By Jason McFarley, Truth Staff
jmcfarley@etruth.com
MIDDLEBURY -- From the 11th tee, Brad Smith spots one of the regulars at Sims Oak Hills Golf Course and teases the man about his decision to walk rather than rent a riding cart.
The man, a retired teacher, says the slumping economy has not yet forced him to give up his favorite pastime, but he has tried to cut back where he can.
The trend troubles Smith, operations manager at the course that the city of Elkhart has owned since 1966.
"People are walking instead of riding. They're not buying as much when they're out here," says Smith, who was hired in 1994. "But we've been through crunches before. There are always the highs and lows, but we survive."
Increasingly, that is not the case at other municipally owned golf courses that are either shutting down or contracting out to private operators because of financial constraints.
Oak Hills is not turning a profit, though city officials see potential for it to do so.
"We do put a lot of money in it, but it generates a good deal of money," says Mayor Dick Moore. "I think it can be self-supporting."
The past several years have been costly.
Receipts have declined each year since 2004, according to city financial records. On paper, the golf course made more money than it spent last year, but that was only because of an unexpected $100,000 refund from its liability insurance carrier.
Among major investments recently, a new fleet of golf carts cost $200,000 -- an expense that until it was paid off this year had consumed about 40 percent of the course's annual revenue.
Smith, who is also the golf professional at Oak Hills, says he was left with no money for advertising and promotions, an important part of marketing the course as he insists it should be.
"We're nine miles from Shipshewana," he says. "If I can promote the golf course in Shipshewana, with all the visitors there, imagine the economic impact here.
"Think of the city events and activities I can promote here. I can hang up plans for the new Elco (Theatre) in the clubhouse. I can hang up a schedule of the shows. The way I view the course is as an ambassador to the city of Elkhart."
In short, Smith says, the course puts a nice face on Elkhart -- even if it is located 15 miles east of the heart of the city.
Mayor Moore agrees.
He says he is unwilling at this point to consider closing or selling the course. The fact that the course was a gift to the city and that selling it would go against the benefactor's wishes also plays into the deliberations.
But some Elkhart City Council members say the mayor should certainly explore leasing the course to private management. David Henke, R-3rd, and Mary Olson, R-at large, say leasing would reduce the city's costs and liability.
"Privatization keeps the onus off the local taxpayers," says Olson. "If someone else leased it from us, I would know in my heart that we are responding to the pain that our taxpayers are feeling. We have to cut the frills. It is about basics right now."
Municipal-owned golf courses are common amenities in Hoosier communities, but they are quickly falling by the wayside, says Matthew Greller, executive director of the Indiana Association of Cities and Towns. He knew of two cities planning to close their golf courses because of budget crunches, but he declined to identify them because officials there had not yet publicized the cuts.
Olson says she hopes for a better fate for Oak Hills. While the course does not fit Olson's definition of a basic city service, she says she views it differently from a city-owned attraction such as the National New York Central Railroad Museum, which appears to spur little interest from Elkhart residents.
"It has a better return on the taxpayers' investment, and it's supported by our local taxpayers." Olson says of the course. "We're asking Elkhart taxpayers to support a railroad museum that they don't go to."
Golf courses can be wise investments for cities, experts say.
With an average gross revenue of $850,000, the nation's 2,300 municipal courses represent a $2 billion niche in golf management, according to the National Golf Foundation. Cities in many cases find that by employing private management they can improve income from one of the few profitable assets a local government can possess.
More than a quarter of publicly owned courses are privately run, according to industry research.
Bristol has leased its town-owned Raber Golf Course for more than 20 years. The private operator pays the town $40,000 a year, maintains the property and employs his own staff.
The town is responsible only for major capital improvements such as the construction of a $400,000 clubhouse that opened last year. Lease payments financed the new building.
"We haven't had to sink one taxpayer dollar into the course," says Bill Wuthrich, town manager. "It's not a big profit to the town, but we don't spend anything. It's not a loss."
Wuthrich says the cost of staffing and maintaining a course would be too burdensome for the town, particularly as budget pressures mount. He estimates the town would need as many as six workers to operate the course.
Oak Hills, Elkhart's course, has two full-time employees and 18 part-time workers at its disposal.
"Most municipalities can't run a golf course," Wuthrich says. "The lease has been the best thing for Bristol."
Smith, though, sees opportunities for Oak Hills to prove itself under city management.
He hopes that organizing events such as Halloween hay rides, cross-country runs and ski outings at Oak Hills will encourage the community to think of the facility has more than a golf course.
But Smith realizes the economic realities. He looks for ways to trim spending, whether by putting in more hours than his salary demands or changing the grass-mowing routine to conserve fuel and wear on the equipment.
"We are masters out here at cutting costs," he says. "I never want to be a burden. I never want this golf course to be a burden."