1 APPROVAL OF AN AGREEMENT
WITH TOUCHSTONE GOLF, LLC FOR
MANAGEMENT OF BENNETT
VALLEY GOLF COURSE ENTERPRISE
Jason Nutt, Assistant City Manager
Jen Santos, Parks Deputy Director
City Council
June 7, 2022
2 • CITY COUNCIL BVGC AD HOC COMMITTEE
• SAVE THE BENNETT VALLEY GOLF COURSE GROUP
• NATIONAL GOLF FOUNDATION
• CITY ATTORNEYS' OFFICE, FINANCE DEPARTMENT,
TRANSPORTATION AND PUBLIC WORKS
BENNETT VALLEY GOLF COURSE
TEAM
3 BENNETT VALLEY GOLF COURSE
BENNETT VALLEY
GOLF COURSE
GALVIN
COMMUNITY
PARK
4 • Golf Course:
• 18-hole, Par 72, 6,500-yard
• Unlit driving range
• Major Capital Investments needed
• Restaurant/Event Center
• Commercial kitchen sized to serve restaurant and
events simultaneously
• Minor to moderate Capital improvements needed
BACKGROUND
5 • 2004
• Bonds and loan from Park Development Zones
• Modernize restaurant/event center and construct
new Pro Shop
• 2005-2007
• Construction complete
• Management and Operations Agreement with
Bennett Valley Golf Shop Inc.
• Lease Agreement with Sports Restaurant of Bennett
Valley LLC
BACKGROUND
6 • Sports Restaurant of Bennet Valley LLC
• Restrictions related to Covid Pandemic
• Requested and granted early termination of lease
agreement in December 2020
• Restaurant not in use
• Bennett Valley Golf Shop, Inc.
• Management and Operations agreement expires
June 30, 2022
• Bennett Valley Golf Shop not seeking renewal
BACKGROUND
7 • February 2, 2021
• City Council presentation with real estate option
and similar options for using the golf course to fund
capital investments
• Citizens formed the Save the Bennett Valley Golf
Course group
• BVGC Ad Hoc Committee
• Established by Mayor Rogers on March 2, 2021
• April 13, Ad Hoc recommend comprehensive
analysis of future BVGC operations without real
estate options
ANALYSIS
8 • August 17, 2021
• City Council approve RFP to solicit for BVGC
evaluation for future operations
• November 4, 2021
• National Golf Foundation (NGF) approved on
November 4, 2021
• NGF recommend single operator for golf and
restaurant/event center
ANALYSIS
9 • February 15, 2022
• City Council approve RFP to solicit for a single
operator to manage the operations and
maintenance of BVGC
• Receive comprehensive presentation from NGF for
operations, maintenance and capital needs
• March 24, 2022
• Five proposals received
• BVGC proposal Review Committee recommends
highest ranked firm, Touchstone Golf LLC
REQUEST FOR PROPOSALS
10 • Key Elements from the Proposal:
• Approve the three year with option to extend up to
two-years Agreement with Touchstone Golf
• Implement Transition Plan
• Implement support services
• Golf Tee times available within 3-5 days of current
golf operators expired agreement
• Provide professional management services for
operations and maintenance
• Reopen restaurant, bar, and event center
• Professional and fully integrated marketing and
outreach
TOUCHSTONE PROPOSAL
11 • Touchstone Fees
• Base Management Fee: $8,000 per month ($96,000
annually)
• Incentive (20% of net revenue goals): +/- $20,000 in
year one and +/- $50,000 in year three
• Projected Revenue
• Year 1: +/- $3.4 million and Year 3: +/- $4.6 million • City receives all revenue to fund all expenditures
• Touchstone manages on behalf of City
FISCAL ANALYSIS
12 • Existing Annual and Total Debt Service
• Annual Bonds +/- $ 395,261
• Total Bonds +/- $3,525,210 (10 years)
• Annual Park Development Loans +/- $ 63,244
• Total Park Development Loans +/- $569,200 (10 years)
• Projected Annual Expenditures
• Year 1: +/- $2.9 million and Year 3: +/- $3.8 million
FISCAL ANALYSIS
13 $537,031 Projected FY 22/23 Available Budget
• ($234,682) – projected year 1 losses from
Touchstone
• ($681,574) – Reserve requirement per Council Policy
• ($317,000) – Additional golf course expenses
• $345,000 – BVGC Capital Fund transfer to operations
• $351,225 – General Fund Transfer to reserves
= Balanced budget, year 1
BVGC BUDGET ANALYSIS
14 • Touchstone anticipates minor to moderate capital
projects in year 1
• Touchstone committed $50,000 towards front entry
landscape improvements for immediate positive impact
• NGF Presentation on February 15, 2022
• Identifies high priority capital projects
• Recommends two phase approach to implement
capital projects
• Estimates high priority capital needs at +/- $ 6.8
million
CAPITAL PROJECTS
15 February 15, 2022 NGF Presentation identifies the following funding strategies for high priority capital projects:
• General Fund Investment
• Bonding for the capital improvements to occur as
soon as possible
• Net gains collected from the BVGC are saved for
future capital.
• Predicates NGF potential revenue projections on
implementation of the capital needs and increases
to golf fees
CAPITAL PROJECTS
16 Touchstone has capabilities to manage capital projects and has mentioned cost saving alternatives to complete
closure of the golf course during capital projects
Staff will provide comprehensive review of all funding
strategies, including but not limited to increase in BVGC fees
Staff will return to Council prior to the Mid-Year Budget Cycle in a study session to review strategies proposed by Touchstone and NGF for funding high priority capital
needs
CAPITAL PROJECTS/NEXT STEPS
17 • Kick off meeting 1-3 days following Council approval • Implement transition plan 2 weeks following Council
approval
• Establish Touchstone’s check list which contains over 100 action items with deadlines
• First day of golf operation minimum of three days
following June 30, 2022
• First day of restaurant operation minimum of 15 days
following June 30, 2022
OPERATIONS SCHEDULE
18 It is recommended by theTransportation and Public
Works Department that the Council, by resolution:
1) approve the Agreement with Touchstone Golf
LLC., to manage the Bennett Valley Golf Course
(BVGC) Enterprise; and 2) authorize increased
appropriations in the BVGC Operations Fund in the
amount of $345,000 to fund the transition plan
capital costs from the Agreement, with the source
of the funds from the BVGC Capital Fund; and
RECOMMENDATION
19 (Continued)
3) authorize increased appropriations in the BVGC
Operations Fund in the amount of $351,225 for the
creation of sufficient projected reserves with the source of the funds from the General Fund; and 4) authorize
the Chief Financial Officer to appropriate all operator fees and operating and maintenance expenditures
from BVGC revenue to Touchstone Golf LLC., as
described in the Agreement; and 5) authorize city
assumption of the responsibility for the golf cart
contract with the current golf operator.
RECOMMENDATION
20 QUESTIONS?