Agenda Packets - 1997/03/03 - Laserfiche WebLink

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I ELEMENTS OF A CONTRACT In any discussion of contracting golf course management to a private operator,it must be note that no two golf courses are the same, no two operations are the same; nor will all leas agreements will be the same. However,there are certain elements of any lease that should be included and a brief description of these key elements follows: RENT Probably the single most important element in any lease. It is the amount to be paid by lessee for the use of the property to be rented. The rent amount may be paid in a number of different ways. A set rate,established by the lessor,is paid at a given time for the term of the agreement. $2,000 per month, or $20,000 per year are examples of a flat rent. Set-up rent calls for an increasing amount over the initial rent at predetermined intervals. Example: $2,000 per month for the first 12 months;$2,500 per month for the next 24 months;$3,000 per month for the next 24 months,etc.Apercentage lease is a type of agreement which usually provides fora minimum fixed rent plus a percentage of gross receipts paid from certain aspects of golf operations such as green fees, golf cars, food and beverage, etc. CAPITAL IMPROVEMENTS For many communities the need for capital improvements is the sole reason for entering into a lease agreement with a private contractor,so it should be looked upon with great importance. In many cases,the NGF found that,because of budget restraints, cities did not have adequat� appropriations for making the necessary capital improvements. If this is the case, then a program of improvements to the course should be included,outlining when such improvements will be made and what the dollar amount will be. TERM The term of any contract may be for any length of time that is mutually agreed upon by both parties. If there is to be a large capital improvement program,the lessee will usually require a long-term contract. In most instances, there is an option to extend the lease, providing the lessee has met all previous conditions in the initial term. TERMINATION There should be a clause in the contract that allows either party to terminate the contract by mutual agreement.. The termination notice should be well enough in advance so either party can make arrangements for the efficient change in operation. PAYMENT • - A clear established method of payment including a schedule for such payment must be stated. It is very important that each party knows when and how much is to be paid. RECORDS