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Home My WebLink About1998.05.19_OPGA AgendaNOTICE OF PUBLIC MEETING OF THE OWASSO PUBLIC GOLF AUTHORITY TYPE OF MEETING: Regular DATE: May 19, 1998 TIME: 7:00 p.m. PLACE: Council Chambers, Owasso Community Center Notice and Agenda filed in the office of the City Clerk and posted on the City Hall bulletin board at 4:00 p.m. on Friday, May 15, 1998. arci Boutwell, Au ority Secretary M AGENDA 1. Call to Order 2. Flag Salute 3. Roll Call 4. Consideration and Appropriate Action Relating to a Request for Approval of the Consent Agenda. All matters listed under "Consent" are considered by the Trustees to be routine and will be enacted by one motion. Any Trustee may, however, remove an item from consent by request. A motion to adopt the Consent Agenda is non -debatable. A. Approval of the Minutes of May 5, 1998 Regular Meeting. Attachment #4-A B. Approval of Claims. Attachment #4-13 1 Owasso Public Golf Authority ' May 19, 1998 Page 2 ' 5. Consideration and Appropriate Action Relating to a Request for Implementation of a Yearly Fee for Golf. ' Mr Lehr Attachment #5 The staff will recommend Trustee approval of a yearly fee (membership) for golf at a cost of $1500 per individual and $2000 for a family, to be utilized during "off-peak" time periods. 6. Report from OPGA Manager 7. Report from OPGA Attorney 8. New Business 9 X. Adjournment OWASSO PUBLIC GOLF AUTHORITY MINUTES OF REGULAR MEETING Tuesday, May 5, 1998 The Owasso Public Golf Authority met in regular session on Tuesday, May 5, 1998 in the Council Chambers at the Owasso Community Center per the Notice of Public Meeting and Agenda posted on the City Hall bulletin board at 4:00 p.m. on Friday, May 1, 1998. ITEM 1: CALL TO ORDER Mr Wilken called the meeting to order at 7:30 p.m. ITEM 2: FLAG SALUTE The flag salute was given during the City Council meeting preceding this meeting. ITEM 3: ROLL CALL PRESENT ABSENT Mark Wilken, Trustee Denise Bode, Trustee Mary Lou Barnhouse, Trustee Tracy Standridge, Trustee ' Melinda Voss, Trustee STAFF ' Rodney J Ray, City Manager Ronald D Cates, Authority Attorney Marcia Boutwell, Authority Secretary A quorum was declared resent. q P a ITEM 4: ELECTION OF CHAIRPERSON. Dr Standridge moved, seconded by Ms Voss, that Mayor Bode be elected to the position of OPGA Chairperson. ' AYE: Standridge, Voss, Barnhouse, Wilken NAY: None I Motion carried 4-0. ITEM 5: ELECTION OF VICE CHAIRPERSON. ' Dr Standridge moved, seconded by Ms Voss, that Vice Mayor Wilken be elected to the position of OPGA Vice Chairperson. 1 Owasso Public Golf Authority May 5, 1998 AYE: Standridge, Voss, Barnhouse, Wilken NAY: None Motion carried 4-0. ITEM 6: CONSIDERATION AND APPROPRIATE ACTION RELATING TO A REQUEST FOR APPROVAL OF THE CONSENT AGENDA. A. Approval of the Minutes of April 21, 1998 Regular Meeting. B. Approval of Claims Dr Standridge moved, seconded by Ms Barnhouse, to approve the consent agenda. The consent agenda included minutes of the April 21, 1998 meeting, by reference made a part hereto. Item B on the consent agenda included the following claims: (1) Bailey Ranch Golf Club $38,784.78; (2) Payroll $14,786.81. AYE: Standridge, Barnhouse, Voss, Wilken NAY: None Motion carried 4-0. ITEM 7: REPORT FROM OPGA MANAGER No report. ITEM 8: REPORT FROM OPGA ATTORNEY No report. ITEM 9: NEW BUSINESS None. ITEM 10: RECESS TO COMMUNITY CENTER ACTIVITIES ROOM FOR RECEPTION. Ms Voss moved, seconded by Dr Standridge, to recess to the activities room for a reception honoring the outgoing Mayor and Vice Mayor, the incoming Mayor and Vice Mayor, retiring Councilor Helm, newly -seated Councilor Voss, and City Manager designee Jeff Hancock, to reconvene at the conclusion of the reception. Meeting reconvened at 8:35 p.m. 2 Owasso Public Golf Authority ITEM 11: ADJOURNMENT Dr Standridge moved, seconded by Ms Barnhouse, to adjourn. AYE: Standridge, Barnhouse, Voss, Wilken NAY: None Motion carried 4-0 and the meeting was adjourned at 8:36 p.m. Marcia Boutwell, Authority Secretary 3 Denise Bode, Chairperson May 5, 1998 1 ()WASSO I:'(Jr:<L_1:(, G(:)L..F=' fiUT*I-IC)1'•:1:'T'Y ' X}AlI...F::Y I1 (:;OL..F' C:L_U(:: `i/14/98 20:07:36 A/P CLAIMS REPORT PO 0 VENDOR DESCRIPTION II . .................................. .............. BGR DAILY ACCOUNT REIMB PETTY CASH OKLAHOMA TAX COMMISSION 4/98 SALES TAX DEPARTMENT TOTAL ===-. (:;ART .`JUSTICE GOLF CAR CO INC CART RENTALS ABCO RENTS & SALES TABLE,.CHAIR RENTAL ' DEPARTMENT TOTAL IGOLF S-IOI' OPERAT I O1-*3 ETONIC TRETORN SHOES ETONIC TRETORN SHOES ETONIC TRETORN RETURN SHOES ETONIC TRETORN TREDLITE SPIKES ADAMS GOLF CLUBS ASHWORTH I14C GOLF CAPS BAGY 30 GOLF WEAR GOLF SHIRTS BRIDGESTONE SPORTS INC GOLF BALLS BRIDGESTONE SPORTS INC GOLF BALLS -DISCOUNT ETONIC TRETORN GOLF SHOES ETONIC TRETORN GOLF SHOES -DISCOUNT ETONIC TRETORN GOLF SHOES ETONIC TRETORN GOLF SHOES -DISCOUNT ETONIC TRETORN GOLF SHOES ETONIC TRETORN GOLF SHOES -DISCOUNT BEN HOGAN COMPANY GOLF GRIPS IZOD GOLF & TENNIS GOLF SHIRTS IZOD GOLF & TENNIS GOLF SHORTS LA JOLLA CLUB JR CLUBS/BAGS ODYSSEY GOLF GOLF CLUBS THE. ROCKPORT CO GOLF SHOES CHARLES SAKMAN14 GOLF INC GOLF SHIRTS CHARLES SAKNANN GOLF INC GOLF SHIRTS TITLEIST DRAWER CS GOLF CLUB TITLEIST DRAWER CS GOLF CLUB -DISCOUNT TITLEIST DRAWER CS GOLF BALLS TITLEIST DRAWER CS GOLF BALLS -DISCOUNT TITLEIST DRAWER CS GOLF BALLS 1�m APAPVFt PAGE AMOUNT 1.753.04 9_-- 803-- ----- 1.:1..556.87 125.00 41.00 166 .. 00 613.96 -609.00 1.5.32 3'27.35 169.92" 303.80 1.1.4..00 84E3 .. _3 i -41.50 87.43 -4.15 87.43 -4.15 2-4.04 696.89 497.21. Z,73.22" 360.00 53) . 5.L 696 .. 09 117.67 304.01. -12.00 77. 5D -3 _ bd 1.92 .. ,y2 5/ 1.4/98 PO ## OWASSO F'UBL.I C GOLF" AUTFIOR I: TY (.icA..l::' C:L..(. B :2Os07e36 VENDOR --------------- TITLEIST DRAWER CS COBRA GOLF INC COBRA GOLF INC COBRA GOLF INC COBRA GOLF INC CUTTER & BUCK MAXFLI GOLF DIVISION MAXFLI GOLF DIVISION MAXFLI GOLF DIVISION VIAXFL.I GOLF DIVISION MAXFLI GOLF" DIVISION SF'ALD I NG SPALDING OAKLEY. INC CHAPS GOLF COBRA GOLF INC COBRA GOLF INC A/F' CLAIMS REPORT DEPARTMENT TOTAL GOLF COURSE OF'ERAT"IONS DESCRIPTION GOLF BALLS —DISCOUNT GOLF CLUBS GOLF CLUB GOLF CLUB GOLF CLUB GOLF SHIRTS GOLF BALLS —RETURNED GOLF BALLS GOLF BALLS GOLF BALLS —DISCOUNT GOLF BALLS GOLF CLUBS —CREDIT GOLF CLUBS SUNGLASSES GOLF SHIRTS CREDIT VOUCHER GOLF CLUBS OWASSO PUBLIC WORKS AUTHO 4/98 USE OWASSO PUBLIC WORKS AUTHO 4/98 USE SOUTHWESTERN BELL TELEPHO 4/96 USE ESTES INC ROUNDUP.BARRICADE JUSTICE GOLF CAR CO INC CART REPAIR JUSTICE GOLF CAR CO INC CART REPAIR GUARDIAN SECURITY SYSTEMS MONITORING 5/98 YALF_ UNIFORM RENTAL UNIFORM—GLEAN/RENT YALE UNIFORM RENTAL TOWEL SERVICE MILL CREEK LUMBER CO CONCRETE MIX VICTOR WELDING SUPPLY CO WELDING SUPPLIES HASKELL SAND & GRAVEL CO MASON SAND SAFETY KLEEN SERVICE FARTS CLEANER MINGO TURF & TREE CO SOD L.EROY'S REEL MOWER MOWER FARTS WAL MART OFFICE SUPPLIES DYIAA SYSTEMS SHOP HARDWARE NICK KNOTT TURF SUPPLY SOIL TESTING E—Z—GO TEXTRON REPAIR FARTS DEPARTMENT TOTAL ==- FOOD & BFVERA(31ii. Oi'ET''ATIONS 66 AP'APVR PAGE.: I AMOUNT 380.54 90.01. 90.01 68.01" 734.28 --600.00 612.84 94.78 3. 59 338.79 —96.00 3,3 6.. 00 208.79 192.53) —154.01 tir i 7,.969.08 1.72 .^6.. 77 59.39 1.119..50 41.06 40.00 29.95 6.70 10.60 28.80 14.27 299.64 139.75 180.00 �19.75 1.6.38 14.39 90.00 605..37 3,144.04 ml ti OWASSO 1='UDLIC GOLF AUTHORITY DA*1:L_E::Y F'tANCa I [:,OLF Cl UD 5/1.4/98 20:07„36 A/FCLAIMS REPORT PO # VENDOR DESCRIPTION LANCE INC :SNACKS 1='ADLER CO INC GROCERIES FADLER CO INC PAPER SUPPLIES LANCE INC SNACKS PEPSI COLA COMPANY SOFT DRINKS LAKE COUNTRY BEVERAGE INC SOFT DRINKS ALLIANT FOODSERVICE INC GROCERIES ALLIANT FOODSERVICE INC GROCERIES PERSONAL HEALTH DEVELOPME SNACKS PEPSI COLA COMPANY SOFT DRINKS STANDARD DISTRIBUTING CO CIGARS TRAILS END CATERED FOOD ABCO RENTS & SALES TABLE,CHAIR RENTAL ALLIANT FOODSERVICE INC CREDIT —RETURNED GOODS ALLIANT FOODSERVICF_ INC GROCERIES ALLIANT FOODSERVICE INC PAPER SUPPLIES ALLIANT FOODSERVICE INC GROCERIES ALLIANT FOODSERVICE INC GROCERIES ALLIANT FOODSERVICE INC GROCERIES ALLIANT FOODSERVICE INC CREDIT —RETURNED GOODS LAKE COUNTRY BEVERAGE INC SOFT DRINKS PEPSI COLA COMPANY SOFT DRINKS DEPARTMENT TOTAL =---. CI...0 Ht: USE:. OF:'I :FtiA',1':I:t: l%ls OWASSO PUBLIC WORKS AUTHO 4/98 USE OWASSO PUBLIC WORKS AUTHO 4/98 USE SOUTHWESTERN BELL TELEPHO 4/98 USE FADLER CO INC PAPER SUPPLIES GUARDIAN SECURITY SYSTEMS MONITORING 5/98 ALLIANT FOODSERVICE INC PAPER SUPPLIES DEPARTMENT TOTAL & ADMI..NI.STRATIVE CITY OF OWASSO ADVANTA FINANCIAL CORP DEPARTMENT TOTAL APAPVC� PAG1=: 5/98 WORKERS COMP DIGITAL PLAYER —CONTRACT AMOUNT 2 5 `} 261»15 60.50 91.86 141.84 60.00 99 ..::i.:i 6r'.`19 391.00 74..37 272 7 `y 250 00 1.00 .. 00 22 e 30 76.40 —14.,23 90.00 131.92 2 nor 84..81 8. 60 265..79 29..95 41. e9Gy 464 .. 608.33 97.99 706 .'3)2 m OWASSO PUBLIC GOLF AUTHORITY DAILEY RANCH GOLF CLUB 5/1.4/ 8 20:0.7:36 A/P CLAIMS REPORT PO # VENDOR DESCRIPTION ASSOCIATES COMMERCIAL COR CART LEASE 53 DEPARTMENT TOTAL ====. FUND TOTAL GRAND TOTAL APAP'VR PAGE: AMOUNT 3n , .25 ------------- ------------- 30., 1.30.1;i ------------- 30p130.1. i OWASSO PUBLIC GOLF AUTHORITY PAYROLL PAYMENT REPORT PAY PERIOD ENDING DATE 05/09/98 OVERTIME TOTAL DEPARTMENT EXPENSES EXPENSES ::::..... ::::::.::$.;;;;;;;;:;::::......;;;;;:;>;;;;;;;;;;>;: 706.19. >::.::::::::::::::::. Golf Shop Operations 0.00 47736.86 Food & Beverage APPROVED: 05/19/98 Chairman Trustee Trustee 78.00 2,114.40 0 4 MEMORANDUM TO: THE HONORABLE CHAIR AND TRUSTEES OWASSO PUBLIC GOLF AUTHORITY FROM: WARREN LEHR DIRECTOR OF GOLF SUBJECT: YEARLY FEE FOR GOLF DATE: May 14, 1998 ' BACKGROUND: Since the opening of the golf course at Bailey Ranch, numerous golfers have inquired about the ' existence of a "membership" or a yearly fee for golf. To date, such a "membership" or yearly green fee has not been offered at Bailey Ranch for economic reasons. To understand the issues related to the question of whether to offer memberships, we must define the position of Bailey Ranch in terms of three major criteria which dictate fee structures and operational policies. They are 1) type of course, 2) location of course, and 3) sources of revenue and operating funds. ' There are four major categories or types of courses; municipal, daily fee, semi -private, and private. Municipal golf courses are facilities constructed and operated by tax -supported agencies such as states, counties, cities, towns, or park districts. Their chief goal is to provide golfing ' facilities to the greatest number of citizens at the most reasonable cost to the taxpayers. In most cases, municipal courses host the highest number of rounds and charge the lowest prices in ' keeping with their goal, but they are also usually subsidized with monies from the operating agency in order to pay operating expenses which exceed revenue funds. In our area, Mohawk and Page Belcher are Tulsa city courses which fit this definition. ' Daily fee golf courses are operations which are open to the public and owned by an individual, a partnership, or a corporation. Their primary purpose is to berate as a successful business ' venture. Accordingly, operating policies are designed to return to the owners the maximum net profit. Many daily fee courses offer member privileges for monthly or yearly fees, but still encourage daily fee -paying public patrons. Traditionally, resorts have fallen into this category, ' but in the last twelve to fifteen years a new type of course termed "upscale daily fee" has been constructed in large numbers. This type of "upscale" course targets discriminating golfers seeking to avoid the crowded and often -times run down conditions of many municipal courses and who are willing to pay more for better conditions, course quality, and amenities. In our area, Forest Ridge is the best example of this type of course. a YEARLY GOLF FEE ' MAY 14, 1998 PAGE 2 . Private golf and country clubs are limited -use facilities, usually not for profit, designed to meet the specific needs and desires of a restricted and usually affluent membership. The membership may own a proprietary interest (equity -type club) or the ownership may be vested in private enterprise that leases, rents, or in some manner makes the facility available to the club members. The responsibility for management of private clubs usually falls on the officers and directors elected by the members. The best examples of private courses in our area would be Southern Hills or Tulsa Country Club. Semi -Private courses are mentioned last here due to their diminishing numbers. With the advent of the upscale daily fee course, it has become difficult to distinguish between the two types as semi -private courses are open to the public on a daily fee basis, but also have a nucleus of members which they attempt to serve very much like a private club would. Most semi -private courses were originally private clubs which opened their doors to the general public due to financial struggles. Some semi -privates are still owned by the membership on an equity basis while others have sold out to single owners, partnerships or corporations. Hence, the only difference between a semi -private course and a daily fee course offering yearly memberships is the attempt of the semi -private course to retain the atmosphere of a private club. In our area, Spunky Creek is the lone example of a semi -private course, but the forthcoming Owasso Athletic Club appears to be planning an operation which resembles a semi -private course with its low monthly membership fees and private club type clubhouse amenities such as swimming pool and fitness room. (Owasso Athletic Club membership dues have been projected by Lindsey Company officers to be in the $1004125 per month range.) Bailey Ranch Golf Club, in theory and practice, is a combination of the municipal and daily fee type operations. It is municipal in its management and operation, and in its goal to provide golf for citizens at a reasonable price commensurate with the quality of the course. It is upscale daily fee in its course quality and goals for maintenance, service levels, and added amenities, and daily fee in its orientation toward being a "stand alone" operation which does not require taxpayer subsidization. The second major criterion which dictates fee structures and operational policies is location. In estimating the golf market for a given area, the National Golf Foundation has established an acceptable yardstick for daily fee and municipal courses as one 18-hole operation for every 25,000 persons. Other surveys and studies have indicated that golfers are generally willing to make up to a 30-minute drive to reach a course on a regular basis. Obviously, closer is better, especially when pertaining to the preferences of senior and junior. golfers (or their parents) and also with regard to twilight play (late afternoon or early evening starting times to play less than a full 18-hole round). Close proximity to the population of a metropolitan area such as Tulsa allows a course to charge higher fees driven by supply vs. demand ratios than, for instance, a golf course in a town of 10,000 which is 45 minutes or further from any major population base. Generally speaking, courses in such outer lying small towns are not of a quality level to demand higher fees due to the fact that not much money was initially invested in the construction of the course. Such a course, lacking a significant debt obligation or high maintenance costs, often is 9 YEARLY GOLF FEE MAY 14, 1998 PAGE 3 able to charge fairly low green fee rates (in the $5412 range), but generates most of its repeat play by offering yearly green fee "memberships" for $300-$500. Many of these small town country clubs are semi -private in their operational policy. As one approaches closer proximity to major metropolitan areas, fees for golf increase proportionately. The third major criterion to consider is sources of revenue and operating funds. By type, private and semi -private courses rely primarily on their membership dues bases. These can range from a quarter of a million dollars a year (200 members x $100 per month dues x 12 months per year) in the case of small town country clubs or semi -private courses, to as much as five million dollars per year (1200 members x $350 per month dues x 12 months per year) in the case of an elite private country club. Along with this dues base, other sources or funds such as golf cart rentals, food and beverage revenue, and guest fee charges also exist. When all sources of revenue fall short of requirements for the necessary operations and improvements, "assessments" are often made to the members of equity -type private clubs or the owners are forced to absorb the cost of the shortfall. In the case of municipal and daily fee courses, the primary revenue source is the accumulation of fees and costs paid by golfers on a daily basis. Many municipal operations are necessarily subsidized by general fund or taxpayer collected monies due to lack of operational efficiencies or the low cost of golf necessitated by the goals of a municipal operation which exists to provide inexpensive recreational opportunities for the citizens of the community. IISSUE: Given that the primary revenue source of public golf courses is daily revenue supplied by golfers, a more specific discussion of green fees and rates is applicable to the issue of green fee rates and yearly memberships. Green fee rates at a public. course should be competitive with other public courses, but an upscale daily fee course may charge more if the quality of its course, maintenance levels, service standards, and added amenities warrant higher fees. Upscale daily fee courses have proliferated on the premise that providing golf facilities of different types and quality will appeal to golfers of varying capabilities and taste. The upscale daily fee course targets a market niche of golfers who are more experienced and have more discriminating tastes. Also, some tax laws have recently changed which have eliminated certain tax advantages of belonging to a private club. This has led some to refer to upscale daily fee courses as "pay -as -you -play country clubs." Such daily fee courses have effectively bridged the formerly wide gap in product quality between private clubs and municipal courses. Daily fee courses must offer more to players on the course and in the golf shop if they hope to compete successfully with municipal facilities' lower prices because many golfers don't easily recognize qualitative differences. While the problem of weekend congestion on public golf courses has received considerable attention in recent years, another problem concerning the distribution of play is more critical for YEARLY GOLF FEE MAY 14, 1998 PAGE 4 golf course operators. Many golf courses which are unable to accommodate the onslaught of weekend golfers are often uncrowded on weekdays. Increased midweek play is the most likely source of new revenue at most public courses. Ideally, golf courses should experience about 70 percent of their play on weekdays. Any percentage over 60 is considered good by today's standards, but anything under 50 percent can mean financial difficulty for a public operation. Bailey Ranch has now experienced four full calendar years of operating history and its percentage of weekday play has been between 60 and , 61 percent in each of these years. As is often the practice at daily fee courses, there currently exists a less expensive rate for weekday play at Bailey Ranch than for weekend and holiday play. (The days that holiday rates are in effect are the "warm weather holidays":. Good Friday, Memorial Day, Independence Day, and Labor Day.) There has also existed for the past four ' years a perpetual "Early Bird Special" which is in effect Monday -Thursday and offers half price cart rentals before 11 a.m. These measures, in addition to the fact that there has not been a fee increase at Bailey Ranch since July, 1995, have helped keep the weekday to weekend/holiday t play ratios at acceptable levels. However, there is another method which many daily fee courses have used to encourage golfers to use their facilities on a regular basis other than on weekends and holidays. This is the annual "membership" which is basically a yearly fee for golf. There are various types of memberships which are sold and management can reserve the right to limit the number of memberships in a given category. Examples of membership types follow: Unlimited Play Annual Memberships are for the golfer who plays a considerable amount. Such a membership entitles one to unlimited golfing privileges with the right to reserve starting times on weekends and holidays and any other time. The yearly fee is normally payable in advance and while most are sold on a calendar year basis, some clubs have a policy of beginning one's membership the day he joins and having it in force for one year. Weekday Annual Memberships are for golfers who can play most of their golf Monday through Friday. It permits them to play unlimited golf without paying green fees on those days. Should such members wish to play on weekends or holidays, they pay the going green.. fee rate. These memberships are normally 30-40 percent less than the cost of unlimited play memberships. Associate Memberships entitle holders to various discounts or privileges not offered to the general fee paying public. The ability to reserve starting times on an advanced basis and receive discounts on fees and merchandise are often benefits of this type of membership. Such members pay a discounted green fee each time they play and the annual fee is relatively small (usually from $40-$200) compared to the other membership types. Bailey Ranch offers a Ranch Patron Card "membership" which is a good example of this type of membership. 1 11 1 1 YEARLY GOLF FEE MAY 14, 1998 PAGE 5 OWASSO GOLF ADVISORY COMMITTEE RECOMMENDATION: After several discussions concerning the above factors and criteria, the Golf Advisory Committee recommended unanimously that Bailey Ranch Golf Club offer an "off-peak membership" which would protect revenue during the busiest time periods - weekend and holiday mornings. A great deal of thought and research went into these discussions which occupied a portion of at least three meetings. It was also recommended that the sale of these memberships and the subsequent rounds of play be closely monitored so as to determine the membership program's profitability. The program could then be limited, expanded, or discontinued accordingly. A membership program of this nature would not be intended or promoted as a bargain for the average golfer as these needs are currently served through our Owasso Resident Rate and Ranch Patron Card programs. Both have been extremely successful in providing bargain rates. The use of a membership program is recommended by the Advisory Committee for the purpose of profitability - to attract more consistent repeat play during the off-peak weekday time periods. A major priority for the golf course is to maintain sound financial performance so that taxpayer funds will not need to be utilized for either debt service requirements or operating expenses. The desired goal in establishing that priority is to offer the quality service, course maintenance, and amenity standards of an upscale daily fee or private club while offering the value oriented price levels of a municipal course. The implementation of such a program will allow Bailey Ranch Golf Club to continue to be considered as an upscale daily fee course or perhaps be the originator of a new category which sets high standards in quality, efficiencies, and profitability: the "upscale municipal golf course". RECOMMENDATION: The staff recommends that the OPGA authorize the management and staff of Bailey Ranch Golf Club to offer a yearly membership for golf which permits the member to play golf without paying daily green fees during the following "off-peak" time periods: Monday through Friday excluding holidays, anytime; weekends and holidays after 1:00 p.m. Such a membership would cost $1500 for an individual and $2000 for a family. Membership dues would be payable in advance, non-refundable, and annually renewable on the date of purchase. Further particular details would be written into contract form and be approved upon review by the OPGA Manager, the OPGA Attorney, and the Owasso Golf Advisory Committee. ATTACEAWNT: March 12, 1998 Memorandum C:\WPDATA\GOLFAVTH\MEMOS\ 1998\980519. FEE 1 MEMORANDUM , TO: THE HONORABLE CHAIR & TRUSTEES ' OWASSO PUBLIC GOLF AUTHORITY FROM: WARREN LEHR ' DIRECTOR OF GOLF SUBJECT: CONSIDERATION OF THE INTRODUCTION OF A YEARLY FEE FOR GOLF DATE: March 12, 1998 , This memo is for the purpose of informing you of recent discussions I have had with the Owasso Golf Advisory Committee concerning the possibility of introducing a yearly fee for golf (commonly referred to as a "yearly membership"). This type of fee allows a golfer to pay one , yearly fee and be exempt from paying daily green fees for a specified period, usually one year. Since opening, we have had numerous inquiries from golfers who are familiar with such "memberships" offered at other public courses. Normally those "memberships" are offered at courses in small towns or outer lying areas where the goal is to increase traffic and help with cash flow. Many of these courses were constructed many years ago and often with taxpayer money. Due to their lack of proximity to a major population base and the absence of significant debt service obligations, such yearly fees are often priced in the range of $300 - $700 per year. This is the type of fee many golfers are looking for, and it doesn't take a mathematician to figure out why. A yearly fee of that amount would not be economically feasible for our operation as it would limit our capability to meet our debt service obligations by filling the finite number of reservations available with golfers who are effectively paying $4 - $6 per round. Research in our industry recommends setting a yearly fee at 100 times the amount of the green fee in order to be potentially profitable. While it has not been considered feasible or economically prudent to offer such a program in the past, several factors have now come into play which have led me to consider potential benefits of a yearly fee priced in the $1500 - $2200 range: 1) a willingness on the part of several golfers to pay a fee in this range for the convenience it offers, rather than strictly for the price reduction benefits; 2) an interest expressed by some golfers in allowing their memberships at other area courses to expire so that they could purchase a membership at Bailey Ranch; and 3) the offering in the near future of a similar program at the new course in Owasso. Discussion to date has been limited to the consideration of offering an "off-peak membership", which protects our revenue at our busiest times - weekend and holiday mornings. A great deal of thought and research has gone into the issues that are briefly outlined here, but it is our aim to more fully develop these possibilities through discussions in our upcoming Golf Advisory Committee meetings, with a view toward possibly bringing a recommendation to you in the near future. If you have any questions or concerns, please call me or any member of the Golf Advisory Committee. C:\WPDATA\GOLFAUTH\MEMOS\1998\980312.FEE