Comments

A Democratic Election Process by Mark Goldstein

The vote to either support or not support annexation begins soon. I strongly encourage everyone to vote. However, I have several questions and comments about the election process.

How will neutrality be maintained?Specifically, who will call or email those who have not voted?Will there be a scripted message so that all non-voters will hear the exact same message?How will questions be handled if the non-voter has a question?What should be the maximum number of calls, emails and/or text messages made to an individual who has yet to cast a vote?Who will count the ballots at the end of the process?Will there be monitors (as occurs in local, state and national elections)? How will electronic votes be verified and secured?

It seems essential that board members or Kenmure Concerned Residents NOT be callers, as these individuals have a bias, and their bias may be either consciously or unconsciously communicated to the recipient.As a clinical psychologist, I can cite hundreds of articles supporting this conclusion.For example, the placards placed on tables during Trivia (good reminder to vote, but biased in including the Board’s unanimous support to vote “yes”).It is essential that callers should be selected who can maintain absolute neutrality to ensure a completely fair election process. 

It also seems reasonable that each caller have an identical script whether calling or emailing recipients.The message should simply be “PLEASE VOTE.”If the respondent has questions, the response should again be “PLEASE VOTE.” One needs to remember that some individuals may not vote due to indecision or indifference, not just due to laziness or forgetfulness.

The annexation issue has already created divisiveness in our Kenmure community.If either side of the annexation issue feels that the election process has been tainted or less than totally neutral, negative feelings may continue for some time and result in disharmony.Therefore, it is essential that neutrality be maintained at all costs.

Response:

How many eligible votes are there?  829

How many YES votes are needed to pass the Declaration Change? 556

When does the vote take place?  Voting by Paper Ballot or Online:  September 3 – 23

What is the Voting Process?

The process for the voting on the Annexation of the 60 Acres is the same as it has been for all prior votes and elections.  The election process is under the direction of the KPOA Corporate Secretary, who retains custody of the ballots for one-year after the election.  The Election Committee assembles the package of voting materials and delivers it to the printer who assembles and mails the voting package.  The voting package includes a cover letter from the Board; the Ballot (with Declaration Changes) with an Owner ID# and a Voter ID#; and online voting instructions.  The Ballot does not have the owner’s name on it — just an Owner ID #.  All ballots are confidential.

Is this vote the same process as the electing the Board of Directors?

There is a BIG Difference:  The Annexation Vote is a statutory process as set out in the NC Planned Community Act, G.S. 47F-1-101et.seq.  Neutrality will not be maintained as the statute places a heavy burden on the proponent seeking to amend the Declaration of a planned community.  To “win” the right to amend a community’s Declaration the proponent must obtain an affirmative vote of 67% of the votes of the lot owners.  47F-2-117.   If 67% of the lot owners do not turn out to vote, the proponent loses.  If 67% or more do turn out to vote, the proponent prevails only if 67% or more vote in favor.  (In contrast, in the KPOA Board of Director elections, the candidate receiving the most votes is elected regardless of the number of votes cast.)

What can a proponent do to convince the owners to support amending the Declaration?

The proponent can state how and why they support the amendment, and in fact have an affirmative duty to try to get 100% turn out.

Your KPOA Board has worked diligently over the past four months to provide all property owners with factual information and asks you to base your decision on whether, after weighing the pluses and any perceived minuses, the annexation will benefit Kenmure.  We hope you agree with the KPOA Board’s recommendation that a yes vote is appropriate.

8/16/2019
Comments (Travis O. Rockey and Gail Drake Rockey):

On June 8, 2019, without discussion with the KPOA dues-paying neighbors most affected; without a plat map of the project; without addressing the Long Range Planning Committee’s concerns from 2019; without looking at alternate ingress/egress paths to the project; without a study of the financial impact on KPOA’s budget; without a study of the impact on land values, especially KPOA lot owners trying to sell their lots; without a study of security issues; without a study of safety issues; without a study of the environmental impact and without a written Developer’s Agreement, the KPOA Board voted to recommend a Yes Vote to its Members on the annexation of 60 acres outside our community and schedule a vote in September.

The benefit to KEI is a very substantial increase in the 60-acre property value that can now be sold with other KEI assets.Lee King said he would prefer to sell the 23 lots on Hollybrook before he did anything with the 60 acres, which may take 11-12 years at the rate of current lot sales, proving that rushing a vote on annexation is not necessary at this time. 

KPOA lot owners who are currently trying to sell their lots will see reduced values due to 62 more lots coming to the market (23 for the KEI Hollybrook development and 39 lots in the 60-acre annexation); a 10+ year construction project significantly impacting the quality of life of the people who bought into Kenmure for peace, quiet, safety and security; significantly increased traffic and safety risks on Pinnacle Peak Lane, Tarnhill Drive, Chatsworth Court, and Kenmure Drive from the new 62 home owners; possible increased KPOA dues to maintain the 60 acres after KEI or its successor hands over all maintenance and upkeep to the KPOA one year after construction begins; increased security risk from direct access to Kenmure through the unmanned Mt. Olivet Road gate; and reduced quality of life for Chatsworth Court residents who would now have the only cul-de-sac in Kenmure with two entrances and two exits. 

The Board’s primary stated reason for moving this annexation forward is to maintain the property values across all of Kenmure, with no incompatible development like the small home that can be seen from the golf course.  Other than the 19 most impacted residents on Chatsworth Court and Pinnacle Peak Lane, no one else can see or hear anything to do with the 60 acres.No matter what is built there, it will not affect our neighbors in Brookwood Village, on Winding Meadows Drive, Founders Drive, Kenmure Drive, Overlook Drive, or anywhere else in this community.And over 70% of the 19 most impacted residents do not want the 60 acres to be brought into this community.So why are we trying to do this?

8/15/2019
Comments (Bill Daleure):

Responses

(Lisa Rosencrans): Just like politics, this should not show favoritism, as it clearly appears to us.  Not saying what we are voting for as we’ve paid attention to both points of view.  However, to avoid that appearance, the cards should clearly ask  just to “please vote.”  I believe anyone concerned about Kenmure enough to have diligently paid attention to both views, are educated without a sway, as we are.   Or, how about those opposed make equal amount of voting ballots to be distributed?   Same thing.

(Susan Boland):  The message of the tent card is PLEASE VOTE.  Not tell folks how to vote.  How would you like it if you were part of the 92% who voted yes and the vote failed because not enough folks voted?  The KPOA Board’s goal is to convince voters that their vote is, indeed, very important.  Those who oppose annexation have an advantage.  They don’t even need to get a majority of No votes, they just need to convince folks that the annexation doesn’t concern them.  Tent cards and ballots are not the same thing.  The opposition is doing its best to get its point of view out… often.  The KPOA Board is providing information and encouraging folks to vote.

(Peter Haft):  The KPOA Board was elected to provide direction and support for all of Kenmure.  You moved into this community knowing there was a strong volunteer structure.  I fully support their position and providing defendable FACTS; not the misleading false statements from your group.

(Gayle Schwarz): I find nothing offensive about the tent cards. I found Dennis Carroll’s comments regarding “Cottages” or turnkey homes much more offensive.

Response:
First of all, KPOA does not control what  KCC or KEI does.  They are independent of KPOA.  KEI owns KCC and can advocate in any manner they would like for its members that reside in Kenmure to vote for their proposal.  KPOA does in fact agree with what was written on the cards and does not object to them as they are reminders of the need to Vote.  It is a reminder for EVERYONE to VOTE.  The tent card does not even urge a YES vote on the current 60-acre proposal.  For those residents that want more information on the prior or current proposals, information is available on the KPOA website.  All Kenmure residents are encouraged to educate themselves and to VOTE.

Response (John Ely):  Fifteen years ago I was on the verge of purchasing a lot in Wolf Laurel as the real estate sales lady assured me that the development was going to be very special and a very good investment. After a bit more research it became obvious that Wolf Laurel had some very negative attributes.  Only 2/3rds of the roads are paved.   Goods and services are about 20 minutes away in Mars Hill, a small town with a population of 2000.  There is the regular meteorological phenomenon known the Northwest Flow Snow Events (NWFS) resulting in the closure of the country club for the winter season (closed from October 31st till May).  In my opinion, it is a very long stretch to compare Wolf Laurel with Kenmure from a development point of view.  Few people want to live in Wolf Laurel.

Response:  Ghost Town Fiction. The suggestion that an unscrupulous developer of Wolf Laurel carried out an annexation resulting in a “ghost town” implies that Kenmure’s development plan could lead us to the same results. This is disrespectful to Lee King’s 30-year track record in Kenmure.  Recent communication with the President of the Wolf Laurel  Road Maintenance & Security HOA also reveals the description is false.

Comment:
From Concerned Pinnacle Peak and Hollybrook residents not opting for anonymity
Andy Clapper & Barb Smith, Andy & Margie Scott, Mary Ann & Larry Stewart, June & Larry Rostetter, Don Lynn Johnson

We are concerned residents of Pinnacle Peak and Hollybrook that are not represented by the “Kenmure Concerned Residents” and we are not anonymous. Most of our properties border the proposed 60 acre annex.

We don’t know who or how many the “Concerned Residents” are. We do know that replies to messages from “Concerned Residents” did not go to all of the addressees of those messages. They went to the originator and were not shared with the larger audience. Responses that challenged the inaccurate information being disseminated were not shared. So much for open discussion.

We have followed the arguments for and against the annexation and conclude that we support this proposal. The arguments against annexation have been demonstrated to be inaccurate in many ways.

Many different issues have been discussed but we believe the overriding and strategic issue is the future use of the 60 acres abutting our properties. The options are:

Development by KEI
We have confidence that Lee King will meet his commitments to KPOA because that is his track record. KEI survived the financial crash that began in 2008 and lasted for many years. Many communities such as ours failed or foundered with great loss of property value during that time.

KEI and KPOA have a history of effective collaboration. Each party recognizes that the problems of one can impact the other.

Other Development Possibilities
County Zoning for R2R property such as the 60 acres permits commercial, agricultural, industrial and residential development (much higher density allowed). Short setbacks to adjoining properties are allowed. Use of any of these development options can have a significant negative impact on property values for Kenmure residents south of Pinnacle Mountain Road, and by ripple effect, extend to the rest of Kenmure. Even a small percentage impact is tens of thousands of dollars in property value.

Other Issues
A variety of issues have been raised as reasons for rejecting the annexation. Such issues need to clear a high bar if they are to be decisive.

Traffic
Large numbers describing future traffic have been put forward that do not stand up to fact-based analysis. Assumptions about the number of occupied residences, daily trips, number of cars per residence and other visitors were not descriptive of the Kenmure environment. The front gate will see an increase in traffic of about ½ percent a year for ten years. Three streets in Kenmure will be affected. Tarnhill Drive, a segment of Pinnacle Peak Lane and a segment of Chatsworth Court. When the new area is substantially built out over ten years, these roads will see an additional passing vehicle every 8-10 minutes.

Road Maintenance
The recent work done on all Kenmure roads will extend their lives beyond earlier projections. Due to more advanced technology, the short length, and limited use, the life of Applewood is expected to be 18 years. In summary, maintenance cost per mile per property owner will be lower than historical experience.

Security
The Board and the Security Committee and the Treasurer have years of experience in determining the
Security budget and we have confidence in their plan. Their message of August 4 said there was no incremental Security cost attributed to the potentially annexed property.

Governance
Suggestions have been made that the KPOA Board is not competent to handle this matter and may be naïve about working with KEI. The increase in property assessments has averaged about 1% per year for about ten years. As for working with KEI, drive in the gate and take a look to remind yourself that what you see is the result of KEI and KPOA working together.

Summary
We believe the budget presented by the Board is realistic, experience-based and perhaps conservative in some areas. We are confident that the package negotiated between KPOA and KEI will result in ZERO added net costs in the near-term and a favorable impact to costs over the long- term.

The other issues raised by residents during the process were worth identifying and evaluating. They have not been shown to have any significance and are secondary to the overriding and strategic issue of how the 60 acres will be developed and by whom.

8/2/2019
Comments:
Past KPOA Presidents: Nick Weedman, Larry Rostetter, Les Christensen, Kathy Meersman, Linda Mensch, Bob Wilson, Alan Van Ostenbridge, Ron Thornton

As KPOA Past Presidents and property owners of Kenmure, we fully support the annexation of the 60 acres adjoining Kenmure’s southern border.

We have reviewed the pros and cons associated with this annexation. Including, but not limited to, impacts such as traffic, security, finance and community lifestyle. Our conclusion is that the pros significantly outweigh the cons, and most importantly that the annexation will benefit all property owners of Kenmure.

KEI has been a good neighbor to all Kenmure property owners. We would expect this attitude to continue by KEI in the development of this 60-acre parcel – as has been the case for all of Kenmure.

It is important to all Kenmure property owners and protection of property values that this portion of our southern border be protected by requiring the 60 acres to be developed to KPOA standards.

We fully support the Declaration change incorporating the 60 acres into Kenmure.  We encourage all property owners to vote, as they may deem appropriate, upon receipt of the election materials.

8/1/2019
Comments:
William M Douberley

Two points on the annexation issues:
The focus on Lee King should be removed. Understandably, many owners applaud the continued engagement by Lee King in Kenmore and surrounding properties. However, many have issues with him and his management style (and his success?), and this animosity has provided a distraction to the real issue: KPOA should seek to control the development of that property, regardless of who develops it. Assuming that the property is to be developed, there should be no question that development with Kenmure’s covenants and restrictions benefits every member of Kenmure. These covenants run with the land, and this opportunity to impose Kenmure’s covenants and restrictions on the property should not be missed.

Secondly, understandably we all are and should be concerned with the sale of the club. Again, the focus should not be on Lee King, since sooner or later he no longer will be involved in club ownership. If he can sell it to another club operator, then we deal with another entrepreneur over whom we have no control. Just take a look at the historic High Hampton’s current situation in Cashiers to see the probable result: a renovated course that rhas emoved much of its history with homes on the fairways and dramatically higher fees. We can only hope that “our” club can be sold, because the alternative is a stark one: if there are no takers, then the golf course either becomes the weed patch that Lee King warned us about, or, with an easy zoning change, the golf course is developed into something else. Again, we homeowners have no control over the use of the club property; no restrictions in our deeds can prevent a change in use.
And so, given the fact that we want a successful sale of the club to someone who will operate it much as it is, wouldn’t we want the club  to be an attractive proposition for a prospective developer? Is there any doubt that the annexation will make it more attractive?

Annexation is in the best interests of all KPOA members. Accordingly, I, for one, believe that the board exercised its fiduciary duty to us all by voting to recommend approval, and the subsequent due diligence has confirmed that decision.

7/17/2019
Comments:
Les Christensen

… here are some thoughts concerning the request from KEI to allow an additional 60 acres in Phase 7 to be incorporated in the 1400 acres referred to as Kenmure Properties.

First of all, it is important in order to continue Kenmure as a vibrant development that we seriously consider allowing these 60 acres to be included in the 1400 acres under development. Continued development means that Kenmure maintains and grows the financial value of the homes that are completed in Kenmure, and future construction will influence prices positively in Kenmure Properties. It is very important that Kenmure does not become a stale and totally developed community. A person can drive around Henderson County and see developments that have become stale due primarily to the fact that all lots have been sold and construction has been terminated. Many homes in Kenmure were built for under $200 sq. ft., but new homes in the area such as Berwick Downs are going for $300 sq. ft. not including the lot. New homes in Kenmure will be built in the range of $300 sq. ft. which is healthy for economic growth and development.

Secondly, Kenmure was bought by entrepreneurs including Lee King while Kenmure was in bankruptcy. Lee King and his partners have been good stewards in the development of the six phases of Kenmure. Phase 1 was developed initially, followed by Phase 2. When one phase was developed, the next phase was started. People in Phase 1 undoubtedly had some concerns about contractor traffic with slowness of cement trucks driving up the hills in Kenmure to their next job sites. People in Phase 1 were cognizant of the activity in Phase 2, but they did not object vehemently to the construction-caused impediments. Phases 1, 2, 3 and 4 were developed; Phase 5 and Phase 6 are currently in development stages. Now Phase 7 is projected to be developed over the next decade. The great majority of people now living in Kenmure will not be affected by the inclusion of Phase 7.

Thirdly, a few residents living in the Phase 5 area will experience some impact to increased traffic generated by the construction in Phase 7. This can be reduced by a construction gate in the area of Mt. Olivet Road, if that is a consideration. The geographic area of Phase 7 is architecturally desirable for beautiful home construction which will inflate the cost of building in the neighborhood.

The reason people are living in Kenmure is due to the architectural beauty of the homes and the physical lots which were available for construction. All one has to do is drive through the various phases in Kenmure to see what a remarkable and charming place this is to live. The reason most of us are living in Kenmure is in part influenced by the wonderful security gate, the well-maintained golf course view, and the impact of the grand clubhouse set on the side of a distant hill. Phase 7 will be a continuation of what we already find desirable and pleasing in Kenmure.

In my opinion, none of this would have happened without Lee King and his unique vision for Kenmure, as well as the support of outstanding successive KPOA leadership. I believe it is in our best interest to support the efforts of Lee King, and keep him on board and available in the next foreseeable future.

For these reasons, I wholeheartedly support the inclusion of the 60 acres for development by KEI.

7/19/2019
Comments:
Lisa Caudle, Peter Haft, Ken Hogue, David Amsler

We, former Kenmure Country Club Presidents (Board of Governors), fully support the proposed 60 acre annex — Phase VII development by Kenmure Enterprises, Inc. The proposed Phase VII Development Project, as defined, has considerable benefits for the overall health of the Kenmure development and certainly benefits KPOA, with very little downside.   The financial health and growth of the Kenmure Country Club (KCC) and its facilities helps all KPOA residents.   Only two-thirds of KPOA are members of KCC, yet everyone’s property values benefit from a vibrant KCC; some estimates are a 20-30% increase in value due to being inside the KCC gates.

Some of the many benefits of this proposed Phase VII Annexation Project include:

• • • KPOA protection “buffer” on its southern border.   Well maintained homes, subject to KPOA standards are certainly superior to any external, alternative development if KEI sells this property.
    • Additional revenue to KPOA (39 additional property assessments each year when fully built out) which far exceeds the minimal extra costs (roads, right-of-way).
    • Potential additional members to KCC

The concerns regarding additional traffic and burden to existing KPOA-maintained roads has been greatly over-stated in recent resident communications.   Examples and statistics support how few vehicles actually travel the Kenmure roads. Neighborhood vehicle traffic, including Brookwood Village and Berwick Downs, as well as primary roads, like Greenleaf Drive, are much larger and good comparisons to support how few vehicles actually travel during daylight (prime) hours.

Again, we feel strongly that this Annexation Project is beneficial for the Kenmure community.

Sincerely,

Lisa Caudle (2019)
Peter Haft (2017-18)
Ken Hogue (2016-17)
David Amsler (2014-15)

Comment
(7/2/2019)
Don and Lynn Johnson, Larry and June Rostetter, Andy and Margie Scott, Larry and MaryAnn Stewart, Andy Clapper

This letter is from residents of properties adjacent to the acreage being considered for annexation by the property owners of KPOA. The decision to do this ultimately rests with the property owners who must, by a 2/3 majority, vote in favor of this idea.

We have seen this proposal before. We supported it then and support it now. Some of the details have changed but the broader strategic perspective is the same.

In the previous vote, the great majority of the property owners supported the measure, seeing the strategic benefits to all property values. The proposal failed because of insufficient participation of property owners in the voting process. The 2/3 voting requirement exists whenever the Declarations are to be changed.

At that time, as now, there was opposition to the plan and questions about the costs and benefits were raised on a variety of issues. This is a healthy thing for the community. With some exceptions, the great majority of property owners at that time were satisfied that annexation was a positive thing.

In this letter, we hope to address some issues and expect that other sources will address these same issues and probably others.

Comments Made:  Some of the communications on this issue have suggested that the KPOA Board is a tool of KEI.
Response:  As long-term residents and volunteers, we have had plenty of visibility into these operations and find this claim to be implausible and disrespectful of those volunteers who devote a great deal of time and energy on our behalf. Collaboration with KEI is a daily effort by both parties aimed at common success. The results speak for themselves.
Comments Made: It was suggested that the Board is fast tracking this annexation proposal without an examination of the pros and cons.
Response: We would suggest that providing all of us with early visibility into this issue was the right call. Delaying resident visibility into this issue would have doubtless led to leaks followed by other criticism. There is adequate time to air out the issues and provide voters
with sufficient information for decision making. That is happening now and will continue.
As the President of KPOA explained, the Boards assessment of the situation necessitated either dismissing the plan or starting the decision-making process and offering the opinion that this was worth the effort. The property owners will ultimately make the call. The Board
has done nothing to foreclose discussion of the matter.
Comment Made: KPOA is planning a “get out the vote” campaign for KEI.
Response: We see it as a “get out the vote” campaign for Kenmure Property Owners. There are considerable downside risks to the failure of this that will impact the property values in the community. If the property is developed with anything other than residences similar to
Kenmure, it is likely Kenmure property values close to the 60 acres will decrease. That will have a knock-on effect for all property values in Kenmure. More to follow on this point.
Vehicle Traffic
The projected number of vehicles related to the development of the 60 acres will be addressed by Board reps at subsequent meetings, based on data retrieved from the Security system. We believe the theoretical numbers presented by some already are exaggerated.
Board reps will present updated plans for the construction entrance.
Resident Occupancy Patterns
This will slowly increase over the better part of a decade. It is important to recognize that, at any given time, about 40% of property owners are not present in Kenmure. They are at other residences or on trips. This information comes from the KPOA database. With 40 lots built
out, the average number of occupied residences at any given time will be about 24. Service calls from vendors or service providers match accordingly.
Property Value Considerations
To understand the downside of failing to annex this property requires some background in Henderson County Zoning Regulations. The current zoning for the 60 acre parcel is R2R. Effective zoning inside Kenmure is R1. R1 is very restrictive zoning for residential
development. Per Henderson County Zoning, R2R is very flexible and can have higher density residential building as well agricultural, commercial and industrial business enterprises.
Concluding Remarks
We sense that some in Kenmure are uninterested or ambivalent on this topic. We hope all will comprehend the bigger picture of understanding:
– The 60 acre site will be developed.
– Development by Lee King (under KPOA guidelines) is a better outcome than any other.
– Having Lee King continue to be engaged in Kenmure and the Club for an extended number
of years will benefit all Kenmure residents.
We expect that the Board will have more information on these topics and others at the
upcoming meeting. The signatories of this document are willing to expand on these topics and
listen to other views.

Comments:

Dennis Carroll

Since the current KPOA Board’s vote supporting the annexation of the sixty acres, which occurred before the Board had done any detailed analysis of Mr. King’s proposal, the KPOA President and Board have pictured the proposal as entirely exempt from risks.This optimism is in stark contrast to the view of risks identified by the previous KPOA Board in 2012, when it provided a thoughtful view of benefits and risks.In fact, it listed only five benefits in contrast to eleven risks.The most important risk involved the following concern: “A property expansion in the current (2012) market might increase the financial risk to KEI and by extension might put Kenmure Country Club at risk.”The previous Board expressed a genuine, legitimate anxiety that the current Board has not acknowledged.The Board in 2012 confronted Kenmure with a serious question: What if Kenmure throws a party and nobody comes?

The Indirect Response to Risk: The only way in which the risks have been addressed is indirectly in the disagreements over whether the proposal will or won’t increase the annual dues assessed for Kenmure property owners.From the start, the KPOA Board has contended that the annexation won’t result in extra dues.However, it should be noted that Mr. King has increased his allocations at least partly in response to questions raised by Bill Daleure as the spokesman for Kenmure Concerned Residents.Attempting to resolve the problem at the KPOA Board meeting on 8/6/2019, one member of the audience suggested that a Developer’s Agreement, which is now being negotiated between Lee King and the KPOA Board, should include a special clause.This clause would require the two sides to review the costs incurred by each side, perhaps every two years, and then adjust the costs.Whichever side is falling short in covering its costs would reimburse the other side—an equitable arrangement.

The Board’s Response to Allocating Risks More Equitably: Responding with enthusiasm, the KPOA Board President repeatedly stated her intention to present this plan to Lee King and see if such a clause could be included in the Developer’s Agreement.We agree that such a clause might help reduce the risks for Kenmure property owners if the annexation is approved but doesn’t pay its way.However, nothing is in writing yet, and it’s uncertain how much time, if any, Kenmure property owners will have to examine the agreement before the voting starts on September 3.This clause might be the only way to allocate the risks in fairness to both sides, but it remains uncertain whether Lee King will agree to it.His response—one way or the other—will provide a barometer of his perception of the risks.If he refuses to agree, he will reveal his own assessment of financial risks as being unacceptable. 

The Board President Interrupted Lee King: In this regard, a very awkward moment in the 8/6/2019 meeting occurred when another member of the audience asked Mr. King if he would pay the dues for 31 instead of only 15 lots, thus increasing the certainty that KEI (or a new owner and developer) would cover all of the annexation’s costs.Instead of allowing him to answer, the Board President interrupted him and stated that the Board already had decided that the costs were covered.Her reluctance to let him address the actual coverage of costs was obvious for all to see, but as we’ve noted, she expressed enthusiasm for the special clause, which will give Lee King a second chance to answer.

Will the Annexed Area Be a Boom-Town or a Ghost-Town? The KPOA Board has also addressed the risks somewhat inconsistently.On the one hand, the Board foresees sufficient development in the annexed area that it may provide important revenues to Kenmure in general and the Kenmure Country Club in particular.In the Board’s view, there are no risks that the annexed area will fail to cover its expenses. On the other hand, in trying to assure the residents that extra traffic is of no concern, the Board President has stated that the development of the proposed 39 sites may occur so slowly that any increase in traffic will be gradual and unnoticed.She observed that sales in Phase VI (the Hollybrook area) have occurred at the rate of two per year, and Lee King has agreed that the market is slowing down in Kenmure.In this case, of course, there may be so few sales of lots over ten or twenty years that it’s difficult to see how the sales will cover costs or add significantly to Kenmure’s revenues.These inconsistent arguments have blurred the risks, creating opposite scenarios of a boom-town or a ghost-town.The deeper risks will be addressed directly in Part Two when we confront them squarely with our further answer to the question: What if Kenmure throws a party and nobody comes?

At this point in time, Kenmure’s property owners have no way of knowing the financial implications of the annexation, if it is approved.If sales are very slow, we ought to ask ourselves a blunt and honest question: Was the 2012 KPOA Board wrong in warning of its concern?It stated unequivocally that in the event of slow sales: “A property expansion in the current (2012) market might increase the financial risk to KEI and by extension might put Kenmure Country Club at risk.”If the annexation is approved and 39 more lots are added to the considerable inventory of lots for sale in Kenmure by Lee King and other Kenmure lot owners, it may flood the market.If it does, it may resemble the example of a ghost-town after annexation in a community like Kenmure, as described below.

A Flooded Market: As of 8/13/2019, there are 52 lots in Kenmure for sale, based on our count of properties available on Kenmure.com.To these 52 lots one has to add the 23 unplatted lots that will become available for sale on the 32 acres that Lee King owns in Phase VI (the Hollybrook area) as the newest area for development.When these lots are platted, they will drive the number upward to 75.The addition of yet another 39 lots will flood the market with a total of 114 lots for sale. Lee King is in fact competing with himself by adding the proposed 60 acres with its 39 lots.The annexation may flood the market, driving prices down, not up, for decades to come, the opposite of what those who favor the annexation have declared without thinking through supply-and-demand dynamics.

The Actual Motive for the Annexation: The truth behind the motive is that Lee King purchased this land at the height of the 2006 market and has owned this property as prices have dropped and not fully recovered over the past 13 years.He has tried to sell it at least once, a fact revealed in papers linked with the 2012 proposed annexation.His only option is to make it part of Kenmure and enhance its value, but this strategy may work against him.His own plans call for selling the existing lots in Kenmure first.Based on the slow rate of lot sales in recent years in Kenmure—averaging only two per year in Hollybrook—the prospect is for very slow development of the annexation, if approved, which may take into the late 2030’s at the rate of one or two lots per year.If sales are very slow, the role of risk and who will bear it turns into a paramount consideration while the annexation lowers values. 

Study the Developer’s Agreement and the Special Clause: To cast an informed vote will require a close look at the Developer’s Agreement, if it becomes available before the vote with adequate time for Kenmure property owners to review it.You should consider whether Lee King responds to the enthusiasm expressed by the KPOA Board President for the clause that would spread the risks equitably between KEI and Kenmure property owners.A Kenmure Alert from the KPOA Board on 8/11/2019 states that the Developer’s Agreement is undergoing legal review but provides no date for its release and no reference to a special clause.The Agreement should have been done before the Board’s support of the annexation.Now we’re forced to wait for it with the vote three weeks away.If it isn’t available, it’s a sign of serious problems.If it is available, the question then is whether Lee King will agree to include this special clause.If he doesn’t want to allocate the risks more fairly, then the lack of such a clause will show that the risks are greater than the KPOA Board has assumed.It will also show that the thoughtful Board of 2012 told the truth about the risks connected with the annexation in the event of slow sales. 

We Should Weigh the Reality of Risk When Voting: Lee King deserves enormous credit for developing Kenmure as a beautiful community, but the addition of 39 lots in a remote area that has remained unsold for 13 years to an already sluggish market will reduce the value of Kenmure properties, not enhance it.What it will enhance, however, is the reality of risk.The annexation, if it’s approved, will take decades to develop the properties while it floods the market with a total of 114 lots for sale.This flooding is especially apparent if the sales occur at an average rate of two per year as has occurred in Hollybrook.It thus becomes increasingly hard to accept the indifference to risk displayed by the KPOA President and Board.It also becomes increasingly hard to understand how the annexation will pay its way for the next twenty years.The probable prospect is that the annexed area will remain a ghost-town for a decade or longer.Such a ghost-town poses questions of security caused by another unmanned gate to Kenmure in a largely empty area that we will address in a later e-mail. 

An Example of a Ghost-Town after Annexation:The community of Wolf Laurel (straddling Madison and Yancey Counties) is somewhat larger than Kenmure with a country club and a golf course.It succeeded in obtaining an approval for the annexation of about 25 lots.According to a former resident of Wolf Laurel, who now resides in Kenmure, the outcome was an annexation in which five lots have been sold in 15 years.The annexation at Wolf Laurel has resulted in a ghost-town.Given the reality of risk and the two scenarios of a boom-town or a ghost-town, we repeat our basic question: What if Kenmure throws a party and nobody comes?

Response:

Susan Boland

KPOA Board President

The KPOA Board refers all KPOA property owners to all the FACTs on the KPOA website regarding reasons to support annexation of the 60-acre parcel. Here are 3 good reasons to vote YES:

1. Preserve Property Values for All Kenmure Property Owners by eliminating the risk of incompatible development on Kenmure’s southern border.

2. Ensure that homes/cottages are built with Kenmure’s Covenants and Restrictions and subject to KPOA’s Bylaws and Rules.

3. Provide quicker emergency and fire response time — the new Mt. Olivet Gate will cut in half the distance from the Green River Fire & Rescue’s Station in Tuxedo to Kenmure’s Pinnacle Peak area.

A combination of incentives given from KEI to the Kenmure Property Owners equals NO INCREASE in your KPOA annual assessment as a result of the annexation.  Here is a summary of KEI’s Financial Commitment Package:

• $15,000 from KEI to KPOA when the Declaration Change is Approved
• $15,000 from KEI to KPOA when the first road segment is accepted by RMC
• Thereafter each year, KEI to pay to KPOA 15 x the current lot assessment [annual income stream]
• KEI to pay the entire cost of the New Mt. Olivet Gate as well as the temporary secure entrance at Chatsworth Court

Yes, KPOA President Susan Boland, did interrupt Bill Daleure’s question to Lee King for two reasons.  First, it was based upon erroneous assumption that additional security is needed and that those costs should be attributed to the 60-acre parcel.  Second, only the KPOA Board and its representatives are authorized to negotiate on behalf of KPOA property owners.  Could you imagine the chaos if every property owner tried to negotiate a ‘deal’?  Throughout this entire process, the KPOA has considered all property owner suggestions.  The KPOA Board represents ALL property owners.

Lastly, the suggestion that the 60-acre parcel will become a ‘ghost town’ is more FICTION.  Whether the 60-acre parcel is developed by KEI or by another company in the next three years or more is not important.  What is important is that whoever develops the parcel, that company will be bound forever by all Kenmure’s covenants and restrictions, bylaws and rules and regulations.

As KEI told us at the Third Town Hall Meeting, its finances are good.  KEI is in the best position to understand the need for additional Kenmure lots, including lots for Kenmure cottages.  KEI has developed Kenmure over 30-years through both boom and bust real estate years.  We see no reason that KEI would change course for the 60-acre parcel.  And, as one Kenmure resident who is familiar with Wolf Laurel told me:   it is a very long stretch to compare Wolf Laurel with Kenmure from a development point of view.

The KPOA Board continues to encourage all Kenmure residents to base their annexation decision on FACTS NOT FICTION.  Voting will open on September 3 and close on September 23.