Officials at Haymaker Golf Course said last week that fee increases at the profitable course are driven partly by upcoming expenses, such as a $1.5 million payment on the clubhouse in 2013. The clubhouse is shown here in 2007.

File photo

Officials at Haymaker Golf Course said last week that fee increases at the profitable course are driven partly by upcoming expenses, such as a $1.5 million payment on the clubhouse in 2013. The clubhouse is shown here in 2007.

Haymaker debt payment influences fees

Golf course rates increase to cover clubhouse costs

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Haymaker by the numbers

Golf Fund unrestricted fund reserves

2007 $1,175,000

2008 $1,273,000

2009 budget for golf operations

Revenues $1,263,700

Expenditures $1,222,795

Net revenues $40,905

Source: City of Steamboat Springs 2009 adopted budget and Golf Committee Chairman John Vanderbloemen

2009 Haymaker rates

- Individual season pass: $1,025 through April 30

- Spouse add-on: $850

- Junior add-on: $175

- Junior pass: $300

- Punch cards: $435 for 20 nine-hole rounds or 10 18-hole rounds

- Daily resident fee: $48 for 18 and $31 for nine

- Non-resident rates: $98 for 18 and $58 for nine (June 12 to Sept. 13), $69 for 18 and $45 for nine (opening day-June 11 and Sept. 14 to close)

City initiates golf pro search

The city hopes to distribute by next week a solicitation for a golf professional at the municipal Haymaker Golf Course. A draft request for proposal, or RFP, was discussed and amended at a meeting of the city's Golf Management Committee on Thursday with the help of Professional Golfers' Association Employment Consultant Jeff Beaudry, who participated in the meeting by telephone.

The committee and city officials discussed establishing a response deadline between May 15 and June 1. They hope to make a selection by Nov. 1. The contract would take effect Jan. 1, 2010.

Current Haymaker pro Hank Franks said Thursday that he intends to respond to the RFP, depending on its conditions.

"We've had a great 12 years and want to extend it if we can," Franks said.

The decision to advertise the position was not based on any dissatisfaction with Franks but rather City Council direction during the budgeting process last year to re-evaluate all existing contracts as they expire. A March 16 memo to City Council from the Golf Management Committee stated that Franks continues to do a "very good job" in his role at the golf course.

The golf professional is hired as an independent contractor for the city and is responsible for hiring his or her own staff and serving as chief operating officer for the course, pro shop and practice facilities. The city paid Franks $81,000 to $86,000 a year from 2006 to 2008, which is in addition to revenues from other sources such as golf lessons and equipment sales. Golf course maintenance workers are employees of the city.

Beaudry said the response rate to the RFP might be affected by the economic recession.

"People aren't as mobile as they were three years ago because they can't sell their house right now," Beaudry said. "We're seeing fewer people respond to job opportunities who might otherwise be interested because of that."

— Fee increases this year for locals looking to play golf at city-owned Haymaker Golf Course were driven partly by the city's need to make a $1.5 million "balloon payment" on the course's clubhouse in 2013.

The city's enterprise fund for the golf course ended 2008 with an unrestricted fund balance of $1.3 million. Operationally, the course netted $98,000 in 2008. The city's 2009 budget projects a profit of $40,905. John Vanderbloemen, chairman of the city's Golf Management Committee, said the fee increases, annual operating profits and the large fund balance are appropriate not only to assure the golf fund's ability to make the 2013 balloon payment, but also to build a rainy-day fund for operations and a capital needs reserve. The committee and city officials particularly are concerned about the imminent need to repair or replace the course's 15-year-old irrigation system.

"We've got to make sure that, operationally, we make a profit," Vanderbloemen said Thursday. "We've been selling golf perhaps cheaper than we should. : I'm sure this is a tough year to be raising prices on people : but we felt this was something we had to do. : From Day 1, we've tried to operate it as a conservative enterprise."

Historically, proceeds from the city's 1 percent accommodations tax on short-term nightly rentals have been sufficient to cover Haymaker's debt service on the bonds that acquired, constructed and equipped the golf course, and the lease-purchase agreement that built the clubhouse. However, although the city makes biannual payments of $113,967 on the clubhouse, the final payment due on April 15, 2013, is $1,475,004. Bond repayments vary from $407,878 to $413,450, according to the city's 2009 adopted budget, and also expire in 2013.

The city collected $855,000 in accommodations taxes last year, more than enough to cover the $640,004 debt service. Because of the downturn in the economy, the city has budgeted $768,000 in accommodations tax revenue this year, but Deputy City Manager Wendy DuBord said she now wonders whether that was a large enough decrease.

"I suspect, based on what we're seeing from the economy, that the accommodations tax is going to be significantly less than what we've budgeted," she said. "We feel we are pretty conservative, but if accommodations tax went down considerably, we would be looking at using these reserves just to make the bond repayment."

Vanderbloemen said accommodations tax revenue would have to decline more than 25 percent from 2008 before the golf fund reserves would have to be used for debt service. Once Haymaker's debt is paid off, the golf fund no longer will receive accommodations tax revenue.

"The tax doesn't go away," interim Finance Director Bob Litzau said. "It will revert back to the city's capital fund for other above-ground tourist facilities."

Gripes

This year's fee increases - about 5 percent across the board for locals - were approved in a 5-2 vote of the Steamboat Springs City Council on March 17. Councilmen Jon Quinn and Walter Magill dissented. Quinn didn't want to see locals' rates increased. Magill wanted to amend the rates to provide a discount for city employees.

Resident Bill Jameson urged council to revisit the ordinance that created the five-member Golf Management Committee and remove a provision that gives committee members a free season pass to the golf course. Jameson said committee members voluntarily should have given up their passes before proposing fee increases.

"Why is this one committee, out of all voluntary committees, getting compensated with free passes?" Jameson said. "I would hope that you look at this ordinance."

City officials, however, said the free pass is appropriate because of the golf committee's workload. In addition to serving in an advisory role to the City Council like other city boards, commissions and committees, the golf committee also is charged with the actual management of the course, Litzau said.

"I think the golf committee deserves everything it gets," Councilman Steve Ivancie said at the council meeting.

City officials also have noted that, unlike most of their enterprise funds, the golf fund successfully has operated without subsidies from the city's general fund. DuBord said the last thing she wants to happen is for the general fund - and taxpayers who do not play golf - to end up subsidizing the course.

"This is an enterprise fund, and it actually works as an enterprise fund," DuBord said. "This isn't set up to try and make a lot of money for the city."

At the City Council meeting, President Loui Antonucci said fees need to increase annually to keep up with inflation and avoid the type of situation the city was faced with last year, when it was forced to increase water and wastewater fees by 50 percent after not increasing fees for 15 years.

"I don't want to end up upside down in any enterprise fund," Councilwoman Cari Hermacinski said.

To help reduce further rate increases for locals, Vanderbloemen said the golf committee has set a goal to increase the number of tourist rounds at Haymaker. Historically, tourists have accounted for about 20 percent of rounds played.

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