Munis face challenges from many fronts

Golf Course News, Oct 2002 by Rice, Derek, Overbeck, Andrew

Moreso than other types of courses, municipal golf courses face challenges from many directions. Residents want to be sure their tax money is being spent wisely, while owners of other courses in the area want to be sure they aren't getting squeezed out of the market by an owner - namely a city, county or state - with deep pockets.

Occasionally, local owners will call on their local chapters of the National Golf Course Owners Association (NGCOA) for help in opposing municipal projects if they feel the municipality is acting irresponsibly, according to Curt Walker, executive secretary of the Midwest chapter of the NGCOA.

"There are pockets of responBible and irresponsible proposals, and I think plumbing those is the job of owners in that particular market," Walker said. "If they then decide to ask for help in opposing those enterprises, various forms of help are available to them."

More than once, Walker has been asked to get involved in such a debate, but always on the local level, since, as he said, municipal golf by its very definition implies locality.

"I really don't think municipal golf is a generic term. It is a local term, and each situation probably has a unique analysis, a unique discussion and a unique concern to owners in that market," Walker said.

While there is no real generalization of municipal golf as either good or bad, there are many examples of specific projects that have gone both ways. On the down side is North Links Golf Course in North Mankato, Minn., which Walker has called "the poster child for failed local enterprise." Built for $6.6 million in the early 1990s, the course suffered from overspending-the clubhouse cost $1 million and one bridge was $300,000 -until the course was foreclosed upon in 1995. It has since been purchased by Wilson Golf Group of White Bear Lake, Minn., for $2.3 million.

But for every North Links, there is a Black Gold Golf Club (Yorba Linda, Calif.) or Pennsauken Country Club in Pennsauken, NJ. Both of these clubs have been able to turn a profit and keep local criticism to a minimum.

Black Gold, which opened in November 2001, faced some vocal opposition during construction. A group of residents resented the city's spending nearly $24 million on the course, which was a valid concern, according to Eric Lohman, Black Gold's director of golf.

"There were a few people who spoke out openly at city council meetings, and if anybody knows anything about city politics, that's usually the case," Lohman said. "In this instance, they had a valid point, but the city had already spent an awful lot of money on something that may have seemed a bit risky."

Since opening, however, Black Gold has exceeded expectations, Lohman said.

"We had budgeted for 52,000 to 53,000 rounds in our first year, and we're going to end up doing about 60,000," Lohman said. "I think that's really silenced everybody. We haven't heard any complaints in the last seven months, let's put it that way."

Lohman, who has worked for OB Sports and American Golf Corp. in his career, said working for a municipal course is different from any other experience he's had.

"When you deal with city politics, all major expenditures have to be approved by the city council," he said. "There were times when people wanted to see us not succeed, but here, from the first month on, we were able to give money back to the general fund and pay down our debt."

Bob Prickett, general manager and superintendent at Pennsauken CC, has had a similarly pleasant experience. The township of Pennsauken paid $1.2 million for the course, which used to be known as Iron Rock, back in 1981. Today the course, which gets about 55,000 rounds a year, is worth $10 million.

"From day one, it has been in the black and it has made the township extremely happy," he said. "There are no tax dollars involved and there never have been."

The course has made several capital expenditures over theyears,building a new clubhouse, a tunnel under a major highway that bisects the golf course and several new tees and greens. Course upgrades will wrap up with the installation of a new irrigation system and the renovation of other old greens and tees. Improvement projects cost the course an average of $250,000 a year.

Prickett said the facility, which takes in nearly $2 million a year, pays for all of the improvements with course revenues. The course currently pays the city $50,000 a year in lieu of taxes.

"Once the major capital projects are completed and we pay back the bonds, the township will see about $500,000 a year from our revenues," Prickett said. "With the bonding and the capital outlay, the place has been running like a charm since 1981."