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Home My WebLink AboutSpecial 2011-09-27 COMPLETE AGENDA PACKETCitv of Tukwila Council Budget Work Session AGENDA AGENDA Tuesday, September 27, 2011 Foster Golf Links Clubhouse Meeting Rooms 6:00 p.m. 8:00 p.m. I. Golf Course 411 Fund A. Introductions and Overview B. Fund Status How we got here C. Policy Issues and Recommendations D. Course of Action E. Capital Improvement Plan F. Attachment G G. Council Discussion II. Discussion Summary Next Steps III. Adjourn x 9/26/2011 Foster Golf Links 11 foster GOLF L I N K S 9/26/2011 Golf Course, Pro Shop, Restaurant 4=01 foster Marty O'Brien PGA Head Professional Education Affiliations: B.A. in Fine Arts Life Member PGA �cw foster 2 9/26/2011 Warren Orr PGA Professional 14 year PGA Professional in the Pacific Northwest 8 seasons at Foster Golf Links 2 years at Inferbay Golf Center (Head Professional) 6 years at Hawks Prairie Golf Links (Head Professional) Education Affiliations: A.A. in Golf Course Management PGA Professional 4=0 foster GO L F L N K S Curt Chandler Superintendent 26 years specializing in Golf Course Maintenance Construction 8 years as a Turf Specialist with Simplot 18 years of golf course experience 7 1h year as Foster Golf Links SuperintendentEducafion Affiliations: B.A. in Public Recreation Golf Course Superintendents Assn. Northwest Turfgrass Assn. Board Member Inland Empire Superintendents Assn. President 4QW foster G 0 L P L t N K I 3 9/26/2011 40 Years in the Hospitality Industry 16 years with the worlds largest Private Club Management company, Club Corp. 12 years opening and managing facilities worldwide. 4 years at The Columbia Tower 4CW foster G O L F L 1 N KS Fund Status: How we got here Golf Operations Bond Payback Course Construction Closure Economy Weather Patterns 4=0 fester G OLF L N KS 1H 9/26/2011 Rounds Projected for 2003 Bond 60,000 Rounds with 2% Growth Annually foster GOLf :'INKS Policy Issues 1 Maintenance Building transfer of $650,000 2 Admission Tax 3 Director's Salary 4 Maintenance Building Cost 5 2003 Bond 6 Indirect Cost Allocation 1 foster 5 New Clubhouse Year 2000 1 2001 1 2002 L 2003 1 2004 1 2005 1 2006 1 2007 1 2 008 1 2009 1 2010 1 2011 1 ;Total 66,317 60,3111 57,4901 35,7641 53.0701 54,4491 55,1951 55,446 53,5651 51.9221 49,2021 50,0001 Projected Rounds 60,0001 61,200 62,424 63,6721 64,9461 66245 67,5701 68,9211 Rounds Under Projections (6,930)1 (6,751)1 (7229) (8,226) (11,381)1 (14,323)1 (18,368)1 (18,921) Average Cost of Round wicartl 241 241 241 24 241 24 241 24 Re (166,320)1 (162,024)1 (173,496)1 (197,436)) (273,142)1 (343,748) (440 (454,107)1 foster GOLf :'INKS Policy Issues 1 Maintenance Building transfer of $650,000 2 Admission Tax 3 Director's Salary 4 Maintenance Building Cost 5 2003 Bond 6 Indirect Cost Allocation 1 foster 5 9/26/2011 1- Maintenance Building -Transfer $650,000 In 2004, the City transferred funds into the Golf Fund Recommendation For the City to consider the transfer of funds for half of the cost for the Parks and Golf Maintenance Facility. foster GO L F L I N K S From 2005 to 2008, the City Council placed a temporary hold on collecting this tax. In 2009, the Admission Tax was applied to the Golf Course. Foster has paid $122,000 in 2009 -10 and will contribute another $60,000 (est.) in 2011. Recommendation For the City to temporarily or permanently relieve the Gott Fund of this tnx foster GOLF 2 9/26/2011 3- Director's Salary For years, the Golf Fund has paid a portion of the Park Director's salary. This is the only Special Enterprise Fund that pays a portion of the Director's salary. Recommendation Relieve the Golf Fund of this expense. foster G O L F L I V K 5 The maintenance building is equally shared between Parks and Golf. Since 2002, Foster has paid the entire cost of the maintenance building. Recommendation Have the Parks Department pay 50% of the maintenance building cost. _..9 19 9/26/2011 5 -2003 Bond i The 2003 Bond relied on a golf round projection of 60,000 rounds in 2004, with a 2% increase in rounds each year. Foster was scheduled for 68,921 rounds in 2011. Foster did increase rounds from 2004 through 2007. Recommendation Utilize a 301 Fund transfer to pay off the debt. The Golf Fund would transfer money back to the 301 Fund once the revenue stabilizes. foster GOLF L NK Indirect Cost Allocation (ICA) It is anticipated that the ICA will be less in the future with the efficiencies found city -wide and in the golf operations. The City Council will be provided the new information with their ICA annual review. The Golf Fund will pay annually as much of this as possible. f 0 9/26/2011 ECONOMY WEATHER 4=0 foster C; 0 L F L N K 5 Alternatives Remodel facility and create a driving range with 9 hole golf course Close the Golf Course and sell or develop the property 9 1 1 Outside management 9/26/2011 Course of Action -Round Projections- 2010 Rounds 50,000 2011 Rounds 46,000 (est.) 2012 Rounds anticipation of 50,000. This projection is based on historical precedent, current economic conditions, and the prediction of another La Nina weather pattern. Goal -To show an annual growth in rounds and return to 55,000 rounds by 2017 foster GO L F L I N K S Course of Action Marketing- Continue utilizing Social Media to connect with our members and guests: texting, Facebook, and email A greater emphasis in our community involvement and charitable assistance to increase tournament rounds and overall participation. Focused marketing to deal with our "soft" spots Create a flexible fee structure where the Director of Parks and Recreation can adjust fees accordingly to increase net revenue foster G 0 L F L N n S 10 9/26/2011 Course of Action -Reduce Expenditures- Staff reorganization Reduce Extra Labor Reduce various line items in supplies and services Share building maintenance costs 4 90 foster G O I. F UNK S 11 9/26/2011 Golf Enterprise Fund Attachment G 2012 2017 ANALYSIS IN OOO'S 7. 000 Rounds /Year Increase /Round Average Increase in Even Years Ill 112 11 11 1 112 11 2 11 111 122 111 111 11' 1,: 71 1 r 11 N 1, 2 21 21 11 1 2— 1 1. 1 711 1 113 l "I I I" t Conclusion Foster Golf Links is a valuable commodity to the City of Tukwila, its citizens, and the golfing community. We will continue to provide a great product and service to our guests as we weather the economic climate. 12 "I 21� 21ll is, "1 331 0 s 2 1� 1 11 ,1 485 Is, 1 al Ill I Dll Is" 1"13 1 "1 s2l lv Ull 220 'l, 12 22 Conclusion Foster Golf Links is a valuable commodity to the City of Tukwila, its citizens, and the golfing community. We will continue to provide a great product and service to our guests as we weather the economic climate. 12 x x ATTACHMENT G City of Tukwila GOLF ENTERPRISE FUND 2012 2017 Analysis in 000's IREVENUES 2008 2009 2010 2011 2011 7,062 Actual Actual Actual Budget Estimate Green Fees 1,099 1,034 1,018 1,200 1,020 Sales Tax (2l 500 328 330 225 225 Merchandise Sales 170 158 132 148 130 Power Cart Rentals 192 186 172 195 173 Concession Proceeds 50 19 80 120 120 Other Revenue j3) 75 31 24 24 24 Total Revenues 2,086 1,756 1,756 1,912 1,692 EXPENDITURES Operations Maintenance 1,587 1,634 1,551 1,871 1,692 Indirect Cost Allocation Debt Service (4) 634 378 335 339 339 Payback to General Fund lal 0 0 0 0 0 Subtotal 2,221 2,012 1,886 2,210 2,031 Golf Capital CIP Program 0 0 0 75 64 Total Expenditures 2,221 2,012 1,886 2,285 2,095 Cash Flow Year by Year (135) (256) (130) (373) (403) Carryover from 2010 620 610 220 425 425 Accumulated Totals 485 354 90 52 22 DRAFT 9 -26 -11 1,000 RoundsNear Increase $1 /Round Average Increase in Even Years 2012 2013 2014 2015 2016 2017 Total 1,070 1,091 1,164 1,187 1,263 1287 7,062 0 0 0 0 0 0 0 130 133 142 144 154 156 858 175 179 191 194 207 210 1,155 120 122 131 133 142 144 792 24 24 26 27 28 29 158 1,519 1,549 1,653 1,685 1,793 1,827 10,026 1,357 1,390 1,425 1,461 1,499 1,538 96 79 148 144 212 207 1,453 1,469 1,573 1,605 1,711 1,745 66 80 80 80 82 82 1,519 1,549 1,653 1,685 1,793 1,827 8,670 886 9,556 470 10,026 2011 2016 Financial Planning Model XXI I 09262011 ATTACHMENT G City of Tukwila GOLF ENTERPRISE FUND 2012 2017 Analysis in 000's REVENUES Green Fees 1 Sales Tax (2) Merchandise Sales Power Cart Rentals Concession Proceeds Other Revenue 131 Total Revenues EXPENDITURES Operations Maintenance Indirect Cost Allocation Debt Service (4 Payback to General Fund (5) Subtotal Golf Capital CIP Program Total Expenditures Cash Flow Year by Year Carryover front 2010 Accumulated Totals 2008 2009 2010 2011 2011 Actual Actual Actual Budget Estimate 1,099 1,034 1,018 1,200 1,020 500 328 330 225 225 170 158 132 148 130 192 186 172 195 173 50 19 80 120 120 75 31 24 24 24 2,086 1,756 1,756 1,912 1,692 1,587 1,634 1,551 1,871 1,692 634 378 335 339 0 0 0 0 2,221 2,012 1,886 2,210 0 0 0 75 2,221 2,012 1,886 2,285 (135) (256) (130) (373) 620 610 220 425 485 354 90 52 339 0 2,031 64 2,095 (403) 425 22 DRAFT 9 -26 -11 750 RoundsNear Increase $1 /Round Average Increase in Even Years 2012 2013 2014 2015 2016 2017 Total 1,070 1,086 1,153 1,170 1,240 1257 6,976 0 0 0 0 0 0 0 130 132 140 142 151 153 848 175 178 189 191 203 206 1,141 120 122 129 131 139 141 783 24 24 26 26 28 28 157 1,519 1,542 1,637 1,661 1,760 1,785 9,904 1,357 1,390 1,425 1,461 1,499 1,538 8,670 96 72 132 120 179 165 764 1,453 1,462 1,557 1,581 1,678 1,703 9,434 66 80 80 80 82 82 470 1,519 1,542 1,637 1,661 1,760 1,785 9,904 2011 2016 Financial Planning Model XXI I 092612011 DRAFT 9 -26 -11 ATTACHMENT G City of Tukwila GOLF ENTERPRISE FUND 2012 2017 Analysis in 000's REVENUES Green Fees t' Sales Tax (2) Merchandise Sales Power Cart Rentals Concession Proceeds Other Revenue (3) Total Revenues EXPENDITURES I Operations Maintenance Indirect Cost Allocation Debt Service t41 Payback to General Fund l� Subtotal Golf Capital CIP Program Total Expenditures Cash Flow Year by Year Carryover from 2010 lAccurnulated Totals 2008 2009 2010 2011 2011 Actual Actual Actual Budget Estimate 1,099 1,034 1,018 1,200 1,020 500 328 330 225 225 170 158 132 148 130 192 186 172 195 173 50 19 80 120 120 75 31 24 24 24 2,086 1,756 1,756 1,912 1,692 1,587 1,634 1,551 1,871 1,692 1 634 378 335 339 0 0 0 0 2,221 2,012 1,886 2,210 0 0 0 75 2,221 2,012 1,886 2,285 (135) (256) (130) (373) 620 610 220 425 485 354 90 52 339 0 2,031 64 2,095 425 22 500 Rounds/YearIncrease $1 /Round Average Increase in Even Years 2012 2013 2014 2015 2016 2017 Total 1,070 1,080 1,142 1,153 1,216 1228 6,889 0 0 0 0 0 0 0 130 131 139 140 148 149 837 175 177 187 189 199 201 1,127 120 121 128 129 136 138 773 24 24 26 26 27 28 155 1,519 1,533 1,621 1,637 1,727 1,744 9,781 1,357 1,390 1,425 1,461 1,499 1,538 96 63 116 96 146 124 1,453 1,453 1,541 1,557 1,645 1,662 66 80 80 80 82 82 1,519 1,533 1,621 1,637 1,727 1,744 8,670 641 9,311 470 9,781 2011 2016 Financial Planning Model XXII 0912612011