September 2, 2015 – The city of Redmond looks like it will give CourseCo, the golf-management company that has run Juniper Golf Course the past 4½ years with mixed results, a mulligan.
Redmond’s golf committee unanimously recommended Tuesday that the city continue negotiations with CourseCo, which is seeking a new contract when its current agreement with the city expires Dec. 31.
Michael Sharp, CourseCo’s chief operations officer, said his company is more than willing to invest in capital improvements at the city-owned golf course, as well as pay for part of Juniper’s debt service and share operating losses with the city if they occur.
“We’re willing to go all in here,” Sharp told committee members. “We believe in the future of Juniper.”
Since 2010, the city has made all the golf course’s debt payments, which right now equal about $34,000 a month or $405,000 a year. Juniper still owes $4.5 million on its original construction note, which will run until 2033. A smaller loan, on which Juniper owes approximately $470,000, will be paid off in 2026. CourseCo, which the city pays $115,000 a year to operate Juniper, kept the course in the black for two of its first three years managing it and even contributed to part of Juniper’s loan payments.
The city has had to contribute money to the golf course’s operating costs the past two fiscal years, though, as rounds and memberships are down. Total rounds played, for example, have dropped 15 percent over the past four years – 32,947 rounds were logged at Juniper during the 2011-12 fiscal year compared with 28,152 in 2014-15 – and full memberships are down from 171 to 137 over the same time period. Revenue dropped 8 percent during that stretch and expenses fell by 4 percent.
With CourseCo’s current contract up at the end of the year, Redmond’s golf committee has held a public meeting and sent out a survey to better understand what the public wants from the course. Based on those discussions, the committee put together several key points it hopes to see included in the city’s next contract with CourseCo or whomever the city chooses to run Juniper, the most important being the need to reduce the city’s financial risk.
The five-person committee also discussed putting in measurable benchmarks for CourseCo to hit in a new contract – goals for the number of total rounds played or new members, for example.
“We want to make sure, though, that these are realistic performance measures,” Annie McVay, the city’s parks and administration division manager, warned the committee. “We don’t want to try to impede them from being able to perform their jobs.”
In talking to other communities that run public golf courses, McVay said most officials she spoke with were just happy if they didn’t lose money.
“It’s pretty bleak for municipal courses out there,” she added.
Committee member Matt McGowan pushed for a third party to look over a proposal CourseCo presented, which included the California-based company bringing in some capital investment of its own and sharing in operation losses if the course fails to make money, debt payments not included.
While most committee members acknowledged another set of eyes looking over contract details couldn’t hurt, they would instead prefer to move as quickly as possible with CourseCo’s current deal nearing an end.
“We need to make a decision,” said committee member Don Noldge. “There’s a lot of uncertainty out there (at Juniper), people wondering if they’re going to have jobs. That uncertainty is affecting everyone.”
With the committee’s endorsement, Sharp said he hoped to have a new deal with the city in the next 30 to 60 days.
“We want to be a true partner here,” Sharp said. “We want to show our commitment to Juniper and to the community.”