Agenda Packets - 1997/03/03 - Laserfiche WebLink

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• In the wake of the tax revolts, citizens in many communities, many of whom were golfers, demanded that golf courses become self-sustaining, or at the very least, operate on a break- 410 even basis. For a few communities this was a very large task. Golf courses were enormously seen as playgrounds for a comparatively small percentage of P the population. _ P In many cases budgets were cut to the minimum and staffing at the courses fell below standard. Once this happens,the golf course begins to feel the effects and golfers begin to see the effects. Reduced budgets meant very little money would be appropriated for capital improvements,if any at all. Once a course falls into a state of disrepair,rounds of play fall off,which obviously reduces the amount of revenue to be generated. This situation put many cities in a quandary as to what to do. Municipal courses :are often run from city hall by bureaucrats ill-equipped by training or experience for such a job. One urban . golf course manager,who prefers,understandably,to remain unnamed,remarked, "most city bureaucrats simply don't have enough business sense to run a complex operation like a golf 1 course. 1 When it became apparent that some cities,as well as some country clubs,were having problems managing their courses, private management firms seized the opportunity and became a permanent fixture in the golf industry. Led by American Golf Corporation of Los Angeles; : Calif., and Club Corporation of America (CCA), private management companies gained a foothold in running many golf courses. Today there are more than a dozen firms operating in the United States—some rather small,while others have grown rapidly,most notably American Golf. Some firms deal only with certain segments of golf course operations,such as California Golf Centers which focuses on golf shops, or others that concentrate their effcm- in CCYlicsa maintenance. - LEASING A GOLF COURSE Before the trend of total facility Ieasing became a part of the golf industry, there had always been separate agreements made between parties that desired to operate certain segments of a golf facility. The most common arrangement is an agreement between a golf professional and course owner (public or private)to operate and maintain a pro shop providing certain services to the golfing - public.Usually these services include golf instruction,repair and storage of equipment,rental of golf cars,and the sale of golf equipment and clothing.If there is a driving range at the facility, it is included. A general condition of a contract such as this is for the golf professional to receive an annual salary for services rendered while,in return,the course owner receives a percentage of all gross receipts derived from sales. Another common lease arrangement is for food and beverage operator to maintain and operate any existing dining concession. Conditions of the agreement are like the golf professional contract and, in many cases, the food and beverage operation is part of the golf 40 pro's responsibility. _