$36.36 per year...

I know, i am beating a dead horse. Apparently no one cares. Or, so i am told. With that said, the cost per household to subsidize golf in Sun City comes to $36.36 per year, per household. The good news is, if you are a couple, that is only $18.18 cents per year. Not bad. If you are a single person paying $496 you are paying the full monty; $36.36.

So we are clear on the math, a one million dollar subsidy from the general ledger divided by 27,500 rooftops is the methodology. It's not a perfect science, it's very close. I know from the RCSC financials they took in in 2020 a little over 7 million dollars including everything, car rental, shop sales, range balls and round play. Obviously that wasn't all profit as merchandise sales is not total revenue. Why quibble over a couple of bucks.

We also know from the 990's posted for 2019 the RCSC's expense side was just over 8 million dollars. I doubt greatly those expenses went down in 2020,and if they did i will be the first to post it. No idea why those 990's aren't up yet, but they should be soon. BTW, if the number went up, i will post that just as quickly.

Anyway, the argument may well be members should be willing to subsidize golf. Obviously i think members should have that choice, but it was never given them. In fact, until the 990's were posted we had no idea. Now that we know, it's worthy a discussion. Unless no one cares.

But that's not the point of this argument/discussion. Nope. I have a very simple question to ask all of you reading this, living here in Sun City; Do you think, believe each and every Sun City member, all 32,600 members should be subsidizing golfers from Peoria, Surprise, Glendale and surrounding areas as well?

It's not a hard question, why should a 45 year old from outside the community get a break on the cost of a round of golf? One that each of the 86% to 88% of the non-golfers are being asked to pay for?

Just curious?

 

It gets worse by the way. Think in these terms; 350,000 rounds of golf played last year. For golf to break even, the down and dirty math is this: roughly $23 per round times gets you that 8 million dollars to cover expenses. It's not a realistic number because there are any number of gimmicks to generate that 350,000 rounds, the most glaring are full play passes, both for members and non. The second is summer reduced rates and time of day passes. The point here isn't to analyze them.

My issue is this: a couple that plays golf once a week and pays the rate in place at the time, $35 for peak, summer rates around $24 per person. What that means is they are not only paying the $36.36 subsidy for non members to golf, the rates they pay are higher on average than the full play passes non-members are paying so their rates are subsidizing those outside the walls.

Where is the logic in that? Where is it written in any of our documents that it is the job of the RCSC board or management to provide cheaper costing amenities to those who don't live here...and then pass those costs on to members?

 

.....that is only $18.18 cents per year. Not bad. If you are a single person paying $496 you are paying the full monty; $36.36.

Let me be sure that I understand this: so my husband and I, who have never set foot on one of the golf courses here in Sun City, contribute $18.18 cents out of our $496.00 annual assessment fee to "help" golf be sustainable for golfers. (Sustainability means meeting our own needs without compromising the ability of future generations to meet their own needs.) Well, gosh, that doesn't seem like much. BUT, wait a minute! Then that's multiplied by the number of members in good standing - 36,200 or so? I thought the assessment fee was to go for operating expenses? Or did I read something wrong?

 

It's one of those unanswerable question odaat. We know the golf courses were purchased under terms they should be self-sustaining. Over the years, the board and more recently the GM made a decision that wasn't possible. For years, we all just pretended everything was fine. The only golf fees raised lately are on those that play occasionally. My personal opinion is the management has decided the measuring stick for golf is the number of rounds played per year, irrespective of who the golfers are, or the price they paid to step on the course.

To be able to do that, they had to subsidize golf. If there was a deficit, they just wrote it off in their yearly budgeting process. We could never tell that from the data they published. That is until one of the readers on TOSC found and posted the 990's. Those yearly reports sent to the Federal government break out golf in a category of unto itself. They show revenue (which we always could find), but then along with it, expenses which we could never find). We now know they/we subsidized golf to the tune of roughly 25 million dollars over a 12-15 year period. Actually that doubles the rate ($36.36), because i was using a best guess scenario at a million dollar loss.

I happen to believe golf courses are an important amenity in Sun City and to our future. The question, like every other challenge we face here is simply this: At what cost? The problem is if you don't know the numbers, if you don't ask the questions, the answer becomes, there is no cost too high. That is foolishness.

 

Does anyone think that the golf courses in Sun City have not enhanced the value of your property or does that logic escape you folks?

 

I have NO dispute about the enhancement to the community. Golf is a major draw in AZ. My concern is the lack of honesty, transparency, clarity - whatever you choose to call it - as to the REAL cost of maintaining and operating all of the courses. And, opening the courses to all of the outside play at such a low cost is the big issue. My question is, why should we bare the expense to provide low cost golf to non SC residents, when so many serious issues have been neglected, or put off for years, for our residents AND RCSC Boards were not forthcoming about the real costs. I haven't played golf in years, but I thoroughly understand and appreciate it's value.

 

Hey Larry, welcome. I am confused by your comments. There's nothing in anything i have ever written that has been critical of the RCSC owning the golf golf courses. As i've written a hundred times; Sun City was built as a golfing community, it always will be a golfing community. That's pretty straight forward. BTW, nicely stated Linda.

Where you may take issue is when i talk about how much it costs us (everyone living in Sun City). Before we begin the discussion, let's clear the decks with the math from the Preservation and Improvement Fund (PIF). Since its inception, some 50-60 million dollars invested in our 8 golf courses. It's hard to find because they buried numbers under the amenity side of the ledger rather on the golf side where it belonged.

It's neither here nor there, because PIF was intended to upgrade our amenities as they aged. Golf is an amenity that needed updating. It doesn't need to be billed back against golf to determine if it is self-sustaining. Not an issue, except when we start selling golf to those living outside our walls at prices cheaper than we sell it to our own members and giving them access to our web portal (that still boggles the mind). Then we (the 86-88% that don't play) are subsidizing non-member play.

What i am trying to do is get members to understand what has happened so they can better determine what is to happen going forward. We know the ADWR is going to shove the 5th management plan down our throat in 2025 and we are looking at another huge infusion of PIF to cover the cost for desert landscaping. 8 million dollars on the south course alone. It's not free money, every home sale in Sun City adds $4000 to the kitty. When you spend it there, other things are neglected (like a theater).

It simply goes back to the question, how much should we be subsidizing golf beyond what we are paying for from PIF? If i said i'm all in for a million dollar a year subsidy, would you be happy? 2 million? 3 million? The real problem for golf is when you measure success by the number of rounds played and then you give it away for $5 or $10 per round, you will never cover your costs. Let me repeat, 12-14 % of the population of Sun City is all that play. That's been the number since we opened in 1960. It's also why new age restricted communities don't build or own golf courses, there's no future in it.

Hope that helps, hoping you share your thoughts.

 

I wholeheartedly agree that non residents should never pay less than residents. I also don’t believe that they should not have access to the website. Where this gets complicated is as you quote the 86% of non-golfers that get up in arms over the $36. My comment wasn’t directed at you although apparently you took it as such. Simple logic dictates that golf must produce as much revenue as possible to cover the costs. Allowing non residents to play cheaper in SC than at their home course makes no sense, but we still need outside revenue to make it work.

 

Just going to throw out a random thought. If we need outside golfers for additional revenue to maintain all of these courses, is it time to rethink the need? Maybe converting at least one to a really great park, with bike and walking trails, benches to just enjoy the outdoors, etc. Maybe it's time to think of additional uses. Or, is there something in the transfer of ownership that prohibits such a change?

 

I am under the understanding that deed restrictions require that they remain golf courses. Maybe Bill can clarify.

 

That's probably correct.

 

Couple of quick points; the courses have some covenants preventing that in place and honestly until we see what happens to the private courses in 2025 i wouldn't do anything radical. Thanks for jumping in guys.

Sorry if i sounded crass Larry, people are always accusing me of hating golf. I don't. I hate that management has elected to keep secrets from the membership. You know the latest push by the board president is data driven decisions. I don't disagree, however data collection is worthless without the technology to do it right. We've been begging for card reader's made available for every club for at least ten years. They can't do it because the technology is 20 years behind the times.

We are dead on in agreement about outside play Larry. If they want to play and pay the cost for a round of golf, let them take our open tee times. Letting them come in on the cheap is foolishness. Giving them access to our web portal when they buy the full play pass should be criminal. I believe golf is worth supporting, in exchange, i want total transparency. And less people think i am picking on golf, i want it on everything. There should be no secrets, no hidden agendas.

Everything i have written for the past 15 years has been about building a sense of community, a sense of ownership and accountability. It's why Sun City was so successful for so many years.

 

Sometimes you get a little heavy in your opposition to golf. I would offer this to any opponent of golf. Show many any expenditure of PIF funds that brought homeowners greater value than the $36.36 spent on golf? Golf is an easy target, but let’s agree it’s not the problem.

 

No, we won't agree it's not a problem. When they bought the courses from DEVCO for $10 and a cup of coffee they were afraid they would become a money pit. Claiming there is no greater value is nonsense when you look at the 75 million dollars spent in the past 15 years. By 2030 we'll be reaching 100 million dollars between PIF and subsidizing rates through the general ledger. When we are done, it's still only 12-14% of the population of the community.

The reason it sounds like i come across heavy on golf is because no one has the balls to question the numbers. It has simply become a sacred cow. I'm all for keeping golf alive, but like every other amenity, the question really is, at what cost? Is there any number too much? Or, is it more important that people can play for $5 or $10 a round and we ask/tell that 96 year old single woman living off her social security to subsidize their play?

 

So what’s your solution? It’s really easy to poke holes, how you gonna fixit? Is your 96 year old gonna spend time at the car club instead? Or does the knitting club provide the draw to Sun City?

 

Everything provides the draw to Sun City Larry. It has never been just one thing. The RCSC needs to become more transparent. We need solid data going forward. We need to know where to best invest our PIF going forward. Until we fix the technology, they can't even do that. For now, i would love to see them stop the sale of full play cards to non-residents. If they want to play on our courses, let them pay $1 or $2 more than members pay, not $10 or $15 less than what members are paying. They need to look at the impact of full play passes by members. Again, i have no idea if they are playing 100 rounds, 200 rounds or 300 rounds per year, maybe it doesn't matter. Unless or until we have sound information, it's all just a guessing game.

I would love to see the golf advisory committee be tasked with looking at golf over all and letting them make recommendations to maintain the integrity of the game by insuring it has some limits on yearly capital expenditures. All i am saying is going forward it can't just be a blank check with management making every decision. After 15 years of that, it's time to let the community have a voice. Posting data is pretty simple. It's there, just show the community.

If you watched the April member/board exchange, you know the issue wasn't raised by me, but by three long time female golfers who were angry about outside play from people with full play passes and by bringing in tournaments and bumping members. The general manager claimed they only booked tournaments when there were open tee times; utter nonsense. They were fair complaints and they've done nothing. In fact, the sale of full play passes to non-members went up in May from last year when it had doubled in sales. A board member suggested it wasn't that many rounds. Irrespective, they should never displace a member of the community.

All in all, the past is the past, we can't change it, we can better understand how we shape our future.

 

Must be doing maintenance…I’ve removed for now. Thanks

 

Exceptional presentation from the RCSC regarding golf today at the Member/Board Exchange meeting. Lots of good information. Hopefully they will post it on their website as they said they would.

 

Yesterday was a little crazy, and fell behind a bit. Still playing catch up. I did want to post this quickie regarding golf and outside play from the RCSC's golf report. The average cost in 2021 for a round of golf, full play non-member was $20 and change. I suspect that includes a mix of both the full play non-member with car ($2500) and without car ($2000). I was disappointed by the general manager telling us that it wasn't true non-members didn't pay less than residents. That picture he tried to paint was by comparing members buying full play passes ($12 and change) to non-resident full play passes.

That's never been the argument. The question is do people living outside our walls get to pay less than those living here? if i step on golf course in season i pay $35 and in off season $23 or $24. Either way, it is far more than someone outside the walls who has contributed nothing in PIF or the yearly subsidy of $36.36 all home owners pay in Sun City to keep golf affordable for the members.

That's not even what this post and my argument is. Nope, we know that 3 members stood up in April, raised an issue regarding getting access to our courses. One of the concerns was outside tournament play and they are suggesting limiting play to a couple of times per month and only 1 course north of Grand and 1 south of Grand. The good news is, rather than the goofy claim they only booked tee times when there were open tee times, they did reveal tournaments are booked 10 months in advance.

The second complaint is the one i want to dwell on; members being able to get on OUR courses. Let me be very clear, there is no solution proposed or coming to deal with this. They did talk about sometime next year (2023) making an increase of $250 for non-members. That means every full play pass sold this year will run for the remainder of the year (2023). And so we are even more clear, since the complaints were lodged in April, the RCSC in May has sold an additional 20-25 more passes than the year before. The answer is simple, they don't care if you can't get on a course, they want the revenue from under-priced golf from non-residents. You simply don't matter.

When i confronted the gm on this topic, he wanted to tell me that golf was profitable. If you watch the video, he freely admitted the 990's are accurate. It isn't. When this years 990's come out, we will know exactly how much it has lost. That's not even the point. Their second argument outside play is only 3% of the rounds played. That comes out to 12,000 rounds. When we were chatting, he went on to say even if there was no outside play, golfers going into the lottery for tee times wouldn't always get the times they wanted. Imagine this though, if those 12,000 rounds of golf were available, the golfers would have that much more access to desirable tee times. Duh.