Posts Tagged ‘kempersports’

Golf Costs – 2014

Were you to OPRA expense and revenue information for Union County golf operations you would get 34 pages in pdf format of about 20,000 numbers in 4-point type and if you squinted you might be able to see the county claiming total revenues rose from $6,325,759 in 2013 to $7,621,400 in 2014 and, after reduction for expenses, net income rising from $162,062 in 2013 to $501,587 in 2014.

But after taking out some columns and leaving only the 2013/2014 Actual Summary for All Units to put into an spreadsheet a different story emerges.

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Paying to be Thirty-three

Since 2009 Union County has paid over $35,000 to New Jersey Monthly for what appears to be Runnells-related ads but it did buy them a feature story in the July issue on the 40 best public golf courses in New Jersey.  Galloping Hill came in at number 33 and Ash Brook was number 36.  There were 32 other courses in 13 other counties who did not spend (supposedly) $17.6 million on their operations who still came out ahead of the  Galloping Hill money pit and even Ash Brook, without tens of millions of dollars being sunk into it, managed to come within 3 slots of Galloping Hill.

But the interesting aspect of this publicity was the machinations that the NJ Monthly staff had to go through, from distractions to outright lying, to make their puff piece fly.  Some excerpts form the article with (my comments):

The selection of Galloping Hill—a Union County course where registered residents can play 18 holes on a weekend for just $31 ($47 with cart)—is the fruit of a rare public-private partnership: Union County; the NJSGA; Kemper Sports, a leading golf course management company; and TaylorMade, the world’s No. 1 golf-equipment maker, have together brought about a stunning turnaround for a course that just seven years ago was an embarrassment  (like every other area that is within the direct control of this dysfunctional system of governance) .

Maintenance on the 27-hole layout was slipshod….Galloping Hill in the early 2000s “was being run like a park,” says Armando Sanchez, who was hired as Union County’s director of golf operations in 2008. “The attitude was, ‘If we don’t cut the greens today, we’ll cut them tomorrow.’” (2008: 11 years into total Democrat control and 7 years into the Devanney era.  Was it Bush’s fault?)

(The next four paragraphs are on the food in a restaurant and banquet center that was still months from opening at press time.)

“When golfers come to Galloping Hill now,” Sanchez points out, “they receive treatment they usually see only at high-end daily-fee and private courses. But most important, they will be doing so at very affordable prices.” (Since Union County taxpayers will be squeezed for the millions of dollars this fiasco will lose every year.)

In 1995, the county hired prominent New Jersey-based golf architect Stephen Kay to renovate Galloping Hill. The project, completed in 2000, used three different contractors, of whom the first two had little or no golf experience. In the end, says one veteran observer, Galloping Hill got only “a Band-Aid.” (So what were the first two contractors experienced in? Political donations?)

By 2007, Galloping Hill—far from being ready to wrest the most prestigious state championship from the private clubs—was barely holding on. That year, for the first time, the Union County Board of Chosen Freeholders examined the economics of its three golf courses separately from the operation of the Department of Parks and Recreation. It discovered that golf was losing about $500,000 a year. (They lied.)

Devanney brought in Sanchez, who has a degree in golf management and had worked with Jack Nicklaus’s Golden Bear Industries. (No experience in personal training?  And where does one get a degree in golf management?)

In 2009, the county signed a five-year contract with Kemper Sports to manage the daily operation of Galloping Hill and Ashbrook. In the deal, expected to be renewed when it expires at the end of next year, Kemper is paid a monthly management fee, and the county retains all revenues except for retail sales in the pro shop. (That’s a lie.  Kemper also gets a cut of gross revenue over a certain amount plus construction management fees.  For 2012 Kemper got $4,224,630.76 out of the county including $56,768,66 as an incentive fee.)

The freeholders took the biggest step in 2010, when they approved $17.6 million in bonds to pay for the Learning Center, a new maintenance facility and the new clubhouse, whose second floor includes a large banquet hall—expected to produce significant revenue for the county (which will go to Kemper, DeCotiis, Netta, et. alia while the county absorbs the far more significant expenses.)

In June of this year, the clubhouse opened with the NJSGA’s flag flying from the roof. “It’s a dream come true,” (finding these chumps) says NJSGA executive director Steve Foehl. “It’s vital to our branding to be associated with a first-class facility like Galloping Hill.” In the first two years, the association will pay the county $5,000 a month rent; then the sum will increase 3 percent every three years till the end of the 10-year lease. By the end of May, the banquet space had already booked 80 events through 2016. “We are on target to hit about $5.6 million in revenue this year,” says Sanchez, “with operational costs at about $5.3 million.” (by county math).

The next phase begins this fall, when Montclair’s eminent golf architect, Rees Jones, known as the Open Doctor, begins preparing the course for the 2016 NJ Open. While 200 to 300 yards will be added to Galloping Hill’s 6,639-yard length, much of the work—like bunker renovations—will aim to “restore the classic feel of the golf course,” says Jones, “and provide regular golfers with as enjoyable an experience as possible” (and taxpayers with as excruciating an experience as possible).

UC Golf Update

Union County is saying their golf operations are (or will be) profitable. They’re not and I say so within an article today where I’m quoted:

Critics are skeptical. John Bury, an actuary and active member of the Union County Watchdog Association, thinks the projections are exaggerated and that actual expenses in recent years have left out some personnel costs. And he doesn’t believe the county should be involved in the event business — something it plans to do with a large banquet space on the second floor of the new clubhouse.

“It’s not the business of government,” he said. “They’re just doing it because it’s an ego trip.”

in response to:

“In the next two years, once the clubhouse is finished, the golf operations will probably break even, said Sanchez, the golf director. They should be stabilized, however, by 2015, when he expects to once again earn a profit while paying down all the debt.”
So where did the Summit Council president get his information:

Through June golf operations made $2,595,505 according to official county numbers.

Based on the 2012 check registries, costs through June came to $6,863,660.

  • KemperSports hand check registry:$1,293,890
  • Claremont Construction: $5,308,083
  • Kemper Sports check registry:$225,046
  • Total Turf Golf Services: $36,641

Even without including any engineering, legal, or consulting fees that may be hidden under ‘professional services’ or any building material that may be hidden within the check registry, or salaries and benefits for Armando Sanchez and any ex-greenskeepers still on the county payroll,  the loss through June from golf operations in Union County comes to $4,268,155.  Black indeed.