Golf Course Analyses

The following are some thoughts on the Town Golf Course, as proposed. The material is from the documents on the Golf Study Committee web page and other documents released by the golf committee.

In particular, I find it difficult to understand how we could have gotten this strongly committed, given what was known coming into the project.

• Two feasibility studies already said No
  The Golf Committee already had two feasibility studies done last Spring. One, by a golf course architect, was dated 5/3/2000 (CSM), the other, dated 4/27/2001, by a wetlands scientist, (BSC). Both determine that locating a golf course on the proposed land parcel would be very difficult. BSC concluded that only a 9-hole course would fit, since almost half of the total acreage is restricted wetlands. CSM is more optimistic, they believe that a 6500-yard 18-hole course can be squeezed onto the property, with several par-3 holes on the Lorusso property, but even CSM rules out the possibility of a championship golf course.
  The problem is that 150 acres are generally needed for an 18-hole course, and 47% of the proposed 220-acre site is wetlands, leaving only 117 acres. There simply is not enough land to support the high-end, profitable golf course that the committee publicly envisions.
  Both reports strongly advised looking at the wetlands limitations first, before proceeding, but the BSC report in particular is as strong an admonishment against the course as one is likely to get from a hired consultant. The report focuses on the environmental problems related to the course location, and reads like a bullet-list of points against, ie. why pursuing the course is not worthwhile:

  1. too many wetlands (47% of area, 33 acres short of 18 holes)
  2. poor soils (shallow, boggy / too steep / shallow, rocky)
  3. most of parcel is in a 100-year flood plain
  4. all of parcel is in a Title V Zone II wellhead protection zone (permitting issues)
  5. habitat contains rare, protected species (permitting issues)
  6. not enough contiguous area for 18 holes (74 acres; +17 and +28)

  The course will compete for irrigation water with town water wells of three towns
  The entire parcel is in a Zone II wellhead protection area. Golf courses are considered potential threats to groundwater quality by the DEP (due to the pesticides and fertilizers used), and the special permits required are by no means guaranteed. The towns of Franklin and Wrentham already have wells drawing water from the same aquifer, and the Norfolk water department is proposing drilling the third Norfolk town well there. Additionally, permits are required for wells drawing more than 100,000 gallons per day, and the state licensing is designed to protect municipal water resources.

  One of the properties under consideration for purchase is contaminated
  This need not be a deal-killer, but is a huge unknown in the equation. Buying the Buckley/Mann property could increase the financial liability of the town by millions of dollars, completely skewing the profitability and break-even analysis. The golf committee makes no allowance in any of its analyses for the cleanup costs associated with buying a contaminated former industrial property. The golf committee chairman has continued to insist even in late October that there is no contamination, when in fact he had been informed by town counsel to the contrary back in August. (Note that the presence of contamination can not be disputed; I've seen it stated in plain language in the the B&M environmental consultant's own report. The only unknown is the overall extent and magnitude of the problem, which has never been studied - and the dollar figure.)

  Uncertain financial outlook
  But won't this course make us all filthy rich? Better numbers not being readily available, here's an engineer's back-of-the envelope estimate of the revenue an 18-hole course would generate. Since a championship course is out of the question, the fees would have to be in line with other 18-hole courses in the area - average revenue per game of $28, plus $5 from cart(s) and $5 from miscellaneous (cf. Bridgewater, et.al.; data from the golf committee's comparative analysis. Note that the courses closer to Norfolk, our primary competitors, have lower course fees.) Let's be bullish, and presume that 40,000 rounds will indeed be played, and for simplicity, ignore ramp-up time and discount pricing. This results in total gross annual revenues of $1,520,000.

  The annual expenses associated with an 18-hole golf course are $1,000,000 [??] and up. Add to this the $850,000 in annual loan servicing (10 million, 6%, 20 years, 0 points), and we're seeing a deficit of $330,000 every year until the loan is paid off. Over the 20-year loan, that's a total deficit of $6.6 million. A more conservative premise of 30,000 rounds at $23 per game would show us losing $17.2 million over the first 20 years, and never becoming profitable.

  Breakeven for us at this location is at $46.25 per game played, which is much higher than the local market seems to sustain. Nearby public courses seem to target revenues in the mid-30s per game in season, and less in the off-season. And any additional cost for decontaminating the land of harmful chemicals and industrial waste could add hundreds of thousands of dollars annually, possibly driving the total deficits much higher.

  Even once profitable, the golf course as conceived would have no obligation to turn over any of its profits to the town. It could choose to reinvest all of the surplus into developing and improving the course, and the town residents could see no revenue at all.

What is the lesson in all this? Hard to say, but certainly the golf course appears to be much less of a sure bet than described to the town. What's appalling is that much of the above has been known for many months, and was simply ignored, dismissed or ``de-emphasized.''