In what the mayor said could be a model for future partnerships, a 30-year agreement with Phoenix, Ariz. will begin July 1, with a non-profit golf foundation being created to manage the city’s third-oldest municipal course and cover all operating and capital expenses, including mandated construction of a new clubhouse within three years.
After years of debt, management issues and snake-bitten restoration attempts, the city of Phoenix, Ariz. is once again trying to breathe new life into the once-storied Papago Golf Course, the Arizona Republic reported.
The city has signed a 30-year agreement with Arizona State University (ASU), which will begin managing the course July 1 and base its men’s and women’s golf programs there, the Republic reported.
The university will create a non-profit golf foundation to manage Papago, covering all operating and capital expenses for the city’s third-oldest municipal course, the Republic reported. The foundation will also have to build a new clubhouse within three years, or the agreement can be terminated.
The city’s Parks and Recreation Board approved the agreement last June, the Republic reported, though final approval stalled for nearly a year when ASU lost its Athletic Director, Steve Patterson, in the middle of negotiations.
“This is still a great partnership,” Rob Harman, the Phoenix Parks Department’s Deputy Director for Special Operations, told the Republic. “I think they’re back on track and we’re right back where we were a while ago.”
The City Council unanimously signed off on the project last week, the Republic reported.
The terms of the agreement have not changed since the Parks Board approved it last year, the Republic reported:
• The ASU foundation will pay the city rent of $200,000 per year until it builds a clubhouse. After the clubhouse is completed, the rent will drop to $100,000 for the next three years, and then increase to $200,000 or 20 percent of net revenue, whichever is greater.
• The city will still own Papago, but the university will have naming rights to the clubhouse.
• ASU will have access to the course at no charge for team practices, up to two NCAA tournaments per year, one ASU golf fundraising event per year and one Pac-12 men’s and women’s tournament.
• ASU also has agreed to continue running Papago as a municipal golf course. That means it will charge Phoenix residents greens fees at rates already approved by the City Council and give residents access to half of the tee times, evenly distributed throughout the year.
ASU has had a long track record of successfully operating a golf course, Harman noted to the Republic. The university’s teams currently play at the ASU Karsten Golf Course, which the university plans to close and redevelop.
Sharon Keeler, a representative for ASU’s athletic department, called the agreement a “win-win situation” for the university, its student-athletes and the region’s golf enthusiasts.
Papago Golf Course staffers said the average golfer should see very few changes, the Republic reported.
Since May 2011, Phoenix has contracted with Mark Woodward, formerly the Mesa, Ariz. Parks Director, Golf Operations Manager for the city of San Diego and Chief Executive Officer of the Golf Course Superintendents Association of America, to oversee daily operations of Papago while searching for a permanent solution. Mark Woodward and Associates LLC will remain in charge of daily operations during the transition, the Republic reported.
“The changes that we have made in the past two years have been very positive. All that’s going to stay the same,” said Jesus Martinez, Papago’s General Manager. “Over time, you’ll start to see the construction, but that’s [over] a three-year time period.”
With city approval, the ASU foundation will create a new entrance to the course and a new access road, as well as additional parking, the Republic reported. The new clubhouse will be built between the first tee and the 18th green.
The 18-hole course at Papago Park, designed by William Francis “Billy” Bell, has been one of the city’s most popular, the Republic noted. Unlike the city’s other courses, Papago generates profits and is on track to make nearly $500,000 this fiscal year.
Bell designed more than 100 golf courses and their facilities, including Torrey Pines Golf Course in San Diego and the Tucson and Wickenburg country clubs.
The idea of a separate agreement for Papago caused concern among some Phoenix golfers, who were skittish after years of what they called mismanagement the last time the city outsourced the course, the Republic noted. Under a previous agreement with Phoenix, Arizona Golf Association Management LLC (AGA) took over Papago in 2007 and completed a $7.8 million renovation of the course.
However, the management company filed for bankruptcy before it could build a new clubhouse, leaving temporary trailers in lieu of a clubhouse — and droves of disgruntled golfers.
Under the AGA’s management, course numbers for Papago fell from about 62,000 rounds per year to about 30,000, according to Joe Hume, a spokesman for the Papago Men’s Golf Association.
Hume told the Republic that he felt ASU got the better end of the deal in its agreement to manage the city course.
“Let’s face it, there was no good geographic alternative available for ASU to solve their home golf course need, except Papago,” Hume said. “Thus, if the city wanted to drive a harder bargain, they could have, but didn’t. Papago is once again profitable and in excellent condition.”
The golfers’ main concern, Hume added, was whether ASU would continue to keep Papago affordable for residents.
The agreement with ASU is one of a series of attempts Phoenix has made in recent years to try to resuscitate its municipal golf courses, which formerly operated under a separate enterprise fund created in 1981, the Republic noted.
In theory, it was noted, that meant the program would not need support from the taxpayer-supported general fund that covers the bulk of the city’s costs, such as employee salaries and most city services.
However, over 13 years, the golf fund accumulated a deficit that reached about $16 million by the end of 2013, the Republic reported. Experts blamed the diminishing popularity of golf nationwide, a growing number of golf courses and the slow economy.
In 2012, city officials considered shuttering some or all of its courses to reverse the financial situation, the Republic noted. Last March, the City Council voted to keep all of the city’s municipal golf courses open by eliminating the enterprise fund, moving the courses into the general fund and paying off the debt.
That meant taxpayers now subsidize the program, much like they do other parks-and-recreation programs.
In February, the council outsourced maintenance for all of its public courses, except Papago, to a private contractor, the Republic reported. Scottsdale-based OB Sports Golf Management now provides all labor and upkeep for the city’s Aguila, Maryvale, Encanto, Palo Verde and Cave Creek golf courses. OB Sports recently hired Woodward as its Senior Vice President of Operations.
Through steps like these, the Republic reported, the city of Phoenix has continued whittling away its annual golf deficit, which was $2.5 million three years ago — meaning the city lost $2.5 million every year of operating its golf courses.
This year, the golf program’s annual operating deficit will be $1.1 million, the Republic reported, and next year the Parks Department is projecting it will shrink to $600,000. Both the Cave Creek and Aguila courses are expected to make money next fiscal year.
“Golf is on the right course,” Harman said.
Mayor Greg Stanton and Phoenix council members agreed that the ASU agreement could be a model for future city partnerships with outside entities, the Republic reported.
Councilman Daniel Valenzuela expressed interest in exploring a similar partnership for Maryvale Golf Course in his district, perhaps with Grand Canyon University.
“We have one of the most iconic pieces of property in the city, and that’s Papago Park,” said Councilman Sal DiCiccio, whose district includes the Papago course. “With Papago Golf Course, we’re now going to be moving Arizona State and more youth into the area.
“If you look at any area in the country, when you have a revitalization project, it’s always people that are younger that are willing to come in, take the risk,” DiCiccio added.