Golf Board of Governors

Golf Committee Special Meeting August 21, 2018 at 4:30pm City Hall, 1st floor Board Room 455 N. Main Wichita, KS 67202 Present: Eddie Fahnestock, President, Chair, Greg Ferris, At-Large, Thomas West, District II, Cindy Renard, District III, Cory Rainwater, District IV, Richard Schodorf, District V, Debbie Burch, District VI, Shana Appelhanz, Troy Hendricks, Troy Houtman, Michelle Haun, Ron Reese, David Buschschulte, Grant West, CM Meitzner, CM Frye, CM Claycomb, Bill Ramsey Park Board, Citizens Absent: Dr. Michael Williams, District I Houtman called the meeting to order at 4:34pm. Public Agenda Regular Agenda Items MacDonald Golf Course options/updates Houtman explained the purpose of the golf advisory committee and asked members to introduce themselves and state which district they represent to the public. Renard thanked Hillman for his service on the committee. Houtman stated that the finances of the golf system have brought us here today. He explained that MacDonald Golf Course is owned by the Board of Park Commissioners and that Johnny Stevens has made an inquiry to see what it would take to purchase the golf course. Park Board members recently met to discuss the inquiry. It is now the committee’s opportunity to discuss the options and what this means. The purpose of this meeting is for the committee to discuss why we are here and how we got to this point. We cannot sell the land without a request for proposal. There has been no prior discussion pertaining to the sale of MacDonald Golf Course. Fahnestock thanked the public for coming to this meeting. He stated that he has had the opportunity to speak with Mr. Stevens. He asked him about his interest and what his intent is. He said that Mr. Stevens stated that the course is not in good condition and he wanted to improve it. He wants to see it as a daily fee course that is open to the public. The negative is that it would be in competition to our City courses. West stated that he represents the First Tee, as president of their board, on this committee. He stated that he has also had the opportunity to speak with Mr. Stevens. He stated that Mr. Stevens is not interested in making money, just improving the course. First Tee has invested a lot of funding at the course already. First Tee is only interested in growing the game through youth golf. First Tee works with elementary school PE programs. First Tee is leasing property from the City for $1 per year with two 10 year options and the City has the responsibility of maintaining the property. First Tee needs the committee and the City to make sure that this responsibility is transferred to any future owner. The facility that First Tee is building will be for the use of the junior golfers, but the public will be welcome to use the driving range and the chipping and putting greens. The First Tee insists that any future owner will keep the course a daily fee course and an 18-hole course that is open to the public and welcomes juniors. Ferris disclosed that Mr. Stevens’ father and Mr. Ferris’ father are cousins. He also stated that he has not had any discussion with Mr. Stevens regarding MacDonald Golf Course at this time. Fahnestock stated that it sounds like a good relationship and asked if Mr. West asked Mr. Stevens about those parameters. West stated that he has not had any specific discussion yet. Ferris stated that we are getting ahead of ourselves. Schodorf stated that we need to consider the legal constraints of the RFP process. Ferris stated that there currently is no RFP. Schodorf stated that we should consult with legal so that we don’t have a bid challenged due to lack of consideration. Houtman stated that the city won’t sell the property without an RFP. It is the interest of Mr. Stevens that has sparked the RFP process. Just because there is an RFP, that does not mean the property will be sold. Ferris stated that there has not been a decision made to form an RFP yet. Schodorf stated that we just shouldn’t discuss terms and conditions with a specific individual. It is good to discuss terms and conditions for the RFP. West asked why we would want to sell it. Schodorf explained the background of the committee and the structure of the golf system as an enterprise fund. The way the system currently operates, it is not the way an enterprise fund should operate. If the course was sold, where would the money go? He also wants to know what would happen to the remaining courses. Fahnestock stated that if the course was sold we would eliminate a deficit and it could go toward the improvement of the system. Schodorf stated that our debt is still larger than what the course would sell for. The funds would need to be used for improvements and not to pay back our debt. The debt was supposed to be paid for a long time ago through the property tax collected at Auburn Hills. Ferris stated that the Park Board would need to make a commitment that the funds would go back to the golf system, not into the general fund. Houtman stated that staff has had some discussion on this and determined that the funds should go into the golf system. The first priority should be to reinvest in the golf system, not the debt. Forgiving the debt will be a future discussion. Schodorf stated that he doesn’t oppose the sale if it is done right. Fahnestock stated that it comes down to who can maintain it better and create the better golfing experience. He stated that, at this time, a third party could do a better job due to the financial position of the golf system. Schodorf asked if there would be any control of rates that would be charged by a future owner. Houtman stated that we couldn’t dictate that in the proposal, but would like to think that a future owner would want to have competitive rates. Rainwater stated that course conditions are improving and we should give it time to see it come to fruition. Schodorf stated that it is not a destination course like it should be. Rainwater stated that he is concerned about what happens once it goes private. Ferris stated that golfers won’t be able to play for pass rates. He asked if it is a good business decision for the other courses to continue subsidizing MacDonald and LW Clapp. Hendricks stated that we also have other programs and entities that we need to think about. We talked about First Tee, we also work with Wichita Junior Golf Foundation and USD 259. Without an east side course, we would lose these opportunities. Renard stated that there would not be a municipal course on the east side of the city. Ferris stated we just don’t have enough information. West stated that we really need to consider the competition. We don’t have enough golfers to support all the courses we currently have. He asked what the effect of turning a city course private would be. Ferris stated that some of the private courses struggled even when there were more golfers. He stated that he is not opposed to putting out the RFP to see where we stand. Houtman stated that we are more interested just to see what would come of the RFPs. Schodorf stated that we need to have a plan for the golf system. Renard asked if the driving range would stay with the course. Ferris stated that the RFP would be written in a way to protect the First Tee. Burch asked for clarification that all kids would have access to the driving range. West stated that was correct for all kids ages 5-17, at no charge. First Tee was also going to work with the city to have kids bused to the facility. Fahnestock stated that First Tee would be a priority and the Park Board would make sure that the funds would go back to the golf system. Ferris stated that if we are absolutely not interested at all in selling a golf course, then we would not do an RFP. Houtman stated that staff has been discussing golf division needs and various ways to use additional funds. There would be full disclosure on where and how the funds would be used. Renard asked if we would revisit the closure of LW Clapp if we proceed with the sale of MacDonald. Houtman stated that we do need to look at a vision for the golf system to determine how to manage the system with the funds we have and how many courses we will be able to support. Ferris stated that if we did sell MacDonald, we should keep LW Clapp in the system for at least an additional year to see if it would rebound. Fahnestock asked if anyone else had anything, otherwise we would see if there is any public comment. Citizen asked if we can just have Stevens consult on how to run MacDonald better. Schodorf stated that an RFP would help us see if there is a better way to do things. Citizen stated that if an RFP goes out, Mr. Stevens may not be the only person that submits a bid. He feels that bidders should know what is going to happen with LW Clapp, since that will have an impact on MacDonald. He asked what will happen to the First Tee programs. West stated that they would have to work closely with the new management to make sure the kids could still play and balance it with public play time. Citizen stated that Mr. Stevens may not even submit a bid based on what ends up in an RFP. He stated that it seems the committee is being short-sighted to consider an RFP on MacDonald when it was just decided to get rid of LW Clapp. He agrees that the golf system needs a vision. Ferris stated that the letter of interest did not include an offer, it is just an expressed interest. He also stated that the closure of LW Clapp has been discussed for well over a year, or two. Houtman stated that with the closing of LW Clapp there will be a master plan for what will happen with the property. Citizen stated that he is concerned about the junior golf programs. Citizen stated that it was going to be exciting to see the effect that the First Tee would have at MacDonald. Citizen stated that since Auburn Hills was built, it has generated a significant amount of property tax money for the City. Since the City holds the note for the debt from the building of Auburn Hills, they could make that go away. He asked if there is a more credible revenue stream for the system. He suggested a CIP or sales tax around Auburn Hills. He stated a long-term plan is essential. Ferris stated that the golf system is an enterprise fund and the City is still expecting repayment of the $5 million. Citizen stated that we need to urge the City to find another way to fund this. Golf courses represent a quality of life. Wichita shouldn’t be known for closing golf courses. Citizen stated that this is bad timing with the First Tee. Citizen asked for clarification of public course vs private course. He pointed out that he is in favor of what Mr. Stevens’ plan for MacDonald was quoted as being, “making it a destination course that is open to the public and for all ages.” We just don’t know what Mr. Stevens’ proposal is yet. He stated that he thinks everyone would agree they would like to see MacDonald improved. Schodorf explained the difference of public vs private. He also explained that RFPs can be rejected. They can be written with specific restrictions. He proceeded to make a motion to recommend the Park Board to issue an RFP and recommended that members of this committee be on the RFP selection committee. Ferris seconded for discussion. He asked to amend the motion to include parameters that it remain a public golf course and to honor the agreement with First Tee and junior golf. Schodorf stated that he doesn’t want to add too many parameters. Ferris stated he can’t second the motion without parameters. Schodorf stated he would amend as Ferris suggested. Hendricks asked about the school system. Ferris stated they can negotiate on their own. Fahnestock asked for a vote on the motion. Renard and West are opposed. Schodorf and Ferris are in favor. Rainwater is undecided. West stated that he was excited to see the improvements at MacDonald. He stated that it is too soon to look at selling MacDonald and suggested waiting 2-3 years. Ferris stated that an RFP doesn’t commit you to anything. Rainwater stated that he would like to discuss this more and asked if we could just come up with our vision first. West made a substitute motion for the committee, with staff help, to create a vision for the golf system, before considering an RFP, before the end of the year. Rainwater second. Schodorf stated that we should create the vision and present it to the Park Board. Houtman suggested that staff will assist the committee with creating the vision and to complete this as soon as possible. Fahnestock asked for a vote on the substitute motion. Motion passed unanimously. Adjourned at 6:15pm.