Losses mount at Bennett Valley Golf Course

Both the 2009 contract and the 2011 elimination of non-resident rates were negotiated and presented to the City Council by Marc Richardson, the former director of the city's parks and recreation department until his retirement in December.

Richardson was fined $6,500 last month by the state Fair Political Practices Commission for failing to report thousands of dollars in free golf, cart usage, lessons and merchandise discounts from Borowicz over several years.

Richardson and Rich Hovden, the former parks development manager who also was fined, repaid Borowicz a total of $9,365 in December. Both have said they didn't consider the freebies to be gifts given that they were responsible for oversight of the course.

Richardson also was fined for conflict of interest because he negotiated contracts with Borowicz at the same time he was accepting undisclosed gifts from him. Richardson contended that the contract negotiations with Borowicz saved the city $1.6 million, a calculation based largely on a reduction in the annual cost-of-living increase to Borowicz's management fee from 4.4 percent per year to 2.75 percent.

But the report, by casting doubt on the wisdom of the 2011 elimination of non-resident rates, raises questions about whether the city's best interests were being represented in those negotiations.

Borowicz thinks they were. The drop off in rounds in 2009 was steeper for non-resident golfers, and it was important for the city to do something to woo those golfers back, he said.

While he acknowledged the benefits from the increase in rounds may have been "uneven" in recent years, he said doing nothing would have been far worse.

"If we didn't offer the discount and the promotion to get people out there, the city would be hurting worse and I would be, too, said Borowicz, who has worked at the course for more than 25 years.

Another major area of concern was what the report characterized as weak financial controls and poor accounting practices.

For example, more than 100 rain checks were issued to golfers from June through September of 2012, a period when there was no rain. That indicates a problem if nearly "one golfer per day needs a rain check to be placated," the report found.

Borowicz denied that figure is excessive, saying other courses in the area also offer rain checks. They are not merely for inclement weather, but for all kinds of reasons where people can't complete their rounds, he said. He recalled offering a 91-year-old woman a rain check on the back nine holes because it was too hot for her to continue.

Resort courses can be less generous with rain checks, but for a course they relies on regular, repeat local business, it's just a smart business decision, Borowicz said. "You give them reason to come back," he said.

The amount of green fees revenue the city has received is another "red flag" listed in the report.

It found a $548,000 discrepancy over three years between the amount of green fees listed in the income statement and those listed in other reports. It's possible the discrepancy is just an accounting error, but the report suggests "someone should track it down."

Another area of concern involves annual passes. The amount of revenue from the pass holders didn't match the number of passes reported as sold. The report called the finding "disturbing" and one that "demonstrates carelessness in bookkeeping and the fact that a number of passholders are not paying the full amount."

It is issues like these that most concern Councilman Gary Wysocky. He said he awaits Phillips' report to the council and Borowicz's responses "with great anticipation."

The consultant's report calls for a "comprehensive audit to determine the nature and the extent of the problems" at the course, a recommendation Wysocky, a CPA, said he strongly supports.

"This is why I say we should focus here first," Wysocky said.

Both Borowicz and Phillips cautioned against relying on the accuracy of the 95-page report, which the city paid $15,500 for, until they had more time to analyze it. Borowicz said there are several areas where data appears to have been misinterpreted by the author, Sirius president John Wait.

Wait declined to comment, citing the need to allow the review process with the city to play out. He noted his report was completed before the gifts to Richardson and Hovden became public.

Borowicz said he is working closely with Phillips to clarify any misinformation in the report and expects to renegotiate his contract soon with an eye toward helping the course succeed.

"We want to get this thing squared away and going in the right direction," Borowicz said. "We are working on it and we are going to figure it out together."

Phillips called the effort her "highest priority."

It is likely that the contract will be revised with "a combination of cuts on my end and increases in fees a little bit," Borowicz said.

Bartley said he couldn't prejudge those negotiations, but said it was clear the course needs to become self-sufficient again.

"I think the reality is we need to get the golf course to break even and to build back the reserves," he said.

It's unclear how golfers will react to higher green fees, which the report suggests are appropriate. Fees went up 30 percent after the clubhouse and pro shop opened. Rates for annual passes went up 11 percent in 2011, and last year they ticked up $1 across the board. Today adults playing 18 holes on the weekend pay $38 and $24 during the week.

For years the course was the best bargain around, said Tony Conrady, president of the 368-member Bennett Valley Golf Club. But comparable courses nearby, many facing similar challenges to Bennett Valley, are offering aggressive promotions.

"That has taken away some players, for sure," said Conrady, who has played the course for 30 years.

He said he's concerned the city will overact to the report and consider management changes at the course, which he feels would be unwarranted. The staff is excellent and beloved by regular golfers, he said. "It feels like home to me," Conrady said.

Upgrades like adding sand to the fairways to improve drainage and the installing more tees for women are underway, he noted. Adding new features to the practice area, like a sand trap, might help draw more golfers, he said.

Most golfers probably would accept a modest increase in green fees if they knew it was necessary to keep the course solvent and well managed, said Nancy Kennedy, a retired vice principal at Santa Rosa High School who is a regular golfer and member of the Bennett Valley Women's Golf Club.

"I think people would stay loyal to it," Kennedy said. "It's still a very good deal."