City Council Minutes 2014 01 14 SP

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City Council Special Meeting Minutes January 14, 2014 Page 4 of 14 • Restructured Golf Course Enterprise Fund from "WGP License" model to City-run model • Initial Assumptions: • Adjustment to loan repayment schedule • Pro Shop merchandise purchase (2014) • Maintenance equipment purchase (2014) • Golf Course reconstruction (2014) • City-run Golf Course operations (2015) Parks & Recreation Director Stevens outlined the golf course budget changes. The goal is to generate enough revenue to set up an enterprise fund to cover all the operating expenses of the golf course, pay back the debt to the water fund and provide 7% of gross revenue to the general fund to cover the overhead. Staff is currently working on a business plan and business model. At the open houses, the public has commented and made suggestions on the business model. The anticipated cost centers for Golf Course operations include maintenance; food & beverage, general & administrative and clubhouse. The anticipated revenue sources to fund operational costs include green fees; electric cart rentals; driving range; Pro-Shop sales; food & beverage; golf lessons and miscellaneous revenues. Parks and Recreation Director Stevens noted some municipally owned and operated golf courses contract out for food and beverage services. With in-house operations for food and beverage services, the risk is greater, but the revenue streams are better. Finance Director Watson explained Council passed the 2014 Budget, but now the estimates are being changed for budget amendments. The loan repayment schedule for the golf course to repay the Water Treatment Fund was originally $180,000 per year. Since there will be no revenue for 2014 from the golf course there will be no repayment to the Water Treatment Fund. In 2013, the City only received $90,000 from Western Golf Properties, making the payments to the Water Treatment fund $270,000 short through 2014. Those payments will be delayed until 2015, and increased to get back on schedule City Manager Fleming explained in order for the City to operate the golf course, the City would have to purchase the maintenance equipment or contract with a contractor to provide maintenance services as part of the overall contractual project. In 2014 and 2015 the golf course will have to be staffed and fully operational before any revenue can be generated. No revenues are anticipated from the golf course in 2014. COUNCIL QUESTIONS Council member Jasiak asked if the golf course would be open for parties and receptions and voiced her preference for the golf course to have multiple uses; parties, receptions, and snow shoeing, and cross-country skiing in the winter. Parks and Recreation Director Stevens explained with an enterprise operation, the higher priority is