoc oversight committee for HFFA (which only came to light when it was reported in the Herald Weekly after remarks the mayor made at a Huntersville 101 alumni meeting), but then gets mad when a citizen actually attempts to engage in oversight of HFFA. The mayor was just as curt in June 2016 when I asked questions about this new ad hoc committee – but, to his credit, Commissioner Boone, one of the committee members, had no problem in providing me his notes and the agendas from the HFFA oversight committee meetings upon request. Might I suggest that if more citizens in Huntersville had attended “vendor meetings” about HFFA in the past, it might not have taken so long to put the management contract out for bid in the first place?

If Mr. Aneralla’s cavalier attitude towards government intimidation isn’t enough of a reason to not support his re-election effort, let’s just look at his record on fiscal responsibility. He has failed to reduce the tax burden on Huntersville taxpayers for two consecutive budgets. Last year, he was the tie-breaking vote against a budget that would have lowered the tax rate by 5/8 of a cent. When the mayor voted against lower taxes last year he said we just need another year to work towards the goal of lower taxes and that it would be his goal to cut the tax rate over the course of the next year. Well it’s next year and the budget this year did not reduce the tax rate yet again.

What difference does it make if you can point to a long list of spending cuts if none of it resulted in a lower tax burden? A large percentage of the spending cuts for mileage/travel/dues that Mr. Aneralla is touting were no-brainers related to the jetsetting of the prior mayor for trips to San Francisco, Washington D.C., and Indianapolis. But, again, why did these cuts not result in a lower tax burden? One of the few good ideas he did come up with, pushing to redirect CATS spending to transportation infrastructure in Huntersville and away from more studies, is hard to see as anything more than political pandering when he has yet to display the same vigor when it comes to our town budget.

This isn’t to say everything the mayor has done in the past year and a half has been bad, but open meetings and government transparency are particularly important to me so it’s tough to overcome his statements and inaction on these issues.

If people in town can get worked up over the color some members of town staff want to paint an old caboose, maybe a few people can also find the energy to get worked up over attempts to suppress political speech and intimidate citizens from participating in local government. If enough people demand a change in the attitude at town hall, maybe it would even convince a true conservative to run for mayor in Huntersville – I mean the filing fee is only $10. Anyone know someone who fits this description in Huntersville? If so, I bet we could find a way to raise the funds to cover that filing fee…

Eric

Rental Property Shenanigans at 510 Dallas St.

UPDATE: An interesting development, apparently Mr. Ryder was arrested on or about June 8, 2017 for six counts of larceny by employee (a felony) according to the Mecklenburg Co. Sheriff’s website. He has a June 29, 2017 court date for these charges.


The good news for a blog primarily focused on local government in Huntersville, town hall never stops providing me material to write about. The bad news for a blog primarily focused on local government in Huntersville that currently nets this writer $0 per word, town hall never stops providing me material to write about.

I referenced receiving some records related to rental property owned by the town in a post a few weeks ago about the Huntersville Legal Dept. According to the town’s response to my request, the town is currently earning rental income on eight (8) residential parcels (the town collects rent on non-residential properties as well). Rents paid range from $400-$650 per month. Seven of the eight residential parcels are situated along the Hwy 115 corridor and are related to the planned Main Street upgrades. But one parcel, 510 Dallas St., stood out since it was off of Hwy 21 and clearly not related to the Main Street project.

The purchase of 510 Dallas St. was approved by the prior town board 5-1 (Commissioner Phillips opposed) at their Sept. 21, 2015 meeting and the purchase contract was executed by the town in Nov. 2015 for $330,000 as part of the planning for the US 21/Gilead Rd. project. The existing structures at the parcel are set to be demolished at some unknown point in the future to make way for a redesigned interchange with US 21. You can review the project plans here. The US 21/Gilead Rd. project has now been turned over to NCDOT and is tentatively planned to start concurrently with the I-77/Gilead Rd. interchange project. There is no firm start date for construction of either project at this time since NCDOT is still engaged in utility relocation and obtaining right of ways – including still needing to negotiate the acquisition of property directly across the street from 510 Dallas St.

Some issues don’t require much in the way of explanation and this is one of them. I’ll allow the reader to draw their own conclusions based on the following information.

  • 510 Dallas St. is approx. 3,472 sq. ft. with a large detached garage on almost a full acre of land
  • The current rental contract for 510 Dallas St. was signed and approved by former town manager Greg Ferguson sometime in Dec. 2016; this rental contract did not require town board approval
  • The current term of the rental agreement is Dec. 1, 2016 through Nov. 30, 2017
  • The US 21/Gilead Rd. project will not begin construction by Nov. 30, 2017
  • The current tenant is listed on the rental agreement as C. Lane Ryder, Jr.
  • The current rental amount per the agreement is $600/month
  • According to Zillow, the current “Rent Zestimate” for this property is $2,198/month
  • The town did not publicly advertise the property for rent prior to renting it to Mr. Ryder
  • As of yesterday, June 15, Mr. Ryder has failed to pay rent to the town for the months of Dec. 2016 and Feb. 2017
  • Failure to pay rental payments when due constitutes default under the terms of the rental agreement
  • Mr. Ryder is currently in a relationship with a member of town staff

Just another example of the mismanagement of taxpayer dollars that lead to the departure of the former town manager and a new town board being elected in November 2015.

Eric