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Dunedin golf course needs better management

The Dunedin City Commission seems determined to throw away opportunities for success and profit at the city-owned golf course leased to and operated by the Dunedin Country Club. Dunedin residents who think the golf course — their property — should be paying more dividends for the city in this time of tight city revenues should share their opinion with city commissioners now.

On Thursday, the City Commission is scheduled to discuss a new license agreement with the Dunedin Country Club for operation of the city's outstanding Donald Ross-designed golf course. That golf course is adjacent to the smaller city-owned and city-operated St. Andrews Links golf course. The two golf courses together lost hundreds of thousands of dollars in recent years, and the country club, plagued by declining membership, wanted a rent reduction and new lease. The city stopped collecting rent while negotiations with the club dragged on.

In July, the City Commission voted unanimously to seek proposals from professional golf course management companies to operate both courses. Meanwhile, the country club came up with a check for $107,000 for back rent so it could not be accused of being in default on its lease. The club also made promises to be more open in its business dealings and friendlier to nonmember golfers.

However, some top-flight companies responded to the city's request for proposals, providing an enticing glimpse of the recreational and financial benefits that professional management of the public courses could bring. For example, Billy Casper Golf, which operates golf courses all over the country, was confident it not only could operate in the black, but add new services and return rent and additional profits to the city treasury. It was even willing to guarantee those results.

But the Dunedin Country Club, with 13 years remaining on its lease and no longer in default, would not agree to relinquish its lease hold rights. And it sealed that refusal recently by delivering to the city this year's lease payment of more than $88,000. Country club officials argue that they have taken care of the property for decades, have funded many improvements there and deserve to continue to operate the course.

Because of the lease, city officials may have no choice but to allow the club to continue to operate the 126-acre Donald Ross course, but there is no rational explanation for the step the City Commission seems poised to take Thursday: to approve a new 20-year agreement with the country club that gives the club a break on paying rent to the city for at least five years.

The new agreement has some good provisions and attempts to demand that the club be courteous to golfers who are not country club members. It also raises the rent (now being called a license fee) after the first five years to 6 percent of the club's gross revenues rather than the current 5 percent.

But the city takes a financial hit in this agreement. For the first five years the club would not have to pay its rent to the city. Instead, it would deposit the money in a trust fund and use it to pay its general manager and to make capital improvements on the course. And later, the club would be required to pay rent only if its net income exceeded $40,000 a year. Also, the city would purchase a small sliver of land from the club for $250,000, which could help the club finance course improvements.

Clearly, the club can pay the rent demanded by the current lease, as its recent payments have shown. So it ought to be required to continue to do so, while also meeting all the other requirements of its current lease. If, in the future, the club fails to do so, it will be in default and the city can do what needs to be done: hire a company with a record of successful golf course management to upgrade and consolidate both courses into one outstanding golfing destination.

It simply makes good business sense to have golf course management professionals managing a spectacular public amenity like the Donald Ross course. For that matter, it makes sense to have professionals, not the city, managing St. Andrews Links.

City commissioners are finding it difficult to take tough stands against fellow residents who are members of the country club. But the City Commission has a fiduciary duty to properly oversee the public's property and the city treasury. Having to stick with a partner that has fewer resources and a vastly inferior track record of golf course management to professional companies is hard enough to contemplate, but giving that partner access to public land for years without paying rent at a time when the city needs more revenue is simply inexplicable.

Dunedin golf course needs better management 11/14/09 [Last modified: Saturday, November 14, 2009 2:42pm]
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