The Truth about The Legends

[giant lugey]

Here are excerpts from the Mayors monthly reports for past 2 years. The TRUTH is that the course was making money, and in most months, revenue was increasing from the years before. Some fluctuations due to weather, etc can be expected.
So why is the mayor and rec board president painting such a doom and gloom picture?
Why did they fire the guy responsible for these increases?


Jan 2006
GOLF COURSE: Golf Revenue: Golf revenue totaled $3,807.00 versus $1,610.00 a year ago

Feb 2006
GOLF COURSE: Golf Revenue: Golf revenue totaled $2,421.00 compared to $215.00 a year ago

March 2006
GOLF COURSE: Golf Revenue: Golf revenue totaled $31,134.00 increasing our year to date golf revenue to $37,363.00.

April 2006
GOLF COURSE: Golf Revenue: The Legends is experiencing a good spring. Golf revenues for the month totaled $120,341.00, an increase of almost 8% from the same time last year.

May 2006
GOLF COURSE: Golf Revenue: Golf revenues were $121,724.00, an increase of 3.53% from a year ago

June 2006
GOLF COURSE: Golf Revenue: Golf revenues were approximately $100,700.00. This represents a decrease of nearly 6.5% from a year ago

July 2006
GOLF COURSE: Golf Revenue: Revenue was $136,427.00 compared to $111,499.00 last year

August 2006
Golf Course – not available at time of printing along with seven (7) other groups

September 2006
GOLF COURSE: Golf Revenue/Rounds: This month was a great month for the golf course. Total golf revenue for the period was $122,868.00 an increase of 14% over the same time last year

Oct 2006
GOLF COURSE: Final month end figures were not available from the Auditor’s office at the time this report was submitted.

Nov 2006
GOLF COURSE: Golf Revenue/Rounds: Golf revenue figures from the Auditors indicate total golf revenue to be $34,294.00 compared to $54,811.00 same time last year. These figures do not include revenues of $10,201.00 for the last 3 days of the month deposited 11/30 and 12/1/2006. Comparing actual revenue numbers for the calendar period tells us that revenues for 2005 were $42,661.00 while totals for 2006 were $37,750.00.

Dec 2006
GOLF COURSE: Golf Revenue: Golf revenues were $23,895.00 representing an increase of 61% over last season. For the year golf revenues increased 2.24% to $927,164.00.




Feb 2007
GOLF COURSE: Golf Revenue: Golf revenue was $5,580.00 increasing our year to date total revenue to $8,539.00


March 2007
GOLF COURSE: Golf Revenue: Golf revenue was $23,991.00 increasing our year-to-date revenue to $32,530.00.

April 2007
GOLF COURSE:Golf Revenue: Golf revenue was $80,708.00 increasing our year-to-date total revenue $113,289.00. Poor weather significantly impacted our revenues

May 2007
GOLF COURSE: Golf Revenue: For reporting purposes, the following information is based on actual activity for the calendar period. May was basically even with last year. Golf revenues for the calendar month were $107,341.00 representing a decrease of 1% from the same period last year.

June 2007
GOLF COURSE: Golf Revenue: The Auditor has reported golf revenues for the month of $103,276.00 compared to $97,805.00, this same time last year. This represents an increase of 5.6%.

July 2007

Golf Course – not available at time of printing along

August 2007

Golf Course – not available at time of printing

September 2007

Golf Course – not available at time of printing

October 2007

Golf Course – not available at time of printing

November 2007

Golf Course – not available at time of printing

December 2007

Golf Course – not available at time of printing

[tucker]

There is no argument that the golf course revenues are sufficient to pay its normal operating expenses or that it can be a great asset for the city. The problem is the huge debt payment over and above operating expenses. The debt was incurred in building the additional nine holes, which cost about twice as much as the original 18.

The responsibility for the course was transferred from the mayor's office to the Park & Recreation Department five years ago, and that department has been using its own capital improvement funds to make the debt payment. Those funds are now depleted.

Someone - the city or the good fairy - has to come up with $350,000 a year for the next twenty years to pay off the debt. That is what the current discussion is about. The mayor's proposed fix is to sell some of the land to a developer and use the revenuebeing to make the payments. Some on council are against this idea, but seem unable to come up with an alternative.

The finger-pointing and fault-finding has to do with the initial period when the course was under the mayor's administrative control, when many bone-headed decisions were made by the mayor's bone-headed pals. There is also criticism of some council members for dragging their feet, unable to make a dedcision and doing nothing as the day of reckoning fast approaches.

[giant lugey]

I agree with what you say, but the mayors plan is to use $250,000 a year of the land sale money. So an alternative would be to come up with another $250,000 a year to save the course and preserve the future income of this asset.
1) They are working on renegotiating the food and beverage contract to get an additional $100,000 per year. That will bring the balance down to $150,000.00
2) They have increased membership prices by $500.00 - $800.00
With 240 members, that should bring in an additional $100,000 per year at least.
So now we are down to $50,000.00
3) Use $50,000 per year of the Genshaft money until the food and beverage contract
runs out in 5 years. Once they take over the entire food and beverage, they will
gain an additional $200,000.00, and then they will be well ahead of the game

Problem solved

[TigerCoach]

A bigger question I have is this.... Who did the financial analysis on this project? Anyone with a brain could have seen that the cost to build 9 holes wasn't worth it.

[Ron Halter]

They could take a loan from The Wastewater Treatment Fund. That would have to be paid back before Dec.31, 2008.

This could be the only legitimate use of Wastewater Treatment Funds that the administration has ever tried.

They have already recieved the results of their latest contracted "Rate Increase Study". That should tell them how much they have to increase our sewer rates again.

[Indiana95]

I agree with what you say, but the mayors plan is to use $250,000 a year of the land sale money. So an alternative would be to come up with another $250,000 a year to save the course and preserve the future income of this asset.
1) They are working on renegotiating the food and beverage contract to get an additional $100,000 per year. That will bring the balance down to $150,000.00
2) They have increased membership prices by $500.00 - $800.00
With 240 members, that should bring in an additional $100,000 per year at least.
So now we are down to $50,000.00
3) Use $50,000 per year of the Genshaft money until the food and beverage contract
runs out in 5 years. Once they take over the entire food and beverage, they will
gain an additional $200,000.00, and then they will be well ahead of the game

Problem solved

Like the supposed financial analysis done for the expansion to 27 holes....the numbers look good on paper, BUT are they realistic? Too many assumptions used in solving this problem with your plan..

[giant lugey]

They are assumptions, but they are attainable assumptions.
It can be done, if they put a little effort into it.
They are taking the easy way out by just selling the land.

[Golf Guy]

Here are Facts - not assumptions and inaccurate information.

These are in response to Giant Lugey's remarks

If you think it is not a "doom and gloom picture" look at the facts.

5 year history of the Legends

YR: Rev Generated: Operating Exp: Debt Retirement: Grand total

03 $1,077,545.02 - $832,510.03 - $409,670.00 = ($164,635.01)*
04 $1,008,348.28 - $847,099.46 - $363,730.00 = ($202,474.18)*
05 $906,883.21 - $768,815.08 - $357,540.00 = ($219,471.87)*
06 $927,164.98 - $884,348.69 - $456,240.00 = ($413,423.71)*
07 $798,906.04 - $751,000.00 - $482,362.50 = ($434,456.46)*

*Not included are the bills and other subsidies that were paid by the Parks and Recreation Department.

Who covered these deficits for the past 5 Years?

"Why did they fire the guy responsible for these increases?" - What increases? Look at the big picture, revenues were dropping over the past 5 years.

The debt retirement over the next 3 years- 2008 is $487,195.00, 2009 is $531,045.00, 2010 is $527,885.00. This increases until 2018 when it maxes out at $561,375.00 PER YEAR.

For clarification - All revenue that is brought into the Legends has 25% of that revenue going directly towards debt retirement. (Council Ordinance).

The Mayor never had a plan to use $250,000.00 a year to pay off the debt. It still would not cover the annual deficit. The plan presented to the recreation board and then council was that the course would still use the 25 of its revenue to go towards Debt Retirement and the money generated from the sale of the land would off set the debt annually until the money ran out (approximately 12 years). The plan was to put the money from the sale into a money market and generate interest without dipping into the principal annually to cover the debt.

If I have to agree with anything that Giant Lugey says - yes the 3rd nine was a terrible investment and it cost the city incredibly.

As for your assumptions
Food and Beverage - What if the City does not get $100,000 additional a year and the contract runs for the final 6 years? What do they do then?
Memberships - Giant Lugey stated earlier that memberships are going to drop. What do they do then?
Genshaft money - What if Genshaft does not happen? What do they do then?

In the big picture - you are still forgetting the fact that with all these solutions the Parks and Recreation Department will still need to offset the operating deficit annually. What do they do then?

[Ron Halter]

Speaking of debt. The City has again rolled over the note for the Lincoln Center Phase III land aquisition. This requires last years intrest to be added to the note (approx $100,000.00) The original $2.7 million debt is now over $3.0 million.

The reason council continues to roll it over is because an annual bond payment of approx. $150.000.00 would be required out of the already depleted General Fund.

Talk about VOO DOO economics!

[WoodyHayes]

They could take a loan from The Wastewater Treatment Fund. That would have to be paid back before Dec.31, 2008.

This could be the only legitimate use of Wastewater Treatment Funds that the administration has ever tried.

They have already recieved the results of their latest contracted "Rate Increase Study". That should tell them how much they have to increase our sewer rates again.You have a substitute school teacher running the town and god knows where city council members cut there teeth at. What do you expect? Get some people that actually have ran businesses and let them run the town and set the budget. I knew a guy one time that got elected to city council who still lived with mom and dad and really never had a real job.

[Proud Tiger]

Woody Hayes - What a pathetic attempt to discredit Mayor Cicchinelli to bring up a profession he held 34 years ago really is ridiculous! What is wrong with a school teacher as a profession any how? He is a college graduate, is he not? How can you insinuate that the Mayor doesn't have a business background when he has attracted many businesses to Massillon, both as a councilman and as Mayor. Part of that success is because when business people talk to him, they know he is definitely pro-business. Why do you care any how?? You live in Texas - by choice. We live in Massillon - also by choice. By the way - the Mayor's plan for the Legends will work - you mark my word.