ARTICLE

Municipal golf courses struggle as golf's popularity wanes

Debate continues over whether courses should be funded by cities

Nicholas Casa of Chicago putts as Ryan Wagner of Cedar Rapids looks on at Ellis Golf Course in Cedar Rapids on Wednesday, July 17, 2013. Cedar Rapids has paid $1.4 million of the four city courses’ debt since fiscal 2010. The courses have lost money four out of the last five years and have been without a cash reserve since fiscal 2008. (Cliff Jette/The Gazette)
Nicholas Casa of Chicago putts as Ryan Wagner of Cedar Rapids looks on at Ellis Golf Course in Cedar Rapids on Wednesday, July 17, 2013. Cedar Rapids has paid $1.4 million of the four city courses’ debt since fiscal 2010. The courses have lost money four out of the last five years and have been without a cash reserve since fiscal 2008. (Cliff Jette/The Gazette)

Taxpayers in Cedar Rapids and Coralville have poured millions of dollars into municipal golf courses that have lost money in recent years because of flooding and golf’s waning popularity.

City leaders say golf courses, like pools, libraries and recreation centers, deserve public support. But with only 1 in 10 Americans playing golf and cities cutting other services, some citizens wonder if municipal courses should be handed over to private contractors.

“I like golf, but there are a lot of taxpayers that don’t golf,” said Doug Paul, a rural Johnson County resident and critic of Coralville’s financial practices. “Maybe it should be investigated, ‘What would it mean to privatize?’?”

Cedar Rapids courses

Cedar Rapids Golf Operations, which manages four city courses, is supposed to be a self-supporting enterprise, but the city has paid $1.4 million of the courses’ debt since fiscal 2010. The enterprise lost money four out of the last five years and has been without a cash reserve since fiscal 2008.

The four courses together made a $56,600 profit in fiscal 2012, when an early spring boosted golf rounds by 15 percent from the previous year.

In the last three years, Ellis and Twin Pines have come out ahead, while Jones Park and Gardner have lost money.

“If one course is losing, we hope another one is making up,” Golf Operations manager Lisa Miller said.

Jones Park Golf Course, at 2901 Fruitland Blvd. SW, flooded in 2008 and again in May. The closures mean fewer golf rounds and the city must restore waterlogged greens and fairways. The city was able to reopen the front nine in June, but the Jones closure could cost the enterprise any profit officials hoped to make in fiscal 2013.

After two floods in five years, city officials are considering whether to redesign the course, possibly by adding earthen berms or elevating greens, Parks and Recreation Director Sven Leff said.

“It’s definitely not desirable to be wrestling with the environment in that way,” he said.

Selling Jones — or any other course — is not on the table, Leff said. The City Council briefly considered selling a portion of Twin Pines in 2007, but dropped the idea when community members denounced the plan.

Coralville sees improvement

Coralville’s Brown Deer Golf Course has received nearly $1.5 million in taxes since fiscal 2006. Without the city’s annual subsidy, ranging from $80,000 to $622,800 in the last eight years, the municipal course would not have turned a profit since 2004.

That’s when the city took on $7.6 million in debt for a renovation that included expanding the course to 18 holes and adding a clubhouse.

“The goal of the course was never to make money,” Coralville City Administrator Kelly Hayworth said. “We knew covering the expenses for the debt would be difficult.”

The last two years have seen improvement for Brown Deer. Rounds of golf were up 10 percent in fiscal 2012, when the course made a $7,800 profit. Unaudited numbers for fiscal 2013 show the course made $10,400.

More courses, fewer golfers

Golf course operators across the country have struggled in recent years as a glut of courses compete for a shrinking pool of golfers, said Ed Getherall, senior director of operations for the National Golf Foundation.

The number of golf courses in the United States increased by 20 percent in the 1990s and has continued to grow, the foundation reported. The number of golfers went down 14 percent from 30 million in 2005 to 25.7 million in 2011.

Only 9 percent of Americans age 6 and up played golf at least once in 2011, compared to 12.1 percent in 1990, the foundation reported.

Golflink.com shows 17 courses within 20 miles of Cedar Rapids.

One of those is Airport National, a public course on Wright Brothers Boulevard. Public courses are open to the public, but may be privately owned. Mark Lemon, PGA pro and owner of Airport National, said municipal courses have an advantage because they don’t pay property taxes.

“This isn’t a good business to be in if you want to make a lot of money,” he said.

Lemon thinks the Cedar Rapids courses deserve public support, but said the city should consider selling a course or privatizing operations.

Des Moines outsources golf

Des Moines has been using an independent contractor at the city’s three municipal courses since 2008. Before the change, the city was losing hundreds of thousands of dollars each year on golf, Parks and Recreation Director Ben Page said.

“Last year, we got a check from the operator for a little over $600,000,” he said.

Des Moines would not have hired a contractor if it weren’t for budget cuts, Page said.

“We’re not in the business of laying off city employees,” he said.

The city’s contract with Des Moines-based C Corporation allows the city to set golf fees and control capital improvements, Page said. Because C Corporation isn’t held to labor agreements negotiated by the city, the contractor can save money on labor, Page said.

“Cities from all over the Midwest are calling us,” Page said, adding that he’s talked with both Cedar Rapids and Coralville officials about how Des Moines runs its golf courses.

Leff, who saw privatization of golf courses in Nevada before coming to Cedar Rapids in 2011, said the idea is not being considered locally.

Golf like other amenities?

Municipal golf courses are an amenity, just like a library or pool, and should be supported by the public, Hayworth said. Taxes subsidize greens fees, allowing more people to enjoy a sport that can be pricey, even at public courses.

“What’s the difference between a golf course and a pool?” Hayworth asked.

Coralville’s outdoor aquatic center, which opened in 2004, received an average of 13 percent of its expenses from the city in the last four years. Coralville also pays the outdoor pool’s construction debt. The $80,000 the golf course received from Coralville’s general fund in fiscal 2013 covered 3.3 percent of the golf course’s operating expenses and debt.

Coralville’s 2012 annual report said 29,100 rounds of golf were played at Brown Deer that year, compared to 38,700 admissions to the aquatic center.

Openness a concern

Some people think Coralville should be more open about the amount of taxes going to Brown Deer.

“This is a legitimate function for a municipal government to provide recreational activity, but it can’t be provided with a blank check,” said Paul, who is part of a group that sued Coralville in 2009 over annexation practices and has been critical of the city’s financial practices.

Paul questions how the city can subsidize golf, while cutting Sunday services for SEATS, the transit system for elderly and disabled residents.“That’s a decision the Council and the Parks and Recreation Commission have to make every year,” Hayworth said.

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