Long Term Planning

January 28, 2014

City Manager:

We appreciate your note and kind remarks about FOLB. Our organization is only interested in helping the city achieve maximum efficiency and productivity from Lady Bird.
We are encouraged that City Council elected to continue with the Master Plan, allowing more time for our current professional management to develop a track record. However, we are puzzled by the inconsistency of some members of City Council who seem reluctant to stick to the plans and professional management for which they voted both in the distant and more recent past. Our recollection is that City Council voted unanimously to create the Golf Department, to accept the selection of the Director, to accept the Master Plan, to accept the business plan, and to commit to the renovation project.
Certainly, we agree that City Council should provide oversight for the golf course. In fact, the purpose of our annual report is to provide objective information to assist City Council in its oversight role.
Our perspective from a position both inside and outside the ropes suggests that the reason for City Council’s inconsistency is the lack of a well-considered and articulated mission for the Golf Department. Is the goal to produce an operational profit? Is it to support business and tourism? Is it to provide an affordable recreation to residents? Is it to provide a safe venue for juniors? Perhaps the mission is another or even a combination of these.
Our perspective also suggests that City Council has yet to define a specific set of parameters to use in measuring performance and a specific time line for exercising oversight. If the mission of the golf course is a combination of the questions posed in the previous paragraph, then perhaps performance might be measured not only in terms of operational costs but also with consideration of other factors including the number of out of county visitors, measurable co-operation with local businesses, active participation in the Chamber of Commerce, number of junior lesson provided, achieving a certain percentage of good marks on post experience surveys, and operating to certain industry and professional standards, just to name a few.
As we consider these foundational issues, we are reminded to re-consider our own relationship with the golf course and the city. We are under no illusions that we are either empowered or qualified to operate the golf course. Rather, we take seriously our City Council granted authority to provide objective information and to assist Golf Department management by offering recommendations and providing resources to enhance the city’s investment. From the beginning, our goal has been to support open, transparent, and inclusive discussion and not to achieve any pre-conceived outcome.
Our observations suggest that there are several fixed structural factors which have and will continue to exert downward pressure on golf course management. These structural problems exist for historical reasons and are not due to either current management or the residents and visitors who use the golf course:

1. Club House: Though an architecturally stunning building and a testament to the beauty of the Hill Country, the club house was not only expensive to build but also requires ongoing costs for operation and maintenance well above the industry standards for a municipal facility. Specifically, the Golf Shop is much too large for the retail sales expected; the Cardinal Room currently lacks the access, parking, and catering infrastructure needed to compete with other venues, and the grill has only a limited customer base.
2. Golf course design: Though beautiful, the green areas of the golf course require operation and maintenance costs greater than anticipated due mainly to the number and style of bunker and the design of greens and tees.
3. Maintenance budget: The maintenance budget for Lady Bird as recently renovated is well below industry standards for a municipal facility by at least 50% (USGA, National Golf Foundation) due mostly to the number of full time personnel. The course is a unique city asset in that its optimum revenue generation occurs on weekends and holidays when most city employees do not work. The current full time staff is insufficient to operate and maintain the renovated facility 365 days a year (though the golf course is closed on Monday’s for play, it is definitely open for maintenance).
4. Overtime pay: Not only does the shortage of personnel make it difficult to protect the city’s significant investment, the shortage of personnel also increases the need for overtime pay as it is necessary to compensate workers in the understaffed labor pool time and a half for routine work after 40 hours per week and double for work on holidays.
5. Funding shortfall for renovation: In order to accommodate the shortfall of $80,000 from the renovation budget, Golf Department management had to scale back on irrigation and drainage infrastructure. At that time, this withhold was called “value engineering”. Unfortunately, the result is that ongoing maintenance requirements are greater than anticipated due to continuous breakdowns of irrigation lines and sprinkler heads as well as erosion due to run off after even modest rain.
One of the recurring themes we have discussed in our annual reports is that the golf course is unique among city services in that it must compete in the retail world for discretionary dollars. Therefore, the issue of revenues is a dynamic functional problem rather than a fixed structural problem as discussed previously though the two are connected. To attract patrons, the golf course must offer perceived value, i.e. a combination of the aesthetic experience and the cost. As all business owners know, a price can be raised only so long as it remains a good value Increasing fees to non-competitive levels may lead to decreased demand. Similarly, a decision to decrease maintenance, which would occur if total overtime pay is reduced, will adversely affect the aesthetic experience. Together these decisions may actually lead to diminished gross revenues and increased net negative cash flow. To improve revenues, the golf course must attract a greater number of patrons and that is why we have continuously recommended professional marketing and strongly encouraged the involvement of the Convention and Visitors Bureau. This delicate balance seems to be an area where the city must rely on the professional experience, training and acumen of the Director of Golf.
Lastly, we cannot help but feel some concern that some members of City Council look upon the golf course differently than the city’s other recreational venues. The tennis courts, playing fields, swimming pools, and parks all have expenses far in excess of their user fee revenues. It is only the golf course which achieves revenues (greater than $1M annually) approaching the city’s cost of providing the facility and it is only the golf course which also draws out of county visitors (over 9000 during the past fiscal year). Even MarketPlatz, which has significant net negative cash flow, is looked upon by all to be an attractor for visitors and a generator of business income in addition to being a wonderful amenity enjoyed by residents.
We sincerely hope that you will consider a mechanism for discussing these issues with City Council in an effort to clearly identify the challenges unique to this asset. Much time, effort and money can be saved if the focus is kept on the foundational problems rather than the symptoms. We are confident you and the Council will arrive at the best solution when the challenges are clearly and accurately identified.
Sincerely,
Leonard Bentch, President
Jerry Fischer, Vice President

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