SPSC Road Development, Repair & Maintenance Report

1.0     Purpose and Scope of this Report

An issue was raised through the Strategic Plan Input Process which asked:  “how should POATRI deal with the increasing need for new roads, road improvements, and road maintenance?”  The Strategic Plan Steering Committee (SPSC) agreed to provide a basic report of information and recommendations to assist the Board in determining if this issue should be addressed further.

To look into the needs for future road maintenance, we first had to review where we are today in order to establish a baseline and a frame of reference for future planning.  As a result our analysis we have expanded the scope of this project to include a summary of where we are today, our short term/intermediate needs, and the longer term issues that affect our future.

This report will provide a Summary of our Findings and Recommendations followed by a detailed breakdown of supporting information by category and the impact on POATRI.

2.0     Summary of the Findings

The SPSC has identified a number of issues in each of several areas with regard to current and future Road Maintenance for the ranch:

2.1          Policy Issues

2.1.1  Road Maintenance Definition and Frequency:  The only ranch policy that has been articulated is that the ranch will provide (road) access to all of the tracts of land defined by Terramar.

There is no policy definition with regard to the quality of that access (roads) or the frequency of maintenance.  Early property owners expected roads only for high clearance truck type vehicles.  Today, expectations include roads smooth enough for small low clearance vehicles, and road maintenance done every time it rains (one example source is property owners in the process of selling their land).  These changes and much higher level demands have had the largest impact on our road maintenance work requirements.

In addition the frequency of road maintenance is continually debated and overall road maintenance is a critical issue in every year’s Board election.  Further development, definition, and clarification of road maintenance policy is necessary both to inform and assist property owners set accurate expectations, as well as to provide the necessary guidelines for our General Manager to carry out road maintenance responsibilities equitably and in a manner to meet the needs of our property owners.

2.1.2  Gates and Barricades:  Current policy allows gates and barricades under certain conditions.  In some cases gates and barricades have been in place for some time and do not meet the required conditions.  There are approximately 6 property owner instances where there is a problem (in one of these instances there are 5 gates).  In all cases road maintenance is not performed on roads behind gates.  Therefore when property behind the gates changes hands and new owners want road maintenance, there can be a legal issue to remove the gate, and the roads are most likely to have severe damage resulting in a large road repair cost to the ranch.

In addition, there are references in corporate documents establishing the right of ingress and egress for all property owners and their guests to “all ranch roads”, which appears to be in conflict with the policy to allow gates.  All references to the right of ingress and egress, and the policy to allow gates should be reviewed, conflicts should be removed and the policy should be revised to conform to what is determined to be in the best interests of all property owners.

2.1.3  New Road Development:  New roads in subdivisions are, by Texas law, the responsibility of the original land owner.  However, at Terlingua Ranch, properties have been subdivided without the land owners filing the required county documents, and after some legal discussion, it is not clear what the responsibilities of the ranch are and whether it is cost effective to pursue legal action. 

In addition, the cost of road maintenance for the subdivision will exceed the new annual fees collected.  For example, a 40 acre tract, subdivided into 8 five acre tracts will provide ,160 in fees, while the road maintenance on the one mile of road development required, is calculated at approximately double this amount (in 2007 dollars).

POATRI needs to determine what practical options are available, what actions are in the best interests of our property owners, and how do we as an organization want to deal with both development and maintenance in these situations.

2.2          Budget Issues
2.2.1 Additional Road Grader:  A third road grader may be needed in the near term, and will most likely be required to meet future road maintenance requirements.  The current budget, augmented each by the cost of living index adjustment, will not meet the corresponding financial need.

2.2.2  Road Repair Projects:  There are at least two dozen “medium sized” road repair projects on the current action list which require non ranch equipment and services (bulldozer and sometimes dump trucks and road base material).  The current budget structure will support only one of these projects to be done each year, which means the number of areas needing repairs will grow faster than we are repairing them.

2.2.3  Road Rebuilding Projects:  There are several major road rebuilding projects, including Cedar Springs and Nine Point Wash diversions, the road between Corazon Peaks, the road leading to Section A around Cub Springs, and Big Bend Valley where road sections are 5 feet below grade, which cannot even be appropriately studied or planned within the current budget structure.

2.2.4  Subdivision Road Development:  If POATRI decides or is obligated to provide any new road development in subdivisions, there is no budget for this service.

2.2.5  New Road Development:  Any new road development requiring non ranch equipment and services cannot be paid for within the current budget structure.

2.3          Operations Issues
2.3.1  Buy vs Subcontract:  With the needs for additional road development, repair and maintenance, comes the issues of buy versus subcontract for the equipment or the entire service, and how to pay for which ever approach is chosen.  The options must be carefully examined and clearly presented to property owners.

2.3.2  Road Contract Work:  In addition, if the increase in subdivisions creates demand for contract road work, should POATRI be in that business and how should that business be set up?

3.0     Recommendation

The conclusion of this basic analysis is that these issues need further attention and we recommend that the Board and Management form a Road Maintenance Planning Task Force with appropriate resources to perform more thorough research and to develop solutions in all the areas affected.  We suggest that property owners should be involved in determining what our road maintenance policies should be and that alternatives and options be developed and voted on by property owners.

Supporting information for the issues outlined above is provided in the remaining sections of this report. 

4. 0    Findings and Recommendations by Category

4.1  Road Maintenance Definitions and Responsibility:  The only references in our corporate documents related to road maintenance are”

• The Maintenance Agreement, Section IV, Paragraph C
• The By-Laws, Article 2.02, Paragraph d.

These sections provide the same text – which is that the “Maintenance Fund”, and the “Activities of POATRI” respectively, may be used for (may include) “Improve and maintain roads that give access to , or are within Terlingua Ranch, or on properties  leased by POATRI.”  There are no other guidelines or definitions provided.

Input from property owners indicate the following range of beliefs and expectations as to what POATRI is responsible for:

• Grading all roads at least once a year.
• Grading roads for property owners when they call in advance of visiting their property.
• Fixing road damage immediately after rainfall (which means moving equipment away from scheduled projects and grading some areas several times a year).
• Smooth enough roads to avoid any damage from vehicle vibration (removal of ruts and washboard conditions).
• Adequate road access for all types of vehicle.
• In general, property owners expect access to their properties when they need it, in spite of whatever existing damage there may be to the roads or what the recent weather conditions have been.

4.2 Assessment of Current Road Conditions:  This assessment is based on input from Doug Fagg, the ranch Road Maintenance Supervisor, the experiences of Charlie Oaks and Art Eatman, described in the Sources of Information in the Appendix, and on input from a cross section of property owners with less experience.

• The overall condition of TR roads is frequently described as the best that they have ever been, and from long time owners - as good as they were during the 1980’s during the 10 year drought when there was little or no damage from rain. 
• There are still a number of roads, many of which are unused or are remote, that are not adequately maintained.  Many of the ranch roads were neglected for 10 years or more and require a major effort to bring the roads back to being usable.
• There are a number of roads where the weather and repeated scraping have created the need for road repair, consistent with the ranch repair project list, and several more areas that require completely rebuilding the roads and surrounding areas (building multiple water diversion dams, bringing in large amounts of road base material, etc.), again consistent with the identified rebuild areas.

4.3 Assessment of Current Road Maintenance Capabilities:  The current ranch road maintenance capability is based on the two newer road graders with supporting equipment and two road crews.  The full crew and equipment have been in place only since March 2006, and therefore the estimates made are based only on 9 months of data.  The following is a summary of the ranch’s estimated capability:

• Road grader availability is estimated at 39 days out of every two months (42 working days), with 3 days down time for maintenance and longer travel times between distant sections of the ranch. 
• Out of a 5 day work week it is estimated that the equipment spends 4 days grading roads in an area and 1 day out of a week traveling to new work sites.
• Since the study by the Natural Resource Conservation Service, and the hiring of Doug Fagg as Road Maintenance Supervisor, the practice of the ranch has been to utilize proper road maintenance techniques and this requires more effort and time that the previous practice of just scraping the roads.
• The General Manager estimates that two road graders are capable of grading approximately 1100 to 1200 miles of ranch roads once per year, but only if the work was performed in an organized rotational schedule, and there were no interruptions to work on road repairs or redo areas after damage from rainfall.
• However, interruptions are required both to work on road repairs in support of normal maintenance operations, and to redo highly traveled areas after rain damage.
• The Road Maintenance Supervisor states that with the increase in permanent residents, there are many more areas that now require repeat maintenance after every rainfall, and that a significant amount of normal road maintenance requires repair work as well, such as bringing in road base material, just to perform road maintenance correctly.
• Our Road Maintenance Supervisor estimates that two road graders are not enough to keep up with current road maintenance demands.  Furthermore, when road maintenance does not keep up with damage done by rains and vehicle traffic, and when road repairs and rebuilds are not done, there is a cascading effect resulting in worsening road conditions and high road repair costs.

These estimates indicate that there may be a need for a third road grader in the near future, dependent to some degree on any changes made to the road maintenance policies regarding road quality, frequency of maintenance, and scheduling of road repair projects.

4.4  Road Grader Costs:  The following costs are provided to estimate the impact a road grader would have on the budget:

From this chart and with information from other sources including new property owners, Ebay, and local realtors, we can provide the following:

• Property subdivisions have created the possibility of some 668 new property owners, and the sales of these properties generate demand for new roads.
• From1997 through 2004 the average number of tracts subdivided per year was 6, which then rose to 23 in 2005 and 45 in 2006.
• Correspondingly, the number of subdivided tracts from 1997 through 2004 averaged 14 per year and rose to 53 in 2005 and to 236 in 2006.
• In 2006 there was a substantial increase in subdividing tracts into 5 acre plots.
• In the past two years there has been a substantial increase in the sales of 5 acre plots and new property owners buying over the internet.
• A few of the new 5 acre property owners were contacted, and each of them indicated they intend to move to their property within the next few years to live there full time.

Appendix

Sources of Information

The SPSC gathered information from the following sources:

Corporate Documents

• Maintenance Agreement
• By-Laws
• Policies and Procedures Manual
• Strategic Plan
• Financial Statements and Strategic Plan Performance Reports
• TRIPOD Property Owners Record Keeping System

Personal Interviews

• General Manager, Alida Lorio
• Road Maintenance Supervisor, Doug Fagg
• Property owners with extensive road knowledge, Charlie Oaks and Art Eatman. 

§  Charlie Oaks contribution is based on frequently riding all ranch roads via ATV for over 30 years, including the 10 year drought during the 1980s when road conditions were perceived to be excellent due to the lack of rain.

§  Art Eatman’s contribution is based on traveling ranch roads for over 30 years, being a retired civil engineer, having in depth knowledgeable of the roads in the Solitario and maintaining 4 miles of his own road with his own equipment.

• Interviews with several property owners, both residents and non residents.
• Email exchanges with a small number of new property owners.

Other Sources

• Ebay
• Local Realtors

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