City stays course with Ironwood
Course still losing a large amount of money, but officials cite positive signs
Published: Sunday, October 27, 2013 at 8:27 p.m.
Last Modified: Sunday, October 27, 2013 at 8:27 p.m.
It's the noon hour on a Thursday and clusters of golfers are spread out across the greens and fairways at Ironwood Golf Club.
Inside the clubhouse, a group of friends sits at the bar, drinking beer and finishing lunch.
Twenty-one years after the city purchased the course off Northeast 39th Avenue, Ironwood continues to run in the red to the tune of hundreds of thousands of dollars a year.
But city officials say the last year has brought encouraging signs, with increases in revenue and rounds played.
At the Oct. 17 meeting, the City Commission decided to stay the course with Ironwood for the time being. Commissioners voted unanimously to keep the course under public operation as part of the Parks, Recreation & Cultural Affairs Department. Sticking to a staff recommendation, the commission rejected four bids for private operation of the course, which would have still remained under city ownership, and instead awarded an annual maintenance contract to OneSource Landscape & Golf Services at a $490,000 cost.
Practicing with his 7-iron on the driving range, Richard Urban said the renovation completed in 2010 improved the course conditions and increased play.
"Many golfers who would only play here occasionally, play here a lot since the renovations," Urban said.
That $1.3 million project included reconstruction of the greens and a new drainage system.
Parks, Recreation & Cultural Affairs Director Steve Phillips said the benefit of the course improvements was evident during this summer's heavy rains.
"Before the drainage improvements, if it rained like that, we literally would have had to shut down the golf course," Phillips said.
While the course continues to run in the red, staff in the parks and finance departments say increases in the rounds played and the money brought in at the pro shop, driving range and concessions show signs of a slow but steady improvement in financial performance.
Interim course manager Jeff Cardozo, who took over after longtime manager Bill Iwinski was fired in June 2012, has used a strategy of offering discount play on slow days to draw golfers to the course. There's $1 a hole golf on some Mondays and Tuesdays, a Walking Wednesday special if you do not rent a cart and even discount play if you wear an orange shirt like PGA tour star Rickie Fowler. There are specials offering free lunch or a free draft beer and, on certain weekdays, a chance to win free golf for a month. "You get people out here, and once they see it, they are going to come back," Cardozo said.
Cardozo, a former University of Florida baseball player who hosts sports radio and television shows, also used connections with Cox Communications to get a discount rate on commercials for Ironwood airing on the Golf Channel.
The result is a decline in revenue per round played and overall greens fees, which are expected to decline from $374,360 in fiscal year 2012 to $373,317 in the budget year that just ended Sept. 30.
But total rounds played are up — from 24,605 during the nine months from October 2011 to June 2012 to 29,925 from October 2012 to June 2013. The same is true for cart rental fees, pro shop, driving range and concessions revenues.
From budget year 2012 to 2013, total operating revenues rose from $847,809 to a projected $891,368 in the recently ended budget year.
The $5 per round surcharge put in place to pay off the bond issued for the 2010 course improvements is bringing in about $178,000 a year when the annual debt payments are $95,000. That allows the course to put money away for equipment purchases and infrastructure improvements.
"It's improving," Finance Director Mark Benton said of Ironwood. "While we expect it to continue to improve under Jeff's guidance, whether it will ever make money, I don't expect that. But it is a public recreation offering, and it covers more of its costs than other programs."
How much money does Ironwood lose? The answer depends on whether you look at the course as an enterprise fund, which it currently is, or part of the city's general fund, which is where it is transitioning.
The course has accumulated a total of $3 million in losses in its two decades of city ownership and the city's general fund is paying that off with a $300,000 installment each year through 2019. The course will then become part of the general fund.
With that annual payment taken into account, annual losses are in the range of $750,000. Take it out, and the annual loss is in the range of $450,000 when the course is accounted for as an enterprise fund, where the course revenues are supposed to sustain expenses.
Look at the course as a department in the general fund, which removes expenses such as debt and the costs for time that administrative staff from the city manager's or finance department spend on golf issues, and the loss is $192,350 a year.
A municipal golf course running in the red is not unusual. A study referenced in a September article in the Fiscal Times said 90 percent of the municipal golf courses in Florida that are operated as an enterprise fund lose money, with the average annual loss at $265,000.
In recommending against private management of Ironwood, Assistant City Manager Paul Folkers said staff didn't project that it would bring much savings. He said maintenance costs would stay approximately the same and there would not be much savings in personnel costs because staffing is already "lean."
Cardozo is the only full-time employee. There is one part-time employee and 12 temporary employees.
With the course staying under city operation for now, staff said the city would advertise the course manager job that Cardozo has filled on an interim basis in upcoming months.
At the Oct. 17 meeting, City Manager Russ Blackburn said it has not yet been determined how the course will be managed in the long-term.
While voting with the rest of the commission, Mayor Ed Braddy said the options of private management or the sale of the course should not be ruled out in the future. He said the city should always strive to turn a profit at the course.
Getting set for a round of golf on a clear, comfortable Thursday, Gainesville resident Dave Harvey said he's been playing at Ironwood since the 1980s, when the condition of the course brought the less-than-flattering nickname "Ironweed." Harvey said it's now in better condition than ever. He thinks it's a recreational amenity the city should continue to offer.
"I don't use bike trails," Harvey said. "I don't use parks. I don't use the pools. I golf and I pay taxes. I come here. I love coming out here."