pages: CityCouncil/2011-01-25.pdf, 7
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CityCouncil | 2011-01-25 | 7 | competitive; that he would expect the number of rounds and revenue to continue to decline if improvements are not made; the market is competitive and rates have been lowered; golfers are sophisticated and can compare pricing on line; a good product is needed to compete. Vice Mayor Bonta inquired whether the reserve would continue to be tapped under a management agreement for 36 holes, to which Mr. Blake responded in the affirmative. Vice Mayor Bonta inquired the amount of lease payments that would be made to the City under the 27-hole scenario. Mr. Blake responded modeling has been done showing rounds, revenues and expenses; stated the negotiations with the City regarding the length of the lease and other factors would determine how the profit would be divvied up. The Acting City Manager stated the amount, which would return for Council approval, would not be collected for several years until capital improvements are finished; the amount has not been negotiated. Vice Mayor Bonta inquired whether there are similar leases, to which Mr. Blake responded Mr. Sams could get said information for the City. Vice Mayor Bonta stated Mr. Blake indicated the City would continue to receive lease payments even if Kemper's projections were not realized; inquired whether there is potential for profit sharing if growth projections are exceeded. Mr. Blake responded in the affirmative; stated the matter is negotiable; Kemper would evaluate its risk; the deal has to be good for both parties or it will not work; there will be a finite amount of money and the City and Kemper have to figure out what is fair. Councilmember Johnson inquired whether Kemper believes the course could be viable for the next 40 years without City subsidy, to which Mr. Blake responded capital improvements have not been made for a number of years and the useful life of items have been exceeded. In response to Councilmember Johnson's inquiry whether the course would see a greater decline in rounds due to the declining condition of the course, Mr. Blake stated the City has to consider said risk; the rate is consistent with other courses; as better courses lower rates, players can trade up. Councilmember Johnson stated Alameda residents have told her that they play other courses for $25, including a cart, which would cost $38 in Alameda. Mr. Blake stated golfers like variety; course conditions tend to be the number one driver in repeat play; courses not in good condition have a hard time competing. Special Meeting Alameda City Council 5 January 25, 2011 | CityCouncil/2011-01-25.pdf |