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>> Course expenses would shift from Omaha to a private company.
>> Company would provide more sophisticated marketing of city courses.
>> Fees paid by the company would provide Omaha with reliable revenue source.
Cons
>> Fees could increase (but Omaha might be able to veto any fee changes).
>> City would lose some control over quality of courses.
>> City may still have to reimburse company for major course improvements.
Omaha asked bidders for proposals that would:
>> Last for 10 years.
>> Pay the city annually for the right to run courses.
>> Allow the city to approve greens fees and cart fees.
Sources: National Golf Foundation Consulting; City of Omaha.
The debate over whether to privatize Omaha’s municipal golf courses is a familiar one to John Condon.
Condon fought privatization efforts 20 years ago as head of a local golfers’ group. He is still convinced that privatization would be the wrong move for Omaha’s courses, and he is lobbying City Hall to keep Omaha’s seven courses under city control.
The Parks and Recreation Department this week asked companies to submit proposals for running the city courses. Proposals are due Jan. 27.
If a proposal meets the city’s requirements, the city would negotiate a contract with the company and forward that agreement to the City Council for consideration.
The city is acting on a recommendation from a Florida consultant that said it might be possible for Omaha to stem the financial losses at the golf courses by turning over operations — and course expenses — to a private firm.
Omaha’s golf fund is more than $700,000 in the red.
Unless Omaha finds a solution to its golf losses, city accountants say, taxpayers will wind up subsidizing the city’s courses.
Regular golfers such as Condon fear that turning the courses over to a private company will cause greens fees to increase and might lead to the closing of the city’s smaller courses.
Omaha parks administrator Steve Scarpello emphasized that any agreement would give the city the ability to veto any fee increases proposed by the private operator.
He said “there’s no intention” of closing golf courses if a private company is hired. The whole point of exploring privatization, Scarpello said, is to put the city’s courses on better financial footing.
“I think it’s the opposite,” he said of opponents’ worries. “We’re looking at (privatization) so we don’t have to close courses.”
Opponents say they understand that the city needs to make fiscally prudent decisions. But they don’t want golfers on limited incomes — especially retirees and young people — to be priced out of playing golf.
Privatization opponents say Omaha’s municipal courses are an affordable alternative to the area’s numerous private courses, but that could change under private management.
“I am certain that they would raise fees,” Condon said.
Said another longtime course user, Rose Harck: “If they privatize the golf courses, I’m afraid that we’re going to lose a lot of golfers because the prices will be different.”
Omaha has four nine-hole municipal courses that have lost money for years and are propped up financially by the city’s three 18-hole courses.
Condon worries that the shorter courses could be phased out under private control. The nine-hole Westwood Heights course was nearly closed last summer by Mayor Jim Suttle for budget reasons. The course was saved only after fees were increased by $2 at all city courses.
Condon has written letters to City Council members urging them to keep the golf courses in city hands and to make changes in the way they are funded to put them on better financial footing.
Fee increases may not be a given under privatization, based on Omaha’s current experience with private course management and recent privatization efforts in other Midwestern cities.
Two of Omaha’s courses — the 18-hole Knolls and the nine-hole Steve Hogan course at Miller Park — already are run by private groups.
The Knolls course had similar rates this year as the city-run 18-hole courses.
The Knolls charged $19 on weekdays and $27 on weekends. The weekend rate was the same as that at the city-run Johnny Goodman and Benson Park courses, and $1 more than the city-run Elmwood Park course.
The Knolls’ weekday rate was $2 cheaper than at Goodman and Benson and $1 cheaper than at Elmwood.
The Miller Park course’s fees also were mostly comparable to those at the city’s nine-hole courses.
The idea of privatizing all Omaha municipal courses came up two decades ago, when P.J. Morgan was mayor, after the upkeep of the city courses was criticized.
A team of city employees studied the idea. But the study team raised several concerns about privatization, including the possibility of golf fee increases, and the courses remained under city management.
Some Midwestern cities that have given up control of their municipal courses in recent years report that fees did not increase.
Kansas City, Mo., has privatized five courses. Des Moines and Sioux Falls, S.D., have each privatized three municipal courses.
Dick Nogosek, Kansas City’s golf director, said competition has made it tough for management companies to raise fees at municipal courses.
Kansas City and Des Moines retained the right to approve any fee changes.
“We turned over the operation,” Nogosek said, “but they still have to operate (the courses) the way we expect them to operate. ... I don’t see us going back to the old days. For us, privatizing these courses is here to stay.”
Kansas City officials reasoned that a private company not saddled by government bureaucracy could run the golf courses more efficiently.
Des Moines made the switch because its golf fund was $3.9 million in the red and was being propped up by the city’s general tax fund.
Condon, who founded the Omaha Public Golfers Association, blames the financial problems at Omaha’s courses on the accounting methods applied to the fund that pays for golf operations.
The fund — set up 20 years ago as an alternative to privatization — is supported by greens fees, sales of concessions and cart rental fees.
The fund’s original purpose was to pay for course improvements and maintenance. Much of the Elmwood Park course, for example, was redone years ago with money from the fund.
About 10 years ago, during Mayor Hal Daub’s administration, the city started charging that fund for certain administrative expenses, such as legal services, related to golf operations. A similar accounting procedure had been applied to other city funds for years.
With those extra costs, the golf fund’s balance started to decline.
Condon said the fund worked well “until somebody got their hand in the cookie jar and took money from the fund that was explicitly to maintain the golf courses.”
Scarpello, who studied the issue when he became parks administrator, said the extra charges are justified.
Course funding was one of the topics looked at this summer by Omaha’s golf consultant. The consultant’s report, issued in October, points to a different reason for Omaha’s golf woes: increased competition from private courses.
During the past decade, the number of rounds played on the seven city courses has dropped 30 percent.
The consultant noted that the city has made little effort to market the municipal courses and boost the number of rounds played.
Contact the writer:
444-1149, tom.shaw@owh.com
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