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Less debt results in more green for golf course

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Less debt results in more green for golf course

A player tackles a shot on the Manteca Golf Course.

HIME ROMERO/The Bulletin

POSTED June 27, 2012 1:07 a.m.

Manteca’s golf course is above par when it comes to financial performance.

For the third straight fiscal year, the municipal course is expected to bring in more revenues than needed expenditures to maintain the 18-hole facility. City Manager Karen McLaughlin is making that projection in the 2012-13 fiscal year budget being presented to the City Council during a workshop on Thursday. The council meets at 2 p.m. at the Civic Center, 1001 W. Center St.

The course is expected to bring in $107,705 above the estimated expenses of $1,029,844 it is projected to cost to operate the facility during the fiscal year starting July 1. The current fiscal year is expected to end with a $88,705 surplus in the golf enterprise fund.

The proposed budget includes funding to replace equipment critical to maintaining the course plus addressing meeting needs.

The golf enterprise fund has been able to reverse deficit spending despite decreased consumer disposable income that is impacting play. It has been accomplished through cutbacks in the compensation of municipal employees that keep the course maintained plus the elimination of a large chunk of its debt service that at one time accounted for 22 percent of the annual expenses.

Twenty-three months ago the final annual $175,000 payment was made on a lease-purchase arrangement to build the golf course clubhouse in the early 1990s.

Manteca took out a 25-year loan in 1978 to convert the old wastewater treatment plant to expand the golf course to 18 holes and built the tennis courts along Union Road.

The last payment will be made in 2013 to free the golf course of a $52,000 a year obligation. That debt accounts for 4.9 percent of the budget for the upcoming fiscal year.

Up until three years ago the city had to make an annual loan averaging $140,000 from the general fund to the golf account to balance expenditures and revenue.

McLaughlin in her budget message noted the general fund has loaned the golf course $1.4 million over the years. Various councils have never adopted any position on when - or if - the golf account should pay back those funds.

The budget for the golf course also includes $155,000 from the general fund to pay for the recreational benefit of the facility. The money has been designated in the past to pay for free youth play by high school students and reduced green fees for Manteca senior citizens. The only Manteca recreation facility that isn’t receiving an operating or maintenance subsidy form the general fund is the Big League Dreams sports complex.

The general administration and overhead charges that were suspended starting on July 1, 2007 are still not being assessed to the golf course. McLaughlin is recommending that process be continued for the upcoming fiscal year. Staff is reviewing an allocation plan in conjunction with the 2012-13 budget that could lead to a recommendation to reinstitute some charges.

Critics in the past have argued the blanket 20 percent cost recovery fee the city sought to impose on all enterprise accounts such as golf, water, sewer, and garbage collection was arbitrary and inflated and had the effect of staff expenses being paid for twice.

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