We've Heard from 5 of 5 Landscaping Contract Bidders

Well, I've officially heard from the 5th bidder for the 2009 Edgehill landscaping contract.  It was Turf Tenders, a company out of Raleigh.  They were excellent communicators, friendly and knowledgeable of their services.

I had heard that their pricing was high for landscaping and grounds maintenance and shared with them that I'd heard it from others.  They confirmed they weren't cheap but they were good at what they did.  Given the range of the four previous bidders without offering details, I straight-forwardly told Turf Tenders that if their bid was topping the current high bidder for one year's service, they'd be uncompetitive with their bid.  Something told me they'd be close or over that amount.  And, since the other bids have been reviewed, it was fair enough to let them know the upper range for possible contract bid prices to save us both hassle.  I did not tell them bid amounts we currently have "in house" nor would I try to haggle them down on price.  I want their best shot up front.

To sum things up, they ran numbers on their end and politely let me know they'd be out of the running (of course, we'd decide that as a board decision on who gets hired) but their computer models pushed them away and would push us away in terms of pricing.

There's about a 10% swing between the highest and lowest bidder of the companies that meet ALL provisions of our "Scope of Work."

We have one bid that's low by about 20% from the next lowest bid but doesn't meet all of our Scope of Work.

Turf Tenders, who didn't really offer, could've been 30% to 40% higher than the previous high bidder.  That's a wide gap considering you're looking at four other companies  who say they can do the same work at a lower price.

As a matter of general policy, we try to solicit three bids on all jobs.  We met five companies to discuss future landscape needs.

Thanks to RS Fincher and Beth Harvey for helping out.  She really got the ball rolling.

I think it behooves Edgehill residents to enter a long-term relationship with a landscaping/grounds company where the contract is clear and easy to understand in terms of what we pay, what we expect and the service that's ultimately delivered.  Longer term relationships mean companies increase efficiency the more they're on our property - that fattens their bottom line and helps us avoid nasty inflationary price spikes when contract renewal and adjustment comes up every 365 days.  Every company  tells me the materials (seed, fertilizer) aren't what makes landscaping expensive, it's the man-hours spent on the job that determines a winning or losing contract and that's the landscaper's responsibility.

Five Landscapers Consulted......

"Turf Tenders" came out Monday afternoon to survey our common areas and prepare a bid to handle our landscaping services for one year.  Their representative was very straight-forward and communicated clearly.  We didn't talk money as I won't talk money until they play their card first.  That card is, of course, their bid proposal.

The larger landscape company sales pitches always include the desire to build a long-term relationship.  I agree because it's nice to have a vendor we can count on for weekly services AND know our exact costs for having those services provided.  The longer a landscaper owns an account, the better they know the property and the faster they can perform their weekly job.  Time is money to them.  I understand that profit margins are tight and there's lots of competitors out there if an HOA board will actively solicit bids.

While the Edgehill Farm Master Association will, by majority vote, decide the official landscaping contract that serves us in 2009, I don't think the decision will be based solely on the lowest-bidder.  Our scope of work lists so many small services that the low bidder may be low because he's not willing to provide a service we're requesting.

What if a bidder offers a great price but refuses to regularly water our flower beds (which have no irrigation) or wants $30-$50 per trip to water 8 flower beds they planted and promised to maintain?

What if a bidder can beat the competition on mowing and edging but has no experience with other forms of landscaping matters outlined in our scope of work?

What if a bidder won't get specific about when he'll perform some tasks, using adjectives like "regular scheduled times" or "routine basis" rather than using numbers - "once per week" or "three times per month?"

Should we, as a board, be willing to pay fuel surcharges on our monthly landscaping bill because gas pump prices reach a certain price?  Is that a fair concession for a small businessperson to ask of the HOA?

Is a one year contract needed or should we sign a multi-year deal with locked-in price adjustments to offset inflation BUT give the company a stable account and some protection for the HOA against rapid price spikes every year?

If you like a touch of good-natured negotiating, then this could be for you.  For any vendor the board selects, I want both the board and the landscaping company to feel it's a win-win situation.  I've found the companies to be friendly and reliable in communication.  That's an excellent first step.

The second step is to see how these companies propose to serve us WITHOUT us prompting them for an explanation of their terms.  A best proposal is a clear proposal.

If you have questions or comments, click "comments" below this posting.  A text box will pop up.

KMc

Cary Realtor Mike Jacquish discusses Foreclosure Buying

I literally Googled "Edgehill Farm" to see what was out there and who was talking about us.  I found Mike Jaquish, a Cary realtor who offered a nice write-up on our neighborhood at a website called "localism.com." 

He posts to a blog and even made a quick Youtube video that I found interesting on the topic of buying a foreclosed home to renovate and live in.  If you've gotta second, check out his opinion.  It may not pertain to you, but the topic is interesting given the rising foreclosure rates (hopefully not in our neighborhood).

As the Bids Turn........

Volunteering on the board is primarily an exercise of working the telephone and occasionally meeting a potential vendor literally outside your front door to check out a job.  Though it takes a little "homework time,"  vetting the initial round of landscaping contracts hasn't been that tough.  RS Fincher, the master association's property management company, has a "Scope of Work" document that it gives to all bidders that spells out exactly what we're seeking in grounds maintenance services.  

As of Friday afternoon, four bidders have offered a price to keep our grounds maintained for 2009.  Fontaine Landscaping, TSI Landscaping, Pine State Landscaping and Green Pro have all submitted proposals based on the "scope of work" document.  Turf Tenders, a Raleigh company, reviewed our specifications and want to tour Edgehill Farm early next week.  I'm interested to see their pricing.  By the way, the board pays for its groundskeeping in equal monthly payments over the contract's life.

What I'm learning is that many groundskeeping company literally earn their profits from the efficiency of working a property.  Their profit margins are slim until they "learn" all the nooks and crannies, then as they shave hours off the job (while keeping us happy), they earn more in "profit."  It costs us the same.  If a company can satisfy our community needs so efficiently that make more "money" off us, so be it.  We're having to cut the same check every month anyway.

If you have any thoughts on what we may need for landscaping, email me or leave a comment. 

KMc

Huntin' for a Landscaper......

We've began preparing for the next round of Landscaping contracts and boy it's quite a bit of work - volunteer, of course.

The Edgehill Farm Master Association entered a three-year deal with Fontaine Landscaping in 2006.  There have been few complaints about their service as the lawns are kept mowed and flowers planted according to contract.  But, that doesn't mean that we, as a community and as the board, shouldn't shop around for the best service at the best price for landscaping.

First - it's a huge contract.  It will be huge for ANY professional contractor we hire.  The grass alone is estimated to be 130,000 square feet of mowable area.  I have no clue how many small trees and bushes must be kept trimmed and the streets corners reveal that the walkway/lake/grass areas collect a large amount of leaves that are raked and blown a few times a season.

Our current contract is easy to read and understand.  The grass is mowed at regular intervals and the plants and flowers at the entrance ways are changed out twice a year and watered until they can survive on hopefully regular rainfall.  Rain drain pipes are kept clear of debris so water doesn't back up (but the current landscape contract says sticks and trash are "debris" but a rock blocking the pipe requires a separate $85 fee to move it).  The leaves are blown and grounds are aerated and overseeded yearly.

In the time since the board signed its current landscaping contract, we've added the extra service of twice-weekly scrapings of the paved walkway around the lake.  During "heavy" goose season, the guano REALLY builds up and is unpleasant.  It's a service that's earned rave reviews and a spot in the "Scope of Work" document we give to all potential landscape company bidders as a service we'll require as a term of the next landscaping contract.

I'm not ready to post the bidding terms on this blog regarding the bid prices offered by the competing companies.  As of today (11/21), four bids have come in for review w/ varying degrees of pricing and varying degrees of service as we interpret the bids.  Some contracts use precise language such as doing this or that service once or twice per month.  Others don't pin themselves down to numbers - using only terms like "routine basis" for when they'll perform certain landscaping tasks.  It takes some reading but I'm getting a great education along the way.  My major lesson is that nuanced contract language is likely vague on purpose.

Since handling the contracts for rehabilitating the Edgehill clubhouse, I've learned to appreciate specificity in bids without having to call a company a second or third time for clarification of their estimate.  The company that's clear in its intentions and firm in its pricing, I've found to be easiest with which to deal.  It's on the paper and it's not subject to the interpretation of contract verbage.

If you have any thoughts on landscape services for the lake area or other Edgehill common area, leave a message here or email me.  

99% of the Edgehill residents don't care and wish to bother with what's happening.  But, by not caring, many aren't ensuring the return on their monthly "tax" for living at Edgehill Farm.

Is Cash "King" or Leverage Better?

We had an interesting discussion on the board at the annual meeting about how the Edgehill Farm Master Association Board finances expensive projects that can't really wait to be fixed.

The first major project a few years ago was the swimming pool, which everyone says, was leaking heavily and earning us monthly water bills of $1,000 or more.  It was fixed and complete rehabilitated for nearly $80,000.  The Homeowner's board borrowed the money under a six-year (maybe seven - I wasn't around) loan.  It meant the board could repair the pool and preserve its reserve money (which wouldn't have covered the repair bill)  BUT meant we'd pay about $1,100/month for the term of the loan.  Monthly dues collections were enough to pay the note and homeowners weren't slapped with an assessment.

This past summer, the clubhouse reached the point of maintenance need that we could wait no longer.  If you ever walked in that building in recent years, you could smell what I'm talking about.  Over the course of six to seven regular board meetings, we solicited bids, authorized renovations and repaired the clubhouse.  Thank goodness our old pool loan was 80% paid.  We borrowed again - about $63,000.  $15,000 dollars (est) paid off the old loan and left us with about $48,000 to repair the clubhouse.  It basically refreshed the loan for another 6 years at $1,100.  No assessment, again.

So, we've had two major rehabilitation projects successfully completed in the past five to six years - repairs that could hold up for several years beyond the loan's life if we're diligent about maintenance.  We also have reserve money that's very slowly building up.  Our monthly dues mainly cover operational costs so we're not piling in the money towards the next repaving of walkway or other maintenance projects that really are much more extensive than average maintenance.

There is an opinion that we trim extraneous spending on nearly everything that isn't near-emergency or outright emergency in order to build that reserve fund.  I interpret that to mean that we keep enough money to pay 100% cash for most projects and forgoing any multi-year debt.  We have the $63,000 in debt due to the recent loan.  We have plenty of cash flow to handle that payment and everything else but we don't have $63,000 sitting in our reserve account in cold hard cash.  The argument is that since we have more debt than cash in reserve, our reserve fund for capital maintenance is negative dollars.

Is there anything wrong with carrying debt you can manage and debt that prevents you from losing "nest egg" cash?  Nope.

Is there anything wrong with collecting cash and trying to avoid floating ANY debt for repairs? Nope.

It's philosophical outlook and it's debates like this that we engage in at our monthly homeowners' meetings on the second Tuesday of every month.  Whether we like it or not, there will always be plenty of bills to pay regarding our HOA.

The fact on our finances is that borrowing money to cover big ticket repair bills has prevented ANY assessments which would've collected the total cost but hurt all homeowners like heck.  We've been fortunate to NOT have very expensive projects AND a high debt load.  If something truly big hits before we seriously pay down our existing loan - cash will be king and I'll NOT be looking forward to that meeting.  But, that hasn't happened.

We're beginning our work on a new landscaping contract............those are not cheap.

KMc

To Better Communicating - edgehillfarm.blogspot.com

First of all, thanks to Alex Hussain for getting Edgehill Farm a small slice of the cyberworld through Edgehillfarm.org

Second, thanks to Sally Flint for volunteering to join the 2009 Edgehill Farm Master Association. Her term, like all terms, are for two years. In something of a tradition, she was immediately selected as the board's vice-president. Don't let the Veep slot fool you. It's a great place to start because there's no bookkeeping to management, minutes to keep or gavels to wrap in most cases.

At the annual meeting on Monday November 17, 2008, two board members rotated off as their terms expired and Ms. Flint was elected with Kevin McMahon re-elected to a fresh two-year term. Interestingly, our board and those attending the annual meeting vote on board member candidates then the board members select who fills which seats on the Master Association board. The board re-determines which members hold which offices every year despite our terms being two years. Let it filter through your mind a second and you should find clarity.

Your monthly homeowners' dues will rise in 2009 to $37.80 per month.  

Sadly, electricity rates are jumping by double-digit percentages. The clubhouse, which Progress Energy deems a "commercial building," is charged under the commercial building electric rates. Our electric rates, even when we cut off lights and watch the thermostats, will top $500 every month based on that rate structure. I've unplugged appliances, lowered the thermostat settings very low but still warm enough to protect pipes and made sure lights are turned off. It's no use. I suspect operating the pool pumps, which is very necessary, is the culprit. The bills are easily covered but I was hoping for some serious savings. Oh well.

Also, everything else is rising in price too. The water bill rates (think of the pool), Landscaping rates (think of the grass and walkway) are going up. And we'll have a some leftover to save towards the next round of tremendously expensive maintenance projects. Think: paving the walkway before it crumbles, maybe and finally renovating the tennis courts (yeah, you've heard that one before) and the always unforeseen lake repairs and erosion control. I'll not mention the pool which was overhauled a few years ago. We need more money in our "reserve fund." Then again, we'll always need more money in our reserve fund.

By not attending monthly meetings or the annual meeting, you've missed some interesting discussions about fiscal strategies for handling large repairs and the large costs associated with them. That's another posting.

KMc