Pitch to privatize city’s golf courses in the rough
Report finds no easy way to reverse fortunes of money-losing facilities
Contracting out the city’s public golf courses to the private sector in an attempt to recoup financial losses wouldn’t necessarily be the hole-in-one some are looking for, according to a city report.
Critics such as the Canadian Taxpayers Federation have called on the city to sell off municipal golf courses after a Freedom of Information request by the group showed the six courses lost a combined $2 million between 2015 and 2017. The only city-run golf course to turn a profit each year was Shaganappi Point, which earned a positive return between $261,336 and $470,821 over the three years.
Some on council have proposed looking to private vendors to trim greens at civic golf courses as well as other maintenance operations currently performed by unionized employees. Coun. Diane ColleyUrquhart brought forward a notice of motion last July, calling on the city to explore a different operating model for its golf courses, such as leasing them to private operators.
But despite financial losses, staying par for the course might be the most viable option, according to the city ’s Golf Sustainability Work Plan Update released last week.
The report, slated to come before a city committee this week, states that the financial viability and feasibility of various other service models would have to comply with the Alberta Labour Relations Code. It’s “highly unlikely thirdparty interest would exist given labour relations code complexities,” it states.
The ability of the city’s golf course operations division to fully capitalize on business opportunities would also be hindered without capital investment in the courses.
Diverting limited staff resources to contract or lease golf courses would also put a strain on the ability of the city to manage day-today business activities, according to the report.
“The effect on business performance of unpredictable seasonal weather trends and economic downturn impacts should not be underestimated,” it states.
“This is true for all outdoor recreation asset providers, but is acutely felt in the golf industry. Exploration of the redevelopment or sale of golf courses is an extremely sensitive matter in terms of public opinion.”
Coun. Ray Jones said he didn’t know if privatizing city golf courses is the answer to their financial woes.
“I think there’s an expectation from the public that they have golf courses and that we pay for it in some way, shape or form,” he said. “It’s not all about making money, either. In all honesty, transit loses money every year, too, but we’re not going to privatize the transit system. There’s just some things that we have an expectation by our public to do and one of them is golf courses.”
Jones said that at one time, civic golf courses used to turn a profit for the city that would be used to subsidize other public services. He was optimistic that year-long renovations to the McCall Lake course would help that facility start to make money.
McCall Lake was nearly shuttered in 2014, a plan that faced heated opposition. Plans to shut it down were halted after research determined the land sale would not have netted the $35.4 million necessary to help fund other cityrun courses and create new recreation fields for northeast Calgary.
The course lost $457,350 in 2015, $666,162 in 2016 and $589,336 in 2017.
Coun. Sean Chu said those losses are enough of a reason for the city to get out of the game.
“Everybody knows private business can run better and cheaper than the public can. Everybody knows that,” he said. “The city should be in a supervisory role. We contract out many, many other services.”
If the city elects to hold onto its courses, Chu said he believes there are many ways it can look for efficiencies by taking a page out of the private sector’s playbook.
“When I spoke to the private sector, they have one superintendent for two or three golf courses. But the city has superintendents for each one,” said Chu, adding that lower wages for employees could also help save dollars.
“Just cut back on the management. Superintendents usually make pretty good money,” he said. “If we cut the superintendents to start with and maybe lower the manpower number, we should be able to make up (lost money) if that’s the case.”
But Jones said it’s unrealistic to compare public golf course operations to the private sector.
“The one thing about city courses is it’s fine to say that they ’re losing money but, on the same token, they don’t charge near what a private golf course charges either,” he said. “If they were charging $100 a pop, they’d be making money, but the problem is that Joe Average Public couldn’t afford to play them. So we’re going to lose money on some of the things that we do.”