A MESSAGE FROM SAM BENNETT, SEA PINES CSA PRESIDENT

May 3, 2020

The COVID-19 crisis has had a dramatic effect on our area as well as our nation. Please know that CSA continues to provide for the security, maintenance, and operational needs of the Sea Pines Community.

Because of the crisis, many businesses and organizations, including CSA, have been heavily impacted financially. Two of our primary revenue streams, Gate Pass Fees and Weekly Short Term Rental Pass Fees, have declined dramatically over the past 2 months. Combined, they were projected to generate $4,182,772 in 2020. In March and April alone, these revenues were down $387,431 from their projected amounts. The continued decline in visitors, guests, and renters will be with us for an extended period of time and may carry into next year. The months of May, June, July, and August generate our strongest revenues from these revenue streams, so in order to prepare for the remainder of the year, we have developed some conservative year-end projections based on what we know today.

We believe our overall revenue decline will be in the $2.0 to $2.5 million range for 2020. Again, this is a conservative projection. It is my hope that these projections are high, that the effects of the virus quickly abate, our world returns to normal, and our revenues rise to something closer to their original projection. In response to this change, we are carefully monitoring expenditures and looking for opportunities to cut spending where possible. Unfortunately, our options are somewhat limited based on our operational structure, as well as how and when we spend our revenues.

Most large CSA capital projects take place in the first and fourth quarter of the year. We do this to avoid the busiest part of the tourist season. This year most of those dollars were committed at the beginning of the year and spent prior to the COVID-19 outbreak. Additionally, CSA outsources much of our property maintenance and repair to outside contractors through long-term service contracts. These contracts have proven to be cost-effective, but they limit our ability to make mid-year adjustments. Also any change in service levels from our contractors will reflect on the appearance and potential safety of our community.

Another challenge is the nature of the daily work CSA performs. We protect the community, patrol the streets and beach, staff the gates, repair the drainage system, pick up debris, fix the roads, and provide many other functions essential to our community’s operation. It is all very labor intensive. Currently, we have a number of unfilled positions and will avoid filling these positions when possible; however, as visitors return and our community becomes more active, the need to fill them will certainly increase.

In an effort to bridge our immediate revenue gap and keep CSA operating at current staffing levels, we have secured favorable short-term financing from our bank and have been through the loan review and approval process with the Small Business Administration. At this time, we have not used funds from either credit facility. We are also prepared to use some of our emergency reserves. Unfortunately, as our community is very aware, these reserves may be needed for storm and hurricane related recovery and repairs.

Our Treasurer, Dave Borghesi, gave a thorough update on our financial status and some potential solutions at our CSA Board of Directors meeting on Tuesday. This was our first attempt to live stream our Board Meeting. I would encourage you to click here to watch the meeting and view his presentation. We had 170+ property owners join us for the meeting and plan to continue using this meeting option in response to COVID-19 social distancing requirements.

Several other important actions were taken at the meeting, but one of the most important discussions was the need for additional funding for capital projects.  CSA Board Chairman, Larry Movshin appointed a CSA Revenue Task Force to look at our long term funding needs and directed that task force to bring recommendations back to the Board in the very near future.  The members of the Revenue Task Force are Jim Kaskie, CSA Vice Chair; Dave Borghesi, CSA Treasurer; Dave Ellis, CSA Communications Committee Chair; Mark King, CSA Class B Commercial Director, and Steve Birdwell, CSA Sea Pines Resort Board Member. Board Chairman, Larry Movshin, will serve as an “Ex Officio” member, and Victoria Shanahan, CSA Director of Finance and Administration and I will participate to provide staff support. The Task Force hopes to report their findings at the next Board meeting planned for late May.

Finally, as we slowly and safely navigate past COVID-19, Sea Pines must be ready to return to normal under the new safety protocols established by the crisis.  For many of our friends and neighbors, this health crisis also has become a financial emergency.  Ensuring that Sea Pines is safe and ready to return to normal is essential for them and our local business community.

I hope you find this message helpful. We will continue to provide regular updates as we move forward together. I appreciate the opportunity to serve as the Sea Pines CSA President and can be reached at president@csaseapines.com.

Thank you,

Sam Bennett
CSA President