Water cut-off/fees battle tears apart resort project

As of Wednesday, April 18, 2012

By NEIL HARTNELL

Tribune Business Editor

A FURIOUS battle between several homeowners and the developer at an Exuma-based real estate/tourism development has broken out, Tribune Business can reveal, with the Water & Sewerage Corporation caught in the middle over claims its failure to provide an alternative water supply is "damaging the image of the Bahamas" in investor eyes.

The row centres on the Palm Bay Beach Club, where homeowners are alleging that the developer, Canadian investor Ron Francis, has cut-off water supply to their villas because they refuse to pay inflated fees - "10 times more than the residential rates charged by the Water & Sewerage Corporation" - they claim he has no right to charge.

The homeowners, in correspondence sent to Tribune Business, express fears that water supply to their villas will be cut-off when tenants arrive, potentially costing them rental income, disrupting their guests and giving the Bahamas a potentially bad reputation.

But, when contacted by this newspaper, Mr Francis emphatically denied the homeowners' claims. Arguing that it was just a small minority of Palm Bay's 85 homeowners that were "causing the problems", the developer quoted a legal opinion from his attorney, former Supreme Court judge and ex-Exuma MP, Elliot Lockhart, who said he was entitled to cut-off services to homeowners who had not paid the due fees.

And Mr Francis also denied that the enjoyment of tourists had been spoilt in any way, telling Tribune Business that water supplies were always cut back on even if the villa owner was in default on their payments.

In an e-mail sent to Tribune Business on Tuesday, April10, Marina Munro, one of Palm Bay's villa owners, said: "I am at the end of my rope. Ron Francis continues to cut off water. He has cut off Angie Mulchand's water and Steve Witty's. He also cut off Scott Kilbride's water, but Scott has agreed to pay his indentures and inflated fees.

"I have renters coming at the end of April, and I am sure Ron will cut off my water, at which point my Dad and I are at a complete loss of what to do. We will have to walk away."

Tribune Business was also shown correspondence between Ms Munro and the Water & Sewerage Corporation, where she attempted to obtain her own alternative water supply and bypass the Palm Bay system.

The project only has a single bulk meter, not individual water meters for each villa, and in an April 3, 2012, reply, Philip Beneby, the Corporation's assistant general manager for the Family Islands, said this meant Water & Sewerage was unable to become involved.

"Regrettably, in such circumstances we only put in a bulk meter," Mr Beneby wrote. "Therefore, we are unable to assist with this matter, as we consider this an internal matter that has to be resolve with residents of this subdivision and owners association.

"Our information is that the infrastructure was put in by the owners, and we do not interfere where standards are unknown to us."

This did not sit well seemingly with 10 Palm Bay Beach Club villa owners, although it is unknown if all are in dispute with Mr Francis. An April 12, 2012, letter written to Mr Beneby by Angeline and Vish Mulchard on the homeowners' behalf again demanded that the Water & Sewerage Corporation supply them directly, given the "dire situation at Palm Bay affecting villa owners".

"Given your stated 'objective of the Family Islands and Water Environment Division is to supply, monitor, improve and coordinate Family Islands water and commercial services', we need you to read the information I am presenting here," Ms Mulchard wrote.

"I do not believe that you would want us to turn down tourists who want to rent our villas and vacation in Exuma because we are being cut off from water........

"Under the terms of our purchase in 2004, villa owners were to be provided with water, sewerage, garbage and all amenities. We are all fee simple property owners. However, Mr Francis is denying us our water, sewerage and garbage unless we pay an average of $732 per year.

"This is 10 times' more than the residential rates charged by Water & Sewer Corporation. For 81 villas, Mr Francis will be collecting $59,292! Can you please confirm what the Water and Sewerage Corporation were paid for Palm Bay for 2011."

And Ms Mulchard added: "As investors, we could never have imagined that property owners would ever be denied our rights to have water. It is damaging to the image of the Bahamas that such a situation would occur - where the Water Corporation does not want to deal with rightful property owners."

When contacted by Tribune Business, Mr Francis denied the claims, saying they were coming from just "three or four homeowners" and that it was "a small number of people causing the problems".

He also denied that the homeowners' conveyancings granted them free water, saying the indenture documents merely referred to the "free passage of water and sewerage... in other words, down the pipes and wires that go through the property. Free passage does not mean that it's free".

Denying the claims that Palm Bay was levying inflated fees, or fees it should not be charging, on the homeowners, Mr Francis said of the dispute: "It's a thing that's been going on for several years for us since the recession started in 2008, because people are not able to rent their places as easily as they used to."

Asserting that Palm Bay had only ever cut-off one homeowner, Mr Francis added that water supply was always restored when visiting tourists came in.

"We have never upset a tourist coming here, and all this has been reported to the local Tourist Board by us, not them [homeowners]," he told this newspaper. "I don't want people coming to this country and island, and leaving with a bad taste."

Noting that the complaints were civil in nation, Mr Francis said that if the homeowners has a true grievance and "don't want to pay their bill, than take me to court".

In a March 26, 2012, e-mail seen by Tribune Business, which was also sent to the Exuma police and island administrator, Mr Francis told one Palm Bay homeowner: "Further to our telephone conversation this morning, please be advised that the water will remain disconnected on Villas 21 and 23 until arrangements have been made by the owners to pay for the services provided.

"Any attempt to use water from the Renaissance property by yourself or your workmen may be considered to be theft and will be reported to the police. You or the owners of the units involved have the option of contracting with the Sewerage and Water Corporation to supply water and sewer services directly.

"I trust that you will see that for persons to receive services there is a need for them to pay. Also be aware that the owners of the villas entered into an Indenture of Conveyance contract with Renaissance Beach. Certain rules and restrictive covenants apply. Some of these covenants could possibly lead to charges of trespass.

"I advise you to seek legal advice if you are not sure of the consequences of any actions you are contemplating."

exumawannabe 12 years, 8 months ago

I am also an owner at Palm Bay. Like any condo, home or apartment I have ever lived in, if you don't pay your bills...well your service will most likely be disconnected. To have it turned back on usually comes with a hefty fee.

IF I have to pay my bills to keep my villa up and running, then everyone else should be paying theirs also. It's not fair to those who pay and those who don't expect to receive same treatment...go figure!

If you are unhappy about fees...any suggestions would be great. The one problem with this resort is no one seems to be willing to work together...unfortunate for all.

Regards.

ChuckF 12 years, 8 months ago

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ChuckF 12 years, 8 months ago

I look forward to the day when the real truth is made public. Then maybe these factual posts will not be removed.

exumawannabe 12 years, 8 months ago

My posts are factual...why would I lie about how I run my villa. Everything I stated is what I do. Everything else stated came from the article posted. I think probably post were removed because of name calling. But like I said if anyone is interested in a owners forum..I would be glad to make one. But seems like only one person was interested...so whats the point.

ChuckF 12 years, 8 months ago

Do it! Make one right now and invite every owner. That would be very helpful and much appreciated. I can guarantee that many more than just ONE owner would appreciate it.

BahamasInvestor 12 years, 8 months ago

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International_investor 12 years, 8 months ago

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exumawannabe 12 years, 8 months ago

I pay the same water that everyone pays or not pays...it's part of the fees. I do not have a separate meter...I think that is what this issue is about. I do not misrepresent anyone. These are my thoughts and only want what is best for Palm Bay and as you can see that's not working..So my first concern is for my villa and what kind of impact all the negativity is having on my property. So I don't think anyone should throw stones...everyone is in the same boat...just some have different opinions on how it should be handled. If we were only talking about water this conversation would have been over 4 hours ago.

mynameis 12 years, 8 months ago

A private dispute is news because? Oh I know! Because the homeowners are talking about the possible fall-out to the tourism product...Pay your bills you contracted to pay when you decided to purchase this "investment property" in The Bahamas! This is not news and it's not news because it has little impact on the reading public!

ChuckF 12 years, 8 months ago

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mynameis 12 years, 8 months ago

Disrespectful to who?? Please stop trying to make your personal issue a public debate, Chicken Little (ChuckF) [Now I admit being "disrespectful") SMT! The Chicken Littles of the world always believe that the sky is falling after being hit in the head with an acorn... Further more, as respected a journalist as Mr. Hartnell may be, one would assume that he also wrote what he intended to write and in my reading this article I see nothing about fraud...and a sensible man he is obviously to not have written such a thing...

palmbayvictim 12 years, 8 months ago

I guess you think Mr. Francis is just peachy. Lucky you. Enjoy Disneyland while you can... the bigger picture will eventually come out. You will then be eating your words.

sunshinedays 12 years, 8 months ago

The Bahamas water company just supplies water to the resort from its piping under Queen's Highway; it does not provide any kind of city sewer service.

For 2012, I am paying about $60 / month for my water and sewer service, which seems quite reasonable for an island like Exuma -- it would be reasonable for a large urban city in the US or Canada. That's about $720 per year. There are some owners at Palm Bay that feel entitled to get everything for free and not be responsible for any of the expenses of owning a property in an amazing place like Exuma.

I agree the above poster that taking disputes to public forums to appeal for sympathy from the Bahamian government (i.e. playing the "i'm getting treated unfairly, BUT this means that people will hate the Bahamas when they come here!" card) is a grade school tactic.

These people could install their own water lines and their own septic tanks and hire their own garbage men if they are so unhappy, but I think they pretty much realize that the costs to do these things would be ridiculously high.

ChuckF 12 years, 8 months ago

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ChuckF 12 years, 8 months ago

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palmbayvictim 12 years, 8 months ago

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exumawannabe 12 years, 8 months ago

I sympathize with all regarding breach of lease back, for those that only wanted investment. But also as article states these are Fee Simple property. I think it is each persons responsibility at this point to take control of their situation and do what you can to rent your property and maintain the upkeep. I understand some persons came into buying with no intention of dealing with the struggles and pitfalls of having a rental property, wanting someone else to take all responsibility and only reap the rewards, well hello..Economy is bad all over people.. Step up...this resort could be so much more...but it never will with anger and hostility..

ChuckF 12 years, 8 months ago

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BahamasInvestor 12 years, 8 months ago

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BahamasInvestor 12 years, 8 months ago

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exumawannabe 12 years, 8 months ago

Owners only meeting is a great idea...should have been done long ago...when people are ready to take responsibility..I say let's do it.

Even better than skype..if people are serious about their property..all that are able should set a date to meet during off season. If change is what is the order..and your property is a high priority...well we would have to see who would be willing to show.

palmbayvictim 12 years, 8 months ago

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exumawannabe 12 years, 8 months ago

I thought we were having some sort of discussion here...thank you dewdemdishes for your lack of judgement. You know nothing about me. What you should know is that I have worked my ass off to promote and rent my villa the best I can. Sitting around worrying about what Ron Francis is going to do for me seems insane.
Your issues started from the word "investment"...you have every right to be angry over your investment. But again..how's that workin for ya?

Maybe you should worry about the next step with your property and how you can turn it around and make some money!

palmbayvictim 12 years, 8 months ago

Do you have title? Do you pay the fixed annual fee?

exumawannabe 12 years, 8 months ago

I pay everything that is justifiable to keep my villa up and running. I would have never bought if I chose not to take full responsibility for my "investment". I pay everything that you pay...and from what i hear from this conversation probably more. But again that is my choice...until the day I feel that that there is a better choice or when owners want to make a real change, until then.. this is what I do to provide my guests with the best accommodation I possibly can...to me that is what is important.

palmbayvictim 12 years, 8 months ago

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exumawannabe 12 years, 8 months ago

Actually I hardly deal with with Ron Francis. That again is my choice. I think everyone here has a choice. We do have a choice to choose to rent on our own..( which is what I do) or to have outside management. The only thing you don't have a choice apparently is your water, electricity and trash. I do not know why you are angry at me. I do have a title, I pay all fees that others pay. The only choice I don't have right now is not keeping my villa running or letting my feelings go awry...

International_investor 12 years, 8 months ago

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Kelle28 12 years, 8 months ago

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International_investor 12 years, 8 months ago

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Kelle28 12 years, 8 months ago

My statement said it was "possible." Which means I am keeping an open mind and not allowing inflammatory comments to cloud to my judgement. I simply stated that it was worth checking into before adding fuel to the fire. I fail to see how wanting more information is an indication of bias rather than a sincere desire to be well informed.

Like all good journalists, Mr. Hartnell has used words like "alleged" and "claim." He presents the information as given to him and does not make his own judgement but rather leaves a place for intelligent analysis and discussion. He makes no assertions as to what is true, but rather presents both sides.

Some owners are satisfied, some are not. The bottom line is that we are all in this investment together. We share common areas. Most importantly, we share a common reputation. Publicly slamming Tennerdale, Ron Francis, or even the Water company, does not bring positive attention to our investment or to the islands.

Clearly there are some problems or commentators and the owners that brought this to the Tribune's attention would not be as aggravated as they are. The real question now is what proactive and positive steps can we take from here?

exumawannabe 12 years, 8 months ago

Peace out all...it's been real. Good luck to all!

Kelle28 12 years, 8 months ago

I've been an owner at Palm Bay for many years now. We pay our fees. We don't make a profit on our villa but we cover enough of our costs to make it reasonable for us. For the record, we are not related to the Francis family since that seems to be a point of contention for some owners as a way to discredit a sincere comment.

We pay our monthly fees and our indenture every year. We do it in a timely manner because let's be honest if you tried to not pay your fees in the US, you'd be cut off without so much as a warning notice and they certainly would not turn your services back on until you had paid in full.

My husband tried very hard to work with other owners to come to a consensus for productive and genuine improvements. Sometimes the owners were cooperative and other times they were deadlocked. Often, they did not even bother to log into the virtual meetings. What we consistently found was that Ron Francis was always willing to discuss the situation, he provided budgets and a variety of programs designed to meet owners needs. We also consistently found that some owners enjoyed arguing much more than working together to find a solution.

We all bought into Palm Bay because we fell in love with the property, the villas, the ambiance, and the people of Exuma. Why own somewhere you don't want to be right? We spend weeks there every off season because we like to max out rental potential in the high season. Every time we've visited, the property has been neatly maintained and our villa is always ready to welcome us... along with a cool drink at the Splash bar made by Anita or Tiny. These things have not changed.

Our property value in the US bombed when the housing market crashed... but I didn't call up my developer or my realtor and call him a fraud. All investments are risky. Don't want to take a risk... put your money in a CD.

In addition, we don't just rely on Ron and his staff to get our villa rented. We network with friends. We post the villa on home rental sites. We've given it to extended family for their use. There is much more value in the villa than just rental fees. We've never had a guest return from Exuma that did not find courteous service, a lovely villa, and a well maintained resort.

I am sure Mr. Hartnell did his research and because he is a respected journalist, I appreciate that he took the time to interview 10 owners. However, Palm Bay has more than 70 villas and their respective owners and not all of them are unhappy or feeling conned.

I appreciate that the Tribune allows for comments and public discussion so that all interested parties have a chance to share their views. Given the venom in some of the responses by unhappy owners, I hope that the tone of this comment and the consideration I have taken to be fair will be treated with the same respect that I have given to the other comments. Please only respond with productive remarks.

exumawannabe 12 years, 8 months ago

Wonderfully stated:)

palmbayvictim 12 years, 8 months ago

Do you have title to your property?

BahamasInvestor 12 years, 8 months ago

There appears to be two camps. One group is mistreated and the other is not. I suspect that those who had contractual issues and butted heads with the management have been treated poorly while those who have not had contract issues have been treated well. Those who have been treated well can't see why the others won't just pay. The "victims" can't see why they should fund a company that broke their deal and why others continue to fund it. Sounds like an owners meeting is overdue.

exumawannabe 12 years, 8 months ago

Yes..indeed.

mynameis 12 years, 8 months ago

An Owners' meeting might be overdue but based on the rhetoric in this forum, I'm not sure if much will be accomplished as it appears that the two groups of homeowners would be at cross purposes - the ones on this forum who are venting appear to be persons who will not be satisfied until steel bracelets are being applied to Mr. Francis and he is frog-marched through the streets of Exuma barefoot over a bed of hot coals specially prepared for him. Sooo counter-productive...

exumawannabe 12 years, 8 months ago

I thought this board was to speak about the water issue and from other posts started, some issues at Palm Bay. It seems to me most only want to hear one side of the story. If I do not bash Ron Francis then anything I comment on is not relevant. I have posted my comments regarding how I feel about Palm Bay thinking both sides should be considered and taken seriously. I have taken the responsibility of maintaining my Villa seriously and will continue.

I do not have any ill feelings towards anyone on this board..I do not know you. My ill feelings developed after reading these statements and realizing that there may be no hope for such a beautiful place...I find that very sad.

Water cut-off/fees battle tears apart resort project

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