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Golf course expected to finish in the red for 2013

The city of Maple Valley is expecting to finish in the red on the Lake Wilderness Golf Course budget this year, but is planning to break even in 2014.

In the third quarter financial report to council members dated Oct. 28 Finance Director Shawn Hunstock noted that the golf course’s revenue was improving but had not yet broken even.

As of Sept. 30 revenues for the course were projected to be at 90 percent of the budget and was below budget in sales at the pro shop and in green fees. In the report to the City Council Hunstock also explained that the course did well the second half of the summer but was hurt by the amount of rainfall in September. In the same document it was projected that the course would finish the year just under $100,000 in the red with more than half of that amount — $52,198 — a deficit in operating income and $45,000 in capital expenditures.

“The bottom line is that the LWGC finances will likely not break even in 2013,” Hunstock wrote in the third quarter report. “However, after thorough discussions with the golf course managers, the City is budgeting to break even on operations in 2014.”

The city approved the purchase of the golf course in November 2006 in a 5-2 decision, paying about $4 million for the property after residents asked the city to buy the course as an alternative to YarrowBay developing the property. Since 2007 Premier Golf has been running the course through a contract with the city.

YarrowBay had a deal in place with the previous owner to purchase the course, explained Chief Entitlement Officer Colin Lund in 2010. YarrowBay approached the city at the end of October 2006 with an offer to purchase the course and told city officials they needed a decision by the end of November.

Representatives from YarrowBay told Maple Valley officials it decided to offer the city the chance to buy the course when it decided not to go ahead with the purchase, Lund said. YarrowBay offered the site with the idea the city would want to preserve it rather than see houses built.

In the time since the city purchased the course adjustments have been made to levels of service, particularly at the restaurant that is located at the course over the past few years.

City Manager David Johnston previously explained that money from Maple Valley’s general fund has been used to subsidize the operation at about $100,000 a year on average. Johnston told the Reporter in 2012 that cutting back on restaurant operations was helping to shrink the deficit. The city has worked with Premier and created a task force in 2010 to assess course operations and make recommendations.

Kris Hill contributed to this report.

 

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