Municipal golf

Ron Opelt, left, and Ray Rung on the Glenway Golf Course in March 2016. 

Madison’s Golf Enterprise Fund will keep operating with additional cash advances from the city while a task force is set to begin considering the future of four publicly-run golf courses. 

At the end of last year, Madison loaned the financially weak Golf Enterprise Fund $813,000 due to an inadequate cash balance. A resolution adopted by the City Council Tuesday authorizes a formal repayment plan in response to the loan and allows additional advances up to a total of $1.5 million.  

The resolution is a “short-term” measure in anticipation of future recommendations from the Golf Task Force and action by the mayor and City Council regarding the long-term finances of the Golf Enterprise, Finance Director Dave Schmiedicke said. 

Madison Parks Superintendent Eric Knepp said the advance is a recognition that the Golf Enterprise Fund, which runs Yahara Hills, Glenway, Odana Hills and Monona golf courses, needs additional resources to operate. 

“We are hopeful that it will provide enough resources to continue to operate until such time that policy decisions are made about what the future is about golf and what model, i.e. subsidies or not, will be contemplated,” Knepp said.  

The loan will finance the Golf Enterprise Fund's cash deficit position through the end of the year. The enterprise will repay the loan over the next four years from its operations.

According to the resolution, the goal of the advance is to provide enough time to determine the future of golf course operations and the best strategy to address structural deficits within the enterprise fund.   

“From our perspective, it’s a recognition of what we’ve known and have been saying that operationally we are losing money on a full cost accounting basis,” Knepp said. “The loan will provide the time necessary for the task force to complete its work.” 

For over a decade, the Golf Enterprise Fund, which runs the four courses, has been struggling financially due to deficits between revenues and expenditures. The fund last showed two consecutive profitable years in 2001-2002.

The 72-hole system, which makes up 750 acres of city parkland, also has a host of infrastructure problems and capital needs that could cost up to $9 million to fix. Major flooding in the city last August exacerbated the problem at the golf courses. 

The enterprise had been spending its own cash reserves to cover deficits. At the end of 2018, the city loaned money to the Golf Enterprise from its own unassigned cash reserve to cover a shortfall of $813,340. 

The fund anticipates an additional cash shortage of approximately $500,000 by the end of this year, which would increase the projected cash deficit to approximately $1.3 million.

The resolution authorizes the additional loan in anticipation of the Golf Enterprise developing and implementing a long-term plan for financial solvency. It also establishes a repayment schedule, starting in 2020 with $50,000 and ending in 2023 with $1.2 million.

Mayor Satya Rhodes-Conway called for a task force to study the future of municipal golf after learning of the record financial loss in 2018. The group is scheduled to meet for the first time on Oct. 23 at 6 p.m. at the Goodman Maintenance Facility, 1402 Wingra Creek Parkway.

Recommendations from the task force are due to the mayor May 1, 2020. 

Knepp said the task force is the city’s “best hope for a solution that is truly durable and sustainable.”

“My hope is those recommendations can then be implemented with all due haste,” Knepp said, “that we come to a consensus and move forward with it and we put golf and the courses on a firm footing and with a future understanding not only of where we stand today but where we want to be 30 years from now.”

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