Gulf Breeze City Manager Buzz Eddy sent out an memorandum today in response to series of articles on the financial status of the city-owned Tiger Point Golf Club.
The daily reported the financial losses for the Tiger Point Golf Club, which was purchased in 2012, have total $990,000 and “the projected deficit for fiscal 2015 exceeds the municipality’s entire general reserve fund.”
Eddy told Inweekly in a phone interview that the golf club is an enterprise fund and the losses have been paid out of the reserves of the South Santa Rosa Utility, not the city’s general reserve fund. He explained that the club was purchased in 2012 to give its utility more disposal area for the treated effluent from its wastewater plant that serves most of south Santa Rosa County -from Gulf Breeze to just west of Holley-by-the Sea.
“The golf course is an investment in the future of the utility,” said Eddy.
In his memo, Eddy reiterated why purchasing the golf course was a smart decision:
1) We can provide increased treatment capacity at the existing treatment plant for less cost than building a new treatment plant. If we did not buy the entire property, we would have been land locked out of expanding the plant on that site.
2) By expanding treatment capacity at the Tiger Point site, we will avoid adding significantly to
payroll costs compared to adding a whole new plant at a separate location.3) If we didn’t buy Tiger Point, the property would have gone into receivership and likely would have ceased to operate. This may have led to increased vacancy rates in the neighborhoods around the courses and decreasing property values. Higher vacancy rates and decreasing property values are bad for utilities.
4) Effluent reuse on the 325 + or – acres would have been problematic if the course ceased operations as irrigation systems fell further into disrepair. By owning the course, we can manage effluent disposal in the best interest of the utility and all of our customers. If the course had ceased to operate, we would have been attempting to spray irrigate a non maintained “field.”
5) What is good for the economy of South Santa Rosa County is good for the City. A well operated , attractive golf course at Tiger Point will attract tourists from the Beach to Santa Rosa rather than Escambia.
He said the number of rounds played are high, but the club still is not breaking even. He wrote, “We spent $2.9M to buy the course in Dec. of 2012. We spent about $1.5M correcting capital/structural deficiencies. Our operating expenses were higher than revenues by $320K in 2013 and $542K in 2014.”
The city has been considering rebuilding the West Course and Club House, but Eddy has asked the city council to hire a consultant “with experience in turning golf course around or shutting them down” to analyze the feasibility of rebuilding the West Course at Tiger Point and the club house.
“We need an objective analysis of Tiger Point and the local golf market and a plan that fits this market to make money at Tiger Point, ” said the city manager. “We need a management firm that can manage the property in accordance with that plan.”