HomeMy WebLinkAbout2011-07-12 PACKET 11published June 23. 2011. 0? 00 Pot
Eagle Valley struggles with bond payments
With 3ho eroncmic downturn over tire last throe vemo, me golf indestry was one of many trial 901 , w18r retiring revenues. Eagle Valli Golf Cevrs =_, a Woodbury municipal
epermi0n, was not Immune w the dismal economy.
By Rtham Festtu. Woodu. 1' Bulletin
With the economic downturn over the last three years, the golf industry was one of many that got hit with declining revenues.
Eagle Valley Golf Course, a Woodbury municipal operation, was not immune to the dismal economy, Revenue projections made in the 1990s have not been
met, according to city documents.
Woodbury City Council reviewed a plan at last Wednesday's workshop that would modify Eagle Valley's debt structure starting in 2012.
'All things considered, we're getting as much out of the facility as we can given the market conditions," said golf course Manager Shaun Peltier.
Staff proposed Eagle Valley's debt to be paid off with other city funds. Under that plan, the golf course would no longer be responsible for financing the
principal and interest amounts.
A total of $3.1 million is the outstanding principal balance that's due in February of 2026 under the current debt structure. The proposal suggests that
$92,000 would comma out of the city's closed debt service fund every year from 2012 to 2015. The remaining $2.7 million would come out of the capital
improvement fund, which in total would save about $446,000 in interest costs.
Existing bond structure prohibits refinancing or restructuring the debt until February of 2015.
The plan frees up the golf course to become a self - supporting operation, Parks and Recreation Director Bob Klatt said. More money would be put toward
equipment replacement, irrigation and overall operations.
it sets up the golf course to be very successful financially tin the long run," he said, adding that it would gradually reinvent the golf course and build up some
reserves.
Though the industry has changed, Peltier said Eagle Valley's revenues are solid compared to other municipal courses in the Twin Cities.
However, net operating revenues continued to decline since 2006 — from about $320,000 to $184,000 in 2010, which is attributed to declining overall golf
participation nationwide, according to city documents.
The National Golf Foundation reports the number of golfers dropped 5 percent from 2008. to 2D09 and a total of 9 percent in the last five years. Based on
many factors, people have less time, money and flexibility to play golf, Peltier wrote in a council memo.
Weather patterns and family obligations limit time people can devote to golf activities are also significant barriers.
This appiies specifically to Woodbury because our demographics weigh towards younger families with multiple time commitment=_ for leisure activities;' he
added.
The original business plan set In 1996 aimed for more than 40,000 rounds a year to stabilize the course. However, that goal is not realistic In today's market,
according to a council letter.
Total rounds played dropped from about 30,900 in 2006 to 27,500 in 2010. Eagle Valley would have to attract approximately 30,000 rounds annually to cover
operating expenses and equipment replacement, and about 36,000 rounds annually at current one projections to cover the current debt service obligations.
The council will further discuss the proposal at its annual budget workshop meeting In August before a final 2012 budget Is approved at the end of this year.
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NOTE: River Oaks' Rounds:
2006
35,004
2007
34,672
2008
34,170
2009
35,656
2010
33,853
These
include both 9 and 18 holes.
Woodbury
2006 30,900
2010 27,500
River Oaks Rounds 2006 - 2010
Subject: Next Stop for the Red Rock Corridor: Growing Transit Ridership
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• • •
The Red Rock Corridor Commission recently held an Open House to showcase transit station
plans and a long -term transit vision for Hastings, Cottage Grove, Newport and Lower Afton in
St. Paul. Immediate next steps for the Red Rock Corridor will focus on expanding bus service,
growing transit ridership and promoting economic development throughout the corridor.
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The Metropolitan Council projects that the southeast metro will grow by another 100,000
people in the next 20 years. The four transit station areas in the Red Rock Corridor offer
significant economic development opportunities to accommodate future growth. The station
t
The Metropolitan Council projects that the southeast metro will grow by another 100,000
people in the next 20 years. The four transit station areas in the Red Rock Corridor offer
significant economic development opportunities to accommodate future growth. The station
plans have identified an estimated $510 million in private investment opportunities, including,
residential, office, commercial development and redevelopment, within 1/4 mile of each station
area.
In addition to economic development opportunities, growing ridership through expanded bus
service is essential for meeting the long -term transportation needs of the corridor. The next
step includes constructing two new transit facilities in Newport and Hastings.
The Red Rock Corridor Commission will be releasing the Station Area Planning Report within
the next few weeks for public comment and endorsement by the cities and counties in the
corridor. For the latest information regarding the Red Rock Corridor and station area planning
study, please visit, http: / /redrockrail.org /