City wants to know why Palm Harbor golf is still in the red

Palm Coast Observer
News

City Council members pressed KemperSports managers for hard numbers and projections after a presentation on Kemper’s management of the Palm Harbor Golf Club and Palm Coast Tennis Center at a City Council workshop Tuesday, April 14.

They weren’t forthcoming, and that was by design: City Manager Jim Landon had told Kemper Regional Operations Executive Jody Graham and manager Brad Adams, who prepared much of the presentation, not to use them.

“I told them to quit giving projections,” Landon said after city Mayor Jon Netts asked for them. “They can say that in five years we’ll break even, and you won’t believe them because they’ve been saying that the past five years.”

City Councilmen Bill McGuire, Steve Nobile and Jason DeLorenzo weren’t satisfied with Kemper’s near-numberless presentation, which talked about new initiatives — attempts to get more teens and children to play through programs involving local schools, for example — but not how much money Kemper could make by using them.

“Without that information, all this is nothing, honestly,” Nobile said.
He said he didn’t think many kids wanted a varsity letter in golf.
“Are we building it and hoping they come, or are we building it with projections and plans that they will come?” Nobile said.

Landon said the city had specifically said the course would no longer operate as an enterprise fund. Instead, he said, “we are going try to make money, but we’re no longer going to make those kinds of projections.”
There were a few numbers in the presentation. Among them were statistics that showed that the golf course had $766,344 in expenses from Jan. 1 to March of this year to last year’s $758,572, and that in the same January-March time period, 17,965 rounds of golf were played this year, and 17,805 rounds were played last year.

There was a similar table of numbers similar numbers for the tennis center: $153,077 in expenses from January to March 2015 and $172,856 from January to March of 2014, and 922 walk-on players during that period in 2015, to 635 in the same period last year.

But McGuire wasn’t impressed with the lack of projections.

“The City Council has never said, to my recollection, ‘Well, we’re going just roll with it and hope it does good,’” he said. “Every successful business has a profit plan. You may not hit it, but there have to be goals that you reach for, and it has to be quantifiable.”

Netts sounded like the goal appeared to be increasing rounds of golf played by enticing young people, women and families onto the green.

Nobile, after asking Graham what percentage of the market share those populations were and not receiving a numeric reply, said that wouldn’t help if there weren’t enough women, teens and families to turn around Kemper’s losses.

“If you don’t know what potential market you have, how do you go after it?” he said. “I’m just hearing, ‘We built it, and hopefully they come.’”

Landon said that Kemper had those projections in its archives, and “they didn’t work.”

“The numbers show that we shouldn’t be in the golf business if we’re trying to break even or make a profit. Then the question is: Do you want to maintain a recreational facility?” he said, comparing the golf course and tennis center to the city’s Indian Trails Sports Complex.

McGuire thought it a bad comparison.

“Indian Trails Sports Complex generates a huge amount of revenue,” he said, “And we measure it every month.”

DeLorenzo pointed out that although Palm Harbor visitors are paying more per round, they’re paying less once they’re at the facility.

McGuire asked Kemper how frequently it could come back to the council with new presentations, and Adams and Graham replied that it could do so twice a year, or quarterly.

“Call me an old curmudgeon: I still want to see a goal,” McGuire said. “You may not hit it, but if you don’t have one, you ain’t going to hit it.” Later, he added, “Let me put it into perspective for Kemper: Those of us who are sitting here speak for the people that elected us. The people that elected us are not happy with the performance of the golf course because, keep in mind that there’s more than 78,000 citizens that we represent. A small fraction of those folks play golf. Now, the people that play golf down there love it. They love Kemper; they’ve got red T-shirts that say so. But I have to go back and tell the people that live in the B-section, ‘Hey, this is why we’re doing what we’re doing.’ And I have to be able to put it in perspective and say, ‘The new Kemper management that’s here has a different direction, a different plan and they’re showing some results here. As long as I can say that, I mean — if we ever got to break even, there’d be dancing in the streets, because a lot of people don’t understand and don’t look at our golf course as a city asset like the mayor does. They look at it like a boat. You know, people will say, ‘What’s a boat? It’s a hole in the water that you throw money in.’”

Netts said that the city would eventually have to make a tough decision on the course.

“At some point, this City Council or the next City Council or a subsequent City Council is going make a decision,” he said. “Obviously, we’d love to break even. We’d love to make money. That may or may not happen — you will report back on the new initiatives — but at some point City Council is going to say, ‘If the golf course doesn’t operate even we’re going to: A) Sell it, if you can find someone wiling to buy it, B) Close it, if you can accept that impact on the community, or C) We’re going to continue to subsidize it as part of our recreation program. There aren’t a lot of other options.”