At an August 28 meeting, the Prescott (Ariz.) City Council agreed that the city should not run the in-house restaurant and clubhouse of the financially troubled course, but disagreed on whether to forgive its debt, turn over management to a private firm, or maintain the course as an “enterprise fund.”
The Prescott (Ariz.) City Council agreed at its August 28 meeting that the city should not run the Antelope Hills Golf Course’s in-house restaurant and old clubhouse, the Daily Courier of Prescott reported.
A report from the city showed that the course’s restaurant, the Manzanita Grille, and the old clubhouse, Centennial Center, brought in $764,953 in revenue in the past year, with $764,353 in expenditures. Though the establishments are not causing the city to lose money, expenses include no rent to the city either, the Daily Courier reported.
“The restaurant business is probably not one we should be in,” Mayor Marlin Kuykendall said, noting that the city’s employee-benefits package “doesn’t fit with the restaurant and bar business.”
Council member Chris Kuknyo addressed a similar concern, the Daily Courier reported.
“We’re just plain competing with the private sector,” Kuknyo said “We need to get out of the restaurant and banquet business.”
Other course-related concerns discussed in the meeting included whether the city should forgive the $3.7 million that the course owes to the general fund; whether it should turn over management of the course to a private consulting firm; and whether the course should continue to be an “enterprise fund,” which the city expects to be self-sustaining, the Daily Courier reported.
The council took no formal actions on the matter this week and the course has been an ongoing point of discussion for the council. During budget deliberations in May, the council gave city staff a year to develop a plan for the course, the Daily Courier reported.
Budget and Finance Director Mark Woodfill said much of the course’s financial troubles began with the decision to build a new South Course in the late 1980s.
“In 1988, the council decided to add an additional 18 holes, and that was the mistake,” Woodfill told the council. Officials said that interest in golf tapered off nationwide in the 1990s and rounds at Antelope Hills suffered, the Daily Courier reported.
The golf course fund began borrowing from the city’s general fund to make up for annual losses in 2002 and the deficit between revenues and expenses between 2002 and 2010 ranged from $48,635 to $786,061 at its peak. Current debt totals $3,663,573, the Daily Courier reported.
Increases in rates, an addition of a sales tax on the course and an increased focus on tournament marketing have been implemented to help shore up revenues.
“We did see a smaller loss this year,” Deputy City Manager Alison Zelms said. City records show that the deficit for fiscal year 2012 was $237,995—down from $375,901 in 2011. “That goal to break even may or may not be realistic, based on the current market.”
Councilman Steve Blair said that other city amenities like baseball fields and the public library are not expected to break even, so the golf course shouldn’t be either. He suggested the course’s debt be forgiven, the Daily Courier reported.
Jeremy Knowles, General Manager of the 500 Club in Glendale, said his company might be interested in responding to a Request for Proposal on the management of Antelope Hills, the Daily Courier reported.
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