The council enters an annual agreement with the Powell Golf Club — also known as the Powell Country Club — for management of the golf course. Each agreement runs through July 31 of the following year. It’s a routine renewal most years, passing unanimously with little discussion. This year was far from routine.
Following lengthy discussion about the golf club’s debt, city funding, previous agreements and whether the city should seek proposals from other entities to manage the course, the Powell City Council on Monday voted 5-2 to extend its current agreement with the Powell Golf Club for only three months.
Councilman Don Hillman said the future with the Powell Golf Club is up in the air while the city considers its options.
“I think they understand there’s nothing guaranteed after Oct. 31,” he said.
Councilmen John Wetzel and Floyd Young cast the dissenting votes, as they supported a full year-long renewal.
Wetzel said the city’s action pulls the rug out from under the Powell Golf Club and goes against previous promises.
“We asked them as a golf course to go out and raise a ton of money and to support their club and to be heavily involved and heavily invested in it, and they’ve done that,” Wetzel said, noting the club raised $50,000 in matching funds last year, and is raising another $25,000 this year.
“And we’re telling them they can only operate under the current (contract) for the next three months? I think they feel like the knife is in the back and about to be twisted,” he said.
Request for proposal?
City Administrator Zane Logan on Monday presented councilmen with a three-month extension of the current contract, rather than a full year. Logan said a three-month extension gives the City Council more time to discuss the agreement.
“The thing that staff is possibly recommending, and that’s of course up to you guys, is that maybe we do an RFP (request for proposal) like we did with the airport operator, as we’ve done with cardboard (collection for recycling) — that’s just one of the suggestions,” Logan said Monday.
A request for proposal would mean seeking bids from anyone interested in operating the Powell Golf Course.
Councilman Wetzel said an RFP “just reeks to me of changing ships, changing captains midstream.”
“Other than one public comment by one pro that works out there, they have done everything in their power to work simultaneously with us to do what what we’ve asked them — to run a good golf course and reduce that debt,” Wetzel said.
The comment Wetzel referred to was in an email Powell Golf Club pro Doug Connor sent to golf members that alluded to city councilmen being “dumb politicians.” Hillman was upset by the email and read it aloud during the city’s public hearing on the 2012-13 budget last month.
“And other than that comment, I don’t see any reason why we should change stream at this point and say, ‘We want new managers out there,’” Wetzel said.
“We’re not saying that,” Mayor Scott Mangold said. “We’re offering them an opportunity to still bid on this, to put in a plan.”
He asked if it is more important to have a good golf course or to have the current management.
“I think the people paying for it from the city of Powell, the people who live here, I think they would just rather have a good affordable golf course. That’s the main, important thing for them,” Mangold said.
“So if this RFP actually comes in where somebody can manage it — or if it’s the same group that manages it, or if the city thinks that they can manage it — what’s better for the public and the public dollars, for the citizens of Powell?” he asked.
Dealing with debt,
It’s unclear who would pay off the Powell Golf Club’s roughly $200,000 in debt if the city hired a new operator.
“The city of Powell did not incur that debt, but that management group did,” Mangold said. “Or a previous one had done, but they are still in succession and are responsible for that debt.”
However, if a new operator is hired, “You would actually transfer that debt with the RFP, because that’s who is running it,” Wetzel said.
Also unclear is what the golf club used as collateral in its loans and what belongs to the city or to the golf club.
The golf club’s lingering debt and the city’s funding for the course have been points of continued contention among councilmen in recent years.
“We’ve been giving them money, but now the money’s running out. I mean, our General Fund has taken a beating, and the golf course — if there’s a way for us to save, let’s go out and try doing it, if there’s a possibility of savings for the citizens of Powell,” Mangold said.
Mangold said the city needs to look at saving money however it can — whether it’s the golf course or within city departments or other ways.
“I don’t think you’re going to balance the entire budget on the back of the golf course,” Wetzel said.
“No, you’re not,” Hillman agreed. “But you have to start somewhere.”
Councilman Hillman later said the golf club should be out of debt and the city has already given the club enough to pay it off.
“It’s not the city’s fault that they’re in the situation they’re in,” Hillman said.
Councilman Wetzel said the city and golf club had a plan last year to pay off the debt within three years through fundraising and city matching funds. Wetzel said Hillman is “changing horses in midstream” and is against the golf course. Hillman disagreed, saying “the only thing I’m against is the debt.”
Some councilmen worried what an RFP could mean for investors who committed to supporting the Powell Golf Club for three years.
“It doesn’t give anyone who’s writing big checks to the golf course much stability about what the long-term prowess of the management of the golf course is,” Wetzel said.
“This raises some real publicity problems for us,” said Councilman Myron Heny later. “Because you’ve got at least 15 or 16 people who committed three years for that matching money. And this isn’t just a matter of pissing off the council here — we’re talking about a lot of fairly prominent businesses and other people who do golf regularly. I don’t think we can afford to sit on this even three months. We’re extending this thing, but we better get our butt in gear and get right on it.”
The three-month extension gives the city a chance to figure out the details, Councilman Jim Hillberry said.
“This gives us an opportunity to get to the bottom of this and find out where everything is, who is responsible for what, who incurred what — and get this all aired out,” Hillberry said. “We can make a valid decision as a council then.”
Councilman Eric Paul said councilmen need to gather more facts before they commit to any decision.
“We need to take some time and look at the agreements we have, both implied and explicit, to the golf course. I think we need to probably take a peruse at the loan agreement and see what kind of collateral was tied up before we get into a mess with that,” Paul said.
City Attorney Sandra Kitchen said she needs to see previous agreements and loan documents before she can advise the city on the issue.
Logan said he expects the City Council will have a work session to discuss the golf course.