Board of Park Commissioners

w A Board of Park Commissioners Special Meeting Minutes Monday, April 1, 2021 CITY OF 3:30- 5:00 P.M. WICHITA City Hall, 1st Floor City Board Room Wichita KS 67202 Members Present: Eddie Fahnestock, Ty Tabing, Tori Deatherage, Dale Goter, Philip Simon, Alejo Cabral, Hoyt Hillman Members Absent: Troy Palmer City Staff: Troy Houtman (Director, Park & Recreation), Penny Garding (Clerk), Reggie Davidson, Emma Li-Wormington, Elizabeth Harlenske (Assistant City Attorney), Robert Layton (City Manager), David McGuire, Jennifer Magana, Mark Manning, Guests: Ben Blake (Kemper), Josh Lesnik (Kemper), Tom West (First Tee), Alan Clark (First Tee) GAC: Nancy Knopp, Greg Ferris, Michael Ward, Nile Dillmore, Richard Schodorf Item Descri(ltion Call to Order Eddie Fahnestock, President, called the meeting to order at approximately 3:31 p.m. Announcements No announcements Public Comments lA Golf Update & First Tee Houtman: Steady decline in rounds and revenue prior to 2020. There is a need for "new" golfers, interest in youth development and started discussions with First Tee in the fall of 2020. Manning: City subscription pricing model consistent monthly revenues, no marginal revenue for additional rounds, maximizing carts usage and concession sales. City Performance: 2019-2020 saw green fee revenue decline, cart revenue had slight increase, and concession revenue declined. Marketing not at core competency. Potential new model: Increase expenditures to enhance customer experience and improve maintenance. Increase concession and pro shop revenues and increase per round revenues. Potential Objectives: Sustainability by developing young players, viability by enhancing the customer experience and improving the courses, self-sufficiency by expanding concessions and clubhouse revenues and 2022 projected revenues are to be higher than 2020. Potential Strategic Advantages: Ability to leverage national expertise, economics of sales, limited downside risk, maximized potential, financially incentivized to perform. Benefits for golfers: Greater likelihood of financial viability, better maintained course, and enhanced product offerings. Key Metrics: Course conditions benchmarked to other local courses, customer satisfaction, and operating net margin. Schodorf: Do any of the numbers have any COVID adjustments? Manning: Not at this time. Dillmore: How were the projected numbers determined? Manning: Kemper provided the numbers after discussions. West: First Tee strategies: Provide opportunities to grow the game of golf in Wichita for everyone, create a safe and healthy environment for kids from all backgrounds and spaces. BOARD OF PARK COMMISSIONERS SPECIAL MEETING April 1, 2021 Page 1 of4 Commitment to Diversity, Equity, and Inclusion, dedication to child safety and safe sport programming. Commitment to our 9 core values: Courtesy, Responsibility, Honesty, Sportsmanship, Confidence, Judgement, Perseverance, Integrity and Respect. Wichita Kids Play FOREfree removes barriers for kids to play. Ben Blake: Kemper is family owned/operated for over 40 years. Over 6,000 staff, 24 states, 120+ facilities, and 1 client at a time. There are 35 municipal partners with 45 courses. Kemper Sports Proprietary Programs: TruService - Customer service to employees TruReview - Customer survey, national accounts buying power, expense and revenue management systems, green to a tee- improve environment, Safety National - workplace safety, Center of Excellence - internal learning, standard operating procedures, and GM training programs. How Kemper/First Tee will deliver results: Introduce new and proven sales & marketing strategies and tactics, introduce Grow the Game incentives including robust junior golf program, improve course conditions, enhance food & beverage offerings, grow course outings, attract, train and supervise a quality staff. Course Improvement Priorities: Due diligence performed by team over past few months, established structured agronomic programs, begin an Equipment Replacement Fund at all courses, improve turf conditions at MacDonald and address lake, clean up and mow rough and secondary rough, remove dead trees and general clean up. Programming is key to growth both short and long term: player development for both juniors and adults, community engagement, player devilment month, instructional leagues co­ sponsored with Park & Rec Dept, family golf rates, kids play for free, and mid-day ladies' programs. Staff Transition: Shift from City to Kemper staff. Leverage Kemper - home office and regional teams - experience with onboarding & transition in all areas of operations. All staffers offered positions at 2022 golf industry pay rates and offered 60-day trial period. Kemper to work with City regarding long-term employees, and all full-time employees will be eligible for Kemper insurance and benefits. Key goals for First Tee and Kemper: Improve financial performance, maintain quality course conditions, provide an effective cost management structure, recommend and oversee CIP, maintain environment stewardship, be accountable to all constituents, serve the City of Wichita with notable, high quality golf portfolio, and deliver professional, friendly customer service. Fahnestock: Kudos on maintenance of Sand Creek. Goter: We're 8 months in with no contract or ideas. There is a freeze on hiring. What is the status and specific answers? Fahnestock: There is a contract, just needs finalizations. Layton: Continue to consult until Park Board and others ready to move forward. Will provide contract or agreement depending on outcome of this meeting. Goter: What is First Tee's position in all of this? Layton: First Tee will focus on Junior Golf. Goter: Any financial donation, and why not a normal RFP? Layton: Kemper will be paying First Tee and the meeting today is being held to decide the process to be done. Hoyt: First Tee needs capitol to build and train. What have the pros said about this? West: We have never had a discussion regarding building. We are a nonprofit and get private donations. This is to sustain our program. Fahnestock: How many situations like this with multiple municipal courses? Blake: We have done this many times all over the country with success. Schodorf: Will memberships see an increase in price? Blake: Membership program has worked well. Possible change of tee time structure during BOARD OF PARK COMMISSIONERS SPECIAL MEETING April 1, 2021 Page 2 of4 peak times. Dillmore: Kemper would make recommendations for CIP. Currently looking at wishlists for equipment. Will the current reserves transfer to Kemper and how will the employment of current employees work, specifically the ones close to vesting on retirement. Blake: We will make recommendations that are brought to the city, which still has control. Houtman: A lot of this will come from revenues. Layton: We would look for positions within the city or allow to move on if not vested. Fahnestock: Public will be allowed to speak on this at a later time. Cabral: Will Kemper provide information on previous transitions, both financial and within the public? Blake: Kemper could do some information. Tabing: How do we know this is the best deal? How was the $7SK decided? What is the process to trigger an RFP? Blake: Fees depend on course, different variables. On these courses it was based on potential revenue and improvements needed. Layton: This started as a lease with First Tee. Fahnestock: Timing is an issue, coming up on open/busy season. Need to get the courses ready. Goter: Staff salaries you use industry standard? Can you use that to compare to current salaries? How will you handle the "no green fee?" What is your staffing structure at each clubhouse? Who decides membership fees: City, Park Board or Kemper? This can be provided in writing later. Knopp: What is the role of GAC in the new model? Wichita Junior Golf scholarships, will that be under First Tee? West: Wichita Junior Golf will be operating like before and First Tee will do the registrations. Nothing will change. Knopp: Have any of the other cities been in contact regarding their contracts with Kemper? Layton: We have reached out to Sand Creek and asked Kemper for others. Dillmore: If Kemper fails to meet expectations, are we stuck or what recourse will we have? Layton: Courses and equipment would be city owned and performance standards will be in contract. Dillmore: What is the timeline for hiring staff and purchasing of equipment? Houtman: Realistically, maybe 4-5 months. OPINONS: Tabing: Respect for Kemper, recommends RFP. Cabral: Wants to make sure we've looked at everything. Kemper is impressive, but is hesitant and would like to re-visit at Park Board meeting. Dillmore: Without clawback or accountability, this bothers me. Consider an RFP. Goter: RFP recommended. Will Hendricks' position be filled, process for changes and unfreeze hiring. Knopp: RFP recommended. No need for a Golf Director if management company. What will the role of GAC be? Ward: City needs out of the golf business. What else is out there? Schodorf: No doubt this will be a major change. Asking for over a year for price changes. Deatherage: Kemper has the business side of things down. Would like to see an RFP. Fahnestock: Blanket proposal, each course if different. Adjourned There being no further business, the meeting was adjourned at approximately 6:05 p.m. BOARD OF PARK COMMISSIONERS SPECIAL MEETING April 1, 2021 Page 3 of 4 The next regularly scheduled meeting will be held on Monday, April 12, 2021. 7-�? es oc , President C/WN BOARD OF PARK COMMISSIONERS SPECIAL MEETING April 1, 2021 Page 4 of 4