Janesville city golf operations will change
Crown Golf Properties, the management company that runs the two city-owned golf courses, wants to renegotiate its contract that expires at the end of 2010.
“The revenue coming into the Janesville courses has not kept up with expenses, and they’re now in a position where they’re losing money,” Assistant City Manager Jay Winzenz said.
Winzenz said the city has three options:
-- Negotiate a new contract with Crown Golf Properties.
-- Contract with a different company.
-- Take over operation of the courses.
The council will look at the pros and cons of all options when it makes its decision before the end of 2010, Winzenz said.
Golfers likely won’t see much of a change except the normal cost-of-living increase to play a round of golf.
“You don’t want to price yourself out of the local market,” Winzenz said. “It is very competitive with Glen Erin and Prairie Woods, as well as other golf courses a half-hour away.”
Under the contract with Crown Golf Properties, the city receives 12 percent of the monthly gross revenue at Riverside and Blackhawk golf courses.
The last few years, the courses have generated between $130,000 and $140,000 annually for the city, Winzenz said. In addition, Crown Golf puts 1.5 percent of gross revenue into a fund for small capital improvements. That has totaled about $15,000 a year.
The city has paid for major capital projects at the courses. For instance, it installed irrigation systems at both courses. The system at Riverside in 2003 cost $483,878.
Crown Golf said it doesn’t intend to renew the lease in its current form because it is losing money, Winzenz said.
The local golf market has changed in the recent years with the addition of Glen Erin and Prairie Woods golf clubs.
The number of golf rounds played in Rock County has held steady or risen slightly, but golfers now are divided among more courses, Winzenz said.
Arrangements such as the city’s contract with Crown Golf—collecting money based on gross revenues—are not common anymore, Winzenz said.
Crown Golf is willing to continue a relationship but under different contract conditions. The talks are preliminary at this point, he said.
The city has discussed a management contract in which the city pays the company a fee to manage the golf courses, for instance, Winzenz said. The city would then pay the expenses and collect all the revenue from the courses.
Last updated: 12:54 pm Thursday, December 13, 2012