Tuesday, June 6, 2017

Golf Course Financial Update and Farewell to Cedar Hills

My last day as a City Council Member in Cedar Hills will be June 4th as my family is moving out of the city.  I will miss being a part of this great city.  My last newsletter entry will be an update regarding the golf course financials, which is the same topic which started my involvement in Cedar Hills politics.  Following is a chart of financial investments from the city residents through taxes and through fund transfers since the inception of the golf course:

Note>The numbers added for the Pro Shop in 2012 only included a pro-rata portion of the approximate $2.9 Million to build the Community Rec Center/Pro Shop.

These numbers come directly from the city audited financial statements.  In addition to the investment in the golf course by residents through other fund transfers and through property tax payments, the city, at the end of fiscal year 2016 had golf debt of $5,350,000.  The total investment in the golf course including the above numbers and debt is $12,915,713.  If anyone says the total investment/spending on the golf course is significantly more or less than this number, they are probably trying to manipulate you.  If they will not tell you the number they think it is and will not tell you what they are excluding or including and only say this number is wrong, they are being dishonest.  You can't say a number is wrong unless you know what that number should be and are willing to explain how it is wrong and what it should be.

During our golf course committee meetings in 2015, the city prepared a schedule of cash investments into the golf course through fiscal year 2015 that totaled $12,600,180.  This shows that the city calculations from the audited financial statements and my calculations based on the audited financial statements tell a similar story.  The city forecast provided during the golf course committee meetings showed that for 2017 through 2021 an additional average investment of $572,380 per year is expected.  These are the raw facts regarding the golf course.  These facts do show that there is significant investment placed in the golf course and significant investment required in the future.  However, through looking into the financial statements of the golf course there are also some positive things to point out.

The golf course is comprised of 166 acres.  The total investment in the golf course through 2016 was approximately $12.9 Million.  If you divide the total investment by the number of acres, the average price per acre is about $78,000 per acre.  This is much lower than the market price per acre currently and the value of land will only increase as land becomes more and more scarce in our city.  The initial investment in the golf course was approximately $7,000,000 and was funded mostly by a bond.  We are paying for this investment yearly by an amount of approximately $360,000 for which the city taxes the residents to pay for most of this.  This equates to about $140 per year per household.

In addition to the initial investment in the golf course that was funded by the bond debt, the golf course operating losses have required a subsidy from other funds in order to keep the golf course financially viable.  The average per year subsidy since the building of the clubhouse/community rec center has been between $140,000 and $184,000 (Between $54 and $70 per residence).  The city has started development of a maintenance shed and office for the golf course that will cost between $350,000 and $400,000, which will increase the yearly subsidy for the year in which this is built.

Some good news is that the golf revenues have been about $50,000 higher since 2014 when compared to prior to 2014.  This appears to be from more corporate golf events being scheduled as the golf manager (Wade) has worked really hard to get more of these scheduled at the golf course.  As a result, without a significant increase in the subsidy for 2015 and 2016, the golf cash balance has increased from $61,386 in 2014 to $166,590 in 2015 and then to $233,496 in 2016.  It appears that after the golf maintenance shed is built, the subsidy from other funds may be able to be reduce to under $100,000 per year.

Do residents get $200+ in value per year from this investment?  That depends on your perspective.  Some feel that living next to a golf course is worth more than this amount to them.  Some go for walks through the golf course trails and enjoy this and consider the $200 per year well worth this investment. Some who live close to the golf course feel that the golf course props up their property values and is therefore worth the continuous investment into the golf course.  Others feel that the golf course does not increase their property values and does not provide any day to day value to them, but only represents a cost to them.  Both points are valid for both sides and both sides should respect the opinions of the other.

The fact is that there are other options than having a golf course.  Selling some of the land that is in Highland and a couple of small areas in Cedar Hills, could provide the funds to pay off the debt and still allow most of the open space in Cedar Hills to remain open space as parks.  This option would have some positive results including having more park space and allowing residents to use the open space whether they enjoy golf or not.  However, this will not happen in the near term as those that feel that the golf course increases their property values and those that love to golf are much more passionate about keeping the status quo than those that would prefer to not pay for the golf course they don’t use.  The golf course is here to stay barring any unforeseen political movement in the city by those who would rather have parks.

The pro-golf course group has become very organized, to the point that they can determine and have determined nearly each election period who gets in office over the last 10+ years.  They choose those that will protect the golf course and not ask serious questions about its profitability or cash requirements.

My goal through getting to the truth about the golf course financials was to help the city come to a position of peace through knowledge of the facts.  I believe the solution is for the city to analyze the golf course financials through a golf course committee once every 5 years.  This committee needs to be a fresh group that does not come in with biases and an honest discussion needs to be had each time.  Good arguments need to be presented and then the discussion needs to be put to bed for 5 years, except for a yearly update of the numbers as the financials come out each year (such as this one).  There needs to be less pressure from the organized pro-golf course political party in the city during these meetings to allow the truth to be discussed openly without shaming for those that ask legitimate questions.

This is my last week as a city council member.  I am happy with my service and feel that adding clarity to golf course financial information was a small portion of my service.  I feel that we need a good conservative council member to be appointed and then elected that will try to keep our debt down as a city.  In a 5-member Council, changing one conservative voice can have a drastic change on the outcome on certain issues.  Following are some of the unnecessary spending items that I hope the city will avoid in the future:

1)  Pressurized irrigation metering

2)  Library

3)  Taking ownership or partial ownership of Canyon Road

4)  Swimming pool/rec center

5)  Extending our sewer service across canyon road to service a small number of residences

Following are some things I would have liked to accomplish, but lacked the support of the council:

1)      Put a stop to paying dues to the liberal lobbying efforts of Utah League of Cities and Towns.

2)      Make it so that the Council/Mayor don’t get unlimited free golf.

Following are some of the accomplishments that I feel I have had:

1)      Helped to make sure that Blue Line did not get approved to build a large building that didn’t conform to our code.

2)      Helped to switch to Kirton McConkie law firm, which has the resources we need in our city.

3)      Helped to curtail the spending of approximately $2,000,000 on an unnecessary pressurized irrigation metering system.

4)      Helped to add clarity to the financial situation of the golf course.

5)      Helped to make sure there was more balance between what benefits the residents get from the golf course and what the city council/mayor get from the golf course.  Residents now receive a free gift certificate to golf one round yearly and are allowed free golf when bringing two to three paying customers.

6)      Helped to deter the city from spending approximately $400,000 in extending our sewer service across canyon road which would only “help” a small handful of residents, some of whom are happy on septic tanks.

7)      On the North Pointe Solid Waste Special Service District, I helped to ensure that a process of expanding the size and reach of the government into a private industry through the creation of a government entity named NUERA was not done secretly behind closed doors.

8)      Wrote the arguments on the voting ballot against the CARE Tax which ultimately was rejected as it represented an additional tax. (This next year it will be rebranded and presented again as the PARC Tax and put up for a vote).

9)      Helped to make sure there was more openness and transparency in our city government.

10)   Asked the hard questions that needed to be asked.

11)   Served for a year on the beautification committee.

I have accomplished most of what I wanted to as a Cedar Hills City Council Member.  Thank you for allowing me to serve our great city.

As a final thought, I want peace in Cedar Hills as most of us do.  Here are some suggestions for having peace in the future:

1)      City Count/Mayor-Always be forthright and honest, especially with difficult information.  Over-communicate if necessary to make sure that all sides of an argument feel that their voice has been heard and considered.  Publish a yearly update of the golf course financials (like this one).

2)      Those Who Love the Golf Course-Disband your secret Facebook groups and stop vilifying those who feel it is important to occasionally analyze the golf course.  Sure defend your positions vigorously, but stop spreading rumors about candidates wanting to get rid of the golf course that do not explicitly state that themselves.

3)      Those Who Don’t Want the Golf Course-Save your arguments until a golf course committee meeting is organized (I suggest once every 5 years, the last one was in 2015) so those who want to keep the golf course don’t constantly feel threatened.

4)      Remember we are all neighbors and recognize that everyone has valid points in their opinions and it is ok to agree to disagree and still be friends.  Love one another.

I feel happy to have given service in Cedar Hills.  I wish the best to all in the city and hope and pray for a bright future for Cedar Hills.

PS--Just in case any rumors have started or will start regarding why I resigned.  I resigned because my family is moving to a home in Highland that is just right for our family.  I am sad to not finish my term and explored all possible ways that I might continue on the City Council while doing what is best for my family and found there are no possible ways to remain on the Council while not living in the city of Cedar Hills.  My family took precedence. God first, then family, then country/community.

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