Based on the title one might think that I have my sports jargon mixed up. However, this story is about golf. Specifically, it is about a proposal for $1.5 million to replace and extend the netting which surrounds the driving range in Liberty Lake.
Lets start with some background and numbers
The City of Liberty Lake owns and operates Trailhead golf course. Opened in 1973, the course was acquired by the City about 15 years ago to provide recreation to the residents and preserve the open space. According to the Fiscal Year 2018 Budget, it appears the golf course will profit about $30,000*.
It is interesting to note the Facilities – Outside Labor & Materials, Golf-other Improvements, Golf-Furniture, Computers&Equip, Golf Cars – Furniture, Computers& Equip expenses are estimated at zero for 2018. Most of these expenses had balances in previous years. Golf-Other Improvements expense had a cost of $30,000 in 2017 and includes a note which states, “Waiting on Irrigation Estimate”. The cost for the irrigation is expected to come in between $850,000 and $1.2 million.
Now lets talk about nets
The net surrounding the driving range has been described as too short for the distance of the range and too short on the sides. This means it is possible for golf balls to travel outside the perimeter of the range.
This doesn’t seem like a big deal. So what if a golf ball breaks a window, dents a car, or damages any property? The percentage of property damage in relation to the number of balls hit each day barely registers. Many times the balls hit City-owned buildings. Costs for repairing the potential damage is relatively very low. A drop in the bucket of the City’s overall budget.
Unfortunately, it is possible (still unlikely) that there could be personal injury from a ball leaving the perimeter of the range. The current liability insurance provider is not willing to assume this level of risk and would like to have the risk mitigated. Costs associated with potential litigation and personal injury could bankrupt a city the size of Liberty Lake.
The city has a high liability exposure for this driving range with the number of golf balls being hit over/through the fencing. It is only a matter of time before someone gets hit by a golf ball causing serious injury or death. We recommend following the recommendations by the specialist you are working with concerning these items, including his recommendations regarding the metal poles and the height of the netting. We highly recommend the City begin the process of budgeting for these repairs in the near future.
The report goes on to state, “There will be a follow-up within 45 (forty-five) days to ensure that items identified in this report have been corrected.”
In order to limit liability, one solution is to raise the nets around the perimeter of the driving range. Seems like a simple and straight forward solution. Like most improvement projects, it is not that simple.
To accommodate the required height, the poles supporting the net would need to be replaced with metal poles versus the current wood poles. The estimated base cost for this is $1,370,600 plus sales tax and options which easily bring this project to over $1.5 million.
Back to the numbers
Liberty Lake is considering the solution of spending $1.5 million on the driving range nets and between $850,000 and $1.2 million on the golf irrigation this year. Neither expenditure increases revenue or provides a service that doesn’t already exist. Just limiting the liability and replacing the irrigation system would total over $2.5 million dollars.
- Law Enforcement: $2.2 Million
- Library: $505,000
- Streets Operations: $1.1 Million
- Operating Revenue: $7.6 Million
- General Expenditures: $9.1 Million
Imagine you own a lemonade stand. You sold $900 per year in cookies at your stand. Because you have good cookies customers also buy $2,200 per year in lemonade and $500 in bottled water. Then imagine the health department comes by and tells you you have to spend $15,000 to upgrade your oven to avoid someone getting sick on your cookies. It doesn’t change the flavor or add any benefit to your productivity or sales, but is required if you want to keep selling cookies.
Would you keep selling cookies knowing that it would take over 16 years of selling cookies to earn that much in cookie revenue (not profit) to pay for the new oven?
Or, would you shut down your cookie operation and look for a more profitable product to compliment your lemonade and bottled water?
These are the type of questions city councilmembers have to answer.
The driving range (cookies) will bring in about $90,000 in fees this year. Green fees and season passes (lemonade) should bring in about $220,000 this year. The pro shop (bottled water) is expected to sell $50,000 in 2018. A cost for the new driving range net (oven) is expected to be $1,500,000. It would take over 16 years of driving range fees just to pay for the net assuming you had no other direct expenses or capital expenditures and did not borrow money with interest to make the purchase.
Are there other, less expensive solutions?
City Council is holding a special meeting on December 12, 2017 from 5:30 p.m. to 7:00 p.m to help answer this question. The meeting will be a workshop for Council to better understand their options. The meeting is open to the public. It is my understanding that public comment will be minimal as this meeting’s purpose is to allow the Council to discuss, better understand the issue, and work on solutions.
Keep in mind you may always contact councilmembers to share your opinion or ideas. Here is a link to their contact info: http://www.libertylakewa.gov/184/City-Council
Some of the things they are likely to discuss at the special meeting:
- Does the entire perimeter need to be rebuilt from the ground up?
- Is there a different insurance underwriter who would assume the current risk?
- Could the projected be done in phases over a number of years?
- Is it worth $1.5 million so that a few residents can practice their swing?
- Could the current nets be moved closer so they don’t need to be as tall?
- Should we get more than one bid?
- Does the city need a driving range?
- Should the prices for all golf services be increased?
- Are there other capital improvements which could benefit from $1.5 million and provide a benefit to residents?
Resident and councilmember-elect, Mike Kennedy, has two main questions he would like to have answered before making a recommendation. They are:
1. Do we (Liberty Lake) want to be in the golf course business?
2. If yes, what are the costs?
As a taxpayer and/or golfer, what are thoughts?
*Removed Unreserved Beginning Cash/Investments and Unreserved Ending Cash/Investments to arrive at $530,515 income minus $502,714 in expenses. Total is $27,801.