#06 Authorize to replace turf maintenance equipment at Riverside and Blackhawk Golf Courses (File Res. #2012-885)
ADMINISTRATIVE SERVICES MEMORANDUM
February 3, 2012
TO: City Council
FROM: Jacob J. Winzenz, Dir. of Admin. Services/Assistant City Manager
SUBJECT: Action on a Proposed Resolution Authorizing the City
Administration to Expend Funds to Replace Turf Maintenance
Equipment at Riverside and Blackhawk Golf Courses (File Res
2012-885)
Summary
On December 31, 2010, the lease with Crown Golf for Riverside and Blackhawk
golf courses expired and the City entered into a management contract with
KemperSports. Under the terms of the lease with Crown, the lessee was
responsible for providing all the equipment used to maintain the turf at both
courses. Crown complied with that lease requirement, but at the end of the lease
the equipment was at least ten (10) years old (see attached). The City
purchased the maintenance equipment, along with other furnishings and fixtures,
from Crown to get us through the 2011 golf season. The turf maintenance
equipment is now eleven (11) years old, or older, and experiencing increased
downtime and escalating maintenance costs. File Resolution 2012-885
authorizes the City Administration to begin replacing the maintenance equipment
at the golf courses and commits the City Council to include $200,000 in the 2012
Note Issue.
Recommendation
City Staff and the Golf Course General Manager and Superintendent recommend
that the City Council approve File Resolution 2012-885.
City Manager Recommendation
The City Manager recommends approval.
Background
On December 31, 2010, the lease with Crown Golf for Riverside and Blackhawk
golf courses expired and the City entered into a management contract with
KemperSports. Under the terms of the lease with Crown, the lessee was
responsible for providing all the equipment used to maintain the turf at both
courses. Crown complied with that lease requirement, but at the end of the lease
the equipment was at least ten (10) years old (see attached). The lease with
Crown included a provision that at the end of the lease term the City could
purchase all equipment at the depreciated or fair market value. The City
purchased the maintenance equipment, along with other furnishings and fixtures,
from Crown to get us through the 2011 golf season. However, the turf
maintenance equipment is now eleven (11) years old, or older, and experiencing
increased downtime and escalating maintenance costs.
A management contract is different than a lease. Under a management contract
the City pays a management company a fee to manage the courses, but the City
retains the responsibility to provide all the equipment necessary to operate and
maintain the golf course. With an aging fleet of turf maintenance equipment staff
has developed a multi-year plan to replace the critical pieces of equipment
including such as greens mowers, fairway mowers, rough mowers, and trim
mowers. The equipment listing attached to this memorandum indicates which
equipment is scheduled for replacement from 2012 – 2016. At the time of
replacement most of the mowers will range from 11 to 16 years in age. For
comparison, mowers used for park maintenance are currently replaced at nine
(9) years. This equipment is critical to maintain the course conditions that golfers
expect at quality courses.
Based upon the needs for replacement of maintenance equipment, and other
anticipated capital needs, staff is projecting that we will need to borrow $200,000
each year for the next three (3) years (2012, 2013, and 2014). This will allow the
replacement of the entire fleet of maintenance equipment and minimal amounts
to meet other capital needs.
Analysis
The following table summarizes the debt service for the golf courses over the last
seven (7) years:
2006200720082009201020112012Average
$95,196$97,675$94,811$96,764$53,437$78,534$83,827$85,749
The average debt service over the last seven (7) years has been $85,749. It
should be noted that prior to 2011 all debt service on debt issued for the golf
courses was paid by the golf fund from lease payments made by Crown Golf.
The following table summarizes the projected debt service if the proposed plan to
borrow $200,000 in each of the next three (3) years is implemented:
2013201420152016201720182019Average
$106,507$125,950$97,288$94,248$95,175$93,048$90,886$100,443
Implementation of this proposal is estimated to result in an increase in the
average annual debt service payment for the golf courses by approximately
$15,000 per year. When the debt is actually issue, staff may propose to structure
the debt repayment slightly to avoid the debt service spike in 2014, by this should
not significantly affect the average.
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Golf Course Equipment List
1/12/2012
Purchase Replace Age @ Estimated
ItemLocationHoursYearYearReplaceReplace Cost
Buffalo BlowerRiverside2001201211$6,000.00
HR 5111Blackhawk66461998201214$50,458.70
HR 9016Riverside93241999201213$50,000.00
Lely SpreaderRiverside1980201232$4,575.00
$42,235.86
LF 3400Riverside2001201211
LF 3400Riverside37942001201211$42,235.86
Tri KingRiverside36741998201214$51,996.40
$247,501.82
Greens MowerRiverside37722001201312$26,666.67
Greens MowerRiverside28222001201312$26,666.67
Greens MowerBlackhawk21431998201315$26,666.67
LF 123Blackhawk42611995201318$43,000.00
New Holland TractorRiverside25912001201312$25,000.00
Sprayer TruckRiverside15412001201312$36,000.00
Toro RakeRiverside1989201324$16,000.00
$200,000.01
GA30 544885Riverside8651993201421$21,000.00
GA30 544885Riverside1994201420$21,000.00
Tee MowerRiverside44822001201413$26,666.67
Tee MowerRiverside2001201413$26,666.67
Tee MowerBlackhawk22151998201416$26,666.67
TurfcatRiverside2001201413$20,000.00
$142,000.01
Cushman TruckRiverside15012001201514$20,000.00
Toro 325 DBlackhawk19122000201616
Tri KingBlackhawk20692001201615$52,000.00
Agri Metal BlowerRiverside2002N/A
Agri Metal BlowerBlackhawk1994N/A
Carry All 1Riverside1997N/A
Carry All 1Riverside1997N/A
Carry All 1Riverside1997N/A
Carry All 2Riverside2000N/A
Carry All 2Riverside2001N/A
Carry All 2Blackhawk2000N/A
Core HarvesterRiverside1992N/A
Cushman TruckBlackhawk8842000N/A
EdgerRiverside2001N/A
F12 Top DresserRiverside1992N/A
Golf Course Equipment List (cont.)
1/12/2012
Purchase Replace Age @ Estimated
ItemLocationHoursYearYearReplaceReplace Cost
GeneratorRiverside1997N/A
Jacobsen RakeBlackhawk1998N/A
John Deere Reel MowerBlackhawk1998N/A
John Deere Reel Mower-PushRiverside1999N/A
John Deere TractorBlackhawk1987N/A
National 68"Riverside1989N/A
RollerRiverside1989N/A
RollerRiverside1991N/A
Seed-A-VatorRiverside2001N/A
Sod CutterRiverside1995N/A
SP1530 Top DresserRiverside2001N/A
SpikerRiverside1983N/A
SweeperRiverside6911996N/A
Toro Push MowerRiverside2009N/A
Toro RakeRiverside?N/A
Tri KingRiverside37461998N/AEliminate
VericutterRiverside1991N/A
Walk Behind BlowerBlackhawk?N/A
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RESOLUTION NO. 2012- 885
A Resolution authorizing the City Administration to expend funds to replace various
pieces of turf maintenance equipment at Riverside and Blackhawk golf courses.
WHEREAS, on December 31, 2010, the lease with Crown Golf for Riverside and
Blackhawk golf courses expired and the City of Janesville assumed maintenance
responsibilities; and
WHEREAS, under the lease agreement with Crown Golf the Lessee (Crown Golf)
owned all the turf maintenance equipment; and
WHEREAS, in 2010 and 2011 the City Council approved note issues totaling $200,000
for golf course capital; and
WHEREAS, in order to provide continuity of operations the City of Janesville purchased
all assets at Riverside and Blackhawk golf courses from Crown Golf, including a fleet of
aged turf maintenance equipment; and
WHEREAS, the City’s experience over the last year indicates the current fleet of
maintenance equipment is experiencing increasing maintenance costs and equipment
downtime; and
WHEREAS, in order to continue the high maintenance standards Janesville golfers
have enjoyed and expect at the municipal courses the City needs to begin a program to
replace the maintenance equipment and Riverside and Blackhawk golf courses; and
WHEREAS, the 2012 Major Capital Projects Budget anticipated expending $200,000 for
Golf Course Capital; and
WHEREAS, in order to have replacement equipment available for the start of the
mowing season certain capital costs estimated at $250,000 will need to be incurred
prior to the 2012 Note Issue
NOW, THEREFORE BE IT RESOLVED, by the Common Council of the City of
Janesville that they hereby approve and authorize the City Administration to expend
funds not to exceed $250,000 for the replacement of turf maintenance equipment at
Riverside and Blackhawk golf courses; and
BE IT FURTHER RESOLVED by the Common Council of the City of Janesville that is
commits to include $200,000 in the 2012 tax exempt obligation promissory note issue
for this purpose as permitted by the Internal Revenue Code of 1986. This declaration of
official intent is consistent with the budgetary and financial circumstances of the City.
The purpose of this Resolution is to satisfy the “official intent” requirement of the
Treasury Regulation Section 1.150-2.
ADOPTED:
Motion by:
Second by:
APPROVED:
Councilmember Aye Nay Pass Absent
Dongarra-Adams
Eric J. Levitt, City Manager
Liebert
McDonald
ATTEST:
Rashkin
Steeber
Voskuil
Jean Ann Wulf, City Clerk-Treasurer
APPROVED AS TO FORM:
Wald Klimczyk, City Attorney
Proposed by: Operations Division
Prepared by: Operations Division