Council moves toward lease deal for golf complex

Council moves toward lease deal for golf complex

Michele Ellson

Alameda’s City Council moved a step closer to hiring a professional operator to take over the Chuck Corica Golf Complex on Tuesday night, voting unanimously to introduce an ordinance that would make it so. The council is expected to approve a deal with Greenway Golf next week.

“I am more than excited,” City Councilman Doug deHaan said after moving to introduce the ordinance authorizing the deal, which has been five years in the making.

The council deliberated for two hours over the finer points of the lease deal, in particular over staff projections that the city would need to lend its golf fund up to $440,000 in order to pay a promised $1 million toward renovations that come in the wake of criticism over the council’s failure to permanently cure chronic budget deficits.

City staffers estimated the money, which staff proposed taking from the city’s general fund reserve, could be recouped over six years, though Greenway has estimated it could happen in three.

“I remember a long and heated conversation over the budget and how we were going to close the gap, and whether to use general fund dollars to close the gap instead of cutting city services. And here we are, just in principle, using general fund dollars to pay for recreation,” Mayor Marie Gilmore said.

City Councilwoman Beverly Johnson said she believed a long-term lease would lift all of the golf complex’s liabilities off the city’s shoulders, something the proposed lease deal doesn’t do. The city will still make $130,000 a year in debt payments for earlier driving range work and pay $80,000 a year in urban runoff fees.

City Manager John Russo pledged that city staff would look elsewhere for the rest of the money the city is to contribute toward upgrades, money the city would pay out in 2015 after Greenway makes improvements to the golf complex. City Attorney Janet Kern will make council-directed adjustments to the contract language.

“Mr. Russo and I are pretty creative. I think we can put our heads together, put together some options and bring that back to you before any decisions are made,” Assistant City Manager Lisa Goldman said of council’s request that the money be found elsewhere.

The city began to consider hiring a private operator to run the complex in earnest in 2008, a year after a consultant told them it needed $10 million in upgrades council members said the city couldn’t afford. City leaders had originally sought to negotiate a deal with KemperSports Management, which it hired to manage the course while a more permanent operator was found, but city leaders balked when Kemper’s managers offered a proposal that didn’t comply with the city’s requirements.

Council members chose to negotiate a deal with Greenway in May, citing the operator’s proposal to revamp the Jack Clark South Course, environmentally friendly practices and proposed solutions to the drainage issues that have bedeviled golfers who play at the complex.

Under the terms of the deal, Greenway would pay a minimum of $11.5 million in rent over 20 years and make $6.7 million in upgrades, with $1 million of that coming from the city. Greenway estimated they would pull in $45.6 million in revenues over their first 10 years of running the complex.

Golf Commission President Jane Sullwold applauded the deal, saying it’s “exactly what we need for golf in Alameda.” She also asked the council to reopen negotiations with the owners of Jim’s on the Course, who the city had negotiated unsuccessfully with for a long-term lease to operate a restaurant there.

If the council approves the lease deal on July 31, Greenway could be set to run the complex by September. Greenway’s Kelley said his firm would begin renovations soon after, starting with the complex’s driving range and the nine-hole Mif Albright course.

“Thank you. I look forward to working with you,” Kelley said as the council voted to move forward.

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