Fort Walton Beach Council minutes — 06-17-08 special minutes — reading text

does for other city property. Joe Herzig, 128 Clements Street, questioned why the golfers have to pay for Council's predecessors mistakes. Lee McDonald, 10 Ru de Ie Roi, commented the golfers opposed the clubhouse and revenues declined two years ago when there was an increase in fees and lost membership. He believed the only way to get them back is not by increasing the cost. John Franklin, 221 California Drive, asked why the General Fund could not pay off the bond then loan the Enterprise Fund the money to pay it off and reduce the debt service to the clubhouse. The City Manager said the General Fund could payoff the debt then make a transfer to the Golf Fund to pay it but she did not believe there is significant money in the General Fund to pay it off at one time. Mr. Franklin asked about the $ 2 million received from the sale of the fairgrounds. The Mayor explained that money was used to payoff the bond for the purchase of the fairgrounds property. Mike Carpenter, 338 Cherie Court, expressed his belief when the clubhouse was built that there is a railing and raised area with wiring and computer drops installed in the cart barn so it could be used as an EGC by the City during a hurricane. The City Manager stated it was not constructed for that purpose. As no one further from the public wished to speak the public comment was closed. Mr. Minich moved not to budget a transfer from the General Fund to the Golf Fund for clubhouse debt service payments. Mr. Garvie seconded motion and it carried unanimously with Holmes, Miller, Reeves, Garvie, Pullen, Hartwell, and Minich in favor. 1 78 Special Council 6- 17 -08 POLICY ISSUES cont. EQuity in Pooled Cash Policy Issue: How should the Golf Fund' s negative equity in pooled cash be eliminated? The presentation included information that the City' s auditors have commented in the last three years' audits about the Golf Fund' s cash flow deficits and deficit unrestricted net assets; that the Golf Fund' s unrestricted net assets, that portion of assets available for use, have been negative every fiscal year since FY 2003; that the Golf Fund' s equity in pooled cash, that share of the City' s investment and checking accounts, is estimated to be negative $ 356, 000 at 9- 30- 08; and the Equity in Pooled Cash represents the cumulative effect of losses of the past several years. Staff recommendation is to budget forgiveness on half of the Golf Fund' s negative equity in pooled cash balance as of 9- 30- 08 in FY 2008- 09 ( estimated to be $ 178, 000) and the other half in FY 2009- 10 estimated to be $ 178, 000) which will require a transfer from the General Fund' s undesignated fund balance. It was further explained that both actions will require a transfer from the General Fund' s undesignated fund balance; that the transfer will fix the problem as of 9- 30- 08 but if nothing is done to increase revenues or decrease expenses and there is a negative next fiscal year then it will not correct the problem in the future. The Mayor opened the floor for public comment. As there was none public comment was closed. Mr. Reeves moved to budget forgiveness of half of the Golf Fund' s negative equity in pooled cash balance as of 9- 30-08 in FY 2008- 09 ( estimated to be $ 178, 000) and the other half in FY 2009- 10 estimated to be $ 178, 000) which will require a transfer from the General Fund' s undesignated fund balance. Mr. Holmes seconded motion and it carried by a vote of 6 to 1 with Holmes, Miller, Reeves, Garvie, Pullen, and Minich in favor and Hartwell opposed. POLICY ISSUES MembershiD Differential Policy Issue: Should City and County residents pay different membership rates? The presentation included information that since FY 2000- 01 membership is down 53% or 425 members, there are currently 181 City members (down 69%) and 193 County members (down 9%, County members comprise 52% of memberships; that the Golf Fund is an Enterprise Fund, meaning it does not receive any property tax revenues and should be self-sustaining, in this regard, it does not make sense to base fees on residency; and water service, another Enterprise activity, to Cinco Bayou and portions of the unincorporated County is provided at a 25% surcharge. Staff recommendation is to modify County resident membership fees to be 25% more than City resident membership fees. There was some discussion on the additional revenues anticipated, a comparison of membership fees with local courses and benchmark cities, and clarified that the City does not dedicate any portion of ad valorem taxes to Enterprise Funds which are typically user fee driven. The Mayor opened the floor for public comment. Thomas Jones, County resident in Shalimar stated if the City raises his membership fee to $625.00 a year then he will go to Shalimar Pointe. He thought the City would lose enough members to off-set whatever gains they made by increasing the fee and they would lose revenue in green fees and at Two Trees. Mike Bridwell, 395 Canterbury Circle, said he dropped his membership this year because he found out as a retired military he could play cheaper on base and asked if it was taken into account that the military dropped their rates by almost 4001c>to help the local retirees. Special Council 6- 17- 08 179 POLICY ISSUES cont. MembershiD Differential Mr. Bridwell further commented they have to take into fact not just the local courses but what the military bases offer the military and suggested the City might want to think a little further about the military community. He said in part he agreed with what the City is doing but a higher increase will drop more people and if they want more play, they have to make it more affordable. Richard Garner, resident since 1959 said he has play golf for 40 years and worked at the golf course as a marshal for six years. He said he would pay to park out there and suggested parking meters be put in. As no one further wished to speak public comment was closed. Mr. Minich moved to modify County resident membership fees to be 15% more than City resident membership fees, and grandfather in all current County members as long as they continue their membership. Mr. Garvie seconded motion. Discussion included an exchange of views on whether or not the 15% increase will accomplish the intended purpose and will alienate golfers; and included suggestions that what is needed to increase revenues is to promote the golf course, increase golf cart rentals, and increase tournaments. The Mayor called for the vote on the motion and it failed by a vote of 2 to 5 with Garvie and Minich in favor and Holmes, Miller, Reeves, Pullen, and Hartwell opposed. RECESS The meeting recessed at 7: 15 p. m. RECONVENE The meeting reconvened at 7: 25 p. m. MembershiD Differential cont. Mr. Hartwell moved to modify County resident membership fees to be 25% more than City resident membership fees. Mr. Garvie seconded motion. There was an exchange of views on the fairness of a membership differential and the effect on golf membership. The Mayor called for the vote on the motion and it failed by a vote of 3 to 4 with Garvie, Pullen, and Hartwell in favor and Holmes, Miller, Reeves, and Minich opposed. POLICY ISSUES Plav Cards Policy Issue: Should play cards be continued? The presentation included information that play cards were introduced in June 2006 to increase non- member play during the slow season, the cards were only valid May 1 through November 30 and provided a 20% discount on the 18- hole non- member green fee only; in October 2007 member play cards were introduced that provide a 33% discount on the green fee, reducing it from $ 15 per round to $ 10 per round; year-to- day through May 31 member rounds are down 52% or about 6,497 rounds while play card rounds are up around 5, 178 rounds; and all paid rounds are on target to reach 74, 000 rounds this year, which is about 201<> or 1, 500 rounds less than last year, however, green fee revenues are on target to be about 9% or $ 132, 000 less than last year; staff believes the disconnect between relatively stable rounds yet decreased revenues is directly attributable to play cards. Staff recommendation is to discontinue issuing member play cards and family member play cards effective immediately; and to modify the non- member play card back to June 2006 parameters. 180 Special Council 6- 17- 08 POLICY ISSUES cont. Play Cards It was clarified there is only one non- member play card that currently exists for unlimited play for $2, 200 and staff recommends to provide a non- member play card with a 200,10 discount valid from May to November 30 and to discontinue the member and family member play cards. Joe Sasso, 18 Oakdale Road commented the play cards should continue, it brings people to the golf course and the majority of them would ride carts, it is a perceived value such as buy one and get one free, it is a great deal for members and it is a great deal for non- members, and gets people who may not be able to playas frequently to play. George Wall, 112 Highland Drive, commented if the member play card was discontinued he would drop his membership and purchase the non- member play card. Pete Bower, 222 Sleepy Oaks Road commented it is a totally seasonal golf course and four months of the year it is the busiest golf course in the area because of the winter visitors and the prices are cheap. He suggested a two- tiered pricing policy where during the winter months when there are customers they charge the market rate and during the summer when there are no customers it be 30-40% less in July, August and September. He suggested someone put together a pricing plan that deals with that market. Chuck Wheelahan, 613 Powell Drive commented discontinuing the play cards at this point would be a mistake. Brad West, Say Drive showed the number of discount coupons he has that come in the various charity coupon books and stated there are many ways to play cheaper golf in this area. He said it is a municipal course and asked that the rates get lower so the average person can go play. As no one further wished to speak public comment was closed. Mr. Minich moved to eliminate all play cards except the non- member $2, 200 unlimited per year play card. Mr. Reeves seconded motion. Discussion included comments that the play card is a good idea but it has shown not to work; the cost of everything has gone up and adjustments have to be made; that the play card remain in place and the golfers were urged to come forward to Jim Frazier with ideas so the play card can be modified in the future and with ideas on incentive to increase play. The Mayor called for the vote on the motion and it carried by a vote of 5 to 2 with Holmes, Miller, Reeves, Pullen, and Minich in favor and Garvie and Hartwell opposed. POLICY ISSUES cont. Twiliaht Plav Policy Issue: Should the hours for twilight play be modified? The presentation included