CITY OF SALINASFinance CommitteeCITY OF SALINASFinance Committee
CITY OF SALINAS
Finance Committee
CITY OF SALINAS
Finance Committee
DATE: August 2, 2022
DEPARTMENT: Administration
FROM: Mark Roberts, DIRECTOR OF Finance
jim pia, assistant city manager
TITLE: Twin Creeks Golf Course
RECOMMENDation:
Provide Twin Creeks Golf Course update report to the Finance Committee for acceptance and share the report through the City Manager’s newsletter.
DISCUSSION:
The 9-hole Twin Creeks Golf Course was built during fiscal year 1998-1999, at a cost of $8,221,604. The project was funded using 1999 City of Salinas Certificates of Participation (Certificates) Series A-1999, issued by the Salinas Public Financing Authority. After construction, the golf course began operations in fiscal year 1999-2000. During four years of City operation, the course operated at a loss, requiring subsidies from the City's General Fund totaling nearly two million dollars. Due to this ongoing City subsidy to golf operations, and the need to significantly reduce the City's budget during fiscal year 2004-05, the City entered into exclusive negotiations in June 2004 with the Monterey Peninsula Foundation and its related foundation, the Future Citizens Foundation, doing business as The First Tee of Monterey County (TFTMC).
On August 24, 2004, the City Council authorized a sublease between the City and the Future Citizens Foundation for the Twin Creeks Golf Course, however a change in bond financing was required for Twin Creeks. Thus, on October 12, 2004, the Council authorized the Issuance of Refunding Certificates of Participation for the 1999 bonds. On September 14, 2005, the Salinas Public Financing Authority issued City of Salinas Refunding Certificates of participation Series 2005A, in the amount of $8,005,000, to refund the portion of the 1999 Certificates attributed to Twin Creeks. With the closing of that financing, the sublease agreement with TFTMC was finalized.
The TFTMC is an initiative of the World Golf Foundation. The focus of The TFTMC is to give young people of all backgrounds an opportunity to develop, through golf and character education, life-enhancing values such as honesty, integrity, and sportsmanship. TFTMC impacts lives through its programs at their Twin Creeks campus. Additionally, the course is open for public play all year round, with some reduced play in weeks of youth programs in the summer, for example.
In 2014, TFTMC requested a permanent, long-term sublease payment reduction from $125,000 to $60,000. After significant discussion and negotiation including a TFTMC concession that they would build a nearly $1.4 million dollar learning center for youth at the Twin Creeks site, the request was unanimously approved by the City Council in 2015. It should be noted that the greatest cost savings for the City occurred when the City moved away from the day-to-day operations of both golf courses, Twin Creeks and Fairways, a savings of more than $1.3 million annually for more than 15 years.
At present, the total current debt obligation of the Twin Creeks Course is just under $2 million dollars, and it will be paid in full by the end of the calendar year 2026. Although the City’s balance is going down with each payment, TFTMC will pay the $60,000 for calendar year 2022, and the City will pay an additional $384,000, for a total 2022 bond payment of $444,000.
FIRST TEE IMPACT ON LOCAL SALINAS YOUTH:
In the attached recent information from The First Tee of Monterey County, Chief Executive Officer Nick Nelson has provided a current snapshot of the program. He notes in the handout that “First Tee delivers a targeted curriculum of golf and character development, life skills, academic support, higher education, mentorship, and career development to provide youth of all backgrounds an opportunity for a brighter future.” Other snapshot information about the First Tee program include:
More than $3 million in scholarships awarded to local college-bound youth to attend California State University, Monterey Bay More than 10,000 Monterey County youth positively impacted by the program 120 local businesses supporting the program, enabling First Tee to provide a safe place to grow new community leaders $1.4 million invested into the facility, to build the Taylor Farms Center for Learning PAY IT FORWARD SCHOLARSHIP AND MENTORING PROGRAM:
On February 2, 2013, the California State University Monterey Bay through its University Corporation (UCMB) transferred to the Future Citizens Foundation (FCF) all rights, title or interest in the Pay It Forward Scholarship and Mentoring Program (PIF). This included all rights in names or styles relating to the Program, it being the intent of the parties that FCF shall own outright the interest, rights and assets belonging to the Program. This permits all funds raised by the FCF for the Program to be granted 100% to student scholarships. Current information on this program include:
Since 2008, 136 of the 220 students in this program have been from Salinas Over $3 million in scholarship money has been provided to Pay it Forward Scholars Pay It Forward Mentors are Salinas community leaders
Pay It Forward Scholars, in turn, have provided over 28,000 hours of tutoring and mentoring to Salinas youth CONCLUSION:
Although the City pays a greater amount of the required bond payment, (our “mortgage” for building the course, if you will), it is important to note that TFTMC has significant day to day costs to operate Twin Creeks. The City is fortunate to not have incurred these costs for many years now, a savings of more than $1.3 annually.
Attachments:
Current First Tee of Monterey County information
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