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Johnson City considers selling municipal golf courses

COREY SHOUN • Feb 3, 2007 at 9:09 AM

JOHNSON CITY - The city of Johnson City could be yelling "fore" in the near future - as in city golf courses possibly being for sale.

During Thursday night's City Commission meeting, the panel voted to begin the process of RFPs (requests for proposals) to gauge interest in purchasing both Pine Oaks Golf Course and Buffalo Valley Golf Course as well as the interest by management companies in taking over operations at both courses.

"(Over the years) we've tried several approaches at the golf courses," City Manager Pete Peterson said. "I don't know that we've ever been real successful with any of these philosophies."

While Pine Oaks consistently brings in revenues, it annually is forced to subsidize Buffalo Valley due to financial losses there. The subsequent negative retained earnings have been the only recurring problem in the city's annual financial audit over the past several years.

"Right now, we really don't know what the golf courses are worth," Peterson said, referring to their value as courses or for different uses.

"We have nothing to lose and everything to gain."

Mayor Steve Darden, who has floated the idea of selling the courses in the past, supported the action suggested by Peterson and made the motion to begin the RFP process.

The motion passed 3-2 with Darden, Vice Mayor Phil Roe and Commissioner Jane Myron voting in favor, Commissioner Pete Paduch voting against, and Commissioner Ricky Mohon opting to pass.

Each member of the commission appeared to be open to the possibility of selling Buffalo Valley, which is located outside the city limits in Unicoi County.

"My problem has always been that we shouldn't have bought two golf courses," Mohon said.

Darden said the prospect of a windfall of revenues, from taxes or otherwise, should make each commissioner listen to all types of proposals.

"I can't say whether I would be in favor of selling Pine Oaks or not until I find out who might be interested," Darden said, mentioning the possibility of an upscale housing development.

"I'd listen to that, and I'm not scared of the information because we can always say no."

In a related matter, the commission agreed to set new rates for some golf course fees. Over the past few months, many members - especially those who own private carts - have been upset by what were perceived as steep rate increases in the 2006-07 budget.

The Public Golf Course Committee recently recommended a 20 percent rate decrease.

"That's an $87,000-a-year reduction in revenues if you have the same amount of play," Peterson said. "That ain't going to work."

Paduch suggested a straight 10 percent increase for private cart fees and cart storage fees plus a $10 rider fee for non-owners. The panel unanimously approved the new rate increase.

"It's just a 10 percent straight increase with the idea we're going to get this caught up," Paduch said. "Why would I want to just all of a sudden start lowering rates? You just don't do that in any business."

Darden stressed that city golf course users should be aware that this approach is not limited to the current fiscal year.

"What I also hear Commissioner Paduch saying is that people can expect this to be repeated next year and the year after and the year after that," Darden said.

Paduch confirmed that was, indeed, the idea behind his approach for increased revenues.

"You're going to get it. You're just not going to get it all at once," Paduch said.

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