COMMENTARY · 30th November 2012
fixed error: it should have been: $100,000 a year, not $100,000 a month
In 2009, Kitimat City Council invested $150,000 to bail out the Hirsch Creek Golf and Winter Club. At the time, a decline in membership was given as the reason for the lack of funds, and the money was going to pay off a debt that was costing the club $4000 a month. They asked for $300,000, they got $150,000.
Art Emmerson returned to Council to request further bail out money as a part of the 2013 budget. His goal this time to increase Council’s investment to $100,000 a year. Council voted to put off the decision until they go into budget and have staff look into it. The vote passed with only Councillor Murphy opposed, stating she would like to stick to the original motion.
Once again the declining population of Kitimat was a factor into the club losing funds. Another factor was the increasing cost of living. The club has exceeded their credit by $10,000 and have $52,000 in accounts payable. Whether or not the Golf Course funding will go through will come up at a later Council Meeting.
The golf course is well advertised outside of Kitimat. It has a very good press agent appearing as one of the benefits to living in Kitimat. The question becomes, should Council bail out a private business?
Council has granted the Golf Course $10000 in past, which was supposed to go towards getting youth involved in the recreation programs. However, the Club is not just for exercise, there is also a restaurant, bar and sporting store there as well.
Emmerson explained in 2009 Council did not have to worry about losing the golf course if they chose not to help out. In the case the course goes under the land would return to the community and Council rather than go to the banks.
Businesses succeed and fail all the time. If Council wants to plug the leaky holes at the golf course with the taxpayers money, it will be a decision which they will confront the voters with in 2014. In addition, it opens the doors for other failing businesses to come before Council for a handout.
And if the golf course does go down, it’s simply going the way of any number of businesses which are no longer in Kitimat and who did not receive a bail out from Council. Why is the golf course more important than anyone else’s dreams? What determines what businesses get help and which do not?
As for the route cause though, it raises a tougher question which needs to be answered…
Comment by DR on 13th December 2012
If the golf course has to be financially self sufficient which I understand it is not, then hire a qualified financial firm to run a business analysis.
They will identify where losses occur and what it requires to break even. That much should be known to determine its fiscal viability.
Comment by A Friend on 5th December 2012
Being a society, I believe the Hirsch Creek Golf and Winter Club recieves an audit annually. I would guess the numbers show that expeditures exceed revenues, of course. The costs of maintaining the facility (whether the course, ice rink, kitchen ,bar or proshop) have likely risen expedentially with energy costs sky rocketing. All suppliers have passed down this cost to maintain their profit margins. This is no different than many businesses of course, except nobody profits from this business. It is there to provide the community with a place to work , be active and connect. One part of their challenge, is that their membership increases in the past years likely do not reflect their increase in costs. I would think that the course has likely had to keep these membership costs as low as possible in order to maintain, at least some, participants because of a dramticallly declining working population, after the closures of Methanex and Eurocan. The HCG&WC is a unique recreational business. It employs , i would quess, 50 community members, who are also tax payers - that pay mortages, rent, buy groceries and particpate in many other community activities and businesses in Kitimat. (This no doubt a consideration to the volunteer board who are faced with some tough decisions, not only related specifically to golf and curling.) Having varied recreational opportunities adds value to your community as a whole. This is why your tax dollars subsidize many other recreational opportunities. Even if you do not swim or skate you likely see value. Many communities in the world invest in recreation as preventative health care , versus diagnostic health care, in order to promote healthy living. This helps to 'reduce' the need for expensive diagnositic equipment and services. Our governments also invests in other sports and recreation for them same reason (ie hiking trails). The HCG&WC has some challenges, but is one of the recreational and social organizations that indicates vibrancy in a community. It's operation supports a 'healthier' community (economically, socially, and in mental and physical health). Hopefully they can find a way to creatively market and manage the operations, that economy growth will support it,and they will recieve support from their neighbours who see value in all parts of HCG&WC's community contributions.
Comment by Bob Drake on 4th December 2012
".Ask big industry for the money,ie Rio Tinto Alcan, Kitimat LNG,Shell and Endbridge"
Would these be the same "big industries" that the District has been slamming, sueing and generally bad mouthing for the past number of years? Now you want to go cap in hand for donations? Priceless
Golf Course Funding
Comment by Bman on 4th December 2012
I was born and raised in Kitimat and lived there for most of my first 43 years. I moved away in search of work in 2006 when methanex shutdown.I still think I will move back one day when its time to retire but if the golf course was shutdown I would never come back.I think, like many people ,golfing would take up many days of my retirement. If the city let a beautiful course like Hirsch creek go under I am sure many of the local retiree's would leave town as well. Good fishing and good golfing have always been drawing cards for Kitimat. Don't let the town die even more. I agree that big business, especially big companies like Rio Tinto that have properred in Kitimat, should give more back. $100,000 a year would be a drop in the bucket for them.
thanks for the correction but..
Comment by djb on 1st December 2012
Walter, what is it that makes you think that anyone is suggesting that"golf is more important thAn anything else"?
Again, this is not a "private" business. It is a society that was formed to furthur the game of golf in Kititmat. It is a public facility, open to anyone, and is used by many people in the community. I agree with your final question but would sustitute the words "pubic faciilty/sports" for business.- which get help or not?
I believe some professional guidance/oversight will be required to determine the root cause(s) of the financial woes. The dedicated volunteers who run the facility may not be equippped to answer the key questions.
Golf Course Woes
Comment by Hard Core on 30th November 2012
Golf is a rich man's sport.I do not think it's right to ask the people of Kitimat to pay for the enjoyment of the rich.This community has to look at what benifits Kitimat as a whole.Ask big industry for the money,ie Rio Tinto Alcan, Kitimat LNG,Shell and Endbridge.These are the people that will be using it to wine and dine there guests.Theres no way .Did any people of Kitimat get a discount last time they got money.I say look for your money somewhere else.
It's time for a forenic audit of the books
Comment by Larry Walker on 30th November 2012
Council needs to know just where the money went for a past couple of years before making any decisions. Sure the town could just take it over and make it part of Parks & Rec but I doubt if they can make it a break even operation as they would ultimely have to pay union wages to they existing staff positions versus what they are probably getting now. Another option is to close parts of the operation like the dining room, pro shop, curling rink, etc (this would show up in the audit)
Comment by djb on 30th November 2012
Really? $100,000 per MONTH? Pease do a little fact/spell checking before printing. The golf course is a society ( essentaily a non profit operation) that is just trying to earn enough money to cover expenses.It is not a business in the truest sense of the word.It is a community facility. I think the real question is; what determines which local sports/causes get funding or subsidies and which dont. ie pools/rinks/marinas,skihills, animal shelter etc.( which got $300,000 when the golf course got $150,000)While I dont believe we wqnt to go the route of Prince Rupert , which once had a city owned course, some financial support is not out of order.