Quote from Laurie Matthews on July 14, 2025, 3:57 pm

Dear Bayside Community Homeowners,

We hope you are having a wonderful summer and enjoying the many amenities that Bayside has to offer.

As part of our commitment to transparency and collaboration, we’d like to share a brief update on additional discussions between the Bayside Community Association Board of Directors, the Shared Area Working Group (SAWG), and Carl M. Freeman Companies (the Founder).

As noted in the April Bayside Founder Update, the official transition of community governance - from a Founder-appointed Board to a homeowner-elected Board - was completed in December 2024. Since that time, the Founder has continued to work with the Board and SAWG to address unresolved matters.

Key Areas of Focus Include:

HOA Reserves Funding Update

The Founder has previously addressed concerns regarding Common Reserve funding levels in meetings with the Owner Directors, the Finance Committee, and in earlier Founder Updates since 2020 when this issue first arose.

With over 20 years of community development, Bayside continues to demonstrate a strong and resilient financial foundation. Since the Association’s inception, the Founder has voluntarily contributed over $700,000 in financial support - most recently $200,000 in 2021 toward the townhome paint and roof programs. These voluntary contributions reflect the Founder’s long-standing commitment to the success and stability of Bayside and ensured the strong financial standing the Association currently enjoys. Despite four years of back on forth on this topic, the Owner Directors and Finance Committee increased their funding request last year by more than 300% to $1.2 million. The Founder remains confident in its commitment to the Charter’s requirements for reserve funding and has consistently fulfilled those obligations throughout the development of the community. The Association is financially strong, with approximately $5.6 million in cash and short-term investments across all entities at year-end 2024 and a target of $1.3 million in Fund Balances (also referred to as operating reserves) - which is 50% above the recommended two months of operating reserves outlined in the Best Practices Report for Financial Operations published by the Foundation for Community Association Research.

Nevertheless, the Founder conducted another comprehensive review of current reserve levels, projected expenses, and long-term needs at the request of the Board. Following that review, the Founder has reaffirmed that no additional reserve contributions are warranted from the Founder. This position is consistent with previous communications and reflects both the Association’s sound financial condition and the Founder’s confidence that the community is well established with a solid foundation for a stable and sustainable future.

For additional context, see page 4 of Best Practices Report #4: Financial Operations by the Foundation for Community Association Research.

Street Drainage Summary

Many of the intersections in question have been under HOA management for over a decade, with some originally installed nearly 20 years ago. While most roads in Bayside have been inspected and accepted by Sussex County as completed, the Founder has remained engaged in supporting the community's efforts to understand and address standing water concerns in certain intersections.

To assist in this matter, the Founder engaged engineering consultants from GMB, who conducted site visits, participated in meetings with the Association and homeowners, and provided additional engineering analysis. The Founder appreciates the time and effort members of the GOC have dedicated to this issue, and although the recent request to fund the installation of valley gutters in multiple intersections was reviewed and rejected for several reasons as explained in prior meetings, the Founder continues to engage with members of the GOC to find a cost-effective resolution to the homeowner concerns.

Community Parking Counts

The HOA requested additional information regarding parking counts and County requirements for the Bayside Community as a follow-up to the Founder’s initial response to this question. The Founder is compiling additional information and will provide more details when they are available.

Dissolution of the SAWG

The SAWG has been a valuable liaison since discussions to restructure and simplify management of the shared areas began last May. While the Founder understands the SAWG was an advisory group, its collaboration with both the Board of Directors, HOA Committees and the Founder helped narrow the discussion around modifying and simplifying the shared area structure. Although the SAWG has dissolved, the Founder remains engaged in discussions with certain Board members on this topic.

Coastal Crossing Phase 2

As previously communicated, the Founder’s construction schedule is tightly coordinated with the U.S. Fish and Wildlife Service and adheres to an Eagle Incidental Take Permit. Because the area is within close proximity to an active bald eagle nest, construction is restricted during the nesting season (December 15 – June 30) to minimize any potential disturbance to the eagles and their habitat. With nesting season coming to an end, we have two main areas of focus for completion in 2025 within Coastal Crossing Phase 2.

1)  Top Paving:  The Founder, in coordination with our builder partner, Schell Brothers, have begun the necessary preparations for top paving Coastal Crossing Phase 2. This includes necessary curb replacement, sidewalk replacement and roadway repairs, as required by Sussex County. We anticipate all prerequisite repairs and final top pavement to be completed in 2025. A detailed schedule will be shared with the Association, once determined. Please pardon our mess while work is underway and exercise caution. We appreciate your support and patience.

2)  Common Area Drainage Improvement: The Founder will be modifying the open space behind Lots 774-773 and 767-770 to improve grade and drainage. This effort includes adding additional drains to tie into the existing inlet. The work will be completed by Sullivan’s Landscape and is scheduled for July.

Fassett House Inn & Spa

Carl M. Freeman Companies had been working closely with Beacon Hospitality to advance pre-construction efforts for the planned Fassett House Inn & Spa. Recently, Beacon Hospitality made the difficult decision to indefinitely pause work on this project. We appreciate the time and effort Beacon has invested in their effort to bring a high-quality hotel and spa to Bayside, and we wish them continued success in their future endeavors.

With the site now under the direction and control of Carl M. Freeman Companies, we are actively pursuing new opportunities that will contribute to the Bayside community while maintaining the site to a standard consistent with the quality of Bayside. We look forward to sharing future updates as we work toward the next exciting chapter for this location.

As always, the Founder continues to support Bayside’s long-term success with our shared goal of finalizing outstanding matters constructively and in a way that upholds the founding vision for Bayside.

We wish you a happy and safe summer!

Live Bayside,

Carl M. Freeman Communities