DUNEDIN — Faced with the prospect of losing substantial operating revenue into next springs’ peak golfing season due to the city taking much longer than expected to build a cart barn and pro shop, the Dunedin Golf Club asked city officials to offset losses with $60,000 amassed in the golf club’s capital replacement fund.
After much discussion, commissioners unanimously approved the request to keep the operation running.
An initial city plan to simply re-roof the cart barn and pro shop turned into a major capital improvement project, now facing cost overruns and taking a much longer time to complete. As a result, the course has suffered from lack of play, significantly impacting revenue. The club has to use staff to transfer carts from a makeshift tent to the clubhouse, twice a day.
In May 2017, the city approved a three-year lease agreement, with an option for two additional two-year extensions, with the Dunedin Golf Club.
As part of the golf course license agreement, the parties agreed to set up a capital replacement fund that can only be used for capital improvements and repairs on the golf course property.
The fund is contingent upon 3 percent of the revenues from gross receipts by the golf club from membership dues, green fees, fees from personally owned golf carts and rental of club-owned golf carts.
The golf club has been paying installments into the fund, but now faces a revenue shortfall due to the amount of days the club was closed for business this past summer, and the displacement of the pro shop and cart barn, said Vince Gizzi, parks and recreation director.
At a Nov. 19 meeting, Gizzi told city commissioners the golf club board of directors is asking the city commission for approval to use a portion of the capital replacement fund in the amount of $60,000 to pay for club operational expenses, leaving a balance of approximately $25,000 in the fund.
The $60,000 will get the club through the end of its fiscal year.
“This request is being made due to loss of revenue during this past summer resulting from severe rainfall and expenses incurred while the cart barn is under construction. The DGC will make every effort to reimburse the fund to meet the future threshold of the agreement,” Gizzi said.
Funds will be used to pay operating expenses, bills and to make payroll.
Ken Nyhus, Dunedin Golf Club general manager, said staff has “worked extremely hard to turn things around at the golf club.”
Additional costs incurred to transport the golf carts back and forth has really taken a toll, he said. “We did everything in our power to minimize expenses and maximize revenue, but the two just are not meeting right now,” he said.
Mike Bowman, golf club president, said the course had to shut down for 24 days during the summer. “Summertime is not our busiest season, but it hurt,” he said. “We set aside a good amount of money to get through the summer and we really had to hit it pretty hard.”
Club officials think the cart barn construction had some responsibility in loss of revenue. The number of golfers who pay $40 to play a round of golf has diminished.
“In the summertime and wintertime, where we make our money is from fee golfers who pay $40 a round. We lost about $37,000 in fee players between 2018 and 2019. We took a real hit (with a fee player loss) pushing $40,000,” he said.
Making the future look even more bleak is the fact that construction will still be taking place on the cart barn this February to March, which are the busiest months of the season.
Gizzi said the cart barn will not be substantially complete until mid-March, the middle of the fee golf players’ season.
Commissioner Deborah Kynes said the cart barn “has been the longest running building. I don’t know why. It does bother me that (construction) is going to go into the biggest part of their season in March.”
Commissioner Heather Gracy said as a golfer, she tries to get on the course as much as possible, and she sees the golf club staff working “and it’s got to be the most in inefficient process I have ever seen.”
Commissioners also wondered why the grounds around the construction site have been allowed to become unsightly and overgrown.
“People are wondering why we are not calling code enforcement on ourselves; some of those weeds around the construction materials are waist-high,” Gracy said.
“I continue to be bewildered why we can’t put a cart barn there, when we have a stadium and we are designing all other kinds of projects in this city. I’m supportive of keeping this investment going, but disappointed as well. We can do better than this and we have to do it,” she said.
Mayor Julie Ward Bujalski asked who is monitoring condition of the property. City Manager Jennifer Bramley said it’s a fenced construction site with access only allowed by the public works department.
“I did talk to some of our folks in public works about cutting the weeds, and we will go out there and do it again to keep construction site grass short,” she said.
The mayor said people shouldn’t be “sitting around and staring at it looking like crap. All I hear about is how terrible it looks. We can do better.”
Bramley said what began as a simple re-roofing turned into an entirely new building with escalation of costs. What started out as an estimated $200,000 project is way over budget, nearing $700,000.
City officials continue to work to complete the project, while containing the costs and figuring out how the city is going to pay for it, Bramley told commissioners.
Commissioners unanimously approved allowing the Dunedin Golf Club to use $60,000 from the improvement fund to remain in operation.