Subject: Hurricane Recovery Update/Member Vote Coming Soon/ Town Hall Planned Feb 18th
Dear Members,
Town Hall on Tues, Feb 18 from 6:30-8:00pm, ASC Clubhouse/Zoom
The Town Hall will be focused on ASC Recovery efforts and open to Member Q&A.
Member Vote Coming Soon
ASC has two loans in play: 1) ASC borrowed $430,000 in October 2024, from six members as a bridge loan to pay tree removal costs, and 2) ASC is nearing final approval for an SBA Disaster Loan which offers better terms to pay off the member bridge loan. Both loans require collateral which requires majority approval of our voting members. We expect to email a ballot to voting members within the next two weeks.
Feb 5, 2025 Hurricane Recovery Update:
Recovery Costs
The Board initially estimated recovery costs at $800,000 for fully contracted repairs. Now that we have clearer figures, we expect total recovery expenses to be around $600,000—a significant reduction from our early projections.
Insurance Update
At first, our insurance payouts looked bleak. We received two checks totaling just over $20,000, and as expected, our $500,000 tree removal claim was denied. However, much of our property damage – buildings, docks, and the club-owned camper – was also overlooked or denied in the initial claim.
Thanks to the efforts of Dan West and Rob Caison, who resubmitted detailed damage assessments, our insurer (Auto-Owners) reassessed the claim. As a result, ASC is now set to receive over $172,000, plus $27,000 from Chubb for damaged boats. That brings total insurance payments to nearly $200,000—a major turnaround.
Donations & Member Support
To date, we have received $35,593 in contributions from members and outside donors. This generosity has helped cover operating expenses over the past four months, and we are deeply grateful for your support.
Member Bridge Loan
To cover the urgent cost of removing 1,200 trees and stumps, the Board secured a $430,000 bridge loan from six members. This loan carries an 8% interest rate (Prime + 0.5%) and is amortized over five years.
If we continue with this loan, the lenders require collateral, which must be approved by a member vote.
SBA Disaster Loan – A Better Option
To replace the bridge loan with a lower-cost alternative, we applied for a U.S. Small Business Administration (SBA) Disaster Loan. ASC qualifies for the lowest government rate:
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3.25% fixed interest rate
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10- to 15-year repayment term
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Pre-approved for up to $500,000
We had to pause the loan to update our insurance documentation, but we have since resubmitted everything. We are nearing final approval for an SBA loan between $300,000 and $500,000. Like the bridge loan, the SBA loan requires collateral, meaning a member vote is needed for approval.
Commodore’s Recommendation
It would be unwise to pass up the SBA Disaster Loan. This is a federally backed, low-interest loan designed for non-profits recovering from disasters. There is no lower-cost financing available.
I strongly recommend:
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Accepting the SBA loan (at least $300,000, or more if approved).
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Using the SBA loan plus insurance funds to pay off the more expensive member loan and contract out more of our dock and building repairs.
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Allocating any remaining insurance money to Capital Reserves to strengthen ASC’s financial position.
With this approach, no special assessment on members should be necessary.
Your prompt response to the email ballot will be crucial – we need your vote to secure proper financing and move forward.
Thank you for your support in helping ASC recover and thrive.
Sincerely,
Bob Damen
Commodore