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City Council again raises spector of selling Lemoore's Municipal Golf Course despite strong opposition
“According to both golf course and city records, the course has been sustaining itself on revenue alone from at least 2007,” stated the report. It went on to state that the city does not pay the management or golf course expenses out of the general fund. Payments were made to the city from the course, but until the newest payment schedule was created, regular payments to reduce debt owed to the city were not clearly detailed and documented.
“City officials have stated that the golf course has not been able to support itself, and that it was not making a profit. However, financial reports show conclusions at odds with these claims,” said the Grand Jury report.
The Grand Jury also reported that when a potential buyer surfaced in July, 2013, public meetings were held where a “large number” of public comments were heard, nearly all of them in favor of keeping the golf course in city hands and expressing opposition to a sale to the Tachi Rancheria, the only entity to express an interest in the course. The Tachi offered $5 million for the course.
It appears that the Tachi are still willing to purchase the course from the city, according to city officials.
The Grand Jury also said city officials feared another private entity could build a golf course, thus creating competition and forcing the Lemoore course to lose money.
The Grand Jury did issue a warning that while at present the Lemoore course is supporting itself, in the event of a large and urgent expense, such as a well drying up, general fund resources might have to be brought to bear. Grand Jurors also suggested the city create a contingency fund to account for any unseen expenses.
In a response to the Grand Jury’s findings, in a written rebuttal, Siegel was at odds with the findings that the course pays for itself. “The City of Lemoore does not necessarily agree with the findings of the grand Jury on this issue because the golf course has only been able to make both the operations and debt payments during three budget years,” he stated in the official response. “Those budget years are 2009/2010, 2011/2012, 2012/2013. During the budget years of 2005/2006, 2006/2007, 2007/2008, 2008/2009, and 2010/2011, the golf course was unable to make up the short fall.”
More recently the city sought vendors to lease the golf course, issuing an RFP (Request for Proposal) that outlined somewhat onerous terms, which included a $1 million up-front payment as well as monthly payments, which over the course of 30 years add up to about $6 million dollars.
Other than an offer from Lemoore Golf Course Manager Rich Rhoads, the city did not receive any other offers. Rhoads offered to lease the course, make the payments and keep it in the hands of the public.
Lemoore Recreation and Parks Director Joe Simonson urged the council to reject the Rhoads proposal as stated, which raised the specter of alternative choices, which may include selling the golf course.
“So do we still have a buyer for the golf course?” asked Siegel. “Either pay for it or do something else.” He suggested staff bring the council additional information so that they may finally make a decision at the next council meeting. Bring more information “so we can say yes or no. Our general fund must not pay for it,” he said.
“We need to know what all the options are. We need to identify how much we need. Can we do that in two weeks?” he asked. “Our goal is to maintain a public golf course,” said Siegel. “If we sell it we still have a public golf course.”
Simonson presented the council with a list of recommendations which included selling the course and putting the course on the November ballot and let the citizens of Lemoore decide what to do. The ballot initiative was only one of several recommendations councilmembers were presented with. Staff is also recommending that council reject an offer from Rhoads to lease the golf course, and instead renegotiate the lease with Rhoads to release the city from any liability. Council could also hire a new management firm to run the course on a month to month contract basis, or it could create a benefit assessment district in which property owners could pay off the debt to the golf course.
A ballot measure would need to be approved by city council a minimum of 88 days prior to the November 4, 2014 election and approval would require a two thirds vote in order to pass.
Several members of the audience took exception to Siegel’s words. Longtime critic Shari Hamrick castigated Siegel for not doing enough to promote the course and by putting out a misleading RFP to seek out someone to lease it. “You’ve been selling a story that it is a horrible loser,” she said. “That’s not the complete truth. There’s been nothing positive put out.”
Hamrick also criticized city officials for not bringing more people into the conversation to find solutions. She said residents have offered to help, but the city has not asked for their input. “You keep working in your own little circles,” she said.
Lemoore’s Karen Osterland, another of Siegel’s critics, said she was disturbed by the city’s motives. “This thing has been a big ruse.” She criticized him for being willing to put so much money into things like a BMX track but he’s not willing to help the golf course. “Why such a hard stand for not putting one more dollar into the golf course? She asked.
Osterland defended the Grand Jury report and said it supports what she and other golf course supporters have been saying for months. “This is a Grand Jury report that supports everything we’ve been saying for a year,” Osterland said. “I believe that Billy Siegel … it was always his intention to sell the golf course. The whole lease option was simply a ruse.”
Simonson defended the RFP that he wrote, insisting that prospective buyers are only interested in dollars and cents. “It’s purely a business decision,” he said.
Council finally decided to wait another couple of weeks before taking up the issue again. In the meantime city staff will get additional information as to a ballot measure and meet again with Rhoads to discuss revisions to his lease offer or a possible management contract. He was also told to determine if there was still a buyer willing to purchase the course.
Rhoads told The Leader he’s obviously willing to discuss his lease proposal with city officials. Rhoads said his lease arrangement would pay off the course by 2030, paying $200,000 per year and keep the course in public hands. His proposal spread out the payments over several more years.
Rhoads, who has been the only golf professional and manager since the course’s opening in 1992, took over the overall course management in 2010 following a search for a new management team. Rhoads contract was valid through June 30, 2015. Earlier this year city officials terminated his contract ahead of schedule.
In 2010 the then city council opted to hire Rhoads Golf LLC despite a search for a new management team, led by then councilmember Siegel, who recommended hiring a Las Vegas firm, Par 4 Golf Management. Siegel provided the only vote for his own recommendation. Council voted 4-1 to hire Rhoads, leaving Siegel out in the cold.
Tachi Chief Financial Officer James Snead, during recent discussions, said the Tachi, instead of paying directly for the course, would structure the payment plan over the course of 14 years, ending with a lump sum $2 million payment in 2027.
